So much for the huge growth rumor at SW

[dicko]

Not true, SWA hedges for the jets they have, the AT jets are as yet unhedged under the SWA banner. Going forward maybe, today, not so much.

Do the AirTran hedges disappear ? I'm assuming we have hedges. Maybe BF and the German were distracted by the Robb Report and forgot to hedge.

 

[Ty Webb]

We were partially hedged, check the last 10Q (Q1) for the numbers.

When oil falls rapidly like this is when you DON'T want to be heavily hedged, but instead buying your hedges (collars). . . . . At least, that's my understanding of how it works.

Regards,
TW

 

[scoreboardII]

Ty is correct.

I'm not saying AT doesn't have hedging, just saying SWA has not bought hedges in addition to it's current fleet. This is a selling point of management when we ask why not buy jets instead of buy back stock, the jet wouldn't make money.

If AT is hedged, those programs continue, I'm saying that just because SWA gets those jets we don't have a magic hedge wand we wave over them to make them less costly to fly, their costs would likely remain flat.

 

[dicko]

Ty is correct.

I'm not saying AT doesn't have hedging, just saying SWA has not bought hedges in addition to it's current fleet. This is a selling point of management when we ask why not buy jets instead of buy back stock, the jet wouldn't make money.

If AT is hedged, those programs continue, I'm saying that just because SWA gets those jets we don't have a magic hedge wand we wave over them to make them less costly to fly, their costs would likely remain flat.

Understood.

I'd rather see SWA buy jets as well. Preferably anything other than a 737. That jet is a noisy, uncomfortable antique. There .... I said it

I did think it was pretty astute to buy back your own stock when its in the toilet. Then sell it again when it recovers.

 

[Secret Squirrel]

Understood.

I'd rather see SWA buy jets as well. Preferably anything other than a 737. That jet is a noisy, uncomfortable antique. There .... I said it

I did think it was pretty astute to buy back your own stock when its in the toilet. Then sell it again when it recovers.

Probably a better bet than fuel hedging right now.

 

[redflyer65]

If oil keeps dropping like this, it will be the perfect time to buy new hedges. Oil will not stay below 80 a barrel very long, I'm ready to jump in when this down turn is over. Oil will go right back to 100 for sure.

RF

 

[jonjuan]

If oil keeps dropping like this, it will be the perfect time to buy new hedges. Oil will not stay below 80 a barrel very long, I'm ready to jump in when this down turn is over. Oil will go right back to 100 for sure.

RF

You do realize that the person willing to take the hedge risk at $80 also realizes oil is going back to $100, don't you. You do know you don't just lock-in the price at $80 without paying a massive premium, don't you? Please tell us you understand this. Big difference between hedging fuel and buying stock back when the PP is depressed.

 

[redflyer65]

Juan,

You do understand that Southwest has the strength and the actual cash to make moves like this right? That was different at AAI, Southwest actual can, and has done these hedges. Big cash on hand makes it work.

When you are USair with very little cash on hand, you can't hedge...which they haven't been...at all.

RF

 

[General Lee]

Juan,

You do understand that Southwest has the strength and the actual cash to make moves like this right? That was different at AAI, Southwest actual can, and has done these hedges. Big cash on hand makes it work.

When you are USair with very little cash on hand, you can't hedge...which they haven't been...at all.

RF

You don't need to hedge as long as you have fuel surcharges that passengers are willing to pay for to cover the higher costs. USair was profitable even with zero hedges, and that may help them out a bit now even more. Hedging is a gamble, and you can really win or really lose. Southwest and others were caught before with too many hedges, and now many don't even play that game anymore. USAir may have gambled and won. They still made $100 million in Q2 without hedges during high oil.


Bye Bye---General Lee

 

[FlyinGuy]

Gotta love it when pilots try to show another pilot how smart they are!!! Go start your own airline if yall are so savvy.