American Airlines loses $3.3 million a day
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Hopeful
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Gee, I guess we are gonna just have to take more concessions so AA can be profitable again.
jimntx
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Ok. Losing $3.3 million/day is not good; however, let's put it in perspective. The article said we have been losing that much per day since January. Yet, we finished the quarter with approx. $4.3 BILLION in unrestricted cash. At that burn rate with that much cash on hand, we would be out of cash and have to close the doors in 1433 days or not quite 4 years. And, that would be if we didn't receive another dime in cash.
I don't think it's time just yet to start hiding the want ads from your co-workers so you can get first dibs on the lead job at the car wash.
I don't think it's time just yet to start hiding the want ads from your co-workers so you can get first dibs on the lead job at the car wash.
Hopeful
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Ok. Losing $3.3 million/day is not good; however, let's put it in perspective. The article said we have been losing that much per day since January. Yet, we finished the quarter with approx. $4.3 BILLION in unrestricted cash. At that burn rate with that much cash on hand, we would be out of cash and have to close the doors in 1433 days or not quite 4 years. And, that would be if we didn't receive another dime in cash.
I don't think it's time just yet to start hiding the want ads from your co-workers so you can get first dibs on the lead job at the car wash.
If anyone doesn't think that capacity cuts, aircraft groundings and layoffs are inevitable, think again,,
No airline can sustain these losses especially with the fuel cost....
But AMR on the other hand will rape us again AND layoff again like they did in 2003.
whatkindoffreshhell
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Check your math there skippy.
You claim that AA can remain in business for over four more years without ever receiving another "dime in revenue" ??
Jake...Brace....... is that you??
jimntx
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Don't know why it posted twice.
jimntx
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And, even though I would be among the first or second group to be furloughed, what do you suggest as an alternative? Eliminate the executive bonusses? Well, aside from the fact that they were newly issued stock and not cash, even if the bonusses were cash, the $200 million would give us 2 additional months of operation at the current burn rate.
All the airlines are in trouble right now. I think we have a better chance of surviving this period than most, if not all, of the others. But, because of the bonusses fiasco (what were they thinking to accept bonusses on the same day they announced a $328 million quarterly loss????), I don't think the pilots or the f/as will be open to much in the way of further concessions. I can't speak for the mechanics and rampers because the TWU doesn't seem to care much what its members think.
Grounding a/c and reducing flying are very real possibilities for the near future. I don't really see an alternative. (We all know that something sensible like raising fares is not going to happen.) As Arpey stated in the article, no business can survive selling their product for less than it costs to produce.
People are getting so antsy...I heard a rumor yesterday that the company is going to close BOS, DCA, and SLT f/a bases. (I know. I know. But, I just couldn't resist. I hate to spread gossip, but I can't think of anything else to do with it. It's like fertilizer and money...useless unless you spread it around. )
All the airlines are in trouble right now. I think we have a better chance of surviving this period than most, if not all, of the others. But, because of the bonusses fiasco (what were they thinking to accept bonusses on the same day they announced a $328 million quarterly loss????), I don't think the pilots or the f/as will be open to much in the way of further concessions. I can't speak for the mechanics and rampers because the TWU doesn't seem to care much what its members think.
Grounding a/c and reducing flying are very real possibilities for the near future. I don't really see an alternative. (We all know that something sensible like raising fares is not going to happen.) As Arpey stated in the article, no business can survive selling their product for less than it costs to produce.
People are getting so antsy...I heard a rumor yesterday that the company is going to close BOS, DCA, and SLT f/a bases. (I know. I know. But, I just couldn't resist. I hate to spread gossip, but I can't think of anything else to do with it. It's like fertilizer and money...useless unless you spread it around.
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It' all WN's fault...
jimntx
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Ok. Bear with me. I was an English major. $3.3 mil/day comes to $1,204,500,000/yr. $4.3 billion divided by $1.204 billion/yr comes to 3.57 years. So, I rounded up .43 years. Sue me.
And, as an English major, let me point out that the phrase "not quite 4 years" means less than 4 years not "over 4 years."
Ok. Losing $3.3 million/day is not good; however, let's put it in perspective. The article said we have been losing that much per day since January. Yet, we finished the quarter with approx. $4.3 BILLION in unrestricted cash. At that burn rate with that much cash on hand, we would be out of cash and have to close the doors in 1433 days or not quite 4 years. And, that would be if we didn't receive another dime in cash.
I don't think it's time just yet to start hiding the want ads from your co-workers so you can get first dibs on the lead job at the car wash.
AA didn't have any "burn rate" during the first quarter, since cash flow from operations actually generated an additional $449 million of cash in those 90 days. AA's loss was a GAAP accounting loss, taking into account various non-cash expenses like depreciation and amortization. So AA was cash flow positive (which it has been since the concessions) but posted a net loss anyway.
UAL, on the other hand, actually generated negative $80 million in cash from operations in the first quarter, meaning that they burned almost $900,000 of cash each day. In addition to that, those geniuses distributed a quarter billion dollar dividend to the shareholders. Just like AA, UA also paid down some debt.
The bolded sentence doesn't compute. If AA doesn't receive another dime in cash, it will be out of business in a matter of days. What you meant was "if we continue to lose money at the current rate." Big difference.
jimntx
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What! Ever! I told you I was an English major. I was not boring enough to be an accountant.
T
The Goose
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But - doesn't it appear that AA is moving into the "cash-burn" position similar to what Carty did before breaking the "Bad News"?
After reading your posts from time to time...... I wish I could share the image I have of you.... it's not pretty !!! And English is not boring... please !!!What! Ever! I told you I was an English major. I was not boring enough to be an accountant.
