Originally Posted by
ecam
When you see management lose interest in running the airline. They just come in every day and turn the lights on and off. They attempt to diversify into things not directly related to the core business model. They pitch investors with wildly unrealistic claims to raise money for said side ventures. The stock drops and they start buying back to pump it up which burns through cash. Very high debt load and uncertain credit streams. Management stops direct communication with the employees and hides behind HR and PR personnel. Cute slogans graphs and unrealistic profit sharing goals pop up to keep employees motivated and working hard in the short term. Pretty soon they stop stocking parts and deferrals pile up. Facilities get realigned. Key people bail. It's all been done before, and the signs are here already.
The company’s financials tell a different story though. We still have exceptional profit margins even though management is diversifying the company profile. I understand the great displeasure from the pilot group regarding the company not investing more in the airline. To say that the sky is falling is premature, IMO.
Could the airline portion be divested? Sure. Again, that would not make much sense if you reviewed the investor calls and presentations. The airline is an integral part of the resort/hotel and G4ce (sp?) strategic business plans. They all go hand-in-hand.
The company is going into uncharted waters with the strategy they want to utilize with these ventures. If it is successful, MG will be hailed as a business genius. If it all goes South, we will be another cautionary tale of an airline venturing too far off the traditional bread and butter aircraft lift model.