Today is a historic day as American Airlines and US Airways announce plans to create the new American Airlines. Together, we will create a premier global carrier with an expanded worldwide network, a strong financial foundation, a modern and efficient fleet, and the industry’s best team of people who will offer an unparalleled travel experience for our customers.
Over the past few months, we conducted a thorough review of alternatives to strengthen American for the future and determined that this combination delivers the most value for our stakeholders and the best outcome for our customers and people. As a combined carrier – the new American – we will have an expanded network to even better match where customers want to fly and enhanced ability to invest in our fleet, modern technologies, and the products and services our customers value most.
We’ve been making progress toward building a new American – from transforming our fleet with the largest aircraft order in history, to modernizing the travel experience, and refreshing our iconic brand. This merger is our next step in the process of building the leading global airline.
American and US Airways combine two highly complementary networks with access to the best destinations throughout the U.S. and around the globe. Together we will offer our customers more than 6,700 daily flights to 336 destinations in 56 countries by maintaining all the hubs currently served by both airlines.
When the new American arrives, we will provide more options than any other airline across the East Coast and Central U.S. regions, and expand and further strengthen our network on the West Coast. The combined airline will add to our reach across the Atlantic and Pacific and bolster American’s industry-leading position in Latin America and the Caribbean. We’ll also enhance our existing loyalty program benefits through expanded opportunities to earn and redeem miles across the combined network.
The new American will continue to give customers options for travel and benefits both domestically and internationally through continued membership in the oneworld® Alliance. As they do today, our oneworld Alliance partners will offer access to a range of destinations, airline choices, and earning and redemption opportunities.
At this time, American and US Airways will remain separate companies and you can continue to count on American for excellent service and safe, reliable travel. We expect the merger to be completed in the third quarter of 2013 and will keep you updated. I invite you to visit www.aa.com/arriving to keep up with our progress.
Both American and US Airways are distinguished by our proud histories and look forward to our bright future as we build the world’s leading airline.
Thank you for your continued loyalty, and we look forward to welcoming you aboard soon!
Sincerely,
Thomas W. Horton
Chairman & CEO
As a valued member of the American Airlines AAdvantage® program, you may have already heard from Tom Horton about our exciting and historic news as we and US Airways announce plans to come together to create a new American Airlines.
For nearly two years, American has been hard at work building a strong foundation by transforming our fleet with the largest aircraft order in history, modernizing the travel experience, and refreshing our iconic brand. With this next step, we boldly continue our journey by combining our airlines.
The combined company will retain the iconic American Airlines brand, and together we plan to create a premier global carrier that provides customers with access to more choices across a larger global network.
As Tom said in his letter, together we will be better equipped to offer you an expanded global network with more than 6,700 daily flights to 336 destinations in 56 countries by maintaining all the hubs currently served by both airlines. The new American is expected to enhance our existing loyalty program benefits through expanded opportunities to earn and redeem miles across the combined network. We will also continue to give our customers options for travel and benefits both domestically and internationally through continued membership in the oneworld® Alliance. As they do today, our oneworld partners will offer our customers access to a range of destinations, airline choices, and mileage earning and redemption opportunities.
At this time, American and US Airways will remain separate companies and each company will maintain its current loyalty program — our AAdvantage program and US Airways Dividend Miles. I want to assure you that your AAdvantage miles are secure and existing miles will continue to be honored. In addition, you will continue to earn miles through existing AAdvantage participating companies and you will be able to redeem those miles for the same great awards — flights, upgrades, car rentals and hotels just to name a few.
As an AAdvantage member, you will continue to enjoy unparalleled benefits through one of the largest and most popular loyalty programs in the world and you can continue to book, track and manage flights and your AAdvantage account on AA.com.
Ultimately, the combined company is expected to offer members more opportunities to earn and burn miles from an expanded global network of routes and partnerships, unmatched redemption options including flights, hotels, car rentals, vacation packages, one-way awards, lounge memberships, and much more.
We expect the transaction to close in the third quarter of 2013, subject to customary approvals and closing conditions, and I will keep you updated throughout the process. In the interim, I invite you to visit www.aa.com/arriving for more information.
I speak for everyone at American when I say we remain committed to providing an exceptional travel experience with you, our customers, positioned firmly at the center of everything we do. Thank you for your continued loyalty, and we look forward to continuing to serve you.
Sincerely,
Suzanne L. Rubin
President — AAdvantage® Loyalty Program
Long integration journey ahead for US Airways, American
Two major goals: obtain a joint certificate from the Federal Aviation Administration and create a common reservations system.
Acquiring a single operating certificate from the FAA, which certifies that the two airlines have become a single airline, should take 12 to 18 months, according to Andrew Nocella, US Airways’ senior vice president of planning and marketing.
The two airlines will work together to align their policies in the cockpit, the cabin and on the ground, he said.
Regarding the res system, US Airways CEO Doug Parker said he anticipates choosing American’s, reported The Beat.
“It’s much easier to take the larger airline’s system to put those in place at the smaller airline than it is to do that the other way around,” Parker said.
Nocella said, “The transfer to a single res system is one of the biggest hurdles in any merger.” It’s the foundation for other decisions, such as determining the look of the website, he said.
The two airlines also have to merge their marketing and compensation programs as well as their preferred relationships with travel agency consortia and corporations.
The agency channel is an important one for the airlines. Travel agencies provide a “good chunk of our high-value customer base,” said Derek DeCross, vice president of global sales for American.
The two airlines initially will be limited in what they do on integrating marketing and compensation plans because they remain competitors and must comply with antitrust laws, said DeCross.
DeCross and Nocella said that the American-US Airways merger is ahead of the game when compared with other recent airline mergers because of memoranda of understanding that they have with labor unions.
These memoranda essentially provide the combined airline with a “road map” for integrating employees, Nocella said.
The two airlines expect to complete their merger by the third quarter of 2013. The carriers have created a joint website to provide info on the merger, www.newamericanarriving.com.
American-US Airways merger deal valued at $11 billion
American Airlines parent AMR Corp. and US Airways Group made their merger agreement official on Thursday, with the airlines valuing the deal at $11 billion based on the price of US Airways stock on Feb. 13.
The combined carrier will fly as American Airlines, with headquarters in Fort Worth, Texas.
US Airways stockholders will end up owning 28% of the combined airline. The remaining 72% will be owned by stakeholders of AMR and its debtor subsidiaries that filed for relief under Chapter 11, American’s labor unions and current AMR employees.
The merger is conditioned on approval by the bankruptcy court overseeing American Airlines’ Chapter 11 reorganization and US Airways’ shareholders. The Department of Justice’s Antitrust Division also needs to review the deal.
The airlines expect that the merger deal will be completed in the third quarter of 2013. During the period between the signing and closing of the transaction, a transition-planning team made up of leaders from both companies will develop an integration plan.
US Airways CEO Doug Parker will become CEO of the combined airline, which would be the world’s largest, edging out United.
American CEO Tom Horton will become nonexecutive chairman through the combined airline’s first annual meeting of shareholders. Parker will assume the additional position of chairman after Horton’s tenure concludes.
The board of directors will initially be made up of 12 members: three from American, including Horton; four from US Airways, including Parker; and five representatives of AMR creditors.
The new American Airlines will maintain all hubs currently served by both airlines, the carriers said. These include American hubs Chicago O’Hare, Dallas-Fort Worth, Los Angeles, Miami and New York Kennedy, and US Airways hubs Philadelphia, Washington Reagan National, Phoenix and Charlotte.
US Airways and American say that their combination is expected to generate more than $1 billion in annual net synergies in 2015. The airlines expect transition costs of approximately $1.2 billion, spread over the next three years.
More information about the merger is at www.newamericanarriving.com.
Video – http://www.youtube.com/watch?v=nJPTtIOAls4