On Feb 14 US Airways and American Airlines announced their intentions to merge by October, 2013. I am not a huge fan of this merger. I don’t like the concentration of airlines in the USA, am not convinced that the merger will quickly fix some key AA issues and wonder what the result of merging two mediocre airlines. (I am not a huge fan of either carrier).
This week, the two airlines appeared before the US Senate Judiciary Committee’s subcommittee on antitrust, competition policy and consumer rights for over two hours. It was noted that the new carrier will have 70 per cent of the slots at Washingon’s National airport.
The deal next gets sign off from a Bankruptcy Judge (hopefully for the carrier). It is also under scrutiny by the US department of Justice.
Yesterday airline staff were updated with a letter from chief integration officer Beverly Goulet and US Airways president Scott Kirby:
March 21, 2013
Dear Fellow Employees:
As Tom and Doug [Tom Horton, CEO of American Airlines, and Doug Parker, CEO of US Airways], announced a couple of weeks ago, we are together leading the team that will design and oversee the American Airlines / US Airways integration. We wanted to take this opportunity to update you on the integration structure and immediate next steps.
We have created an overall structure to manage the integration. As previously announced, a Transition Committee, led by Doug and Tom, will oversee the total integration, make near-term strategic decisions, resolve integration issues and allocate resources. The Transition Committee will be supported by an Integration Management Office.
The Integration Management Office (IMO) will be the primary nerve center for integration. Robert Isom, US Airways Chief Operating Officer, and Bev Goulet, American’s Senior Vice President & Chief Integration Officer, will lead the IMO, with support from Derek Kerr, US Airways EVP and Chief Financial Officer and Denise Lynn, American’s SVP of People. Joining them as full-time IMO members are:
– Kerry Hester, US Airways SVP of Customer Experience
– Jim Butler, American’s Managing Director of Commercial Planning and Performance
– Candice Irvin, American’s Managing Director of Corporate Development
– Matt Pfeifer, American’s Managing Director of Operations Strategic Planning
The IMO will be based in Dallas, with support in Phoenix. We’ve also retained McKinsey & Company to assist us on this project. As I’m sure you know, McKinsey is a highly respected consulting company with a lot of relevant experience in this area.
All integration-related topics will be centrally managed and coordinated through the IMO. Specifically, this team will focus on:
– Capturing the value of the merger (cost savings and increased revenues)
– Developing the master plan and timeline for the integration
– Working in close collaboration with the People departments of both carriers to implement the design of the new organization
Importantly, the IMO, working closely with the Communications team, will also manage integration communications. Our aim will be to communicate regularly and frequently, so that you know what’s happening and what to expect.
The Transition Committee will also provide oversight and guidance on issues of a strategic nature that must be addressed before the merger closes. While each airline will continue to operate separately during this interim period, there will be some decisions that require joint approval. These will be handled by the Transition Committee.
As we start working towards the integration, we ask that you focus on running our two great airlines as usual, and be guided by this simple principle: continue to put the customer at the center of all that you do. Please respect our legal obligations to maintain separate, competing businesses until the merger closes.
Thank you for your support as we begin preparing to combine our two companies. We have a bright future ahead, and we’ll keep you updated along the way.
Bev Goulet Scott Kirby
Watch this space!