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All you need to know -
"How do you make a millions dollars in the airline industry? Start with two million."
Seriously though, what do you want to know about? The Deltas and Uniteds of the world, the Boeings and Airbuses of the world, the Rolls-Royce/GEs of the world? Or all of the above?
This is very cursory, but might be helpful: http://www.investopedia.com/features/industryhandbook/airline.asp#axzz1…
Wikipedia has a decent glossary of the main operating metrics used for airlines:
http://en.wikipedia.org/wiki/Airline_cost_glossary
If you pull up a recent earnings release or investor presentation from a publicly-traded airline you'll see these in there as well.
Other than that the main "primer" I would recommend is to brush up on your operating vs. capital lease accounting - airlines take vastly different approaches in how much of their fleet they lease vs. own. In order to compare different airlines people usually make some capitalization assumption on the existing operating leases,. You'll hear this as EV / EBITDAR = (Enterprise Value + PV of operating leases) / (EBITDA + Rent expense).
Thanks all - Much appreciated....
SECFinance - Have heard it before. But hey...if someone's crazy enough to buy it, who am I (on the sell side) to tell them otherwise?
US Airline industry Outlook?? (Originally Posted: 04/10/2012)
The economy seems to be picking up again slowly as Americans are going back to work.
Do you see the demand for flights within the US increasing, decreasing, or staying the same and why?
Eh, I guess my hair line is hanging in there. I'm not 18 anymore, but hanging in there pretty well.
Oh wait, sorry, AIR LINE. Misheard you. Hmm, I don't know man.
They will probably stay the same for the next year or so. First thing to look at would be oil, as we still have uncertainty with Iran, China/India consumption increase, among other factors, it looks like the oil market should be in contango for the near future. From a personal viewpoint I am actually glad the airlines are decreasing the amount of flights and that they are parking their excess aircraft. I remember several years back when it would take 2 hours to get from the gate at JFK to the runway because of the rediculous amount of traffic, but now it seems that I am in the air within 15 minutes of leaving the gate, even in peak hours.
Also it is worth mentioning that even though the ticekts are getting more expensive and the fees are piling up, planes are still full of people no matter where you are going.
check out this link below. If you monitor Heathrow for a couple hours, you will see that there are at least 3-4 heavies going to the NYC area, Narita, SGP, South Africa, India, and other world centers, so I doubt there will be any significant change to this unless something drastic happens to the economy.
http://casperflights.com/unified/?location=egkk
you have to either look during London daytime hours, as the rewind feature is only for premium members.
Right now the Brazilian Air Force is looking to modernize its fleet by buying up to 36 fighter jets, and Boeing's F-18 Super Hornet is in the running for the deal. I know it's a multi-billion dollar deal but I don't know how much it is exactly.
Dilma Rousseff was actually leaning towards Boeing until the US Air Force canceled a much smaller ($336 million) deal with Embraer last month. They did so because an American company, Hawker-Beechcraft, wanted to be reconsidered for the contract Embraer won, but it's caused political discord.
...Oops, you were asking about flights, not the aircraft industry itself.
well aircraft deals are also a big part of it. One of the big developments (which is happening more with EMEA airlines more than American ones) is that they are trying to move to bigger planes such as A330, Boeing 777, A380 and of course the new 747-800 that will hit the production lines soon.
Emirates just recently contracted to buy 32 additional a380s which is supposed to bring their fleet up to 90 of these gigantic planes by the end of the decade. This might pose a regional threat to airlines like Etihad, Gulf Air, Kuwait Air, Royal Jordanian Airlines and possibly Qatar Airlines, all of whom are not quite positioned to handle a spike in oil prices as well as Emirates is.
I agree with Trailmix, I think flights will certainly increase over the next few years. Airlines are catching on to the fact that people will pay up for tickets. People probably won't mind that increase from $180 to $260 (i'm just ball parking to make a point) for a flight to Florida because they are certainly not going to drive there with the cost of gas going up. Not to mention how long it might take them to drive making it unfeasible. Airlines are realizing that to survive they need to cut back on the over capacity they have built and/or consolidate into larger companies that can help ease the cost of oil with larger volumes and greater pricing power. Just take a look at how desperately US Airways is pushing to merge with AA out of bankruptcy. They are even buying up domain names online. I think you simply see more consolidation in the industry going forward and maybe even a greater focus on customer service because I have a feeling the low cost bare bone airlines may be a thing of the past soon. That said I certainly wouldn't invest in an airline stock, if that is where you were headed with this.
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