Winners/Losers & M/A
 

https://www.airfarewatchdog.com/blog/50112379/the-airlines-most-and-least-likely-to-survive-the-covid-19-crisis/

most likely to survive
Big 4
Spirit

fence:
Jet Blue
Alaska
Frontier

most likely to fail:
Allegiant
Hawaiian
Sun Country

thoughts on his pick in winners and losers?

Also, how would M/A work when companies don’t have money. Is it strictly by government intervention? Gates and airplanes will not be in short supply. How do companies merge with both properties having fly crews out on furlough.

I realize these are unprecedented times but looking to see how they worked post 9/11.

Is this a joke?

is the author a joke? Don’t know of him.

The article is filled with “I think”, “I believe” and “I expect” statements, and the author can’t even be found with a google search.

You tell me why this drivel warrants a post.

The guy's an idiot, his analysis is based on perceptions of brand loyalty, total disregard for international exposure and financials including owned assets.

With just a little industry knowledge and SA, here's my take...



SWA is most likely to survive, worst case they would be last man standing if it came to that.

Big three will get bailed out, they may enter BK but I think the fed will prevent liquidation although that might even involve a surprising merger. Worst case one fails, then they save the other two.

AS/B6 about the same boat, AS financials are better, idiot is apparently not aware of that. Probably survive, maybe gain ground as the big three are distracted by sustained international downturn. Worst case, merger? If the fed saves the big three do they have to save # 5 & 6? Idiot says AS will be pushed out of west coast domestic market and be forced to retreat to Alaska... big three gonna be a little distracted bailing their international boat for market grabs :rolleyes:

ULCC/Leisure operators: At higher risk IMO due to exposure to low-income market and vacation market, as well as *possibly* being small enough to fail if push comes to shove. Worst case, mergers and maybe one or two failures. I think these guys are most exposed if there is a deep sustained downturn. I do not think that legacy customers will flock to ULCC for cheaper fares (legacies will be offering cheap fares for a good long time).

HAL: Deep do-do. I'd be surprised if they don't merge. Asia travel is done, and the locals clearly don't want mainlanders on their islands. Maybe bail out due to unique position, but I'd guess merger more likely.

That's my off-the-cuff SWAG, and may be missing important puzzle pieces.

With the legacies CASM, they can’t afford to offer cheap airfare for a long time. People flock to the cheapest ticket in a downturn, which is a return to normal for the ULCC’s.

People will return to flying again.

And they will return to the airline they always flew on before. Southwest will get their loyal customers back. United mileage credit card folks will be going back to United. People who want the cheapest flight to Orlando will still fly Frontier.

The question of survival is based on operating costs vs money in the bank. The only factor that changes that is govt handouts which so far have been given to everyone

disagree with his assessments

My take?

Big three in deep kimchee. Too many fleet types to be nimble enough to respond to a changing marketplace and overhead will eat them alive.

Worst case? F9 and NK merge. In that event the two survivors of the Big Three are in very deep kimchee.

SWA I think will hold its own. Probably Alaska too

I realize that others opinions will differ but I think that international travel will be the last to come back and 20-25% of business travel never will return.

Agree with this. Legacy networks are built around feeding WB Intl capacity, and that will likely be the last segment of travel to return. Leisure will be first and carriers will be pushing low fares in order to stimulate demand, which legacies can't sustain for any length of time. Strike 3 will be lagging business travel demand. Frequent fliers won't be flying so frequently or buying last minute walk-up fares.

I'm a bit concerned about SWA not pulling down nearly as much capacity as everyone else. They must be burning some serious cash, but I don't think BK is imminent or anything that terrible. They will likely lose market share on the back side of this though.

ALK, JB, NK, F9, HA should be fine and probably come out stronger once the dust settles.