Friday, May 25, 2012

How NOT to Act When Flying

Published: Friday, 25 May 2012
1:11 PM ET By: Darren Booth

It seems like every week there's a news story about an airliner being diverted. Or someone being booted off a flight, due to questionable passenger behavior.

This week's examples include a US Airways [LCC 12.22 0.06 (+0.49%) ] jet that was diverted to Bangor, Maine because a passenger claimed she had a surgically implanted device. She handed a flight attendant a note, written in French, seeking help and stated that she had an object in her body that was out of her control, according to reports.

The other example was a woman being told she couldn't fly due to her "offensive attire." The T-shirt she was wearing read, "If I wanted the government in my womb, I’d f--- a senator." The expletive was fully spelled out and pro-choice, political sentiment aside, American Airlines denied her boarding. American's contract of carriage allowed them to refuse transport of the passenger since she was, “clothed in a manner that would cause discomfort or offense to other passengers.”

A little common sense goes a long way. But it seems many people need a reminder of how NOT to act on a plane. Here are a few tips.

Do NOT get drunk. This type of passenger makes the news most often, it seems, as it's the easiest way to make a fool of yourself. While having a cocktail before your flight may relax you, remember you're about board a flight and have a hundred or so other people around you. Flying should not be considered a party scene.

Do NOT curse at flight attendants. Being belligerent will get you no where and often can get you a one-way ticket off the airplane. I boarded a flight once where a passenger told the flight attendant to "F- off" when being asked to change seats. The captain decided the passenger wasn't fit to fly and booted her off the flight.

Do NOT allow your kids to act out. Traveling with children can be stressful for parents, but it's important to ensure their actions aren't causing discomfort to fellow passengers. Kicking seatbacks or climbing over seats should probably be restricted.

Do NOT attempt to get into the cockpit. As I type this there is breaking news a passenger aboard an American Airlines flight bound for Miami attempted to gain access to the flight deck. This is a sure fire way you'll find yourself in zip-tie handcuffs until authorities cart you away after landing.

Do NOT wear offensive clothing. I'm all for free speech, but there's a time and place for making a statement. Save it for a rally — airports and airplanes are not appropriate places to wear clothing with expletives written on them.

Do NOT mention the 'B-word'. No, I'm not talking about a female cow, but rather the b-o-m-b word. It has no place in conversation in this post-9/11 world.

Finally, if you're approached by authorities for any reason when flying, simply remain calm and answer their questions. I was stopped by two Federal Air Marshals last month for a totally harmless reason, but politely answered their questions and was on my way.

Thursday, May 24, 2012

AMR bankruptcy: Analysts see US Airways merger as American's next step

By JOHN STANCAVAGE Tulsa World Business Editor

Published: 5/20/2012 2:38 AM

Last Modified: 5/21/2012 6:42 PM

American Airlines steadfastly resisted filing bankruptcy for a decade before finally succumbing last November. Is a merger the next inevitable step for the fiercely independent airline?

Several industry analysts think so, but leaders at parent AMR Corp. are sticking with a wait-and-see outlook.

Undoubtedly, financial officers at many airlines are running the numbers to see what a combination with their particular carrier would produce.

The possible merger partner that has received the most attention so far is US Airways, mainly because its CEO, Doug Parker, won't stop talking about American.

In a move that some observers call unprecedented, Parker already has cozied up to American's three major unions, offering a rough version of what a contract with his airline would look like. The terms are attractive enough that American's pilots, flight attendants and mechanics have said they'd support joining with US Airways.

"Doug Parker wants to conquer the world," said Bob Herbst, founder of "Right now he wants American Airlines. All his comments in the press are because he wants everyone to know he's ready to make a deal."

Herbst, who was a commercial airline pilot for 35 years, said he guesses there's a 95 percent chance US Airways will merge with American.

Other combinations have been rumored, but Herbst discounts them.

"Due to the size of United and Delta, there is no way the (government) would approve either of those airlines becoming larger with American assets," he said.

American, meanwhile, was the nation's No. 1 airline until 2007. But declining fortunes and consolidation in the industry changed that.

"Fresh out of their own bankruptcies, Delta and Northwest Airlines merged in October 2008, creating the largest airline in the world," Herbst explained. "Not to be left behind, in September 2010, United and Continental Airlines merged to become the biggest."

Suddenly, American was the third-largest airline.

A merger with US Airways would put American back on top, the consultant said.

"Without merging, both American and US Airways will face major challenges moving forward as they attempt to compete against Delta Air Lines and the merged United/Continental Airlines," he said.

'Makes the most sense'

Sterne Agee analyst Jeffrey Kauffman said he thinks US Airways has a "reasonable chance" of merging with American.

Seth Kaplan of Aviation Weekly said American's stand-alone business plan appears workable, although its smaller size could pose some issues.
"Some of American's projections may be a little too rosy, but then you could say the same about US Airways' plan," Kaplan said.

Mergers are complex, the Aviation Weekly analyst said, and can take years to gel. Along the way, there can be a "cost creep," he said.

"A merger between American and US Airways would not be perfect," Kaplan said. "But the question really is: Would it be better for the two airlines to do it or not? And the answer is that it would be better do it."

US Airways seems not to be too worried that it will have to update contracts with its existing union members, who are among the worst compensated in the industry. calculates it will cost US Airways about $600 million to bring its labor up to parity with American's.

Other bidders may emerge, Kauffman said, but US Airways' chances of being the successful bidder are helped considerably by its tentative agreements with American's unions, he said.

"A deal with US Airways is what makes the most sense for creditors," another analyst, Hunter Keay of Wolfe Trahan & Co., told Bloomberg News.

"It's always struck me as odd that AMR was completely unwilling to listen to US Airways because the offer is probably compelling and US Airways is a motivated buyer."

'On our own terms'

AMR seems determined to complete its bankruptcy before discussing deals.

Kevin Cox, vice president of state and community affairs for American, said in a February interview with the Tulsa World that American wants to present a single business plan to the court and emerge as a "strong independent" carrier.

If a merger offer appeared at that time and was attractive, "we would be able to do it on our own terms," Cox said.

In recent weeks, AMR has softened its position slightly, saying that it would be willing to explore strategic options - including a merger - in response to requests from the unsecured creditors committee.

The committee would have a key role in the process. American currently has until late September to present its reorganization plan to the court. For any other proposal to be considered before then, a majority of the unsecured creditors would have to petition the judge, who would have to approve bringing the option forward for consideration.

Herbst said there's a big reason AMR's top leaders don't want to entertain a deal while still in bankruptcy.

"If AMR does the merger during bankruptcy, it means a monumentally smaller payout to executives," he said.

Herbst also contends a combination would be costlier in general after bankruptcy because the acquirer would have to deal with the stock that had been created, new debt and airplane leases.

American Airlines officials scoff at the idea that CEO Thomas Horton and his team are being driven by personal greed, and say Herbst's analysis is off base. The top leaders have a fiduciary duty to act in the best interest of creditors while in court and later must answer to shareholders, according to this argument.

Forecast for Tulsa workers

What would a merger with US Airways look like for Tulsa?

American employs about 7,000 in Tulsa, including 5,000 mechanics and related groups. The airline's estimate was 2,100 mechanics cut in Tulsa, plus several hundred other employees.

Officials decreased the number of mechanics targeted by about 1,000 in a "final, best offer" that was rejected last week by the Transport Workers Union.

US Airways, in contrast, projects it would cut 450 jobs at the local maintenance center and do what it could to protect pay.

Perhaps the key issue is the long-term outlook. Would US Airways stick with a system that keeps maintenance heavily in-house? Would Tulsa continue to be a key asset? And what would happen at the next contract negotiation, with no ticking clock on a deal or other incentive to "win over" the union?

Herbst said American Airlines employees must decide which vision of the future allows the airline to make the most revenue. The more profitable American is, the greater success unions should have in arguing for their share.

Many of American's union members still look back wistfully at their pay and benefits prior to a concessionary contract signed in 2003. But in those headier days, American was No. 1 in the industry, and just as important, controlled the high-profit business travel market.

"American could charge premium prices in those days," Herbst said.

The airline's passenger fare yield premium started to deteriorate in the first half of 2010, according to figures from

A merger with US Airways might not only help American attract more business travel, but also the combo's sheer size would be formidable, the analyst said.

"Combining the revenues of American and US Airways would move the merged carriers to the top of the largest airline in the world list," Herbst said.
"History shows a long list of once-great airlines that failed. Each of those had one thing in common. They all failed to remain competitive. American and US Airways must merge to remain long-term competitive."

Advantages of an American Airlines-US Airways merger

Analysis by

$500 million to $700 million: Annual reduction in US Airways' core costs

$350 million to $450 million: Annual premium/business revenue increase.

10 percent to 20 percent: fuel expense reduction from newer jets currently on order for both airlines,

$1.8 billion to $2.5 billion: Total cost saving synergies within 12 months of merger.
Analysis by

Want to Sit With Your Family on an Airplane? That'll Be $25, Please

By Davis MacMillan May 24, 2012 12:58 PM 0 0
Back in February, we took note Florida-based carrier Spirit Airlines (SAVE), who saw themselves as a “poster child for extra fees.” CEO Ben Baldanza claimed to be proud of his company’s high fees and to view them as an issue of consumer choice.

Of course, lately, Spirit’s fees have gone from irritating to controversial.
First, the company refused to refund a dying veteran’s airfare, as they do not give refunds. After a week’s worth of protest, Baldanza agreed to pay for the man’s ticket himself, and gave a $5000 donation to the Wounded Warriors charity.

In another strong PR move, the company announced the prospect of $200 fees round-trip for a single carry-on bag.

However, far from distancing themselves from Spirit’s fee-obsessed business model, many air carriers are imitating it. Right now, travelers without frequent flyer status could be asked to pay as much as $25 to avoid getting a middle seat.

According to The Week, passengers on American Airlines (AMR), Delta (DAL), Frontier (FRNT), and US Airways (LCC) can all pay extra to guarantee a window or aisle seat. Spirit passengers pay between $5 and $15 for any seat assignment.

Customers can still get a window or aisle seat without paying in advance, but their chances are lower. This makes things especially difficult for families traveling together, who have to pay in advance to make sure they share a row.

Those looking to get a window or aisle seat without paying can wait until frequent fliers are bumped up to first class but they may wind up with nothing. The frequent fliers, by the way, have a vastly larger number of seats open to them when they purchase tickets. In general, airlines reserve a good number of seats for their regular customers.

Obviously, consumers are upset. The trouble is, there’s not a huge amount they can do as higher fees become the norm among airlines. On their end, airlines are looking to increase their bottom lines in the face of rising fuel costs and other expenses.

So what’s the solution? Drive. Or at least plan ahead.

Friday, May 11, 2012

LOS ANGELES, CA - FEBRUARY 01:  American Airli...

American Airlines to explore merger options

By Soyoung Kim and Kyle Peterson

May 11 (Reuters) - AMR Corp, parent of American Airlines, bowed to pressure on Friday from its unsecured creditors, including its largest labor unions, and said it would explore merger options while it is still in bankruptcy.

AMR, which has been in Chapter 11 since November, had long said it intended to reorganize as a stand-alone carrier, shrugging off interest expressed by rival US Airways Group Inc .

The carrier, however, has faced mounting pressure from vocal members of its creditors committee who believe a better future for AMR can be secured by merging with US Airways.

In reversing its stance, AMR said it wanted to assure stakeholders that it would pursue the best possible outcome for the airline.

"To be clear, American has committed to work in collaboration with the (creditors) committee to develop only potential consolidation scenarios and this agreement does not in any way suggest that a transaction of any kind or with any particular party will be pursued," Beverly Goulet, AMR's chief restructuring officer, said in a statement.

US Airways has been courting AMR creditors, especially disgruntled labor unions that say an AMR/US Airways tie-up would create a stronger carrier and save more jobs than AMR's stand-alone plan.

"We look forward to engaging in the AMR process to demonstrate the significant advantages of our plan to maximize value for all constituents," US Airways said in a statement.

US Airways said in April that a merger with AMR would generate at least $1.2 billion a year in new value beyond the benefit that could be passed to employees of the combined carrier. AMR has said its stand-alone plan would generate $3 billion in new revenue and savings by 2017.

AMR's chief executive, Tom Horton, had said the airline was focused solely on its bankruptcy, calling those who would attempt to acquire the company in bankruptcy "opportunists." But he never ruled out taking a merger partner after bankruptcy.

Other potential suitors also have considered a deal with AMR, including Delta Air Lines and private equity firm TPG Capital, sources have told Reuters.

Robert Mann, an airline consultant and former AMR executive, said AMR's new openness to mergers could flush out more potential partners.

"I think it was already headed there anyway," he said. "It's a recognition of the inevitable that there would be some sort of transaction."


American's three labor unions, which are part of AMR's nine-member creditor committee, have said a merger with US Airways would create a stronger airline and save more jobs than AMR's stand-alone plan. US Airways has not made a bid for AMR, which has a court-granted right to reorganize without intrusion by outsiders. That right extends to September.

"The important point is that both the debtors and the committee are in alignment that it is incumbent on them to explore strategic alternatives on a collaborative basis as part of this chapter 11 case," Jack Butler, creditors committee counsel, said in a statement.

Unions representing pilots and flight attendants at American Airlines on Friday again denounced the company's stand-alone business plan, calling on the managers to explore merger options with rival US Airways.

The workers staged rallies in New York and Fort Worth, Texas, where AMR is based, to declare "no confidence" in the company's ability to produce a viable business plan.

The protests came as the two sides prepared to spar in court on Monday over AMR's request to void the labor contracts it has with the unions. The airline and its unions are on a two-week hiatus from their court battle over that request.

"US Airways management's plans for merging the two carriers call for preserving and enhancing the American Airlines brand, retaining our Fort Worth home and saving thousands of jobs that will be eliminated under AMR management's stand-alone plan," David Bates, president of the Allied Pilots Association (APA), said in a statement.

The airline, which has about 74,000 full-time and part-time workers, has said it must cut 13,000 union jobs.

The carrier won steep concessions from labor in 2003 as it dodged bankruptcy at the time. AMR had been locked in fruitless labor talks with unions for years before filing for bankruptcy.

The APA, which has been negotiating with management this week, has yet to reach a deal. The Association of Professional Flight Attendants also said it has had talks with management.

Meanwhile, the Transport Workers Union, which represents 26,000 ground workers, dispatchers and other groups, is voting on AMR contract proposals for its seven work groups.

The deals do not have the endorsement of union leaders, but if they are ratified, they would cut the number of TWU-represented jobs targeted for elimination to 6,400. That compares with 9,000 jobs AMR said it would cut if it voids the worker's current deal and imposes new terms.
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