Eastern Airlines has no current plans to merge with any other airline but will look for a "Merger partner" if the Civil Aeronautics Board approves the mergers pending before it, Eastern chief Frak Borman said yesterday.
"I think mergers would lead to concentration in the airline industry, and I believe and hope that the CAB will not allow it," Borman said after a meeting of Eastern's board of directors here.
If the mergers do go forward, however, Borma "for defensive reasons" will be looking for a merger partner - "somebody with money," he said.
He said he believed current merger proposals are "thingly-disguised attempts to get assets at a premium." Pan American World Airways, for instance, will be paying about $5 million for each DC-10 it acquires if its merger with National Airlines is approved, he said. In a recent order, the current pricetage of a DC-10 was $50 million each including spare parts.
Borman, who is chairman president and chief executive officer of Eastern, said a Pam Am-National merger would cost Eastern about $7 million to $10 million in lost revenues each year. Though Eastern takes in about $2 billion a year, Borman contended, "every penny counts."
On an optimistic note, Breman predicted that 1978 would be "our best year ever" for profits. Because of increased revenues this year, Borman said he will be able in December to write checks totaling between $55 million and $60 million to employees from profit-sharing and a variable carnings program.
Borman noted that an Eastern enploye who participated in the profit-sharing plan during a wage freeze in 1976 to help out the company will get back all the money lost this year, with two years left to run on the five-year profit-sharing program.
On other matters, Borman said:
The crash of a small plane and jetliner in San Diego Monday indicates the serious need to start some procedure to take small planes out of busy airports and set them aside for "mass transportation" being provided by the airlines. He noted that a third of the slots at Washington's National Airport are assigned to the private Cessnas.
Eastern has no plans to go to the three-class of service operations American Airlines and Trans World Airlines want to institute. Eastern's three-class service betwen Miami and New York proved an "operational headache," he said. "All I can say to TWA and American is, 'good luck.'" He said he didn't think the complaints from businessmen about the crowds that led the others to the three-class service idea was "that great a problem."