Originally Posted by
dera
So in effect the market has stopped lending money to AAG without direct collateral, and even then it is not considered investment grade, but speculative.
No, but they loan it at a slightly lower rate if they know they wouldn’t have to lose part of their investments going through bankruptcy court.
But MOST major airline credit ratings are junk or nearly so right now.
https://www.moodys.com/research/Mood...ges--PR_457882
Moody’s just reaffirmed AAs rating at Ba2 (non investment grade) and downgraded some of the older trust certificates from AA and US Airways to Ba3, most likely because the equipment used as collateral is now used and not as valuable as it once was.
Again, not unique to AA though.
Spirit is B1 which is still speculative:
https://www.moodys.com/research/Mood...ges--PR_448180
Delta just got Baa3 which is the lowest investment grade not considered speculative:
https://www.moodys.com/research/Mood...its--PR_456645
United is about the same:
https://www.yahoo.com/now/united-air...173908934.html
it’s a pandemic and everyone is going from a near stop trying to spin up to full ops despite a lot of restrictions and uncertainties. No airline has great credit rating right now - except maybe Janet…