FlyingElvii wrote:ShinyAndChrome wrote:NameOmitted wrote:How did a thread about a quarterly report stating that AS has the reserves to survive more then a year without an improvement in the present situation shift so quickly to merger assumptions? Are people thinking that AS is daft enougufh to be wanting to buy?
To be fair, it's not like it takes that much to tip this place into merger speculation and that's when things are normal.
Just my humble opinion, but I don’t see any mergers happening.
With the inevitable huge draw downs, and more importantly, the large new pilot surplus that goes with it, I see numerous opportunities for new entrants.
While the US majors have provisions in their purchase agreements that planes they offload can never be used in the US again (aka the Western Pacific Effect), there are going to be TONS of aircraft available cheap, all over the world.
Cheap planes, cheap pilots, and opportunities...
That will all depend on timing of course. And it's not like cheap assets and desperate employees automatically mean new opportunities. With the exception of Breeze, which already had a some of the startup groundwork in place when this happened, any erstwhile entrants will need at least a few more years to go through all the necessary regulatory and operational processes before starting up. For all we know, by the time that happens the incumbent airlines could be recovered enough to fight off new challengers or maybe the public health or economic picture is still shaky enough that there isn't enough space for a new airline to grow into. And that's assuming that you can find investors in that timeframe willing to invest the requisite billions in a new carrier.
I suppose it's no secret that I'm rather bearish on the idea of new scheduled passenger airline startups in this country. Depending on how you want to measure it, the last real trailblazing startup, the last case of actually leveraging an innovative business model into something viable in the long term was either B6 or NK's transition to the ULCC model. If I were an investor and someone came to me with a plan centered around reinventing the wheel with cheap planes and labor, I'd just go home.