Delta Loss $6B

[deadstick]

Originally Posted by cfii2007

Funny thing if all these losses resulted in CRJ's going away, flying going back to mainline, and turboprops making a return.

I remember a few years back when Midway (yellow, not red) tanked. I flew over Clarksburg, WV and there were CRJ's on every spare piece on concrete. Columbia, SC was the same way after ACA/Indi Air closed up. Sad, sad sights.

I really wonder how quickly such a change (cfii2007) could be done. Overnight like Aloha, or a phased draw down? The former could cause a major shock to not only the industry, but the economy.

If anybody happens to know, did Frontier use Ch11 protection to break the RAH contract? Most regionals have 10 year contracts, right?

[jspeed87]

The Government should step in and raise the fares. Thats how easy it is, make airline flying more glamorus. People are going to pay for it, because their is no other choice. What you think people are going to drive all the way to Cali from NY? Don't think so. Bring back the Meals, More leg room, and increase the fares, everybody will be happy.. ( and make a mandatory 1st year FO Salary of 40K)

[FlyingAccountant]

Originally Posted by kellwolf

The bankruptcy emergence was based on stock being a certain price. Now, with gas prices soaring higher than an eagle in a thermal, no one wants to buy airline stock. Result of that is the stock price falls and falls hard. Now, the company is "devalued." What Delta has done is take the difference in what they projected they would be and their current value and termed it a "loss." Like Doug said, if you have a $160K house, an gang bangers move in, the neighborhood goes to hell, and the home value falls to $80K, you can't subtract that difference from your income for the year. High finance business world, you can make it look like you're in trouble by doing that, though. But, I guess as Tony says, it's still playing within the rules.....

Sort of. Here's how it works. Doug wants to buy a house with a book value of $200k. However, Doug will pay more than that $200k BV, because he believes the house will be worth $400k in five years. So let's say Doug pays $300k. The difference between what he pays and what it's actually worth is the goodwill(100k), it's an intangible asset of sorts and he carries that on his books. So now, four years later the housing market goes down the tubes and Doug's house is only worth $220k, he realizes his $100k of impairment, an intangible asset, is now only $20k, so he writes down the goodwill on his imaginary balance sheet down to $20k. So he's effectively realized an $80k loss.

Cliff's notes: It's a paper loss based on money that was sunk years ago, most likely. The only thing this 6 billion loss will do is piss off the stockholders.

[Polar742]

Originally Posted by cfii2007

Funny thing if all these losses resulted in CRJ's going away, flying going back to mainline, and turboprops making a return.

...only if the Tprops are flown by pilots on the "mainline" seniority list. Otherwise, the scenario painted over the last 30 yrs (the inception of "commuters") will start all over.

If not, the 2037 commuter juggernaught will be Cape Air.

[Polar742]

Originally Posted by FlyingAccountant

Sort of. Here's how it works. Doug wants to buy a house with a book value of $200k. However, Doug will pay more than that $200k BV, because he believes the house will be worth $400k in five years. So let's say Doug pays $300k. The difference between what he pays and what it's actually worth is the goodwill(100k), it's an intangible asset of sorts and he carries that on his books. So now, four years later the housing market goes down the tubes and Doug's house is only worth $220k, he realizes his $100k of impairment, an intangible asset, is now only $20k, so he writes down the goodwill on his imaginary balance sheet down to $20k. So he's effectively realized an $80k loss.

Cliff's notes: It's a paper loss based on money that was sunk years ago, most likely. The only thing this 6 billion loss will do is piss off the stockholders.

[kellwolf]

Originally Posted by FlyingAccountant

Sort of. Here's how it works. Doug wants to buy a house with a book value of $200k. However, Doug will pay more than that $200k BV, because he believes the house will be worth $400k in five years. So let's say Doug pays $300k. The difference between what he pays and what it's actually worth is the goodwill(100k), it's an intangible asset of sorts and he carries that on his books. So now, four years later the housing market goes down the tubes and Doug's house is only worth $220k, he realizes his $100k of impairment, an intangible asset, is now only $20k, so he writes down the goodwill on his imaginary balance sheet down to $20k. So he's effectively realized an $80k loss.

Cliff's notes: It's a paper loss based on money that was sunk years ago, most likely. The only thing this 6 billion loss will do is piss off the stockholders.

Thanks. I sorta understood the first part. The last part was crystal clear.

I think what we need to focus on is what airlines are doing OPERATIONALLY. As in if they take a loss of $280 million in operational stuff, that's more or less the "real" loss. Anything else is for paper/tax purposes. Like was mentioned earlier, I'll take a $280 million in a recessionary 1st quarter. It could be a LOT worse.

[OldTownPilot]

280 mil is a hair over 3 million a day in losses. I wish I had 3 mil a day to lose.

[taildragger173]

280 isnt as bad as the 500 something that UAL lost. The rest is just a paper loss. My jaw did drop this morning though when I saw it. Also remember that there is usually a loss in the first quarter. The second and third quarters usually do a lot better.