EU green light to AF/KLM merger

[Lemurian]

The AF/KLM merger has been approved bu the EU commission yesterday ,on condition that both companies give up indefinitely 94 slots.
Details are still sketchy but it appears most of these slots concern Amsterdam to France regional airports and some between Paris and a few US destinations,Detroit been the example given.
Air France is confident that the US authorities will also give their approval very shortly .

[Otterman]

The way this is developing into a non-thread amazes me. It shows how myopic most people are, who participate in these forums. Easyjet adding (or dropping) a route will command tens of responses, Ryanair’s talking head O’Leary opening his mouth will get people off on a rant for weeks on end in these neck of the woods. Mention BA and the server locks up.
This event folks is a seismic shift in our business. The group that is now created is the largest in the world when it comes to turnover. It combines two viable airlines that control two of the four top hubs in Europe. Both hubs have plenty of scope for growth. The route networks of both airlines are largely complementary only overlapping at 30 international destinations (most of which are large enough to justify this overlap JFK, LAX, ORD, IAH etc). Both airlines have separate international alliances that will now be combined into the newly charged Skyteam. When everything will settle the market power of this combination is awesome. Of any four passengers traveling worldwide at any given time one will be sitting in a Skyteam airplane.
There will be no airlines in the world that can even come close to matching the network that the new holding company Air France/KLM will offer, leaving aside the fact that Alitalia is doing everything in its power to add itself to this combination. It is likely to be able to code share with the new Air France/KLM from the start.
What of BA, what are their options? Being assaulted from below by the low-cost carriers operating all around them. A shrinking mainline operation mostly concentrated around Heathrow. And a main hub that is severely restricted in growth. Heathrow is likely to be pried open by the American negotiators during the open skies talks presently going on between the USA and the EU. It will at least allow the British politicians to blame the “bloody Europeans”. Will BA become a large niche carrier concentrating only on what they do best. Becoming more and more a point to point carrier? I do not know, but their options are very limited indeed. KLM was the last large viable European airline that could have added to BA’s position and offered a solution to some of the pressing problems that are in its way. Even now you can fly to more destinations in the UK through Amsterdam than you can through Heathrow. BA’s financial performance is looking up, this is nice for the shareholders and the option holding executive suite, and in the meantime staff is still being shoved out the backdoor.
I am not saying that the Air France take-over of KLM will be totally smooth or that the combination of the two will make for a greater whole than the two separate companies. My feelings are rather that it won’t. But even if 1+1=1.75 you still have a hell of a new monster in the airlines business. And I think people should at least take the time to realize that a new era has arrived. One that with time will affect most people employed with the airlines, as this is only the first step in the consolidation of the business in Europe.
Keep discussing all the little things that happen in life, I enjoy reading some of it. But take off the horse blinkers sometime and try to take a look at the larger picture, there is a whole world out there.
Regards, O.