LCC model challenges - IATA
04-22-2020, 11:32 AM
#12
Perennial Reserve
Joined APC: Jan 2018
Posts: 11,492
Originally Posted by Andy
I don't know who's going to be more impacted by this - full service or LCC carriers. I do, however, know that it is going to hurt all airlines for a very long time. Full service vs LCC won't matter much.
and I personally think that forcing business people hit to use zoom, like the lockdown has done, is likely to PERMANENTLY decrease business flying by 20%.
All in all, those airlines that live by international and business class flying may well die by international and business class flying. And without naming names, one legacy in particular has a lot of debt to service that the market is beginning to doubt their ability to actually service.
04-22-2020, 12:07 PM
#14
Gets Weekends Off
Joined APC: Mar 2011
Posts: 1,022
LCC model challenges - IATA
Originally Posted by tailendcharlie
The article came from IATA. How many LCC/ULCC’s are members of IATA? I can tell you a bunch that aren’t.....
That's interesting. To your point, Allegiant, Frontier, Spirit, and Southwest are not. That's just a quick 5 minute search.
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04-22-2020, 01:19 PM
#15
You scratched my anchor
Joined APC: Feb 2011
Posts: 4,876
Originally Posted by Excargodog
But there is another issue. Most U/LCCs are single aircraft type. Granted, there is substantial difference between A319s and A321NEOs, but they are still the same type. The legacies have some of their most expensive metal and most expensive personnel dedicated to international WB flying that in all likelihood will be the LAST thing to come back, while SWA, F9, and NK (speaking of the US market) can park the larger aircraft of their single type and cover the loads with 319s (and early model/smaller 737s in the case if SWA) while utilizing all their pilot personnel. Should this actually go on to furloughs, it will trigger a domino effect for the legacies as senior people will require new types in aircraft they’ve never previously flown. While the people displaced from that aircraft need to be trained into another, etc, etc, etc.
and I personally think that forcing business people hit to use zoom, like the lockdown has done, is likely to PERMANENTLY decrease business flying by 20%.
All in all, those airlines that live by international and business class flying may well die by international and business class flying. And without naming names, one legacy in particular has a lot of debt to service that the market is beginning to doubt their ability to actually service.
and I personally think that forcing business people hit to use zoom, like the lockdown has done, is likely to PERMANENTLY decrease business flying by 20%.
All in all, those airlines that live by international and business class flying may well die by international and business class flying. And without naming names, one legacy in particular has a lot of debt to service that the market is beginning to doubt their ability to actually service.
everyone is in the same boat! UAL and DL’s CDS charts are the same.
Many airlines are fighting for survival as flights are grounded because of a collapse in demand and air travel restrictions over fears of contagion. Delta Air Lines (DAL.N) DAL5YUSAX=MG has seen its five-year CDS jump to 1238 basis points
04-22-2020, 01:29 PM
#17
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Joined APC: Oct 2019
Posts: 441
Originally Posted by senecacaptain
Folks, my apologies. I was just posting news articles that I felt may be worthy of reading. I apologize
04-22-2020, 01:41 PM
#18
You scratched my anchor
Joined APC: Feb 2011
Posts: 4,876
Originally Posted by Silver02ex
Unfortunately, people are still doing that just about every commute or DH I’ve been on the last few weeks.
04-22-2020, 03:21 PM
#19
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Joined APC: Jan 2018
Posts: 11,492
Originally Posted by Al Czervik
lol...
everyone is in the same boat! UAL and DL’s CDS charts are the same.
Many airlines are fighting for survival as flights are grounded because of a collapse in demand and air travel restrictions over fears of contagion. Delta Air Lines (DAL.N) DAL5YUSAX=MG has seen its five-year CDS jump to 1238 basis points
everyone is in the same boat! UAL and DL’s CDS charts are the same.
Many airlines are fighting for survival as flights are grounded because of a collapse in demand and air travel restrictions over fears of contagion. Delta Air Lines (DAL.N) DAL5YUSAX=MG has seen its five-year CDS jump to 1238 basis points
Five-year credit default swaps protecting against non-payment of American Airlines Group Inc.’s debt have soared to 2,883 basis points, with United Airlines Holdings Inc. on 960 basis points and Delta Air Lines Inc. at 694 basis points. These are fear-and-loathing levels: Lehman Brothers Holdings Inc.’s swaps peaked at 707 basis points on the eve of its 2008 collapse.
There is a very easily discernible difference between 2883 basis points and 960 or 694 basis points. Or even the 1238 basis points your quote gives. Look at the difference in debt at each carrier. They may all be working in the same environment now, but American definitely started in a deeper hole with its debt service.
04-22-2020, 05:17 PM
#20
You scratched my anchor
Joined APC: Feb 2011
Posts: 4,876
Originally Posted by Excargodog
No, their charts are NOT the same:
https://finance.yahoo.com/news/era-a...071351123.html
There is a very easily discernible difference between 2883 basis points and 960 or 694 basis points. Or even the 1238 basis points your quote gives. Look at the difference in debt at each carrier. They may all be working in the same environment now, but American definitely started in a deeper hole with its debt service.
https://finance.yahoo.com/news/era-a...071351123.html
There is a very easily discernible difference between 2883 basis points and 960 or 694 basis points. Or even the 1238 basis points your quote gives. Look at the difference in debt at each carrier. They may all be working in the same environment now, but American definitely started in a deeper hole with its debt service.
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