Projected cash reserves of major airlines...

[delta777]

I posted this in the US Airways section, as it it easily the most visited...

Airline Cash reserves end of 2007 End of 2008 End of 2009

AMR $ 4.5 Billion $3.1 Billion $2.2 Billion

UAL 3.6 2.3 2.0

DAL 2.8 3.3 3.8

CAL 2.8 2.1 1.8

NWA 3.0 2.8 2.6

LCC 2.2 1.7 1.5

LUV 2.8 3.4 4.1

B6 1.1 680 million 675 million

AS(Alaska) 823 million 680 million 721 million

FL(Airtran) 318 million 241 million 296 million

F9(Frontier) 203 million 100 million 63 million

With the skyrocketing price of fuel, these numbers could very well be obsolete next month.

 

[brokenwrench]

That number as a percent of revenue will give a good idea of an airlines "staying" power in this environment. 20% of revenue appears to be the magic number these days.

JMHO


777 What is the source of these numbers?

 

[pilot]

A business that has to rely on cash reserves while "hoping" for lower fuel prices is not going to be in business for very long.

When this industry starts pricing its product according to the cost of its product it will succeed. Until then the companies will fall one by one until some form of pricing sanity arrives. One can use the list to predict who falls when.

 

[North by Northwest]

I posted this in the US Airways section, as it it easily the most visited...

Airline Cash reserves end of 2007 End of 2008 End of 2009

AMR $ 4.5 Billion $3.1 Billion $2.2 Billion

UAL 3.6 2.3 2.0

DAL 2.8 3.3 3.8

CAL 2.8 2.1 1.8

NWA 3.0 2.8 2.6

LCC 2.2 1.7 1.5

LUV 2.8 3.4 4.1

B6 1.1 680 million 675 million

AS(Alaska) 823 million 680 million 721 million

FL(Airtran) 318 million 241 million 296 million

F9(Frontier) 203 million 100 million 63 million

With the skyrocketing price of fuel, these numbers could very well be obsolete next month.

I find those numbers interesting as they DO NOT reflect the recent projections of airlines loss based on increased fuel. Nor do those numbers reflect the outlay of DEBT owed and must be paid, along with many other variables...

http://www.usatoday.com/money/industries/t...sts_N.htm#chart

AIRLINE LOSSES GROW WITH RISING OIL PRICES | Story
Airlines' 2008 estimated net income or loss (), in millions, if crude oil prices average these amounts per barrel for the year:
Airline $75 $95 $100 $110
Alaska $104 $14 $9 $54
American $797 $538 $872 $1,539
Continental $444 $12 $126 $354
Delta $538 $100 $260 $579
Northwest $488 $43 $69 $291
United $540 $116 $280 $609
Total majors $2,913 $709 $1,615 $3,426
AirTran $87 $27 $56 $0
Allegiant $47 $22 $15 $3
Frontier $9 $48 $63 $91
JetBlue $66 $45 $72 $91
Southwest $495 $467 $460 $445
US Airways $259 $19 $41 $160
Total industry $3,877 $322 $1,371 $3,321

In conversations with investors who are increasingly worried about a looming cash crunch, airline executives have begun emphasizing the strength of their balance sheets. Last week in presentations at the JPMorgan conference, senior Northwest, Continental, US Airways and Delta officials all emphasized what they believe to be their companies' more-than-adequate liquidity in light of triple-digit oil prices.

Which is just the opposite they have been saying about the need to merge.

 

[nycbusdriver]

When this industry starts pricing its product according to the cost of its product it will succeed.

What a radical concept for the airline industry!

The problem with that is the super abundance of capacity and the fact that most of the seats are filled with leisure travelers who will walk away from a fairly priced airline ticket. When that happens, the excess capacity problem is then exacerbated. It's a vicious circle and the only way it appears that things can change is for two or three of the biggest carriers to leave the scene, or for the government to finally call a halt to its ill-conceived "Airline Deregulation Act of 1978" and treat the airline industry like a utility by setting fair prices for the service.

If oil stays north of $100 per barrel, I suspect there will be another painful round of bankruptcies with radical consolidation and considerable capacity shrinkage. Even that may not fully cure the problem, but until the airline industry is as a whole "right sized," there will never be any stability nor will companies have the pricing power they need to cover costs.

 

[whatkindoffreshhell]

... or for the government to finally call a halt to its ill-conceived "Airline Deregulation Act of 1978" and treat the airline industry like a utility by setting fair prices for the service.

Riiiight. They'll do that just after re-instituting Prohibition.

The problem is the bankruptcy codes.

If the BK codes had any teeth we would have been done with these problems years ago.

There is no "national interests" reason for UA, DL or NW to keep flying any more than keeping any of the integrated steel makers propped up. Or General Motors for that matter. Wait'll Wilbur Ross gets his hands on that!

Either you fix it in BK (a la CO) or you don't.

 

[jimntx]

Short of re-regulation of the industry--including government control of capacity per route--there is not a solution to the current overcapacity. As has been shown time and time again, there is ALWAYS someone with more money than sense who thinks he/she can succeed where countless others have failed. "Well, sure Skybus was losing money on those $10 transcon fares, but I plan to make up the loss with greater volume. And, of course, I will be charging a sensible $15 for the transcon."

Another good example: How many times over the last 40-50 years has someone started up an "all first-class" airline? How many of those are still in business? People who can afford to fly on an all F/C airline usually own/lease a private a/c, or they are smart and fly F/C on a major and collect FF miles.

 

[deltawatch]

I posted this in the US Airways section, as it it easily the most visited...

Airline Cash reserves end of 2007 End of 2008 End of 2009

AMR $ 4.5 Billion $3.1 Billion $2.2 Billion

UAL 3.6 2.3 2.0

DAL 2.8 3.3 3.8

CAL 2.8 2.1 1.8

NWA 3.0 2.8 2.6

LCC 2.2 1.7 1.5

LUV 2.8 3.4 4.1

B6 1.1 680 million 675 million

AS(Alaska) 823 million 680 million 721 million

FL(Airtran) 318 million 241 million 296 million

F9(Frontier) 203 million 100 million 63 million

With the skyrocketing price of fuel, these numbers could very well be obsolete next month.

If Delta finally abandons their failed 1980's / 90's strategy of using 50 seat express jets to overlap traditional US Airways routes in an effort to force US Airways out of business the numbers could improve for US and DL. "True leadership" ?? at Delta should be able recognize that this strategy pulls down over all yield at Delta and that they need to focus on opportunities that produce more $$$, (international).

Look at all the traditional mainline LGA routes that US Airways use to serve with mainline aircraft that had to be outsourced to US Express carriers when Delta entered the market with Comair in late 80's and early 90's. Just one example of the overlap designed to eliminate US Airways.

 

[delta777]

That number as a percent of revenue will give a good idea of an airlines "staying" power in this environment. 20% of revenue appears to be the magic number these days.

JMHO


777 What is the source of these numbers?

Here's the link to the story...

http://www.ajc.com/business/content/busine...rvive_0412.html

 

[North by Northwest]

Riiiight. They'll do that just after re-instituting Prohibition.

The problem is the bankruptcy codes.

If the BK codes had any teeth we would have been done with these problems years ago.

There is no "national interests" reason for UA, DL or NW to keep flying any more than keeping any of the integrated steel makers propped up. Or General Motors for that matter. Wait'll Wilbur Ross gets his hands on that!

Either you fix it in BK (a la CO) or you don't.

Airlines should NEVER be allowed to enter BK and come out alive. Just like propping up scamming Banks and Brokerages because their little ponzi scheme collapsed.

And let's not forget, Continental ALSO had the benefit of 2/3s of Eastern Air lines assets ($400 million, System One, tons of A/C) given to them, AND two bankruptcies, thank you very much Frank Scumbagzo. If it takes what it took to keep Cont. flying...they should have NEVER survived. It creates a perpetual vicious cycle that kills healthy airline systems, by constantly giving the advantage to the unhealthy (now BK has become a personal ATM for incompetent airline management)

Based on the thirst for Wal mart prices, there is no other way for this country to re-cover a long-term stable aviation industry except regulation.

 

[local 12 proud]

A business that has to rely on cash reserves while "hoping" for lower fuel prices is not going to be in business for very long.

When this industry starts pricing its product according to the cost of its product it will succeed. Until then the companies will fall one by one until some form of pricing sanity arrives. One can use the list to predict who falls when.

Ya Think? :blink:

Let'em fall..........

 

[delldude]

Like it or not,a "thinning of the herd" is long overdue.

 

[Gilding the Lily]

Airlines should NEVER be allowed to enter BK and come out alive. Just like propping up scamming Banks and Brokerages because their little ponzi scheme collapsed.

Just curious, do you have any evidence that liquidation of airlines provides better returns than a reorganization?

 

[JetMonkey]

The numbers from what I've seen are a little off. At the end of 2007, LCC reported having 3 billion in cash of which 2.5 was unrestricted.

 

[North by Northwest]

Just curious, do you have any evidence that liquidation of airlines provides better returns than a reorganization?

Reduced capacity= pricing power.

Downward pricing power from newly bk airline on healthy airlines.


----------------------------------------side joke-------------------

Lady First Class Passenger:

"Steward, I'd like a Gin and Tonic"

NW Steward:

"Me too"