Grist from the Merger Rumor Mill

United-Continental merger gossip from the PlaneBusiness Blog:

[T]he bulk of the existing United Airlines brand will continue to be used internationally, but Continental will take over the domestic operation for the most part.

Other details we were told included the fact that there has already been a transition team put together. The deal will be announced after Delta/Northwest goes public.

There will initially be a holding company set up to run both airlines. This operation will continue for three-five years. This will allow for a “smoother transition” from the two airlines into one operation.

Meanwhile, this Bloomberg piece (hat tip PlaneBusiness Blog) outlines details of how and why pilots are holding up the Delta-Northwest merger.

Northwest union chiefs want their members to be ranked by when they were hired, while their Delta counterparts want a formula that takes into account their larger chapter and the types of planes they fly, one person said.

This is a big deal because
…about 400 Northwest pilots have more seniority than their Delta peers, pushing down younger Delta pilots on a traditional seniority list based on hire date.

So the combined carrier would be named Delta, but the Delta pilots would get bumped down the seniority list unless some other accomodation is reached. So they’re pretty antsy. Unhappy pilots can be costly in a merger.
American Airlines pilots protested their 1999 merger integration with Reno Air, canceling 6,000 flights and costing $225 million.
And unhappy employees are pretty much a given when it comes to Northwest.

Still, Delta-Northwest looks close enough that it could happen next week.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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