A: It could be. ... I think on the one hand it would put us against an even larger competitor. We're dealing with carriers that are giants compared to us already. But I still have the belief that if we keep managing AirTran the way we have ... we can control our own destiny.
Consolidation in theory could create some opportunities because there's no way you could combine Delta and United without shedding some number of assets. It could be additional [airport] gates in Atlanta or at O'Hare [in Chicago] or slots at LaGuardia [in New York]. We would try to act opportunistically [to buy those].
Q: A big merger like that would take years to complete. How would that help when airlines are dealing with nearly $100-a-barrel oil today?
A: I don't want to make the case for the hedge fund. ... If you look at the economics separately, it could be compelling under the right scenario. The problem is the integration process could be very, very difficult. Certainly we're seeing an interesting example with the US Airways-America West [merger, ongoing since 2005]. Obviously there's issues there.
Q: AirTran tried earlier this year to acquire Midwest Airlines, without success. How much did hedge funds support that deal?
A: It's all about money. They were very supportive. ... They wanted a closed deal, and they wanted us to bid the price up.
Q: Hundred-dollar-per-barrel oil seems close to inevitable. What will airlines look like a year from now if oil prices stay at that level?
A: I think it's a very, very big hurdle. I think the scenario is fairly simple. You'll see higher [ticket] prices to offset it. You'll see a doubling of any conservation measure you can [do]. ... And I think there will be lower capacity in the domestic marketplace.
As prices rise, it will have an impact on the number of travelers, and some carriers will go negative on capacity, and others will reduce their growth rate. ... We've taken our own steps in this environment to bring our supply [in line]. If we have to do more, we'll do more.
Q: If oil and fuel costs stay that high, will AirTran be smaller a year from now? Will it be profitable?
A: You don't know what happens because you don't know the impacts on the economy. I think we'll be better prepared to manage it. I think what will happen is carriers will react and pull capacity down. For us, that could create opportunity.
MEET BOB FORNARO
* Title: President and chief executive, AirTran Airways
* Age: 53
* Family: Lives in Orlando with wife, Karen. Has three adult children.
* Background: Grew up in Plainview, N.Y., on Long Island. Went to Rutgers University on a lacrosse scholarship; graduated with a bachelor's in economics. Has a master's in city planning from Harvard University.
* Career: Joined the Orlando-based discount carrier in 1999 as president, helping then-CEO Joe Leonard rebuild the airline after the 1996 crash of a plane belonging to its predecessor, ValuJet. Prior to that, Fornaro ran a consulting business and was a senior vice president at US Airways, Northwest Airlines and Braniff.
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