Federal Bailout $$ Billions, for the Airlines, with 'Conditions' ?

[La Li Lu Le Lo]

mnuchin says aa will 'borrow' x-amount from the govt - have to pay back 30% of payroll 'grants' over 5 years and pay back whatever low interest loans from the govt.; then we're going to let aa 'fail' and default on this money by potentially cutting off more funds in sept./oct., because it has too much debt compared to united and delta or because pan am and peoples express went out of business.

why bother debating?? i do believe some want to start psychological fires and others actually hope aa goes belly-up.

You are talking about the same government that sends aid money to our enemies.

You are talking abut the same government who wastes millions a year on an over complicated tax code.

You are talking about the same government that allows welfare lifers.

 

[La Li Lu Le Lo]

Why is there a big effort to kill it? We all know that UPS; DHL; and FedEX COMBINED can't do what the Post Office does on a daily basis.

I disagree with that statement.

If there is a market demand and money to be made SOMEONE is going to fill it.

Just like if American Airlines goes out of business SOMEONE is going to absorb that market share.

The best way for the post office to get it's debt under control (and it has MASSIVE debt) is to shrink itself, get rid of the dead weight, and run lean and tight. The same way private businesses do it. That is why private business has layoffs.

 

[Kev3188]

It's debt isn't from it's own doing; it's from the $50B pre-funding millstone that's been placed around it's neck that T5 notes above. As for "dead weight," I'm not sure how it is in TUL, but where I'm at, they're are constantly trying to hire/backfill spots. They're running lean already.

 

[CremaDiLimone]

I hear ya, but to say there’s no industry w/o AA or UA (or DL) is wishful thinking. If the Big3 somehow become the Big 1 or 2, industry won’t cease to exist.

that's right, under normal market conditions. these are not normal market conditions.

sept. comes and no one is flying and if the govt. cuts off the spigot, aa may go first, united the next week and delta 2 weeks later.

in essence, if the govt. allows aa to go belly-up, so will others and there will be no industry.

the govt. may be on the hook for $50 billion and then they'll allow their borrowers to collapse in 3 weeks, along with the usa having no real domestic air transportation network and no international air transportation network????

just a bit of critical thinking..that's all it takes.

 

[CremaDiLimone]

You are talking about the same government that sends aid money to our enemies.

You are talking abut the same government who wastes millions a year on an over complicated tax code.

You are talking about the same government that allows welfare lifers.

maybe, but i'm talking oranges and you're talking apples.

whatever your personal opinions are of the govt. and economics, you need to understand that both political parties have acted with deeds and stated with promises - that the industry won't collapse.

no one is flying. delta, united and southwest aren't generating revenues. the fact that aa has more debt has no relevance as to whom the govt. wishes to save.

the industry is mutually inclusive to the big 3, not big 2 or big 1. if one fails, the others will fail.

 

[swamt]

AA has reduced their flight schedule for summer. They has 17% peeps take the VEOP n VLOA not to mention they retired large number planes. If this virus comes back quest is will the admin continue to help airlines or what will happen. Combine that w pax travel not expect to be at pre virus level for a ur if not more

Sounds like the takers of the leave options are about 20% on average at all the airlines. I do believe someone said 20K at Delta but growing, 20K plus at SWA and may grow for May and/or June. With your report of 17% and maybe more it all sounds like an average of around 20% of the big 4 so far. Not sure about United's numbers as of yet, does anyone know???

 

[Kev3188]

that's right, under normal market conditions. these are not normal market conditions.

sept. comes and no one is flying and if the govt. cuts off the spigot, aa may go first, united the next week and delta 2 weeks later.

in essence, if the govt. allows aa to go belly-up, so will others and there will be no industry.

the govt. may be on the hook for $50 billion and then they'll allow their borrowers to collapse in 3 weeks, along with the usa having no real domestic air transportation network and no international air transportation network????

just a bit of critical thinking..that's all it takes.

If 1 or 2 of the Big3 go, there would still be plenty of network connectivity.

Pick anyone of the 3. Now imagine their route map. Now add AS’ and WN’s on top of it. That’s not counting freight carriers.

 

[Kev3188]

Sounds like the takers of the leave options are about 20% on average at all the airlines. I do believe someone said 20K at Delta but growing, 20K plus at SWA and may grow for May and/or June. With your report of 17% and maybe more it all sounds like an average of around 20% of the big 4 so far. Not sure about United's numbers as of yet, does anyone know???

Approx. 35k at Delta have taken some form of leave as of this writing.

 

[dfw gen]

in 4 months - 2nd week of august. no way most of the nation is still 'locked-down'. there will be more fliers than in march/april...we'll see what the numbers are and what the fares will be.

regardless, i do believe the govt. will continue it's support of the airline industry.

as far as the rest, of course the govt. won't say they wish to save aa or ua...but, there is no airline industry if aa or ua goes belly-up. what the big 3 put into the economy from planes and parts/move freight/pay rent to municipalities/taxes/employees spend and add to commerce/owe debt to american financial institutions and now also to the govt.

paying 30% of the payroll grants back to the govt. over 5 years is very doable. ultra-low interest loans for operations are also a God-send. what is the point of all this now, if the govt. walks away from the airlines in sept./oct.???

hope your right

 

[swamt]

Approx. 35k at Delta have taken some form of leave as of this writing.

Delta have 80K or 100K employees?

 

[Kev3188]

I think close to 90kish...

 

[La Li Lu Le Lo]

maybe, but i'm talking oranges and you're talking apples.

No. We are talking about a government that accepts monetary losses and foolish expenditures.

whatever your personal opinions are of the govt. and economics, you need to understand that both political parties have acted with deeds and stated with promises - that the industry won't collapse.

You believe politicians. I don't know rather to laugh or laugh.

no one is flying. delta, united and southwest aren't generating revenues. the fact that aa has more debt has no relevance as to whom the govt. wishes to save.

ALL airlines still flying customers or cargo are generating revenue. I don't think you fully understand the concept of revenue. Revenue and profit are not the same thing. Even a company enduring losses generates revenue if they are collecting money for services rendered.

CremaDiLimone you are absolutely in a state of denial. I think your fear of the possible is blinding you to the practical. A 45 billion dollar debt load for a company with little revenue is a huge obstacle to overcome.

the industry is mutually inclusive to the big 3, not big 2 or big 1. if one fails, the others will fail.

I promise you that makes absolutely no sense to anyone on this forum but you. I assure you no single airline is too big to fail. That only exist in your mind.

Look CremaDiLimone, I am not saying American Airlines is going out of business. I am saying that could be a potential outcome for a company with that high of a debt load.

People keep talking of government backed low interest loans however, since the airline has to use that money to cover the cost of operations instead of pay down higher interest debt in actuality they are just getting deeper in the hole.

 

[CremaDiLimone]

If 1 or 2 of the Big3 go, there would still be plenty of network connectivity.

Pick anyone of the 3. Now imagine their route map. Now add AS’ and WN’s on top of it. That’s not counting freight carriers.

really? so, how big is southwest in bos/lga/jfk? southwest and alaska fly intl. to europe/s. america and asia??

sorry, if aa goes, then the others go.

no one here has given a scenario where aa gets cut off and somehow, delta and united plod on. right. if aa goes, so do the others

 

[CremaDiLimone]

No. We are talking about a government that accepts monetary losses and foolish expenditures.

You believe politicians. I don't know rather to laugh or laugh.

ALL airlines still flying customers or cargo are generating revenue. I don't think you fully understand the concept of revenue. Revenue and profit are not the same thing. Even a company enduring losses generates revenue if they are collecting money for services rendered.

CremaDiLimone you are absolutely in a state of denial. I think your fear of the possible is blinding you to the practical. A 45 billion dollar debt load for a company with little revenue is a huge obstacle to overcome.

I promise you that makes absolutely no sense to anyone on this forum but you. I assure you no single airline is too big to fail. That only exist in your mind.

Look CremaDiLimone, I am not saying American Airlines is going out of business. I am saying that could be a potential outcome for a company with that high of a debt load.

People keep talking of government backed low interest loans however, since the airline has to use that money to cover the cost of operations instead of pay down higher interest debt in actuality they are just getting deeper in the hole.

right. i don't know the difference between revenue and profit.

no airline is generating revenue to pay their employees and maintain operations (rent/debt/fuel).

if aa goes under because the govt. cuts off the spigot, then all go. if all go, there is no airline industry.


you have not given a scenario where aa goes under and delta and united can 'pick up the slack'. how can they pick anything up if the govt. cuts off the help, if needed, in sept.??

 

[Kev3188]

These bailouts are only a short term fix to keep carriers going long enough to devise a longer term plan to survive.