Skip to content
  • 214-244-7227
  • robb@cfoforrent.com
  • Home
  • Blog
  • Contact Us
cfo-logo-hover
  • Robb
  • November 21, 2023
  • 0 Comments

First, this post is not about the banking industry, or the securities industry (regardless of the terrible market performance lately), or the mortgage banking industry, or even the much maligned morgage brokers.

It’s about the airline industry. An industry strategist was quoted recently as saying “many airline business models cease to work at $135-a-barrel oil prices.” I guess they’re not in much better shape at $145.So what happened? We’ve known that oil prices were at risk since at least 2001 if not as far back as the 80’s. And any industry that relies on fuel oil to fly a piece of metal machinery weighing upwards of a million pounds would want to have risk management issues resolved long before survival was
at issue, wouldn’t they? So why are they now trying to nit pick their
customers with extra charges for checking baggage, food in flight,
cutting schedules, etc.? Why is the Wall Street Journal writing about
the possibility of their postponing the purchase of new planes – the
fuel efficient ones, no less? Either they didn’t plan ahead or they
didn’t like what their planning told them so they chose to ignore it.
Oh, you say they saw it but were too poor to do anything about it?
Rubbish! If you think your survival is at issue, you put up everything
you have to prevent a bad outcome. Survival is the basic instinct,
remember? If you don’t do that, you either don’t think it will happen
or you think someone will bail you out if it gets too bad. And if
you’re big enough, you may get a bail out from the biggest
free-of-charge insurance company in the country, the US government.Airlinesregularly go into bankruptcy, but none of the big ones ever stop
flying, in spite of what seems from here like very poor strategic planning. What would happen if one of them actually put their planes on the ground and laid off all their pilots? Would Uncle come to the rescue?

I think we can survive with one or two fewer airlines, don’t you?

I welcome your comments.

  • airline industry planning ahead
  • Share This Post

Categories

  • Board of Directors (60)
  • Controller for Rent™ (153)
  • Entrepreneurs & Business Owners (314)
  • Entrepreneurs and Business Owners (2)
  • Exit Strategies (88)
  • Finance Mentoring (289)
  • Management (44)
  • Non-Profits (156)
  • Real Estate (11)

Popular Tags

  • accounting
  • balance sheet
  • banks
  • board of directors
  • book
  • budgets
  • cash
  • cash flow
  • cash management
  • CFO
  • CFO for Rent
  • economy
  • education
  • employment
  • exit
  • finance
  • Finance for Nonfinancial Managers
  • financial management
  • financial reporting
  • fund raising
  • Gene Siciliano
  • governance
  • growth
  • hiring
  • investing
  • lending
  • loans
  • M&A
  • management
  • money
  • Non-Profits: This Blog's for You
  • nonprofit
  • not-for-profit
  • part-time CFO
  • planning
  • profit improvement
  • real estate
  • retirement planning
  • risk management
  • sell the business
  • small business
  • strategy
  • taxes
  • training
  • Your CFO for Rent

Please feel free to contact us at 214-244-7227 or robb@cfoforrent.com
for an exploratory conversation with no obligation.

We will be glad to hear from you.

Get In Touch

© 2024 CFO For Rent - Western Management Associates. All rights reserved. Website by Avodah Web Solutions.