Predictions for end of 2008

[PCL_128]

Oil: $150-160
Dollar: Up sightly
Inflation: 7% and rising
Housing Market: relatively stable at low levels
President: Obama, by a comfortable margin
War: Status Quo
Airlines:
Furloughs: AA, UAUA, NWA/DAL
Failures: United, Frontier, Sun Country
Impending Failures: UAUA, AA
Capacity Cutbacks: 20%
Leisure Market: Down dramatically
Mergers: NWA-DAL but going very badly

Oil: $115
Dollar: flat
Inflation: 5%
Housing market: flat
President: Obama, 50% to 48%
War: Status quo, with Obama planning to start reductions within 12 months of taking office
Airlines:
Furloughs: AMR, UAL, CAL, LCC, Spirit, maybe more
Failures: FRNT, possibly Spirit, 10% chance of UAL
Impending failures: UAL, Spirit
Capacity cutbacks: 12%
Leisure market: down slightly
Mergers: No more, and DAL/NWA still fighting over SLI

 

[BIGGOAT]

I doubt this year will see any legacy failures. They all have too much cash for that. However, late 2009 maybe a different story if 1Q2008 burn rates continue or accelerate. Delta lost 5-6 billion on paper in the 1Q but only burned @ 127 mil in cash. Similarly, AA lost @ 320 mil in the 1Q but only ate up @ 170 mil in cash. The other majors are similar stories. The real question is who will run out first?

Goat

 

[Occam's Razor]

The required cash-on-hand to enter Chapter 11 (where you gotta pay cash for your uber-Expensive fuel) has risen over 50% from where it was a couple of years ago. That means a legacy airline like NWA or UAL would require about $1.6B to navigate the re-org.

So subtract $1.6B from the cash-on-hand for ____ Airlines, then divide the difference by the daily burn rate.

If we don't change that burn rate number from Red to Black, it will be a bleak Winter for some.

 

[Ty Webb]

McCain supports relaxation of cabotage laws, Obama doesn't. McCain doesn't support the right of airline pilots to strike, Obama does. As an airline pilot I think it would be stupid to support McCain, so I won't.

My prediction for 2008, I still won't have my PGA card.

I don't know about you, but being "an airline pilot" is but one part of my life. I'd rather suffer through not being able to strike than suffer through another Jimmy Carter in the White House.

Besides, with fuel prices being what they are, pilots have more leverage now than any strike. I'd imagine if the UAL "Summer of Love" went on right now, it would be the "Week of Love". :laugh:

 

[JumpersAway]

My job, my profession, my industry is the over riding issue for me. I will sell out all else to get rid of cabotage- and McPain ain't the one to do it. If it takes Obama to do it, the man gets my vote.....

 

[SDF2BUF2MCO]

FedEx and UPS will continue to "prosper" but their day is coming

Jessica Simpson won't find anyone to take her so she'll marry her dad

The Arizona Cardinals will not make the playoffs (shocking I know)

No matter who gets elected for President our government will grow and our taxes will increase

Porn will be taxed, some illegal drugs will become legal so as to generate tax money

Bobby Knight will be a regular guest on Oprah to talk about finding inner peace. He and Tom Cruise will become great friends

The top of the wings will still need to be inspected for punctures after every one of my landings

Used SUV's and trucks will be 1/2 what they were a year ago (will make a great airport vehicle)

More people will be tired of working for the man and go into business for themselves - unfortunately, they'll still be working for the bloated government

 

[skywiz]

Y'all are too much doom and gloom

Oil: $115
Dollar: flat
Inflation: 5%
Housing market: flat
President: Obama, 50% to 48%
War: Status quo, with Obama planning to start reductions within 12 months of taking office
Airlines:
Furloughs: AMR, UAL, CAL, LCC, Spirit, maybe more
Failures: FRNT, possibly Spirit, 10% chance of UAL
Impending failures: UAL, Spirit
Capacity cutbacks: 12%
Leisure market: down slightly
Mergers: No more, and DAL/NWA still fighting over SLI

This is a little more realistic I believe. I can't see oil going up much longer. The oil crisis is getting alot of attention recently from the Int'l community.

Think about it... back when oil was $60 / barrel, what justification was there for spending millions and millions of dollars on research into renewable resources, more exploration of oil, electric cars, etc? Not much. With the price of oil destroying our economy, I believe we as a country (along with others) are currently doing / will do everything we can to explore our refining capacities, look for oil, start accelerating our progression toward non-oil resources and biofuels as well.

My prediction:
2008 through part of 2009: oil stays $120-130 per barrel

After/during 2009: with the value of the dollar improving, inflation tappers off, interests rates go up, AND as a result - oil comes down to around $90-100/barrel and airlines start the cycle upward again....

Then in 2013 another crisis happens and downsizing begins AGAIN

SW

 

[Soverytired]

T

Then in 2013 another crisis happens and downsizing begins AGAIN

SW

2012 is the end of the world, according the ancient Mayan calendar!

I predict massive furloughs.

(hey, this is about as good a guess as anything, right?)

 

[Networ-King]

FedEx and UPS will continue to "prosper" but their day is coming

Jessica Simpson won't find anyone to take her so she'll marry her dad

The Arizona Cardinals will not make the playoffs (shocking I know)

No matter who gets elected for President our government will grow and our taxes will increase

Porn will be taxed, some illegal drugs will become legal so as to generate tax money

Bobby Knight will be a regular guest on Oprah to talk about finding inner peace. He and Tom Cruise will become great friends

The top of the wings will still need to be inspected for punctures after every one of my landings

Used SUV's and trucks will be 1/2 what they were a year ago (will make a great airport vehicle)

More people will be tired of working for the man and go into business for themselves - unfortunately, they'll still be working for the bloated government

You're right..... nothing lasts forever, but at least on this side of the fence when our time comes, instead of making 4 Billion a year net we'll make 2
Billion a year net. Not trying to be a d!ck by saying that, just the worse case scenario that I see. I could be wrong, but on this side of the fence we still have pricing power and not any d!ckhead can buy airplanes and start an airline and under cut everyone else. The age 65 really fu(ked things up for all the airlines, especially this side of the fence since we have the FE's.... I guess I really can't complain though.....

Good luck to all of us cause this is gonna be one fubared year for this industry.

Net

 

[Browntothebone]

FedEx and UPS will continue to "prosper" but their day is coming

Jessica Simpson won't find anyone to take her so she'll marry her dad

The Arizona Cardinals will not make the playoffs (shocking I know)

No matter who gets elected for President our government will grow and our taxes will increase

Porn will be taxed, some illegal drugs will become legal so as to generate tax money

Bobby Knight will be a regular guest on Oprah to talk about finding inner peace. He and Tom Cruise will become great friends

The top of the wings will still need to be inspected for punctures after every one of my landings

Used SUV's and trucks will be 1/2 what they were a year ago (will make a great airport vehicle)

More people will be tired of working for the man and go into business for themselves - unfortunately, they'll still be working for the bloated government

Still waiting for that day. We will have successfully beaten back the ONLY low cost integrator in the USA once the DHL deals goes through. This will give UPS and FedEx even greater pricing power to increase shipping rates and increase profits. You pax guys really have no clue as to this business. We fly airplanes but only as a part of a much larger integrated operation. Since 9-11, UPS has set records for profits each year. We will still profit approximately $4 BILLION in 2008.