Frontier goes Chap 11...

[bluefin]

Isn't it kinda of interesting that all these carriers are going tits up around the same Bush and one CEO (Tilton) are talking, "time to ease foriegn ownership rules" the US Airline industry is going the way of the shipping and cruise line. Not one ship is registered in the US or operated buy American crews.

 

[Andy]

Good luck, F9. I look forward to seeing you come out the other side as a stronger company.
Their credit card processor started withholding additional money which is what put F9 into chap 11. I would guess that the credit card processor agreement required that once F9's cash situation hit a certain level.

Daedalus, F9 must've found some DIP financing in order to go into chap 11. We'll see. At this point, every supplier will be working with them on a cash basis, so their cash levels must've gotten at the point where management felt that it was time to file for bankruptcy.

Becket, the new laws allow an 18 month period of exclusivity to file a POR (Plan of Reorganization). For a company the size of F9, this shouldn't be an issue. The 18 months is an issue for larger, more complex companies. Let's hope that AMR's cash situation doesn't get dinged too hard with these aircraft groundings - it'd be a huge issue for a company of that size.

Realmanofgenius, currency exchange is only one reason why oil prices are this high. There are a lot of other factors, including speculation.

 

[Eagle757shark]

I believe we will begin to see the start of airline consolidation next week! It will be the threat of bankruptcy that will be the justification. No one is immuned. Hang in there everyone. It's going to be a long summer!

 

[Andy]

I believe we will begin to see the start of airline consolidation next week! It will be the threat of bankruptcy that will be the justification. No one is immuned. Hang in there everyone. It's going to be a long summer!

Consolidation requires investment capital. USAirways got a $1.5 Billion capital infusion when they merged.
The traditional investment capital came from investment bankers. They're no longer putting up investment capital.
Golman Sachs just sold their Chrysler debt (from the Cerberus takeover) for 63 cents on the dollar. http://www.marketwatch.com/news/sto...x?guid={2DC4D0DC-3355-4F13-9A88-54B8F062E5E4}

I don't know where Delta and Northwest are planning on getting money - they should need at least 3 billion in new capital - to merge. Some talk about Air France; I haven't been able to find a good website to review their financials, but in today's environment, I can't see where they're getting that kind of money.

 

[BoilerUP]

I don't know where Delta and Northwest are planning on getting money - they should need at least 3 billion in new capital - to merge. Some talk about Air France; I haven't been able to find a good website to review their financials, but in today's environment, I can't see where they're getting that kind of money.

I'd say RJET but they are "in debt up to their eyeballs" already...perhaps they'd take on more to solidify their position with DAL and purchase the Compass 175 operation in a fashion similar to when they purchased MDA to provide LCC with more cash?

Also wouldn't be surprised if Skywest threw a wad of money at a combined entity; I think they have hundreds of millions on hand.

Who else does that leave who is currently operating with NWA or DAL who has a stake in the combined company's survival? PNCL?

 

[HalinTexas]

Consolidation requires investment capital. USAirways got a $1.5 Billion capital infusion when they merged.
The traditional investment capital came from investment bankers. They're no longer putting up investment capital.
Golman Sachs just sold their Chrysler debt (from the Cerberus takeover) for 63 cents on the dollar. http://www.marketwatch.com/news/sto...x?guid={2DC4D0DC-3355-4F13-9A88-54B8F062E5E4}

I don't know where Delta and Northwest are planning on getting money - they should need at least 3 billion in new capital - to merge. Some talk about Air France; I haven't been able to find a good website to review their financials, but in today's environment, I can't see where they're getting that kind of money.

Bingo! We have a winner. My feeling is that they will only support large airline mergers, not reorganizing small ones. Hence, Aloha, ATA, Champion and Skybus. Hate to say it, but if Frontier isn't bought outright, it may follow the same path.

 

[YourPilotFriend]

Bingo! We have a winner. My feeling is that they will only support large airline mergers, not reorganizing small ones. Hence, Aloha, ATA, Champion and Skybus. Hate to say it, but if Frontier isn't bought outright, it may follow the same path.

That is correct, foreign carriers are working overtime to buy american carriers. The only american owned carrier left will be Southwest.

The government has two choices with the airlines. 1. Huge bailouts and Reregulation. or 2. Foreign ownership.
I think we all know which one they will choose.

American Airlines is running dangerously close to bankruptcy as well.

 

[NEDude]

The only difference between the cruise lines and airlines when it comes to foriegn ownership is that there aren't any foriegn crews available to fly the airplanes. Many foriegn carriers are recruiting Americans because they can't find pilots elsewhere.

 

[On Your Six]

Good luck to all the Frontier guys and gals out there. This summer is going to be a rough period if oil stays above $110.

It's always good to have a plan B. I don't work for the fractionals but I have a number who do and they really enjoy it (very wealthy people tend not to be too concerned about fuel surcharges). So, as a reminder, Netjets, Flexjet and Citationshares all offer a DEN base if Frontier pilots are interested (for those who don't commute). Just something to consider... Here's the link for more information:

http://www.airlinepilotcentral.info/airlines/fractional.html

It never hurts to have a plan B. Plus, the starting salaries at these fractionals all hover in the $60K range. Netjets also offers 100 pilot domiciles including DEN (may be better for commuters not living in Denver). Something to consider - GOOD LUCK.

 

[Kugelblitz]

Seems there is a great deal of misinformation coming out of the Frontier situation, according to the article in USA today an executive said that 'there were no bankruptcy concerns' at the airline earlier this week. This was said with this person apparently in the know about the credit card situation.

Combine that with selling off 4 planes to make ends meet, and I wish you all the very best. It would be a real shame to see a large chunk of the Denver market go to SWA.

 

[DOVPILOT]

So much for your bright spot.....

 

[lowecur]

Unfortunately there will be no savior for F9. Credit markets are dead, and M&A is out of the question as other carriers want to keep their cash reserves high in case of a protracted recession.

Analcysts are saying FL and UAL are next up. FL certainly made a mistake by not leveraging more, but as more capacity comes off-line they will benefit by higher fares. I think they will survive.

UAL is the wild card. They feel that CAL will dance with them, but I have a feeling Kellner will let AMR file chapt 11 and then look to talk to them. Regulators will have a more open mind about an AMR merger if that happens.

imp:​

 

[BrickTop]

Combine that with selling off 4 planes to make ends meet, and I wish you all the very best. It would be a real shame to see a large chunk of the Denver market go to SWA.[/quote]

SW. Just another gang of crooks on top hiding under smiles, pencil whipping, and shiny paint.

 

[Tanker Clown]

Combine that with selling off 4 planes to make ends meet, and I wish you all the very best. It would be a real shame to see a large chunk of the Denver market go to SWA.

SW. Just another gang of crooks on top hiding under smiles, pencil whipping, and shiny paint.[/quote]

But I bet you'd love to be working at SWA right now. They are starting to look like the only guys who will be around in a few years.

 

[suupah]

Consolidation requires investment capital. USAirways got a $1.5 Billion capital infusion when they merged.
The traditional investment capital came from investment bankers. They're no longer putting up investment capital.
Golman Sachs just sold their Chrysler debt (from the Cerberus takeover) for 63 cents on the dollar. http://www.marketwatch.com/news/sto...x?guid={2DC4D0DC-3355-4F13-9A88-54B8F062E5E4}

I don't know where Delta and Northwest are planning on getting money - they should need at least 3 billion in new capital - to merge. Some talk about Air France; I haven't been able to find a good website to review their financials, but in today's environment, I can't see where they're getting that kind of money.

my wild guess would be boeing, airbus or an engine manugacturer. They both have some old planes and will need huge orders for new ones soon.