“I don’t think we’re ever going to lose money again,” -Doug Parker, American Airlines CEO, 2017.
Let 'em fail.
But letting the weakest one fail as a warning to the others that the bailouts are over and perhaps they should learn to save against rainy days isn't the worst idea.
Given climate change, air travel is not a public good we should be prioritising.
"Too big to fail?" We fell for that once before.
Airline comes out nimble and debt free. Average Joe still has airline competition. Shareholders get wiped out, but that’s the risk you run for yield.
I am in the tourism industry, owning a small-medium hotel.
If I stop paying any loans and generally I am left out of cash-flow I am pretty much screwed for the next few years, if not closing down.
I know though a few people around my area with massive resorts and a debt over 100mil that have already stopped paying quite a few loans themselvs and they are getting away with a slap on their wrist. The gov gets involved cause the debt is enough to damage a bank, and the people that are going to be left without a job are enough to cause a mini crisis. Then the bank itself... well for them its not just about ceasing the asset as its gonna be a hard thing to sell or manage.
Meanwhile the owners are taking out massive salaries + bonuses for their personal accounts and don't care about their balance sheet being a mess and their debts growing.
Larger businesses have a proportionately larger need for money to sustain themselves. Big business doesn't mean rich business. Look what's happening to the airlines.