Proposed Merger Of Us Airways And American Airlines

The merger is expected to take a total of 5 years with an end result of a fleet of nearly one thousand planes covering more than 150 cities in United States with connecting flights to more than 30 countries around the world. All evidence indicates that a merger between Southwest Airlines and JetBlue Airlines can be completed within 5 years and will be successful in helping the merged company become the industry leader in low-cost, high customer service airline carriers in North America. The minor obstacles such as redundant cities, a balloon payment owed by JetBlue, redundant Point of Sales Systems and baggage tracking systems, and a surplus of employees, is negligible and easily resolved during the 5-year merge period. A few decisions will still need to be made such as what to do about employee contracts being different between the two carriers and pension plans but the merger is being given a good to very good rating for its chances to succeed as

Delta airline uses merger so as to be able to expend its business. In 2008 the company merged with Northwest airlines. It operates in Europe, North America and Asia/Pacific regions. Once the merger was complete, Northwest Airlines and all its constituents become wholly-owned by Delta Airlines. The merger saw to it that Delta Airlines started operating in the Northwest for FY 2008. In the period of two month that is from October of 2008 the time the merger was completed to December of 2008, the company had increased it revenues to $2 billion. Having a flexible nature, allows Delta to improve customer services, and in the long run be able to achieve its strategic objectives.

Two of the largest competing airlines in America may seem to have a lot in common to a consumer’s eye: big commercial planes, friendly staff, one free carry-on bag, complimentary snacks. Maybe the biggest comparison of them all is how much of the airline market these two companies take up. But for every similarity, there must be a difference. Beyond contrasting ticket prices, there are many fronts on which to compare Southwest Airlines and American Airlines. To begin when the companies began, American Airlines was established approximately 40 years sooner than Southwest Airlines as a result of a merger. In terms of people, Southwest Airlines currently has just about half the number of employees that American does. However, to truly compare the two companies, the organization itself must be researched and analyzed. Southwest Airlines and American Airlines appear to be very different to this day in terms of organizational culture, team dynamics, and conflict and negotiation.

United Airlines and Continental Airlines, two major airlines companies, agreed to a merger that would create the world’s largest airline. Such important deal has a lot of problems to be dealt with, from technical, for example how to put the companies databases together, to more fundamental, like how the company should be ruled.

Question 1 Several factors have been proposed as providing a rationale for mergers. Among the more prominent ones are (1) tax considerations, (2) diversification, (3)

The Risk of Entry by Potential Competitors – Since the deregulation of the airline industry in 1978 over 1,300 new airlines have opened for business. However, most now are bankrupt or merged with the other carriers to stay workable. The established giants were Delta (merged with Northwest), American Airlines (merged with U.S. Airways), United Airlines (merged with Continental), and now Alaska Airlines (merged with Virgin America). Now the Low-Cost Carriers (LCCs) are posing a massive threat which includes Southwest Airlines (merged with Air Tran), and JetBlue.

Decreased online reservation can be a problem: customers like me prefer to purchase ticket via travel agencies to have different options and better deals compare to going directly to an airline website to purchase ticket. Another problem will be how will a loyal customer that earned points/rewards on Expedia or Priceline use the points on Southwest website after the merger? This can be an issue because travel agencies websites offers rewards programs that let you earned points as a frequent flyer and the points can be used for future purchases. In addition, Southwest offers only one option of seating while tickets bought on third party websites have the options of choosing seat like first- class, business class and economy class. That can be an issue for major business travelers who prefer spacious seating, luxury and privacy. After the merging, managers should continue to use travel agency websites in order to boost sales and keep up with competition. Also, managers should to encourage customers to sign up for rewards offer by signing up for a credit card, as it’s a good marketing strategy. Managers should cut down cost by not having to customize AirTran flights and the options of first-class and economy seating should still be offered.

American airline industry is steadily growing at an extremely strong rate. This growth comes with a number economic and social advantage. This contributes a great deal to the international inventory. The US airline industry is a major economic aspect in both the outcome on other related industries like tourism and manufacturing of aircraft and its own terms of operation. The airline industry is receiving massive media attention unlike other industries through participating and making of government policies. As Hoffman and Bateson (2011) show the major competitors include Southwest Airlines, Delta Airline, and United Airline.

1. There are a few trends in the US airline industry. One is consolidation, wherein existing players merge in an attempt to lower their costs and generate operating synergies. The most recent major merger was the United Continental merger, which is still an ongoing affair, but has created the largest airline in the United States by market share (Martin, 2012). Another trend is towards low-cost carriers. In the US, Southwest has been a long-running success and JetBlue a strong new competitor, but in other countries this business model has proven exceptionally successful. The third major trend is the upward trend in jet fuel prices, and the increasing importance that this puts on hedging fuel prices and capacity management (Hinton, 2011).

The report finds that Delta Airlines has successfully emerged from its bankruptcy in 2005 to report successful returns in both 2007 and 2008. With its 2008 acquisition of Northwest Airlines Delta became the world's largest airline, further improving its position in the airline industry. Despite this current positive position report also finds potential adversities

The merger between American Airlines and U.S. Airways is one that can be explained using static game theory models. The two players in the game would be American Airlines and U.S. Airways. Each one of the players would have something to gain from the merger, but they would also have something to lose. In this game American Airlines is our first player. American Airlines’ potential payoff is merging with a company that is maximizing profits, but is also lacking in the customer service department. U.S. Airways is player two, and in this game they are merging with a business that is suffering from chapter 11 bankruptcy, but is excelling in customer service.

As the new century unfolded, Delta Air Lines continued exponential growth becoming one of the largest airlines in the country. A merger with Western Airlines in 1987, the acquisition of Pan Am’s transatlantic routes in 1991, and a final merger with Northwest Airlines in 2008 meant Delta now had routes all over the world. Delta like many other airlines faced very difficult times post 9/11 and during the recession. The airline made significant cost improvements across its operation and the merger with Northwest Airlines ended up pushing the airline back into profitable business.

bankruptcy protection bigger and better than ever. It also solidified American Airlines as the largest airline in the world. This merger has become to cornerstone of American Airlines affecting all areas of the organization both internal and external.

5. How does the merger between Delta and Virgin Airlines impact the company as a whole? (Outside research required).

American Airlines Group Inc. (AA) is the largest airline in the world. They seek to be an effectiveness organization that have better customer service, effective staff, and successful. In the following, the five stages of Organization Development process will use to implement the organizational development change process for the new “American Airlines Group Inc.”: