American Airlines resists US Airways' pressure to merge

 

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"Those are the most important population centers, and we are very strong in them," Horton said. "What that airline (US Airways) does is carry a lot of connecting traffic over Charlotte and does so in a way that I would suggest is somewhat unrewarding."

Horton also said that he didn't think US Airways' route map would give American a strategic advantage. "There might be others where integration might be easier and smoother," he said.

In a separate interview on Thursday, US Airways President Scott Kirby said that with hubs in Charlotte, Philadelphia and Washington, his airline could give American better links between 60 cities on the East Coast. Charlotte is the fourth-most-lucrative hub in the country, he said.

"We absolutely complement American and the holes they have," Kirby said. "American has become largely irrelevant on the East Coast outside of New York and Miami. The reality is that a large percentage of the traveling public doesn't live in New York or Miami."

He dismissed Horton's suggestion that US Airways is not as valuable as American.

"We have a business model that works, that is profitable, and generates margins that are far superior to American's," he said. "Our results prove that."

'No substantial progress'

Over breakfast Thursday, the day after Parker once again pressed his case for American at a speech at the National Press Club, he and Horton began discussions about a possible combination.

But "no substantial progress was made," said US Airways spokesman Todd Lehmacher.

In a statement Thursday afternoon, American said Horton described to Parker the process of reviewing potential partners, what the criteria will be and the next steps.

Horton said that process will be fair and transparent. Parker has said more than once that he is skeptical of that.

The two CEOs have a history, having both worked at American years ago. Each has called the other a close friend and insists there is nothing personal at stake in the corporate fight.

But they have very different opinions about whether — and how — the airlines should join forces to rival the larger United/Continental and Delta, which are the nation's biggest network airlines, respectively.

Parker said at the National Press Club that he wanted a merger to happen before American emerges from bankruptcy. American has until the end of the year to come up with a restructuring plan as a stand-alone company. The company already has ended leases on some aircraft and reached tentative contract resolutions with workers.

Horton said he's going to dictate the timing of American's next move.

"I don't think our company should be driven to an outcome because another company has an urgent need to do something," he said.

Some analysts agree that Parker should be more patient.

"American should be allowed to get through its restructuring, understand what it might be as a stand-alone company and examine multiple strategic alternatives," said William Swelbar, a research engineer at MIT's International Center for Air Transportation who has worked as a consultant with American in the past but is not advising on the bankruptcy.

Labor gets involved

American's executives stress that their company is the larger, better-situated airline.

Parker doesn't buy that. But he says that if the two were to combine, the airline would be called American and would keep its headquarters in Fort Worth.