Michael Terry

Are Airlines Going Bankrupt Again?

Utility, phone and water aren't profitable? Perhaps a little investigation/analysis would help your argument. And flag carriers/nationalized airlines? What country exactly has that worked in? Capacity has been/is/will be the determinant of profitability. The States have too many airlines, restructuring will never succeed unless there is liquidation. Another problem is the ability to park the aircraft and have the associated costs flow to the bottom line - encumbered fleets have significant costs in the air or on the ground. The industry model is broken and all the governments horses and government men (even Ratner) can't put the airlines together again.


On Jul 05 11:29 AM HomeGamer wrote:

> Lots of chatter about easily the simplest yet least understood industries
> in America.
> Re-regulate and re-subsidize.
> Network nationwide inexpensive air travel is an essential and indispensable
> public utility, like universal mail service and universal electric
> service.
> However, expecting this public utility to be both inexpensive, universally
> available and PROFITABLE is absurd. We don't expect mail delivery
> to turn a profit--by definition we want all our essential public
> services (electricity, basic phone, drinkable tap water etc) to be
> provided as INEXPENSIVELY as possible. And that's inevitably opposed
> to PROFITABILITY.
>
> Darwinian musical chairs does not work in the public-utility model,
> and can never work. That's been tried since 1979 and failed miserably.
> Government is strangely slow to grasp that, and airline CEOs, never
> best of breed, can articulate the problem but can't seem to take
> the obvious logical step of volunteering to be nationalized.
> Until that happens, there will be much more erosion of air service
> and easy money to be made betting on the next turn of musical chairs.