Airlines

Trustbusters barely dent air oligopoly with Alaska

6 Dec 2016

The U.S. Department of Justice forced Alaska Air to cut code-sharing with American Airlines before approving its $2.6 bln bid for Virgin America. That'll improve competition a tad. But with the top four carriers piloting 80 pct of all domestic flights, it's just tinkering.

Buffett’s love for moats trumps fear of flying

15 Nov 2016

The billionaire's Berkshire Hathaway has bet over $1 bln on four U.S. airlines. Buffett once called the industry a "bottomless pit," and jokingly wished aviator Orville Wright had been shot down at Kitty Hawk. That was before a spate of mergers created a profitable oligopoly.

Shadow activist takes flyer at Colombian airline

6 Oct 2016

Paul Singer's investment firm is urging a sale of Avianca, where it isn't directly an investor. Elliott wants to protect the value of the stake it was offered as collateral for loans it extended to Avianca's controlling shareholder. The logic is clear but the method is fuzzy.

EasyJet misery a foretaste of European airmageddon

6 Oct 2016

Growing overcapacities fuelled by cheap oil, security scares and Brexit jitters are hitting even highly efficient airlines like easyJet hard. The low-cost carrier expects a 28 pct fall in pre-tax profit. Less nimble rivals like Lufthansa and Air France can brace for worse.

German airlines leave logic in the ejector seat

28 Sep 2016

In most sectors, a heavily loss-making company with liabilities that exceed its assets would disappear. Yet German carrier Air Berlin is still airborne, and Lufthansa may take on a chunk of its fleet. Aviation bosses continue to think they can defy financial gravity.

Better to fly Europe’s airlines than buy them

12 Sep 2016

Fuel prices have fallen, but that has incentivised European carriers to keep too many planes airborne. Demand is too weak to meet the supply, which means ticket prices are set to fall, and with them airlines’ profitability.

EasyJet is post-Brexit bet for the brave

21 Jul 2016

The UK airline says it doesn’t know what security scares, currency turmoil and Britain’s exit from Europe will do to earnings. The shares have fallen around 30 pct in less than a month. Yet in past downturns easyJet has snatched market share. There’s no reason it can’t again.

Airbus will spend longer in Boeing’s slipstream

13 Jul 2016

The European group is cutting production of its flagship A380 jumbo sharply and has warned of potential new charges on the fraught transporter A400M. Both are likely to dent profitability and will it make ever more difficult to reduce Airbus' margin gap with U.S. rival Boeing.