Led Zep

The price of gold has risen dramatically too. I wonder if these same people who demand government involvement in big oil will demand the same thing with the jewelry industry.

The Chow

They say we're all related if you back far enough.

The interview I was watching said that if the Air Force gets the results it likes in 2011, then expect the commercial side to jump soon after.

One of the main sticking points to the alternative energy initiatives was fear of no customers. Companies were afaid to invest billion$ into this venue without some insurance. So it looks like the military will save our backsides once again. Becuase the Air Force has already placed an order for 100,000 gallons to start with the expectation that if the companies meet chemical signature, then they'l be off of fossil fuel by 2016.

The interview also said that when the economies of scale kick in this should bring the cost to $55-$65 a barrel.

Led Zep

I think it is safe to say that fear may be obsolete.

OscartheGrouch

For once I can agree with you on something! I am sure there is much more but for now one thing will suffice. The invasion of LCC's comment however is of concern. Just exactly where should ticket prices be? Should the airlines replace the oil companies as the industry that charges prices beyond (10-15% net profit margin) what a consumer should pay because they can? How about the invasion of the RJ that has replaced mainline jets at so called "Legacy" airlines? Lest anyone forget about SWA's fuel hedges it would seem that we are able to charge prices (currently about a 5-6% profit margin) that reflect our cost to deliver our product (at least for the time being). As I have said before I will not apologize for giving the traveling public a product without gouging them. One only need to look at routes where we are the only carrier to understand that we don't gouge people even when we can. We do have prices higher than some on some routes but looking at the pricing practices of legacies on routes where they have had the monopoly (obvious gouging) our pricing looks reasonable.

Some would say if SWA raised prices (and they have) everyone would make money. Anyone who has studied this area would realize that consumer price sensitivity and market share drive many of the prices on routes that are highly competitive. FWIW.

XHooker

In the last 30+ years, oil companies have, collectively, never been in the red. As a matter of fact, the oil industry's worst year is better than the airline industry's best year.

ewrbasedpilot

While you have valid points, SWA doesn't fly into EWR, JFK, LGA, ORD or many of the other "high rent" airports, therefore they don't have the exhorbitant overhead the airlines that service these areas have. They also don't have B777's flying 16 hour trips, they don't fly int'l nor have they ever brought one penny of int'l revenue into the USA. They are a totally different type of airline. But the fact that they have cash to buy hedges (a good thing in this crappy environment) gives them such an advantage now that it appears they might be the only airline that can survive in this country. How would this benefit the US consumer/traveler? Not much I'm afraid. SWA is not suited nor equipped to fly to Japan, Europe, Israel, etc., are they? Are they equipped to take over 7000+ flights a day as airlines collapse? I don't hardly think so. With oil on the verge of literally bankrupting our industry/country I'm not really sure what we can do to stop this idiocracy. It does appear though that our government is so clueless and worthless that we're all about to see the safest most economical travel industry come to a grinding halt. Meanwhile our friends in the middle-east/OPEC/and other oil producing countries are leaving our country in the dust. What a shame..................

atpcliff

Hi!

The Middle East isn't leaving us in the dust, they're buying us!!!

Why do you think the Bush Administration announced that they wanted to end ALL restrictions on the airline industry, at the same time that GW was meeting with his "friends" in Saudi? The Admin wants anyone to be able to buy any airline, and for any airline to fly anywhere they desire.

GW's friends in Saudi have a lot of money (even AFTER they fund the Wahabi schools that preach death to America), and they want to buy our airlines, along with a number of other US companies, with the money we gave them via the gas pumps.

cliff
YIP
PS-Something like 3 days of oil revenues for Saudi, would buy ALL of GM!

KC10 FATboy

There were several oil busts in the 80's that devasted the economies of TX, LA, and OK after consumption decreased as a result of the energy crisis of the late 70s. Google it.

The "oil companies" may have still been in the black; however, the market was flooded with oil and they were lucky to get $10 dollars for it. Many thousands of people lost their jobs and sufferred. People like EWRbasedpilot don't care about this.

I am confident that our markets will react just as they did in the 70s and 80s and things will return to normal.

-Fatty

ewrbasedpilot

You have no idea what I care about.

OscartheGrouch

EWR,

Your comments about the industry are very accurate with reference to oil. However, (and you knew the "but" was coming) the idea that little old SWA is incapable of doing what the "legacies" do is only a matter of time. When is anyones guess, but having been a ramper here when ABQ, TUL, and MSY were the farthest stations in the SWA system all I can say is don't underestimate the little dinky airline from TX. If the money is in international flying everyone will be chasing the carrot.

Also, no airline is indispensable to this world (including SWA). If SWA or any other airline disappeared tomorrow the vacuum would be filled if the market (customers) is there. As a former employee of Pan Am I watched from my new employers (SWA) window as Pan Am went belly up. Talk about sad!

This thread is about oil prices and the only way to bring about profitablility in this industry is to let airlines fail (no more subsidization through BK). I know this sounds heartless, but if the government had not bailed out the airline industry after 9-11 the industry would be better of today. It only delayed the inevitable.