Oil at $60. Film at 11.
06-29-2005, 06:54 PM
#1
Fun Officer
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Joined APC: Feb 2005
Position: Dallas, Texas
Posts: 515
Oil at $60. Film at 11.
www.aviationplanning.com
Hot Flash - June 27, 2005
Short Note: $60 Oil. Desperation C-11 Filings?
Oil has hit, and, as of this morning, is staying over $60. Some talk of $70.
Watch for traffic on the courthouse steps. It's an open question if some carriers can adjust to this situation fast enough before the cash runs out. If Chapter 11 filings are made, it will be only a short-term solution, one that will shift the burden of higher fuel prices to creditors who will be left out in the cold.
In such situations, labor isn't a solution - it's been milked already. Aircraft lessors are of limited relief - they've been hit, too, and may not have a lot of wiggle-room. The ugly conclusion is that fundamentally higher fuel prices could result in a fundamentally different air transportation system - one that is much more limited in scope.
Big concern: as costs go up, the barriers to serving marginal markets go up as well. The already-iffy expense/revenue ratios of RJ operations will get worse.
Film at 11...
Hot Flash - June 27, 2005
Short Note: $60 Oil. Desperation C-11 Filings?
Oil has hit, and, as of this morning, is staying over $60. Some talk of $70.
Watch for traffic on the courthouse steps. It's an open question if some carriers can adjust to this situation fast enough before the cash runs out. If Chapter 11 filings are made, it will be only a short-term solution, one that will shift the burden of higher fuel prices to creditors who will be left out in the cold.
In such situations, labor isn't a solution - it's been milked already. Aircraft lessors are of limited relief - they've been hit, too, and may not have a lot of wiggle-room. The ugly conclusion is that fundamentally higher fuel prices could result in a fundamentally different air transportation system - one that is much more limited in scope.
Big concern: as costs go up, the barriers to serving marginal markets go up as well. The already-iffy expense/revenue ratios of RJ operations will get worse.
Film at 11...
