Originally Posted by
Roy Biggins
Dude, I think they get it. Everyone has heard your doomsday opinions ad nauseam. I think you’d be better suited to worrying about PSA’a future at this point.
American Airlines will be fine. They ain’t going anywhere. Worst case, they come out of this a smaller airline and will have to tighten up with some tough years ahead.
The bigger issue with AA BK is almost all assets are borrowed against. Normally a carrier would become insolvent before hitting these debt levels because interest rates have been much higher historically. Now that they're rock bottom AA has borrowed against literally everything they own.
Creditors will have to individually agree to let a new "AA" continue to use all those assets under new terms. The creditors also have the option to liquidate them on the open market or to sell them to another airline.
That's gates, slots (especially overseas slots at HND and LHR), aircraft, ground equipment.. It would be hard to run an airline without any one of these pieces continuing. Large portions of the airline could be sold off to competitors in a chapter 11 scenario, weakening any reorganization attempt.