Outstanding analysis of AAL's finances

[swamt]

yet you keep reading, Q.

what you can't ignore and neither can Q is that I argued for years about AA's declining position in NYC, its deteriorating finances which I argued justified filing for BK years ago instead of protecting shareholders, and its losses on the Pacific.

In EVERY one of these cases, I ended up being right DESPITE the heated arguments by the fAAn club to try to discredit what I was saying.

and again, Commavia, you could absolutely argue that AA was in a great position relative to DL with its debt position right now. and you can also argue about how well AA is generating cash and making comparable profits but in order to come to that conclusion, you have to ignore the MINIMUM of $1.2 billion of integration costs - and since DL and UA both blew thru way more than $1.5B in integration costs and their mergers took place years ago, the notion that AA's merger integration costs will be JUST $1.2B is more than a stretch.

and of course, it's easy to say that AA's increased debt can be covered this year without taking on debt but AA still has tens of billions of aircraft on order including what US brought to the table. AA's aircraft purchase commitments amount t billions of dollars per year.

add in revenue erosion which will come with low fare competition and the Venezuela crisis and the notions that AA can continue to generous the cash they are now - which is heavily driven by a strong revenue environment has to be viewed with suspicion.

and what I find most amazing is how you and so many members of the nAAtive mgmt fan club were so quick to show your allegiance to Horton and CO. and against Parker and yet you line up without question behind Parker.

The analysis which I linked says exactly what the DOJ noted - not me - that US' pricing policies targeted AA's network above every other.

think about and tell me why Parker did that?

did it occur to you that he did it in part because AA had the highest costs which made it the hardest for AA to defend itself?

and then consider that Parker had said for years that he wanted to merge with AA. So what did he do but do everything possible to take AA revenue away right as AA was working on a standalone emergence - which you supported.

Parker was acting like the tire store that throws broken glass, bent nails, and scrap metal all over the road in front of their store - which happens to be the only business without miles.

Parker then went into the AMR directors and told them about the revenue synergies that the merger could produce - driven to a significant degree because he was responsible for taking a great deal of it away.

no one slights AA and US for getting merger synergies based on the strength of both carrier's networks.

but what you seem unwilling to accept is that Parker and co. played a role in weakening AA's revenues and then in justifying the merger based on removing the factors which negatively affected AA.

And of course other carriers in the industry fared better - but DL and UA who were both larger than AA were not the targets of US' pricing practices to the degree that AA was.

in your haste to tell me about my inability to think thru what is going on in the industry, you might want to take a little time to think thru what actually took place between when you posted so convincingly about why a standalone AA plan made the most sense and where we are today.

That's it, change the subject when it doesn't go your way...

 

[WorldTraveler]

excuse me but what subject did I change?

I acknowledged that I attributed a statistic as an annual statistic when it is a quarterly statistic.

the response was a back of the envelope calculation by commavia trying to argue that AA's debt isn't much different from what DL's...despite the fact that the article I linked (which he wants to discredit) as well as others specifically note that AA has some of the highest indebtedness in the industry in both absolute numbers and in terms of any kinds of ratios.

AA is in debt to a greater level, they are spending far more than practically every other airline, and they are nowhere near in the position to generate the level of free cash that other airlines are doing, including DL. That isn't my opinion - it is a fact which has been repeatedly confirmed elsewhere.

Can some people not accept basic facts without turning them into an argument and an attempt to discredit someone else?

robbed,

yes, AA is making money and has a strong outlook.....

you and others can look at that as a great sign compared to where either AA or US has been. and that is fine.

AA WILL be fine. I've never said otherwise.

But if anyone wants to talk about where AA is relative to any other carrier then it is absolutely essential to look at the competition - and on that basis, AA is far from being at the front of the pack. And no analysts have come close to saying that.

if your objective is only that things look better than they have been in the past, then rejoice. you've arrived.

 

[swamt]

how incredibly sad it is that you have come to that conclusion - because that is not what I have EVER said.

I get the pride AA people have in their organization - I really do.

but when someone (or a group of people) can't even read a few facts about their company without going on the defensive, I'm not sure I am the one with the problem.

I wish AA people well. I do.

All I have pointed out is that AA has emerged from BK and is enjoying a positive revenue environment that is possible because half of the merger made it difficult for the other half and now wants to show the world how great of an idea the merger was.

I am sure AA will restructure well.... but they aren't there yet.

that is all I have pointed out.... no one said anything about another bankruptcy or anything else.

are you all capable of discussing the article and the facts in it and that is all?

WT, your right you have never directly said it.  But you imply it with every post you make about ALL the other airlines.  Every single time someone post something positive about their own airline, you come in with negatives and how much better Delta is and does, it never fails you do it every single time.  AA will in fact be in a better position then Delta when AA reaches the same amount of time out of BK, they have already proved this with the ballances of cash on hand.  
What is the true sadness here is the fact that you don't realize what your doing, or if you do then you are not a good person.  You seem to think or say that people don't like you because you offer challenging post to counterdict them, well, your wrong, most generally like the 2 way convo's it is your way of posting how great Delta is, it's one thing to be proud of your employer, but you have been taking it to a total different level.  You also post misinformation, inaccurate info as well as flat out lies.  You have been proven wrong on numerous postings by many more than just a couple people that have credibility.  FWAAA was right, your credibility is "0" because of how you handle yourself, how you post, and how you spread bad and misinformation and continuously harp on the same issues over and over again.  Something else that you do is, you have to have the last word, in every single thread that you post in you will not stand it if you don't get the last word in.  Then when the majority will ignore you, you then will post again in that forum to try and drum up more confrontation.  All this type of behavior and actions speaks volumes about your character, and this is why you have "0" credibility with anyone out here.   Now you will respond by saying I am wrong and that every one ELSE out here just don't like you posting against them, if this were the case then everyone would be confrontational to averyone, and this is not taking place, the common denominator here is you, WT.  Get a clue man, take some time and read back thru all your postings, have someone read them with you and give their opinion on what they read.  If you really still don't see it then you need help and I would recomend you get some.  I tried a little experiment with you several months ago and started posting just like you, and you fell right into it and started getting pissed about how I was posting.  Now you don't see me all that often now do you.  Experiment is over and now everyone can you for who you really are.  BTW one of the other and many things you do is a long winded post just like this one, when you go on and on and on and on.  I too no longer read any of your postings, just thumb thru one every now and then and it still shows you are the exact same way as you have been, and you never get the clue.  Now, by all means, send out a response to my post as I will more than likely skip right over it, but YOU will have to respond in order to try and make yourself look better to everyone else out here.  It is all about you and Delta.  Delta and you can never do no wrong NEVER.  I would bet your wife (if married) would agree with my post on how you are, just have her read these and get her opinion.  But I bet you won't as she would just confirm it and make you look bad, and ohhhhh, we just can't do that now can we WT???...

 

[swamt]

given the nature of the airline industry, if you are in the top 75% of seniority or more of an airline, you are going to retain a job regardless of what happens

So, if your goal is simply to keep a job, then you can stop worrying about the business aspects of the business not long into your career at an airline.

But AA IS a business - a for-profit business that competes with other for-profit businesses.

There would be no need to discuss anything the business aspects of the airline industry if the goal was to not ruffle the feathers of the majority of the airline employees.

but airline employees have financial interest in the success of their employers and employees aren't the only stakeholders in a company.

customers, stockholders, and others have a financial interest in the success of airlines as well.

beyond finance and business interests, this board also touches on labor, operational, and service issues; why is it so difficult that if you don't want to talk about a specific topic that you just don't open it?

I, for one, find the endless "my union is better than your union" threads which constitute a big chunk of this forum actually quite laughable and I venture to them only long enough to harvest a good quote and then move on.

but it is the steady diet for some here to participate in those types of threads.

AA is a fixture of US aviation - a historical centerpiece that is emblematic of both what is good and bad.

the question is why it is so hard for some people to accept any criticism - valid and corroborated.

within minutes of my initial post on this thread, FWAAA, who is a pretty intelligent and educated person, jumped onto finding the one flaw I wrote in my post and focused like a laser on highlighting it.

there is ABSOLUTELY nothing wrong with challenging the factual basis of what is said, including finding errors.
but in the process FWAAA glossed over a number of significant issues that the article raised, both good and bad.

and then commavia came along and defensively started trying to compare debt levels between AA and other airlines.

in fact, there are a number of analyses that have compared the debt levels among the US airlines and consistently noted that AAL is at the very high end of the US industry.

this article specifically noted that AAL's debt levels are very high and made comparisons to AA's competitors.

again, any one of you can say "who cares... none of this stuff affects me" and you are likely right.

but there are people who continue to post articles and make comparisons of how well AA does relative based on one financial or industry metric or another - so it apparently does matter.

I want AA to survive and successfully restructure and I have repeatedly said that.

I also recognize that after 10 years of a long and dragged out restructuring, there is an immense desire among AA people to find success again.

my posts of late have only been to highlight that AA has done a great job with its merger so far, but that there were a number of factors that set AA/US up to look good, specifically US' actions that were counter to AA's own standalone success.

Now, many here want to proclaim success without realizing there are still enormous tasks ahead of AA that are necessary to fully integrate the airline and to be able to say tat AA/US is in the same league as DL and UA and WN who are much further along in completing their mergers.

again, best of luck to everyone at AA.

may the merger continue to deliver what you expected from it.

but if you want to make claims about how well AA is doing, don't be surprised if someone reminds you that AA is still far from being in the same long-term position as the other airlines that have gone before in the megamerger process and note the specific, business reasons why.

and if you can keep your job without reading or worrying about any of it, great for you.

Didn't read this one but I bet you dodged the topic the poster posted about...

 

[jcw]

swamt - great post!

 

[Kev3188]

It's amazing how you get more info from a 25 word post from comm, fwaaa, e and others than muddling through 1000+ words from WT.

Economical writing is effective writing...

 

[robbedagain]

swamt that was one of the best posts ive seen  great post bro

 

[eolesen]

Economical writing is effective writing...

Yep. If you can't communicate an idea in one or two sentences, you're screwed in the real world.

 

[WorldTraveler]

Economical writing is effective writing...

except when all it does is DODGE the original topic which is that AA is deeply in debt.

no one has yet to acknowledge that.

 

[WeAAsles]

Before I even log on I have to see that guys long winded, verbose nonsense. There are a few posters on this site that I'm not too crazy about but I just can't stand WT. His postings that I don't even read make my skin crawl. It took me only a few days of interacting with him before I just was completely disgusted with even trying.

I also HATE the ignore feature on this site. I wish it was like FB where you can block the person and not see each others comments at all. That is a true ignore feature.

 

[eolesen]

Keep in mind the software on this site pre-dates Facebook by many years...

"Deeply in debt" sounds so scary....

Then again, some people drown in a few inches of water, while others safely swim in water thousands of feet deep.

 

[WorldTraveler]

Before I even log on I have to see that guys long winded, verbose nonsense. There are a few posters on this site that I'm not too crazy about but I just can't stand WT. His postings that I don't even read make my skin crawl. It took me only a few days of interacting with him before I just was completely disgusted with even trying.

I also HATE the ignore feature on this site. I wish it was like FB where you can block the person and not see each others comments at all. That is a true ignore feature.

why would you expect that you would like someone who caught you posting their personal information all the while lecturing THEM about self-control.

BTW, I thought you had put me on ignore.

thank you so much for taking the time to read my posts again.

I knew you couldn't stay away

 

[WeAAsles]

Keep in mind the software on this site pre-dates Facebook by many years..."Deeply in debt" sounds so scary....Then again, some people drown in a few inches of water, while others safely swim in water thousands of feet deep.

And it's like someone else pointed out that advertisers need to see hits to set rates of what they'll pay a website. That's why I'm 100% positive that WT is being paid by someone? It's either that or he's mentally ill?

 

[Glenn Quagmire]

Keep in mind the software on this site pre-dates Facebook by many years...

Surely they could update it to some of the better products out there. I am on other forums where there is a true block feature.

 

[eolesen]

And it's like someone else pointed out that advertisers need to see hits to set rates of what they'll pay a website. That's why I'm 100% positive that WT is being paid by someone? It's either that or he's mentally ill?

I suspect Aspergers. They have an insatiable need to keep a conversation going long beyond the point when other folks have tuned out...

Nobody's going to pay just to generate hits.... Tracking software varies, but usually goes on unique views, as opposed to total views.

When WT views the same page 50 times over, it's likely to be recorded as a single set of eyeballs when it is from the same IP address.