US Airways is trying to buy bankrupt American Airlines, but it’s easy to overlook the fact that American is not a willing partner.
The casual observer might assume that the two sides are talking about a merger, but in reality US Airways is putting pressure on American creditors to do a deal while the company is in bankruptcy.
Related Magazine Content
American filed for bankruptcy in November after losing billions of dollars in recent years.
US Airways is playing things smart by first winning support for a merger from the three main employee unions at American. Airline mergers generally don’t work out as well as planned because of the difficulty getting unions at the two airlines to agree to common pay scales, benefits and seniority rules. US Airways is trying to take care of that issue ahead of time.
American needs to trim as much as $1.25 billion per year in labor costs.