Creditors are only ones who have the big picture

[phasersonstun2]

I have said this in several posts, but I keep reading all these highly charged emotional posts. Relax and follow the money. These people are way smarter than us and will only allow a deal that will make sense financially.

So why did others were supposedly just as smart fail before?

They used a business model that does not exist anymore. Like a hardened football coach that only knows how to coach a team by running the ball on first and second down, the NEW breed of coaches use the west coast offense. Wide open and complicated, but scores a lot of points.

The new airline CEO's use a different business model that involves using more leverage and debt and less cash. This is actually necessary since an airline behaves more like a utility than a traditional business. The cycles in the airline biz do not follow the mainstream.

Market pricing power is the new buzzword, and Bethune is right... there are too many airlines. We are climbing all over each other like hamsters in the cage at Petco. Three years ago, U was the one sleeping at the bottom of the pile. Everyone thought it was dead 'cause it never moved.

We would be just fine with a dozen airlines total in the US... and of course Mesa.

 

[PITbull]

I'm not sure what you are trying to convey...but I do know that U has somewhere upwards in $5billion in cash alone to come up with, and probably, will likely move much higher than $10.3 billion if the creditors wait it out.

As far as consolidation goes, this kind of deal will start a gold-rush of consolidations, but, there will always be regional carriers that will spring up and force the big guys to compete with lower pricing. Then again, all could go to hell in a hand basket if oil prices start rising latter part of the year.

The employees of these carriers better watch out. The good news is that their wages can't go lower than fed. min wage standards. But, health care and benefits could be untouchable for airline workers in the future.