AA Buys Alaska, Korean Leaves SkyTeam, Joins Oneworld, DL & AS Break-Up in this Crazy Scenario

Hunter Keay of Wolfe Research offered a very interesting scenario today in which Korean breaks up with Delta and SkyTeam, AA then pursues a 3-way joint venture with JAL and Korean, DL and Alaska break-up, and then eventually AA makes a play for Alaska Airlines. It’s fun to play what-if, but even as the analyst admits, the odds of any of these actually taking place are about 0%…

This is a story about Asia. We see a potential scenario unfolding over the next few years centered around American Airlines and Delta Air Lines’ growth to Asia that ends with American Airlines examining an acquisition of Alaska Air. Here’s how:

Fact: American Airlines and Delta Air Lines both have Asian growth ambitions
Fact: American Airlines is now doing more business with two key Delta Air Lines partners
Fact: Both American Airlines and Delta Air Lines plan on growing a lot out of LAX
Opinion: The Korean Air and Delta Air Lines relationship is worsening
Opinion: The Alaska Air and Delta Air Lines relationship is not great these days
Opinion: We see Korean Air potentially leaving SkyTeam
Opinion: American Airlines might pursue a three-way JV with JAL and Korean Air …which would be a potential ‘check mate’ for oneworld in Asia
Opinion: We see Alaska Air and Delta Air Lines terminating their codeshare in time
Opinion: Alaska Air could join oneworld soon thereafter
Result: American Airlines fortifies its grip on Asia & west coast U.S. by buying Alaska Air

This series of events happening exactly as we laid out is roughly 0%, but we see benefits for Alaska regardless.

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Comments

  1. Saw the title of this post after being “unplugged” for 24 hours. I thought the entire industry went haywire in the time it took me to get from ATL to Berlin.

  2. Mr. Keay is known as being a joke in UA community, due to his endless lovefest with SMI/J. However, I wouldn’t mind KE to join OW but doubt JL will let it happens, due to alot of overlapping areas between both airlines.

  3. 1 – Alaska is not for sale.
    2 – The Feds will not approve a big 3 merger.
    3 – I want to see Alaska and Hawaiian merge and get me better award offerings to the Pacific.
    4 – Alaska is not for sale.
    5 – The Alaska Air Group is a unique operation of NW people serving NW customers in a higher level. I don’t see this anywhere else.

  4. What IF AA actually HAD seats in J on award across the Atlantic without BA fuel surcharges our double miles? That would be AMAZING.

    All of these partnerships are really pointless if you can’t actually redeem the points you earn. Doug Parker has totally gutted the value of AAdvantage.

  5. I could see an AS / B6 merger, perhaps followed by selling a stake in the combined entity to one of the ME3 (possibly indirectly, e.g to air berlin)

  6. I doubt most or any of this will happen. I do see a potential that Frontier could end up in a merger situation in he near future but I’m just guessing.

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