Airline Solvency

PaulS

New Member
I was wondering which airline, in yall's opinion, is has the most long-term solvency. By that, I mean qualitatively, not quantitatively (i.e. solvency ratios and stuff).

Also:

1. What airline management practices do you all think are the best? Worst?

2. Would a pilots group look more favorable on a CEO if he actively flew (as a non-paid pilot) a couple times a month and was more heart-felt to the workers (i.e. listened to them and even helped with baggage and other work - kind of like Carl Ichan)? If so, could this be a way for the CEO to avoid having unions come in?

3. Other than more days off and higher pay, what would you all like to see or change in regards to having happier employees?
 

Derg

New Arizona, Il Duce/Warlord
Staff member
Yow, I guess I shouldn't ask about how to build a continuum transfunctioner!
 

PaulS

New Member
Actually, this is the deal. I'm in Chicago and I am basically an investor who loves flying. I have been studying the airline biz and I see a potential to make a lot of money, if only management and labor got along and were more efficient.

Airlines generally make between 3%-5% (best I've seen for majors is 10% pre-911). However, regionals clear over twice that in profit. Even Southwest doesn't make a killing (ok, yes compared to the industry) from a business perspective. This is pathetic in my view.

Basically, I'm just another guy (call me crazy) who thinks he has a formula for success. I invest mostly in commodities and futures (currency, stock indexes, oil, metals, T-bonds), and I like a risk and challange.

Anyway, basically I just wanted to learn to be a pilot and the inside of the business before actually persuing the idea. I know the industry looks bleak now, but the key to investing is to buy when others are selling and sell when others are buying. Right now, with over-supply of planes, the time, to me, looks ripe.

I may be insane, but I like risks and challenges.

Anyway, any advice on what would make a great airline for the workers and passengers would be helpful.
 

tonyw

Well-Known Member
Paul, I wish you luck. I sure hope you find that magic formula that everyone's been looking for.

But remember two things. First, there's a saying that if you want a million bucks in the airline industry, you need to start with a billion. Next, even Warren Buffett couldn't figure it out.
 

pilot602

If specified, this will replace the title that
[ QUOTE ]
(i.e. listened to them and even helped with baggage and other work - kind of like Carl Ichan)

[/ QUOTE ]

I don't know which Carl Ichan you're referring to but the one that bought out my father's airline, ran TWA into the gorund and then raided the pilot pension funds is not someone I'd bring up as a role model on a pilot Web site.

That sonof(*$(*#)#)@%)(%)(# should rot in h3ll.

Not that I have an opinion on the matter.
 

stultus

New Member
[ QUOTE ]
Would a pilots group look more favorable on a CEO if he actively flew (as a non-paid pilot) a couple times a month and was more heart-felt to the workers (i.e. listened to them and even helped with baggage and other work - kind of like Carl Ichan)? If so, could this be a way for the CEO to avoid having unions come in?


[/ QUOTE ]

Find a pilot who works for CO and ask him. CO's CEO, Bethune, knows his way around a cockpit.
 

SUSPilot

Well-Known Member
[ QUOTE ]
(i.e. listened to them and even helped with baggage and other work - kind of like Carl Ichan)

[/ QUOTE ]

If you want to see what people think that used to work for that @$$, take a walk down STL's B,C,or D concourse, and talk to the American airlines pilots that are old(All the younger ie lower senority TWA pilots are on the street), Ticket and Gate Agents, and the skeleton crew that is left in AMR STL maintanence. I'm sure that they can tell you about what a wonderful CEO he was especially selling the LHR routes and gates that were used for one of TWA's premier flights STL-LHR, and the great buyout he got which is what broke the back of the company, which was his tickets for his travel agency at about 1/2 of a restricted fare ticket. TWA let the hostile takeover by Ichan go through because it was felt to be better than being taken over by Lorenzo from Eastern fame, but he effectively destroyed one of the worlds premier airlines, and my hometown is still paying for it today.
 

DE727UPS

Well-Known Member
Here's the problem with the airline business and why I'll never invest in it.....

Management screws over employees to make more money for the stockholders. As an employee, I think I deserve more consideration than a stockholder.
 

JollyRodger

New Member
Paul you've missed the boat on this round of airline stock prices if that's what you're talking about (I can't tell if you want to start your own airline or just want to invest in them).

The recovery of the airlines is already factored into the stock prices despite the anemic recovery of the actual industry.

Fall of 2002 was a golden time to gamble on airline stocks. Industry stock prices were at 6 year lows. I only wish I was more aggressive. I was and still am a big fan of SKYW. It was a great buy @ $9. July 2003 12.5 calls were selling for a nickle last spring.
 

Mr_Creepy

Well-Known Member
Folks, history has shown that the successful CEO's did not really get along with the pilot unions that well. Look at Bob Crandall, Bob Ferguson, Steve Wolf, etc.

Best example of this currently is David Nielemann at jetBlue. He has stated publicly that if a pilot union comes on the property he is shutting down the airline. Still, he is closest to what Paul is describing. He gets along with the pilots, helps out with little things to see the big picture and such.

On the other hand let's look at everyone's favorite current CEO to hate, Jonathan Ornstein. He has taken Mesa from a barely successful commuter to a fast growing, expanding regional that is on the verge of becoming a major player in the aviation world. They will have the largest fleet of regional jets once the latest order is complete (almost 250 aircraft) and certainly one of the newest fleets around.

They purchased the assets of Midway, backed off on ACA and now appear to be a contender for USAirways assets.

Admittedly, JO has not gone out of his way to endear himself to the pilot union! Nevertheless communication lines are fairly open at that airline (he answers personal emails, for example.)

He has done several things that pissed of the pilots (Freedom for example) and yet they still grow and expand.

To a shareholder he is a good CEO, and when you come down to it, the shareholders matter more than the employee groups. Keeping the employee groups happy has value of course, but only to keep profitability and the doors open. (sorry about that awkward sentence)

I see that several big investment firms both on and off Wall Street are now marking Mesa as a "Hot Buy." This is definitely a first in the history of this airline!

So as a shareholder, kudos to JO. As a pilot? Shaking finger and whining for more LOL
 

pilot602

If specified, this will replace the title that
[ QUOTE ]
Steve Wolf

[/ QUOTE ]

This the same SW that ran U.S. Air into bankruptcy by pursuing a deal that everyone said would briung the ire of the U.S. Government Anti-trust houdn-dogs? Then splits with a few million in his pocket as a "bonus?"

Leaving a business in shambles, while reaping millions personally from said business, to me isn't the definition of "success." But then I have a conscious so what do I know.
 

Maximilian_Jenius

Super User
[ QUOTE ]
Here's the problem with the airline business and why I'll never invest in it.....

Management screws over employees to make more money for the stockholders. As an employee, I think I deserve more consideration than a stockholder.

[/ QUOTE ]


So then would an airline treat there employees better while still producing a profit if there a private company i.e. not a publically traded comapny.

Could a large major airline survive in todays airline industry as a private company?


Matthew
 

EatSleepFly

Well-Known Member
[ QUOTE ]
Could a large major airline survive in todays airline industry as a private company?


[/ QUOTE ]

I may not be qualified to answer this, but if publicly-traded companies are having trouble surviving, I doubt it.
 

Mr_Creepy

Well-Known Member
p602 I did not say I liked any of those CEOs! Yet they were voted in by their shareholders again and again.

Steve Wolf did in fact leave TWO airlines in shambles and lined his pockets in the process (UAL and USAirways) and yet he is considered "successful."

One of my favorite stories is the United crew who heard that the then CEO of USAirways was on board a flight from IAD to Paris, so they grounded the airplane. Steve moved over to anothe flight hours later and they grounded that one!

He ended up going back to PHL and catching a USAirways flight to London the next day and going to Paris from there.

No, he wasn't liked by the pilot groups!
 

MQAAord

Scheherazade
Staff member
[ QUOTE ]

2. Would a pilots group look more favorable on a CEO if he actively flew (as a non-paid pilot) a couple times a month and was more heart-felt to the workers (i.e. listened to them and even helped with baggage and other work - kind of like Carl Ichan)?


[/ QUOTE ]


"Heart-Felt" and "Carl Ichan" do not belong in the same sentance together. That *insert expletive here* single-handedly destroyed one of this country's proudest airlines. My dh had the privilige to fly with TWA from Feb 97-Oct99, he even briefly flew with their international operation right before he left for Delta. Thankfully he got hired by Delta and didn't become AAssimilated!
 

pilot602

If specified, this will replace the title that
[ QUOTE ]
p602 I did not say I liked any of those CEOs! Yet they were voted in by their shareholders again and again.

[/ QUOTE ]

Take it easy ... I wasn't slamming you. I was slammin' Wolf.




If it'll make you feel better .. I'll be happy to slam ya .... if ya want.
 

pilot602

If specified, this will replace the title that
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Only to tell you that I still play keyboards now and then as a fill in for Derek and the Slammers - www.conventionband.com


[/ QUOTE ]

Much .... too... .... easy.... resisting ............ tough..... argggg
 
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