"This Plan Makes Sense"
The staunch opposition by management at Delta Air Lines to last
month's unsolicited merger proposal by US Airways may be paying
off... as US Airways CEO Doug Parker said Tuesday if Delta can't be
persuaded to support the merger, he'll give up on the bid.
"We have to get to a point where we are all working together on
this, or it's not going to happen," Parker told USA Today. "This is
all about convincing Delta's management that this plan makes
So far, they haven't been swayed.
As Aero-News has reported,
employees at Delta have joined with management in presenting a
united front against the November 15 merger bid, saying it is too
risky and that Delta should remain an independent carrier.
Delta Air Lines CEO Gerald Grinstein -- who, incidentally, came
to Delta after his Western Airlines merged with the Atlanta-based
carrier in 1987 -- said Delta "is making crucial progress toward
becoming a strong, independent, stand-alone company" in a recent
If Delta management had the most powerful say on the merger bid,
it would likely already be dead... but since Delta is still in
bankruptcy, the ultimate decision lies with the airline's
A statement by Delta's Chief Financial Officer, Ed Bastain, may
cause them to consider sticking with Delta's plan, as well. Bastain
says a merger would likely prolong Delta's stay in Chapter 11,
while the proposal is reviewed by the Department of Justice for
That delay would increase costs, Bastain notes... and increases
Delta's vulnerability to an economic downturn, or rising fuel
Parker maintains a merger between Delta and US Airways could be
wrapped up by late June 2007... under a schedule he admits is
If history is an indicator, however, that is highly optimistic
thinking. Last year's merger between US Airways and America West
hasn't been fully realized yet, 15 months after the carriers agreed
to combine forces. Both airlines are flying under separate
reservations systems, and two sets of pilots and flight
This week, US Airways agreed to bring its pilots' pay scale up
to the level of America West pilots... a move many believe is meant
to calm fomenting labor strife ahead of the Delta merger.