East New York Posted May 21, 2008 Share #1 Posted May 21, 2008 So here's a very interesting topic we talked about at work today. With oil prices topping out at $130 a barrel, everyone is feeling it. Within the past 2 weeks, 5 airlines have gone out of business. It is becoming increasingly hard for the carriers to make a sound business case. The average airliner fuel tank hold 15,000 gallons of fuel. At an industry discounted rate of aproximately $2.65 a gallon, most large airlines are paying more than $40,000 dollars for a fill up. A 747 costs $114,000 to fill up. Aloha Airlines has been the #2 carrier out of Hawaii for decades. In it's last days of operation, fuel costs became so much of a burden that the airline was behind on lease payments on it's newer 737 aircraft. So what does that mean? Boeing sent repo pilots out to Hawaii to take back 2 of the planes which are valued at more than $80 million a piece. Not too long ago, Swissair went into default on it's lease payments. Airbus demanded that the airline return 6 A320's. The airline halted operations, and refused to return the aircraft because by Swiss law, airlines are protected from repo as long as the aircraft is in Switzerland. So what did Airbus do? The waited until one of the flights arrived at JFK and repoed the plane, leaving the crew and passengers stuck in New York. Northwest Airlines is the only major carrier in the US to still operate less than fuel efficient DC-9's. This has saved the airline from purchasing and leasing new aircraft. This is another point that was discussed prior to the airline agreeing to be taken over by Delta. American Airlines, which is the world's largest until the new Delta becomes operational, announced today that luggage will no longer be included in ticket price. Each passenger will now have to pay $15 per piece of checked luggage. Each of the "Big 6" airlines have raised ticket prices by up to 20% within the last week in an effort to deal with rising fuel costs. Anyone need a job? Boeing and Airbus are hiring Repo pilots! Link to comment Share on other sites More sharing options...
metsfan Posted May 21, 2008 Share #2 Posted May 21, 2008 Great, more good news for my airline credit.:mad: - Andy Link to comment Share on other sites More sharing options...
Pablo M 201 Posted May 22, 2008 Share #3 Posted May 22, 2008 Yea, lots of airlines going down. A friend of mine who works for Express Jet, got a call yesterday that a few cities that serve closed yesterday. So its really not looking good. And thats part of Continental so I wonder til Continental themselves start cuts. Link to comment Share on other sites More sharing options...
KTrainExp Posted May 22, 2008 Share #4 Posted May 22, 2008 What does repo mean? Link to comment Share on other sites More sharing options...
metsfan Posted May 23, 2008 Share #5 Posted May 23, 2008 Yea, lots of airlines going down. A friend of mine who works for Express Jet, got a call yesterday that a few cities that serve closed yesterday. So its really not looking good. And thats part of Continental so I wonder til Continental themselves start cuts. Different company. It's a "DBA" situation. continental express is a partner service provided by expressjet llc. Expressjet connects major airports with smaller ones. Also they do some medium haul stuff (between the 3 hubs). - Andy Link to comment Share on other sites More sharing options...
East New York Posted May 25, 2008 Author Share #6 Posted May 25, 2008 What does repo mean? Reposses. Link to comment Share on other sites More sharing options...
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