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I wrestled with this problem for a long time before I found the solution, so I'm posting it here.

I had a series of PNG images that I wanted to montage together to I could use them as a single background-image in some css. However, the output montage appeared to lose all the transparency from the input images - the result kept coming out with white where it should be transparent.

I spent a lot of time trying to work out why IM was ignoring my alpha channel - but that's not what was happening.

The problem was that montage by default creates a white background over the whole of the output image. So in fact IM was "correctly" tiling my alpha-aware images on top of a white background.

I change it to

montage -background none {image1} {image2} {image3} -geometry '16x16+0+0' -tile '16x' output.png

Hopefully that will help other people (or me) solve this problem in the future.