Back in the old days, airlines went bankrupt but kept on operating. That let them stop paying on some debts and other costs, but continue reaping revenue.
Today, it seems airlines go bankrupt (and boy, have they gone bankrupt) and abruptly cease operations immediately, if not sooner—no flights, no revenue, nothing. There was an exception or two in the latest spate of airline bankruptcies. At least one airline kept operating, but I forget which one.
I have not read any comments about this increase in bankrupt airlines that cease operation. It seems logical to assume (there’s that dangerous word) that direct costs—mostly fuel—make it impossible to operate even with the reduced costs possible under bankruptcy. If you still lose money on each leg under bankruptcy, why bother?
Please remember this is a question, not an answer. I’d like to get comments from those who know the facts.
Funny thing about cost and revenues. Usually, the goal is to calculate costs in advance then decide if the market will allow you to make a profit. If it won’t, why get into the business? If you’re already in the business and the numbers prove you can’t make it cheap enough to sell it profitably, why not get the hell out? Reminds me of an old rock song from decades ago. One line “goesâ€â€”as the kids say—“GREAT GOOBA GOOBA! LEMME OUTTA HEA!â€
Seems to me you can hear that desperate plea on the airways these days.
What a business.
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