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Could NWA Wind Up On Top?  
User currently offlineZeus01 From United States of America, joined May 2001, 744 posts, RR: 2
Posted (12 years 1 month 5 days 9 hours ago) and read 1927 times:

With the current econmic troubles of UA and now AA who's showing some problem signs, do you think a airline like NWA might take one of there spots. Granted, UA could easily have to make a huge fleet cut to survive and AA is heading in a troubled direction according to forbes. NW stands as the only airline in decent financial condition that still allows them to grow.

Im not trying to make a UA/AA bashing thread, I just want to hear any ideas.

39 replies: All unread, showing first 25:
 
User currently offlineLGB Photos From , joined Dec 1969, posts, RR:
Reply 1, posted (12 years 1 month 5 days 9 hours ago) and read 1889 times:

Southwest or jetBlue is in a better position than NW,CO and even AA. The big 6 will probably have major announcements before the end of this year and WN and JB will keep on truckin without any clitches.

Stephen


User currently offlineZeus01 From United States of America, joined May 2001, 744 posts, RR: 2
Reply 2, posted (12 years 1 month 5 days 9 hours ago) and read 1877 times:

That may be true, but history tells a different story with airlines the size of jet blue. As far as WN goes, there not international service as well as route unavailibity. WN doesn't have the money to go international. There good at what they do, and thats about it. Plus, numbers show people don't always want to fly discount carriers.

Actually, NW isn't expected to make cut anoucments anytime soon. NW is in FAR better shape than AA and CO, thanks to the fact that they own a good portion of there planes as well as very conservitive finincial practice.


User currently offlineSEVEN_FIFTY7 From United States of America, joined Sep 2000, 957 posts, RR: 4
Reply 3, posted (12 years 1 month 5 days 9 hours ago) and read 1871 times:

And DL or CO will be there before NW ever will. (Well CO is debatable, but definitely DL). Delta is less-heavily unionized.

Keep dreaming, red birds.


User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 4, posted (12 years 1 month 5 days 9 hours ago) and read 1870 times:

Southwest or jetBlue is in a better position than NW,CO and even AA

How can you even compare a two-bit discount startup with under 30 planes to one of the major carriers and still keep a straight face? Get real dude.


User currently offlineUal777contrail From , joined Dec 1969, posts, RR:
Reply 5, posted (12 years 1 month 5 days 9 hours ago) and read 1856 times:

b747-437b,
people get on this kick with the leather seats and such awesome service that jet blue could ever compete with a major.

and just my opinion,delta will get to the top long before northwest will.dl is a better airline and they have proven that.


ual 777 contrail


User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 6, posted (12 years 1 month 5 days 9 hours ago) and read 1845 times:

people get on this kick with the leather seats and such awesome service that jet blue could ever compete with a major

"Such awesome service"? A one-class product flying transcon with a bag of chips as a miserable excuse for a meal now equals "awesome service". How our standards have fallen.


User currently offlineSjc>sfo From , joined Dec 1969, posts, RR:
Reply 7, posted (12 years 1 month 5 days 8 hours ago) and read 1821 times:

Zues - You're mistaken when you say Southwest doesn't have the money to go international, though it is completely outside their current business plan, which they will stick to and continute to make loads of money off of it. Southwest's current market value is (I believe) equal to that of the Big 6 combined, or something close to it.

User currently offlineFutureSQPilot From United States of America, joined Jul 2002, 147 posts, RR: 0
Reply 8, posted (12 years 1 month 5 days 8 hours ago) and read 1809 times:

Did you forget about a little airline called Delta? DL is expecting to be back in the black by early next year. With many of the top Airlines' CEOs reinforcing predictions of tough times to come, DL is one of the few airlines that has an optimistic outlook on the future...according to Leo "(Delta) will not merely survive, but thrive." I guess we just have to wait and see how much shrinking UA will do if they go ahead and file Ch. 11, but I am guessing that there is a good chance for UA to slip down the list from the #2 spot in the event of a filing for bankruptcy protection.

User currently offlineBraniff727 From United States of America, joined Sep 2000, 686 posts, RR: 1
Reply 9, posted (12 years 1 month 5 days 8 hours ago) and read 1798 times:

I don't see NW moving to 1 or 2, but 3 after Delta moves to 2.

Although AA is downsizing, it is already so big that the little capacity they are cutting doesn't even begin to fill the gap between 1 and 2.

I also think that UA is going to end up a smaller airline, perhaps 3 or 4. That being said, I think NW and DL are the ones to watch in the coming months / years.



Climbing
User currently offlineSccutler From United States of America, joined Jan 2000, 5521 posts, RR: 28
Reply 10, posted (12 years 1 month 5 days 8 hours ago) and read 1785 times:

"WN doesn't have the money to go international"

This is the most remarkably mistaken belief.

To expand on the point made by Sjc>sfo, at current stock prices, Southwest is worth $10.75 Billion-with-a-B;

AA, UA, US, DL, AS and HP are worth, in the aggregate, $4.727 Billion; and of that, AA accounts for $1.6Bn and DL accounts for $2.2Bn.

The markets assess UAL as being worth $178 Million (with an M), US is essentially valueless now (natch); Alaska is worth $672 Million and HP rates $77 million.

Bottom line? Southwest could buy all of the "Big" carriers without breaking a financial sweat. Not that they would want to do so.

If WN wanted to fly internationally, you can bet theey'd do it better than the rest, and they'd make more money at it as well. That they choose not to is the result of good sense, not lack of cents.



...three miles from BRONS, clear for the ILS one five approach...
User currently offlineSccutler From United States of America, joined Jan 2000, 5521 posts, RR: 28
Reply 11, posted (12 years 1 month 5 days 7 hours ago) and read 1760 times:

So, as it stands now, the "Big" family of US carriers is:

1. Southwest
2. Delta
3. American
4. Northwest
5. Continental

???



...three miles from BRONS, clear for the ILS one five approach...
User currently offlineUSAirways737 From United States of America, joined Jan 2000, 1026 posts, RR: 1
Reply 12, posted (12 years 1 month 5 days 7 hours ago) and read 1731 times:

With Northwest's new Detroit terminal and the in-process-of-being-remodeled-MSP, Northwest could very easily imo take the third spot and keep it. Northwest really isn't as bad as they were made out to be a few years ago with that whole winter storm in Detroit thing, where the people had no water and couldn't use the bathrooms. I think its pretty funny now how the first thing NW does now when your flight is delayed is to pour people glasses of water. They along with every other airline have downsides and most are trying to improve themselves, NW is deffinately one of them.

Erik


User currently offlineFutureSQPilot From United States of America, joined Jul 2002, 147 posts, RR: 0
Reply 13, posted (12 years 1 month 5 days 6 hours ago) and read 1697 times:

Sccutler- This conversation is based in figures of size, not worth, in which case I believe the list is:
1. AA
2. UA
3. DL
4. NW
5. CO


User currently offlineZeus01 From United States of America, joined May 2001, 744 posts, RR: 2
Reply 14, posted (12 years 1 month 5 days 6 hours ago) and read 1664 times:

Yea, I forgot about DL. Excuse my mistake. Now, to say that DL has proven a better airline all around, well, your just a idiot when you say that. NW is in the black, DL isn't. NW has been in better financial shape than DL for years. Now, because of DL's fleet size, we may see them slide into 1 or 2. But, Id still put a bid DL and NW will wind up in the top three (with DL moving hire than its current 3rd place.)


And no, WN doens't have the assests to go international. Net worth doesn't equal liquidity, duh. It costs exuberant amounts of money to operate a Intl. route, along with aquireing planes, not to mention WN would have to upgrade its poor excuse for service.


User currently offlineMilemaster From United States of America, joined Mar 2001, 1066 posts, RR: 2
Reply 15, posted (12 years 1 month 5 days 6 hours ago) and read 1653 times:

You're being a tool Zeus.

User currently offlineArtsyman From United States of America, joined Feb 2001, 4745 posts, RR: 34
Reply 16, posted (12 years 1 month 5 days 4 hours ago) and read 1565 times:

NW isn't expected to make cut anoucments anytime soon...

actually NW announced major capacity cuts along with the others this week

Jer


User currently offlineScottb From United States of America, joined Jul 2000, 6766 posts, RR: 32
Reply 17, posted (12 years 1 month 5 days 4 hours ago) and read 1541 times:

The answer is simply NO.

Delta *is* a stronger airline all around than Northwest. While NWA does own many of its aircraft, most of the owned aircraft have little to no value and will have to be replaced in the next several years. While Northwest enjoys a healthy cash position, it also has a negative book value (debt > assets). Aside from that cash position, Northwest is close to fully leveraged at this point. NWAC's market cap is also roughly 1/3 that of Delta's. Delta has been historically one of the strongest carriers financially; Northwest certainly has not and teetered on the edge of bankruptcy just a few years ago. Even AMR has a cash position comparable to Northwest and has far more valuable assets in the way of owned aircraft.

Moreover, Northwest will never (barring a merger with another airline) have the hubs to be one of the top two or three airlines. MEM is the weakest (by passenger traffic) major airline hub, bar none. DTW and MSP are middle-of-the road for traffic, and likely will never be as strong as markets like ORD, ATL, DFW, EWR, LAX, SFO, DEN, BOS, etc. Delta generates as much O&D revenue at ATL and LGA (let alone CVG, DFW, SLC, MCO, BOS, etc.) as Northwest generates at its three hubs combined. Northwest's greatest strength (in my opinion) is that it simply faces limited competition in its core markets at present.

Why on Earth would WN have any desire to operate international service? They specialize in reliable, low-cost short-haul domestic service (with a slowly increasing percentage of medium-to-long-haul sevice in recent years). They know what makes money for them, and they do it. And their market cap currently is roughly twice that of the other majors COMBINED. Maybe that's because they're one of the few airlines actually making a profit. They have $2.1 billion in cash, the lowest debt-equity ratio in the industry, and a book value of over $4 billion. They certainly have the financial wherewithal to operate international service (after all, they could simply BUY United using their cash on hand at present -- but who would want to?). The fact still remains that there's no reason for WN to begin international service; there are simply too many untapped opportunities in the domestic market to exploit first.


User currently offlinePSU.DTW.SCE From United States of America, joined Jan 2002, 7591 posts, RR: 27
Reply 18, posted (12 years 1 month 5 days 4 hours ago) and read 1537 times:

Here's some no-so-good news for NWA. On the frontpage of today's Detroit News, it states that 2 German banks have backed out of their bonds financing the new terminal at DTW. The airport has 2 weeks to find new backers, put the whole airport commission is a mess right now from all the corruption and the attempts to change the whole way the airport is managed. If no backing is found by Sept 8th, the bonds have to be paid back at $25 Million a year, and NWA bears 75% of those cost.

http://www.detroitnews.com/2002/metro/0208/21/a01-567417.htm

I'm not really the best finanicial guy, so if someone can intrept this better, please do.


User currently offlineUal777contrail From , joined Dec 1969, posts, RR:
Reply 19, posted (12 years 1 month 5 days 2 hours ago) and read 1480 times:

sccutler,
UNITED'S assets are worth 3.8 billion and not including cash that they are burning right now.
UNITED owns the majority of there 777 fleet and alot of 747's.

that doesnt equal 123million.


ual 777 contrail


User currently offlineSccutler From United States of America, joined Jan 2000, 5521 posts, RR: 28
Reply 20, posted (12 years 1 month 5 days 1 hour ago) and read 1430 times:

Simple equation-

Take shares outstanding, multiply by price per share, and you get market capitalization (or "market cap," as it is flippantly known).

That's what a publicly-traded corporation is worth.

If United could simply disregard its liabilities (debt and long-term obligations), then that asset number ual777 cites would mean something.

Of course, that figure does hold the nugget of UAL's salvation- it will file chpt 11, and all those unencumbered assets will be a fine way of moving forward, especially after essentially extinguishing the value of shareholders (including all the UAL employee-owners).



...three miles from BRONS, clear for the ILS one five approach...
User currently offlineScottb From United States of America, joined Jul 2000, 6766 posts, RR: 32
Reply 21, posted (12 years 1 month 5 days 1 hour ago) and read 1420 times:

Ual777contrail-

Problem is, United has almost $7.6 billion in current liabilities, $7.2 billion in long-term debt, $1.9 billion in lease obligations, and $3.9 billion in pension/benefit liability. And many of those 747-400's parked in the desert would be tough to sell off right now.


User currently offlineKwbl From United States of America, joined Jun 2001, 444 posts, RR: 0
Reply 22, posted (12 years 1 month 5 days 1 hour ago) and read 1404 times:

I would agree that DL would be in position before NW however with DL tremendous weakness in Asia, I do not believe they can ever be number 1 in terms of size. NW does have a strong advantage in the Pacific but are not large enough across the Atlantic and the hubs, though decent (MEM not included) they are not ATL, LAX, ORD, JFK etc.....

User currently offlineMCOtoATL From United States of America, joined Sep 1999, 474 posts, RR: 4
Reply 23, posted (12 years 1 month 4 days 23 hours ago) and read 1361 times:

It seems as if we are judgin "on top" to mean "the biggest." That may be a good measure of success, but for most investors, they want to see a high stock price. Most of the major airlines have fallen drastically, while Southwest has done fairly well.


User currently offlineBjones From United States of America, joined Feb 2002, 123 posts, RR: 0
Reply 24, posted (12 years 1 month 4 days 23 hours ago) and read 1359 times:

Sccutler,

AA, UA, US, DL, AS and HP are worth, in the aggregate, $4.727 Billion

......Bottom line? Southwest could buy all of the "Big" carriers without breaking a financial sweat.

Southwest doesn't have almost 5 billion dollars sitting around to buy other airlines with. And they certainly wouldn't want to borrow it either. Just because their stock is worth over 10 billion doesn't mean they have the money to swallow up the big carriers. They would have the ability to buy a major carrier, but not a bunch of them. That being said Southwest is in excellent financial condition and as you mentioned probably would have no desire to buy one of the the majors.


25 HlywdCatft : **Northwest really isn't as bad as they were made out to be a few years ago with that whole winter storm in Detroit thing, where the people had no wat
26 Post contains images HeederA380 : Zeus -- have you ever flown WN? I was just wondering because of your remark that "WN would have to upgrade its poor excuse for service." Obviously, if
27 Ual777contrail : heedera380, why would you DISS someone if they have flown WN and still didnt like them,have you flown all the majors? and you speech is well and fine,
28 TzMSP : Ual777Contrail: and just my opinion,delta will get to the top long before northwest will.dl is a better airline and they have proven that No offense,
29 FutureSQPilot : Considering the topic, the WN debate should really be dropped. Talking about WN going intl is like talking about Taco Bell serving fine wines...its no
30 Scottb : Actually, I don't agree that NW is in a better position to overtake UA in the list of the top X carriers, even though they currently (as of July) gene
31 SESGDL : TzMSP, Hate to diss my fellow Minnesotans on airliners.net, but PLEASE! Delta is a bad airline because they don't paint their planes in a single paint
32 FLYYUL : NW is in a very strong position, and it is one of those that are definitely on the upswing. Northwest has QUALITY hubs in Detroit and Minneapolis whic
33 Post contains images IMissPiedmont : Yep it's true that WN is not very big. Except that if you took the international routes and PAX off AA, DL, UA, CO and NW WN would be a bigger carrier
34 Sllevin : Just as a side note: A company's "market cap" (which is the amount of money it would cost to purchase every share of its stock at the current price) c
35 RayChuang : I think DL is about to become a much more important player, especially with the financial difficulties at US and UA. For one thing, DL has powerful hu
36 Braniff727 : Ok, So the question here is not "If NW was in the same financial state as it was in the early '90's, would..." or "If NW had labor disputes going on,
37 Na : Scottb, there are not "many UA -744s parked in the desert". There were never more than 6 parked at a time, and these days UA is returning them into se
38 Post contains links Haveric : an interesting graph appears in this morning's Philadelphia Inquirer. It shows each airline's debt to equity ratio and the "healthy" NW comes in secon
39 Post contains images TzMSP : SESGDL: Hey, I never argued that NW will be on top. I think they've got room to grow, but it was never my contention that they will be on top. And yea
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