Southwest - Profit!!!

[Dangerkitty]

Wrong.

The $273M. includes non GAAP numbers that include past and future derivative transactions that are not accepted as GAAP for this Quarter.

imp:

OK then $108 Million Profit after excluding Hedges. Happy now?

 

[YourPilotFriend]

The profits are being driven by those capacity numbers and not the fuel hedge cost savings. Those fuel hedges give you the low cost advantage that fills up that capacity. As the fuel hedges relax and the fares go up, you run the risk of losing capacity if the other airlines don't fare match. That's where the current model may drift into the red if changes aren't made. Plus you are adding capacity in a market that is at ideal capacity.

 

[B737Dvr]

new prices....

You mean the hedges do run out? The company is not constantly looking to improve our hedge position?

What do you know that we don't?

Tejas

Ok, uhhhh do you know how to actually hedge fuel and speculate in the commodity markets? Because if you did, you would realize that the August contracts are at $72.00 a barrel and rise to $77.00 a barrel for January of 07. How can you improve on your current hedge position when the current price is at $72 at this moment? Now, if you believe that the price of oil will go back down to the 30ish levels...then I think this deserves a whole new topic because Im afraid that we will never see those days again and oil will only get more expensive from here on in......proving very difficult for everyone, not just WN.
Now if GK wants to hedge for 2010 and beyond and wait out and capture some contracts for the high 60's during some lull in demand......then yes, that would be smart......but the point remains that those prices are substantially higher than current prices being paid.

 

[Dangerkitty]

As the fuel hedges relax and the fares go up, you run the risk of losing capacity if the other airlines don't fare match. That's where the current model may drift into the red if changes aren't made. Plus you are adding capacity in a market that is at ideal capacity.

It's a statement such as this that shows me why so many people don't understand the Southwest Airlines Business strategy.

You couldn't be further from the truth.

 

[B737Dvr]

wow........

Dude, it's a web board. They are having fun. Chill out and retire already.

You crusty guys are getting annoying with all the, "back when Herb...." Yeah, Yeah, we get it. It was great then and blah...blah...blah...

Let's all reminisce to our demise like all you 50+ guys would like.

It's time for change as GK states everyday to the troops. If we keep looking back we're dead.

And you can stop telling new guys they are riding YOUR coat tails and make them feel like outsiders. Good job, jerk. Doesn't seem to me you did anything but fly an airplane around TX. Did you formulate any business plans? Did you market the airline or did you just fly an airplane around TX to the point where all you TX 50+ guys can't slow a -700 down to save your ass. Nor can you figure out how to program a ridiculously easy FMS. Oh wait, you're going to say, "Back in the -200..." Guess what? No one cares about the -200 and how you once flew it completely unsafe. Keep up with the times already. Look forward as GK does.

It's not your company anymore. Your almost done and with attitudes like yours it's more than welcome you leave early.

For someone chastising another for supposedly making others feel like an outsider you do a great job of being hypocritical and telling this guy to retire already. I have been privelaged to fly with pilots who cut their teeth in the 707, 727, and 737 200. They did what is done today without the benefit of today's glass technology. This is not reminiscing about the past, but recognizing that because of their input today's cockpits are alot more user friendly to you and I and we can do alot more than what they could with what little they had to work with! We have auto-slats, PCU's and EGPWS's while yesterday's pilots were discovering what mack tuck was....with pax on board!

Maybe the 'old' guys are a bit miffed about today's cavalier attitudes and chest thumping done by those coming in to an already established and dominant company and treating those old guys like relics hanging on......

For those that are genuinely not assholes.....If you excerise some respect for their accomplishments and show gratitude along with some humility for being a part of a great company that no longer has to scrap and claw for a living, you may learn a thing or two from them, because it is my suspicion that they will fly circles around your ass today because for them raw data or A/T inop was a more common thing and not the "ahhh ******************** what a pain" it is today!

you would expect this of some ERAU grad going into the right seat of an RJ right after graduation....not from someone at SWA....

 

[chase]

sWA's hedges out to '10, I believe 12% @ $61....we won't know if it is a genuis move until then but I'm sure if it proves to be wise, there will be those who will say, "wait to '15 they'll be in red for sure once those hedges run out."....it's simple insurance, simple as that....the risk to not to it is far greater in this environment than to not to do it. We may look back in '10 on fuel prices being under $2.00 like I remember when fuel prices broke through the $1.00 mark....time will tell & the critics/cynics will remain as such....I view you as a realist...I think GK & you have a lot in common...he doesn't believe all the hype out there about any guaranteed dollars that will flow SWA's way simply because one wishes it to or based upon past performance.
Off to see my friends at HPA for a ball park lunch!!! Thanks Mark for the meal in advance!!!

Ok, uhhhh do you know how to actually hedge fuel and speculate in the commodity markets? Because if you did, you would realize that the August contracts are at $72.00 a barrel and rise to $77.00 a barrel for January of 07. How can you improve on your current hedge position when the current price is at $72 at this moment? Now, if you believe that the price of oil will go back down to the 30ish levels...then I think this deserves a whole new topic because Im afraid that we will never see those days again and oil will only get more expensive from here on in......proving very difficult for everyone, not just WN.
Now if GK wants to hedge for 2010 and beyond and wait out and capture some contracts for the high 60's during some lull in demand......then yes, that would be smart......but the point remains that those prices are substantially higher than current prices being paid.

 

[TexaSWA]

messed up post

 

[TexaSWA]

texas swa....you make me laugh! I find it ironic how you chastise someone for their...lack of proper "english", and then choose to quote some broken english yourself in your little 'signature'...ha! cute......

I wasnt correcting english. I was making light of the fact that people start their point with "OK,uhhh...." when they are trying to come across like an ass or make someone else look stupid. That or they are typing internal dialogue that is best left, uhhhh, internal.

Reference your last post.

My signature? Why, them are song lyrics. Terry Allen.

 

[Andy]

Now, if you believe that the price of oil will go back down to the 30ish levels...then I think this deserves a whole new topic because Im afraid that we will never see those days again and oil will only get more expensive from here on in......

ROTFLMAO! I recall back in the late 80s when 30 year mortgages dropped down to ~7 1/2%. Some dumba$$ in my squadron said that we'd never see rates that low again.
I don't know where the price of oil is going, but I'd never make a statement that foolish. One only needs to look at the historic price of oil to know that it has some very steep peaks and valleys.

 

[SWA/FO]

Blah blah blah... we are kicking a$$ and taking names. Sorry that upsets some of you older, wiser guys. I do my part everyday I VJA for a trip, helping out. You must fly 60 trips a month!