Money troubles at AWA?

[Front Office]

I didn't know is was getting so bad at AWA?
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Legacy carriers' liquidity
Legacy carriers' tougher stance with regional carriers comes as they face rising liquidity concerns, according to Baker.

AMR Corp. (AMR: news, chart, profile) , the parent of American Airlines, and Northwest Airlines Corp. (NWAC: news, chart, profile) are the two airlines with the healthiest cash balances, with the analyst describing them as his top picks in the sector.

Baker estimates Northwest will have a cash balance of around $1 billion in 2005, while AMR should have a year-end cash balance of about $2 billion.

AMR's shares moved down 2.6% to $11.19, while Northwest slipped 2 cents to $6.85.

By contrast, Baker said that for Continental and Delta, a failure to "raise additional liquidity is unacceptable as year-end cash balances would dip meaningfully below the $1 billion mark."

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For America West, it would be even worse. The airline's cash balance could fall to "unacceptably low levels, possibly in the $60 million range," he said.

Baker estimates Continental needs to raise a minimum of $400 million, while Delta has to rustle up some $500 million. America West, meanwhile, would need to find about $100 million.

Continental's shares finished down 3.4% to $12.79, with Delta easing a penny to $4.02 and America West losing 3.5% to $5.24.

 

[TWA Dude]

"Bad" is relative. At the current gas prices AWA along with many other airlines will be in Chap 11 or worse within the year.

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I changed my avitar to my new puppy. Is it better or worse than my also beloved 717?

 

[Hansoma]

Does your dog bite??

 

[General Lee]

"Bad" is relative. At the current gas prices AWA along with many other airlines will be in Chap 11 or worse within the year.

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I changed my avitar to my new puppy. Is it better or worse than my also beloved 717?

IF you add fuel surcharges into the picture, that is not the case. Look at UPS and Fedex---they add 7 or 8% to the price for fuel, and now the Majors are doing the same. That doesn't happen on every route, but most and all INTL routes. The majors have added 4 fuel surcharges in the last month or so. (thanks to NW going along with it)


Bye Bye--General Lee

 

[flx757]

Does your dog bite??

It's not my dog.

 

[MedFlyer]

IF you add fuel surcharges into the picture, that is not the case. Look at UPS and Fedex---they add 7 or 8% to the price for fuel, and now the Majors are doing the same. That doesn't happen on every route, but most and all INTL routes. The majors have added 4 fuel surcharges in the last month or so. (thanks to NW going along with it)


Bye Bye--General Lee

Unfortunately, the fuel surcharges aren't enough. Grinstein himself has publicly stated that the fuel surcharges won't make up the difference. And since I know you are such a strong believe in SOX, then you must believe what GG is saying.

If DL doesn't find more cash, they will go bankrupt.

 

[TWA Dude]

Does your dog bite??

Hey dude. Does bright light hurt your eyes yet?
Somebody else already made the Pink Panther response. She doesn't bite but she does chew on anything and anyone.

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I don't think a five or ten dollar per ticket surcharge is anywhere near enough to save the industry.

 

[flx757]

TWA/AWA Dude,

I'll chime in with an avatar answer. As a former 717 driver and dedicated, life-long dog lover, I vote puppy.

But, also very aware of the truth in your "chewing" comment, we are holding off on acquiring one since we just moved into a brand new construction home with lots of new furnishings. I figure it's best to break in the place for a while before bringing in a puppy to take over the position of chief-in-charge of everything.

That one you have is a beauty, though.

 

[juan2go]

I vote Puppy!

I understand that puppies are still being produced.

What is your doggies name?

regards,

Juan

 

[TWA Dude]

'Nuff said, the puppy avatar stays. She's a nine-week old long-haired miniature dachshund named Shira which means "song" in Hebrew. She requires constant supervision right now so she hasn't had the chance to chew through anything of value.

BTW flx757 I play a Guild Jumbo six-string acoustic.

 

[flx757]

Those are very nice guitars. The acoustic I play is also a Jumbo. But a different make. "I play Carvin guitars and amps exclusively." (I'm supposed to say that... ).

I also probably knew that Shira meant "song" in Hebrew when I was 13. But that was a LONG time ago.

 

[General Lee]

Unfortunately, the fuel surcharges aren't enough. Grinstein himself has publicly stated that the fuel surcharges won't make up the difference. And since I know you are such a strong believe in SOX, then you must believe what GG is saying.

If DL doesn't find more cash, they will go bankrupt.

I guess you forgot that DL is asking Congress for pension help. Maybe that would stop him from jumping up and down about fuel surcharges helping the situation. As far as getting more cash, they will when they sell off DCI......And, they just offered another shelf offering of bonds for $500 million. Either way, they will get the money and then the rest of the cost initiatives will kick in eventually.


Bye Bye--General Lee

 

[General Lee]

Hey dude. Does bright light hurt your eyes yet?
Somebody else already made the Pink Panther response. She doesn't bite but she does chew on anything and anyone.

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I don't think a five or ten dollar per ticket surcharge is anywhere near enough to save the industry.

We have added a $40 to $60 surcharge so far per roundtrip. (on all routes not directly competing with LCCs---which is still significant---and even on the direct competition we have upped those by $5-6, which helps)


Bye Bye--General Lee

 

[Wiskey Driver]

I didn't know is was getting so bad at AWA?
.

Very difficult to believe all the hype esspecially when it comes from analysts!! Weren't they the ones that said USAirways would be GONE before 05??? Fuel hurts everyone I would hazzard a guess that we will be adding a fuel surcharge soon. Now all that other stuff I would just wait and see.

WD.

 

[Hansoma]

Yes, the light does hurt my eyes. I have also developed a strange phobia of garlic and wooden stakes for some reason

On a darker note... Nobody wants to charge ticket prices that actually cover the costs of operating the flight. What a novel idea!! The airlines are like a bunch of cavemen sitting around throwing rocks at each other hoping that someone dies in the process so they can rush in and pick up the slack. I don't know how long we (the industry) can provided subsidised travel to the American public in the form of inadequate fuel surcharges. It's like driving down the street and stopping at a gas station. The owner comes out and offers to sell you gas below his cost (at a loss to him) just so no one else gets your business. How long do you think he'd stay open? It would depend on how much money he has in the bank and how much he's willing to part with. Fuel surcharges will help but I think the bigger issue is to stop selling tickets at below cost prices. Of course with competition being what it is, that's not going to happen. 60 million in the bank does not go a long way...

What was the number of that truck-driving school we saw last night. "Truck Masters" I think it was, I might need that.

 

[JetMonkey]

I don't know what's the deal with this Baker guy he really seems to have major hard on for us, maybe we didn't give him a second bag of peanunts or something. He's the same guy who said Delta's new pricing structure was going to SPECIFICALLY kill AWA.

 

[General Lee]

I don't know what's the deal with this Baker guy he really seems to have major hard on for us, maybe we didn't give him a second bag of peanunts or something. He's the same guy who said Delta's new pricing structure was going to SPECIFICALLY kill AWA.

Our Simplifares deal primarily dropped the very very expensive walk up fares to about half of what they were.(who wants to pay $1200 each way for a ticket when Airtran was charging half that?) The lower fare range wasn't really even touched, and actually it restricts the number of low end fares available. The only other thing is did was give everyone the ability to not have to stay over a Sat night, and change fees are now $50 instead of $100.


Bye Bye--General Lee

 

[AA717driver]

I love dogs but the 717 gets the nod...

Hang in there dude, who knows? You might get bought and merged... Second time's the charm? TC

 

[TWA Dude]

You might get bought and merged... Second time's the charm?

TC, I wouldn't wish a merger on anyone (except maybe the PDP). Word up, bro.

 

[HAL]

Seems strange how they suddenly say we'd have only $60M in the bank by the end of the year when we started the year closer to $500M and have had a pretty darn good first quarter.

Makes me wonder just what he's smoking!

HAL