On everlasting bad news on the air industry

Well, well, well, it seems that our friends at Delta and Northwest airlines finally got it right and their pilots decided to drop their selfishness –don’t ask a NWA pilot, still not convinced- and agree on who will be who within the new married airline (apparently forming the world’s largest airline in terms of traffic).

The merged carrier will keep the name Delta and control some 390 routes, along with 75,000 employees and 800 airplanes.

Alitalia is in the ICU (now another Berlusconi’s toy), and just last week Frontier filed for bankruptcy joining ATA, Aloha and Skybus. And that’s only including US carriers, if we go east, Oasis, the Hong Kong based carrier, landed its operations last 9 April, after just 17 months in the air.

American Airlines joined the circus on Tuesday last week after it had to cancel in excess of 3,300 flights due to ‘wiring inspections’. If you complained about the T5 fiasco… imagine flying on a Boeing/MD-80 with AA!!

On April 15, Agora Financial’s 5 min Forecast pointed out that the wedding in the skies is not good value for customers, ‘Guess you can kiss cheap tickets goodbye‘ but also for investors:

The air industry doesn’t seem like these days… or any day, for that matter! Warren Buffet estimated that if you had owned the entire airline industry from the moment the Wright brothers made the first controlled flight, up until the day the Concorde made its last flight you would have made almost nothing of your investment.

If we throw in production problems for the main players –first Airbus with the electrical problems of the A380 and now Boeing with the 787 Dreamliner and the composite used on its parts-, ever-rising petrol and jet fuel (over $130, 60% increase in the last 12 months) and growing competition, it seems that only the potential growth in traffic from China and India add some light to the gloomy picture.

What’s going to be the next transport revolution? That, I don’t know, but I will keep my eyes open. It seems that rail travel is picking (BBC: Eurostar passenger numbers rise), but that just might be because investors paid the price of the tunnel debacle, and because flying from a London airport is worse than having a Taliban mullah as stylist.

Until tomorrow,

.Calvin

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