aaatwood

https://www.nakedcapitalism.com/2020...continues.html

This guy is depressing, but has the annoying Cassandra habit of having been right so far.....

Huell

Sheeyut ... one ugly read.

The Duke

He’s spot on. A cursory perusal of numerous threads here on APC highlights the cognitive dissonance he mentions that is on display by many from within the industry.

Thanks for sharing the video.

usmc-sgt

“This approach is designed to give current airline owners control over any restructuring that might occur, even though they would be totally wiped out under any legally administered reorganization process. It would allow them to impose most of the cost and pain of restructuring onto workers and suppliers.”

They’ve tried this play before. Bankruptcy, ravage any and all contracts, unpaid debts to vendors and suppliers, and the ensured golden parachute for those at the top who always land on their feet.

rickair7777

An experienced airline manager says that essentially the entire industry should enter Ch.11 en masse and shed any and all obligations, including employees and labor contracts.

Points out that demand/revenue are down 75% and 85% respectively, but doesn't mention that it's bound to pick back up, and soon. The only real variable is how much of demand will return by mid 2021. 50% => lots of hurt, 70% => limited short-term hurt, 80% => most will still have jobs, the rest will be back within a couple years.

Also doesn't point out that IF demand stays at 25%, the global economy will be permanently hosed... governments need to restore economies, and air travel (and other travel industry segments) will follow along with that. Everybody I talk to has cabin fever, nobody is saying "gee I never realized how great it was to stay locked in my house all the time, I'll sure never travel again".

This guy is completely discounting the impact of a likely vaccine, essentially assuming no further economic recovery for the foreseeable future. Maybe somebody is paying him to spread doom and gloom and encourage congress to hand out more assistance?

WhiskeyDelta

He also doesn’t mention the industry went into this at the height of the most profitable time in its history. I’m not saying everyone will survive, but we started off in way better shape as an industry than in times past.

11CC

It sounds like he wants some more “consulting” work. A lot of potential money to be made.

pad39a

Ed Bastian has been saying for many months that DL will emerge a smaller airline. It’s difficult to imagine people like EB, for example, being as ignorant to these talking points as the analyst claims. There is certainly validity found in the article, but it also seems popular to say “look what I see that everyone else doesn’t,” which happened frequently in the article OP linked.

rickair7777

The big three are in the worst shape in the US, they might not all get out of this without some restructuring but it's too early to call the ENTIRE global airline industry DOA, and put them all into a collective receivership together to synchronize the slash-and-burn of union contracts. If it gets to that, they'd better just nationalize us and they can pay me GS pay (with retirement buy-in up for 30 years mil).

CincoDeMayo

Well said, agree 100%. Its easy to get lost in these articles when they paint with such a large brush about the industry. Every airline is having issues, but issues at Legacy carriers will not all be the same issues at LCC or ULCC carriers.