Airlines, fuel prices, and cutbacks

[ifly4food]

Maybe I'm wrong, but aren't the airlines still fuel hedged to a certain degree? Certainly they aren't paying the full market rate for jet fuel. Why the sudden panic? Looks like a ploy to whack the employees for concessions again.

 

[Tanker Clown]

Maybe I'm wrong, but aren't the airlines still fuel hedged to a certain degree? Certainly they aren't paying the full market rate for jet fuel. Why the sudden panic? Looks like a ploy to whack the employees for concessions again.

Some are hedged better than others. Even if you're hedged, you still actually pay market prices for the gas. The hedge is a planning tool as much as anything. Most hedges are done in home heating oil.

That said, oil's around $110/bbl, the economy is in the tank, people's largest investment (their home) is in a steep decline, the dollar is worth less and less each day, and to top it all off, inflation is killing folks. The shock should be, why panic now? They should have been in a panic a year ago. UAL looks like they just noticed what's going on and are parking jets. Delta's unloading some folks. Looks like SWA's move to cut growth a year ago was the prudent move.

I'd have a back up if I were a newhire at one of the legacies. They aren't afraid to throw a few pilots on the street....and cut the pay and work rules of the remaining ones.