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Which Airlines Are In Bad Financial Shape?  
User currently offlineMCOtoATL From United States of America, joined Sep 1999, 474 posts, RR: 4
Posted (14 years 4 months 1 week 5 days 8 hours ago) and read 3413 times:

I have read numerous books about the U.S. airline industry following deregulation. There have been so many airlines that have "gone under," including many that were quite prosperous at one time.

Looking at the current airline industry, which airlines are in rough shape and are in danger of fading fast?

Also, how are some of the smaller airlines doing, such as Airtran, Midway, Midwest Express, Frontier, etc... Are they all gonan be here for the long haul?


28 replies: All unread, showing first 25:
 
User currently offlineAA737-823 From United States of America, joined Mar 2000, 5771 posts, RR: 11
Reply 1, posted (14 years 4 months 1 week 5 days 8 hours ago) and read 3020 times:

Northwest and TWA are in bad shape. HOWEVER- TWA is an airline I would fly on. They are slowly pulling themselves up the ladder- rung by rung. They have replaced a sizeable chunk of their VERY old fleet, and are one of five airlines bold enough to purchase the new 717-200. (Airtran, TWA, Hawaiian, Impulse, Olympic, and I can't think of any more). Northwest still has a fleet that averages older than I am; suddenly, red lights and buzzers go off in my mind. The funny thing is, TWA seems relatively expensive, compared to AA and Delta, and even United.
Airtran is doing well, they were the launch customer for the MD-95 which became the 717 as you know. I would fly Airtran too. The other little guys I know little about.
Hope this answers some questions.
R


User currently offlineA32 From United States of America, joined Aug 1999, 163 posts, RR: 1
Reply 2, posted (14 years 4 months 1 week 5 days 4 hours ago) and read 2994 times:

aa737

Please define bad shape. Are you talking financial or operations ? Don't give your personal experience on travel. In particular I would like to hear your opinion on why NWA is in bad shape. Financial numbers please ...



User currently offlineSWA737-500 From , joined Dec 1969, posts, RR:
Reply 3, posted (14 years 4 months 1 week 5 days 3 hours ago) and read 2994 times:

USAir(ways) and TWA have both been losing large amounts of money every year, United is closely following, along with Northwest. Continental continues to show poor ecomonical performance. American Airlines employees are getting pay cuts. Southwest Airlines has made money everyday since it's beginings in 1971.

User currently offlineBrissie_lions From , joined Dec 1969, posts, RR:
Reply 4, posted (14 years 4 months 1 week 5 days 2 hours ago) and read 2973 times:

Firstly, Impulse Airlines have not purchased any 717s. 3 are being leased from Bavaria Leasing and 2 from Pembroke Capital.

Secondly, it is interesting to note with the 717, that 18 airlines from the US, Asia, Europe and Middle East, collaborated with Boeing (MDC) in the design of the 717, but none that I no of have as yet ordered the type (and I doubt that they will). The reason that TWA would have ordered the 717 is price, and price alone. The 717 is listed between 33 and 37 million dollars.

The fact that an aircraft is older than you (your profile says 16-20 years) does not mean a thing. Many Boeing and Airbus aircraft that were produced in 1980 (and even earlier) are still in operation today. I would have no hesitation in getting aboard an *old* aircraft, as long as I know that the aircraft has been well maintained.

I too would like to hear upon what figures you base your assumptions. I have here the 1Q2000 result for the major in PDF format, which I will try to format to be copied here.


User currently offlineKlwright69 From Saudi Arabia, joined Jan 2000, 2028 posts, RR: 3
Reply 5, posted (14 years 4 months 1 week 4 days 19 hours ago) and read 2946 times:

How on earth are AA and CO struggling financially??? That's sure a new one!!

User currently offlinePablo From Argentina, joined Sep 2005, 0 posts, RR: 0
Reply 6, posted (14 years 4 months 1 week 4 days 18 hours ago) and read 2943 times:

out of the smaller airlines, Frontier is doing the best along with Midway. Vanguard airlines currently is making profit every other quarter but they are expanding so at the end of the year the will have around 18 737's. Spirit is doing well it has been around for ten years now and it is making a profit. Airtran a heard thay are not making profit but i heard every so often they do and the 717 is hopefully their savior. I don't know about midwest express but i think they are doing well.
US airways, TWA, NorthWest are having trouble
US airways and TWA are both upgrading their fleet to airbus products. TWA has also ordered th 717 which is just beginning to arrive. NorthWest needs new planes, they are too old. US Airways is probaly in the best shape, Then TWA and then Northwest


User currently offlineMatt D From United States of America, joined Nov 1999, 9502 posts, RR: 47
Reply 7, posted (14 years 4 months 1 week 4 days 17 hours ago) and read 2940 times:

Continental having financial difficulties????????
There can only be one of two possibilities for you saying that....either you are reading numbers from 1990, or........what are you smoking and where can I get some of it?


User currently offlineSWA737-500 From , joined Dec 1969, posts, RR:
Reply 8, posted (14 years 4 months 1 week 4 days 16 hours ago) and read 2925 times:

In 1990, Continental placed it's self in Chapter 11 protection, when she emerged, she sported a new color scheme and an updated managment. In 1994, Continental Lite was set up to compete with Southwest and United Shuttle, but was abandoned after heavy losses. In 1999, Continental went about the task of replacing her aging fleet. All 737-100/200s and DC-9s have since been retired. Continental is gaining small profits, but continues to show poor ecnomical performance. Chances are that the airline will continue to grow and get better.
In 1991, America West flew under Chapter 11 bankruptcy protection with a drastically smaller fleet (including the selling of their two famous 747s) and unprofitable routes were given up. America West emerged in 1994 with a new color scheme and new aircraft (A320). Time has been good to AmWest and profits are soaring.
In 1996, Kiwi International Airlines entered Chapter 11. Many 727s were sold and routes given up, but in 1997, she emerged and is set to recommence expansion.
In the early 1990s, Trans World Airlines entered Chapter 11, but emerged in 1995 with a new color scheme and is now half owned buy it's employees and has a new "corporate identity". New aircraft have been ordered and new routes introduced, however, TWA continues to show poor economical performance.

The early to mid 1990s were a tough time for the airlines, but as you can see, most pulled through. As for American Airlines, I just heard that they were having labor problems, maybe that is old news, but I thought I should say it anyway.


User currently offlineFirstClass! From , joined Dec 1969, posts, RR:
Reply 9, posted (14 years 4 months 1 week 4 days 16 hours ago) and read 2926 times:

This post is a mess. There are things needed to be straghtened out:

-AirTran, Frontier, Midwest Express, and Midway are doing fine. They'll be here for quite some time.
-American, Continental, Northwest, Delta, and Southwest are doing excellent in terms of profits. They will also be here for quite some time.
-I will not say that UA is doing good or bad because I have heard of alot of conflicting reports. I will check ual.com later today.
-Just because NW uses older aircraft doesn't mean they aren't economically off. Have you seen the prices of NW tickets? Not cheap, that's how they make their money.
-SWA737-500 you should visit www.southwest.com and read WN's history. Every airline does not start up and make a profit on the instant.
-US reported a loss last quarter, it's too early to tell if they are well off or not.
-My qualms are TWA and Vanguard. TWA is getting new aircraft everyday but their net losses are also increasing. Also, multiple sources say a bankruptcy file by Vanguard is imminent.
-As you all know S.S.Tower Air has stricken an iceberg and is slowly sinking to their death...

Take care and have a nice holiday


User currently offline777x From , joined Dec 1969, posts, RR:
Reply 10, posted (14 years 4 months 1 week 4 days 15 hours ago) and read 2896 times:

Check your facts

Most US majors have made profits since 1993, and are in good financial heath - for example

Uniteds net earnings were 1.23b $ last year, and in fact have been operating in profit since 1993, when they posted a loss (as did most other US majors)




User currently offlineTxAgKuwait From United States of America, joined Aug 1999, 1803 posts, RR: 42
Reply 11, posted (14 years 4 months 1 week 4 days 15 hours ago) and read 2893 times:

Please do not think SWA737-500 reflects the intelligence, knowledge, or historical background of the typical WN employee. My guess is SWA737-500 is about a 17 yr old kid who has read excerpts from the book "Nuts".

He (or she) writes:>>"Southwest Airlines has made money everyday since it's beginings in 1971."<<

Nothing could be further from the truth. Southwest Airlines Company started operations 18 June 1971. They lost money for 7 straight quarters, although the amount lost was consistentle less and less.

They started with about $6 Million in the bank, which is laughable when you think about capitalization these days but seemed like a healthy amount to have back then.

In order to conserve enough money and make a little extra in order to stay afloat, a fourth airplane was sold to Frontier (late 1972 as I recall). The need to offer hourly service between Dallas and Houston while running a 3 plane schedule is what caused them to devise and implement their ten-minute turn times between flights.

Since Q2 1972, I "think" (it may have been Q3) Southwest has never reported a quarterly loss. To say they have been profitable since day one demonstrates a poor grasp of reality. That's still an enviable record for a firm that had to sell off a plane to stay afloat back in '72.

One thing they NEVER did was have to go back to venture capital folks or stockholders...they did not have to go back to the well for additional money. They sold of the plane...but they were able to achieve profitability without an additional cash infusion from a sugar daddy.

I am still perplexed as to what caused them to attain profitability.....the return to Houston Hobby, the $13 war with Braniff, or the ten minute turn. Hard to say.

As far as "troubled" airlines...you have to think Vanguard (toast) and TWA (dried bread ready for the toaster).



User currently offlineMatt D From United States of America, joined Nov 1999, 9502 posts, RR: 47
Reply 12, posted (14 years 4 months 1 week 4 days 14 hours ago) and read 2892 times:

I'm surprised that no one mentioned the year that Southwest lost money: 1987 and the Muse Air/TranStar mess..."The flying Purple Profit Eater"..... When WN shut MC down after a loss of some $17M. Granted, WN themselves did not lose money, but with MC as a wholly owned subsidiary, well the loss was there.
Yes, I'm sure there will be an obituary...er...chapter in Deregulation KO's II for Vanguard written very soon. TWA seems to be very stubbornly fending off death. I really hope they can pull themselves together for good...especially since they have come as far as they have in the last 5 years.


User currently offlineUA744Flagship From , joined Dec 1969, posts, RR:
Reply 13, posted (14 years 4 months 1 week 4 days 13 hours ago) and read 2892 times:

Check your facts! Either go to Forbes.com or the Fortune500 web site and check the stats for the top 5 major US Airlines -- you'll see UAL is listed as the most profitable!

User currently offlineD L X From United States of America, joined May 1999, 11274 posts, RR: 52
Reply 14, posted (14 years 4 months 1 week 4 days 13 hours ago) and read 2888 times:

Yes, misinformation abounds on this thread, and it is good to see that so many have corrected it. BUT, I've noticed that no one has set anyone straight about the situation at US Airways, and as the resident US Airways backer, I feel that I have to say something:

US Airways had two lossy quarters, 4Q-1999 and 1Q-2000. They still turned a profit for the year, and have turned a profit for each of the years since 1995, especially since Wolf came on board. They are also projected to turn a profit for the year 2000. They have over a billion dollars in the bank, and are quickly retiring the older half of their fleet (not that their fleet was that old, comparable to Continental's).

(BTW, it is also highly rumored that they came exceedingly close to buying American Airlines last year, but labor negotiations were poorly timed and made the deal impossible. It still is a possibility in the future though.)



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User currently offlineMatt D From United States of America, joined Nov 1999, 9502 posts, RR: 47
Reply 15, posted (14 years 4 months 1 week 4 days 12 hours ago) and read 2888 times:

USAirways buying American? If anything, I would think it would be the other way around.

User currently offlineKlwright69 From Saudi Arabia, joined Jan 2000, 2028 posts, RR: 3
Reply 16, posted (14 years 4 months 1 week 4 days 12 hours ago) and read 2875 times:

Hi again First Class! We both agree that this post is a mess! SWA737-500 digs back through years of Continental's history as if somehow that has any relevance on where the company is now. How can 20 quarters of consecutive profits (many of them high) be construed as poor economic performance? He also forgot that CO retired 727's (which is significant) and started modernizing its' fleet long before 99. How is Kiwi set to make a comeback when CO wasted no time in securing their old gates at EWR? Where were they planning on setting up? Funds? Nobody even really remembers them anymore anyway. I agree totally that new planes don't gurantee financial success. NW does relatively well with an ancient fleet. I give SWA credit though, he does seem more informed about some things in airline history than the average Joe, but he has been grossly misled somehow.

Have a nice holiday weekend.


User currently offlineTeenFlyer From , joined Dec 1969, posts, RR:
Reply 17, posted (14 years 4 months 1 week 4 days 11 hours ago) and read 2856 times:

SWA has his facts totally messed up....Continental is known as a great airline considering the fact that they rose from the ashes. That means they are no longer in financial trouble. I have never heard of NW or UA having trouble. UA has and continues to have a little bit of customer service problems as referenced by the site www.untied.com, but they dont have any trouble financially ...... NW is doing good, will get some customers back with their improved meal program, just because they still use dc-9's doesnt mean they are in trouble.... Klwright69, you said you give SWA757 credit for being more knowledgeable than the average joe, but i think every airliners.net user has to be smarter than the average joe when it comes to aviation....

User currently offlineD L X From United States of America, joined May 1999, 11274 posts, RR: 52
Reply 18, posted (14 years 4 months 1 week 4 days 10 hours ago) and read 2863 times:

And why would you think that? Simply because AA has a bigger fleet? US has more money. Remember the MCI merger with WorldComm? If you looked at size and scope, you would immediately think that MCI would do the buying. BUT, it was little tiny WorldComm, maybe 1/100th MCI's size that did the buying. They simply had the money to do it.

Besides, AA is not AMR's most profitable unit. It is again rumored that they are willing to sell it (AA) to someone. And, Wolf (who used to work for AA) has dreams of running it.



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User currently offlineMCOtoATL From United States of America, joined Sep 1999, 474 posts, RR: 4
Reply 19, posted (14 years 4 months 1 week 4 days 7 hours ago) and read 2837 times:

While it may surprise some people to think of USAir buying out American (the second largest airline in the world,) read up on "leveraged buyouts." The whole concept confuses the heck out of me, but Frank Lorenzo was a master at this. His small Texas International tried to buy out almost everyone. Granted, many ofthem were in financial chaos, and AA certainly is not. But a small company can buy up the stock in a larger company and prevail that way.



User currently offlineD L X From United States of America, joined May 1999, 11274 posts, RR: 52
Reply 20, posted (14 years 4 months 1 week 4 days 7 hours ago) and read 2836 times:

Frank Lorenzo. (shudder) I hope you aren't equating Wolf to that guy...

But, yes, you are correct. TI bough much larger Continental, and then became Continental.

Leveraged buyouts happen rather frequently, and are even easier when the company that is being bought is amicable to the deal, which AMR was rumored to be.



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User currently offlineSWA737-500 From , joined Dec 1969, posts, RR:
Reply 21, posted (14 years 4 months 1 week 4 days 7 hours ago) and read 2840 times:

Come on folks, you really think I am some snot nosed little kid? I am well informed and realistic when it comes to aviation in general. Granted, those facts I gave are about history, not ancient history, but history nontheless. But I was meerly trying to point out that many major airlines that are doing well today didn't always turn profits, okay? As you can see, I made no reflections about their current performance, any that were made were made by B. I. Hengi, and I know you are going to say that I get all my facts out of books, but before you do, I want to say that that is not true, I only got out his book to make sure I didn't make any silly mistakes, okay? Which leads me to my next point, I apologise for saying SWA has turned a profit every day since 1971, I am aware that this is not true. I know the TI and Continental made life at SWA very trying at times. I just made a little slip up, that's all. Please excuse me for that, but don't call my facts lies, okay guys?

User currently offlineVirginA340 From United States of America, joined Jul 2005, 15 posts, RR: 0
Reply 22, posted (14 years 4 months 1 week 4 days 7 hours ago) and read 2832 times:

Continental and United is in the Fortune500 website as two of the most profitable airlines. go to www.forbes.com and find out yourself. Before you go posting another BS post like this again you better sit down at your computer and start checking around. I don't know where you thought that CO and United were in financial trouble. Stop looking at CO's 1990 report and jump back to the present. Continental and UAL in poor financial condition? I can already hear the laughing at you not with you. Come up with better facts.


"FUIMUS"
User currently offlineKlwright69 From Saudi Arabia, joined Jan 2000, 2028 posts, RR: 3
Reply 23, posted (14 years 4 months 1 week 4 days 6 hours ago) and read 2828 times:

We're all just pointing out that you should verify things. You use the exact same wording to describe BOTH TWA's AND CO's "poor economical performance," together which is both inaccurate and absurd. You do an OK job of describing some past events, but your evaluation of the present is off. What have you heard about Kiwi that none of us seem to know about yet? You're very, very correct when you say the majors haven't always shown profits. I wasn't one saying you were a "snot nosed" kid by the way.

User currently offlineSWA737-500 From , joined Dec 1969, posts, RR:
Reply 24, posted (14 years 4 months 1 week 4 days 5 hours ago) and read 2819 times:

You guys don't get it, do you!? They're not my facts! They aren't even my opinions! Okay!? Nothing said there was taken from my own thoughts or opinions. So would you pleeeaaaaassssseeeee STOP.

25 TeenFlyer : hehehe VirginA340..... We will teach him not to fly Cattle Car Airlines aka Southwest.... nothing against Southwest its just they are known as cattle
26 737-990 : Among the 10 major airlines TWA is the worst off financially, not making a profit in over 10 years. they have made great strives in getting a new youn
27 737-990 : I couldnt agree with you more first class! You hit the nail right on the head.
28 D L X : Oy. For the umpteenth time... US does not have the highest costs in the industry. Midway does. US's costs are based on the fact that they fly mostly i
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