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DL & NWA will probably file before Oct 17

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On Your Six said:
Shouldn't you be talking to your GEICO customers right now? I love your unequivocal "I believe" - yeah you and other wannabe analysts like Mike Boyd. He predicted UAL's quick demise four years ago.

When oil reaches $90 per barrel you can expect JetBlue, AirTran and SWA joining the Chap. 11 queue as well....

I don't think you would need oilas high as $90 for JB and AirTran to go Chpt. 11.

I thought I had read some where that at $60 both these companies would start feeling the heat, SWA would also be feeling it right now if not hedged at mid to high $20s.

On a positive note, it looks like oil has dropped over a $1.00 down to $59.45... OPEC has said they will increase, and our reserves in the US will be at 100% by August. I guess only time will tell. Wish I had a crystal ball like
Lowecur.

AA :cool:
 
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Common people, do you actually believe fares would not rise to adjust for higher oil. Use a little common sense.
 
lowecur said:
Common people, do you actually believe fares would not rise to adjust for higher oil. Use a little common sense.

Common sense is not a pre-requisite for becoming airline management. Haven't you been paying attention?
 
lowecur said:
Common people, do you actually believe fares would not rise to adjust for higher oil. Use a little common sense.


the problem with the airline industry, as Gordon Bethune once said, is we are only as smart as our dumbest management team. All it takes is once box of rocks at one airline (DAL) to charge too little, and the rest pretty much have to match.

PS the fact that lowecur thinks DAL and NWA will file convinces me it will never happen.
 
lowecur said:
Common people, do you actually believe fares would not rise to adjust for higher oil. Use a little common sense.
Well, most business WOULD raise fares to adjust - it would make sense. Unfortunetly for the legacy carriers, SWA hedged fuel at some pretty low prices. So at the moment SWA doesn't need to raise prices. I think the legacy carriers think that if they raise prices the passengers will scoot over to SWA and leave their airplanes empty, making them lose even more money.

iaflyer
 
skykid said:
Good article. Problem is, Northwest and Delta would both be extremely complicated cases in Ch11 and would be hurt tremendously by the new procedures. Here's hoping it doesn't work out that way.
Who wouldn't be a complicated case? I am not convinced that DAL will enter Chap 11..
 
iaflyer said:
I think the legacy carriers think that if they raise prices the passengers will scoot over to SWA and leave their airplanes empty, making them lose even more money.

iaflyer

Agreed, but I don't get this mentality. With the millions of people flying around this hemisphere each month the LCC's can't fly them all. You don't see people trading in their Hummers for a Civic (yet). So I think to a point that passengers are willing to pay higher fares.

Problem is, like someone said earlier, that right now it's a giant starring contest amongst all the airlines to see who will blink first. Unfortunately a couple of carriers that would have already blinked are being propped up by our govt. and so this suicidal contest will continue for some time.
 
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iaflyer said:
I think the legacy carriers think that if they raise prices the passengers will scoot over to SWA and leave their airplanes empty, making them lose even more money. iaflyer


I don't believe they really think this at all. We only fly to 60 cities, and could never carry all the people who would look for the lowest fare, even if it was us. I really think it is more of a game that the Legacy carriers are playing with each other, and those high ego CEO's do not want to give up any share to another Legacy. If they need more money they just go back to the well, ie: the employees.
 
canyonblue said:
I don't believe they really think this at all. We only fly to 60 cities, and could never carry all the people who would look for the lowest fare, even if it was us. I really think it is more of a game that the Legacy carriers are playing with each other, and those high ego CEO's do not want to give up any share to another Legacy. If they need more money they just go back to the well, ie: the employees.

That is correct, especially for Delta. Unlike NW with all of the union unrest, DL only has one major union, and we pilots have already allowed to give $1 billion a year for 5 years. Could we give more? I hope not, but it may come to that. The rest of the employees would have no recourse, since they are not represented and have no contract. I think we are on the way to recovery, except for the fuel. We are on our way to saving $5 billion a year by next year-----but the key is to get to next year. Also, the fuel prices don't matter much IF you can raise fares to keep up with the increase. We have had 7 fare increases stick so far, and more are on the way. With pension reform on the doorstep, DL will be helped tremendously---since we have huge pension payments due over the next 4 years. If we could get them extended over more years, that would help, and fuel surcharges sticking could help too. But, as I was stating, we have flexibility here at DL, whereas other Majors may not with extra unions....


Bye Bye--General Lee
 
Doubt It

iaflyer said:
Well, most business WOULD raise fares to adjust - it would make sense. Unfortunetly for the legacy carriers, SWA hedged fuel at some pretty low prices. So at the moment SWA doesn't need to raise prices. I think the legacy carriers think that if they raise prices the passengers will scoot over to SWA and leave their airplanes empty, making them lose even more money.

iaflyer
I doubt there are enough empty seats and available locations to absorb "all those passengers." Sure, the legacy carriers would lose some pax in that case, but their planes would hardly be empty. Everyone is running at 80% or better on loads. The really popular routes are running much higher. Cheers...ExAF
 

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