I have a few questions on some predictions that Unisys has recently released.
Does the idea that if you are not in bankruptcy at this time you will survive hold much practical weight?
When talking of unit costs is it proper to place little emphasis on fuel costs? It has almost become an industry-wide talking point to identify fuel costs as a detriment to a sustainable business model.
1.) Brighter days are ahead for the airline industry - notwithstanding continued cost pressures, more bankruptcies are unlikely, but some legacy and smaller fringe carriers will disappear. The existing North American legacy carriers not already in Chapter 11 will weather the storm. Consumers will soon begin to see the fruits of airlines' restructuring efforts as unit costs, excluding fuel, plummet and the offering of low fares day-in and day-out become sustainable. In other parts of the world, the worst is already over. Legacy airlines that do not restructure themselves will face their toughest challenges yet and continue to fail. In Europe, Alitalia is in a very difficult position in terms of being able to prosper and Swiss is in a weak position. SAS is working hard to restructure its business in order to form a new path into the future. "
Can the emergence of the "Southwest" crowd as an international entity be seen to occur in the near future?
"6.) Low-cost transatlantic service will emerge successfully and begin to spread. High-cost legacy carriers will discover that there is no permanent safety from low-cost competition in the international markets. Low-cost transatlantic service will emerge, perhaps in 2005 or soon thereafter - probably first between the U.S. East Coast and London Stansted Airport - and it will be successful. Its spread to other markets, such as Amsterdam, will be more rapid."