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On the war affects our next guest says that despite the economic slowdown most airline companies are gonna end it in the black this year -- lower oil prices are only part of the reason why.
Michael Boyd is president Boyd group international he joins us now Michael good to see again thanks for being here so -- way it's not necessarily true that lower oil prices are always a good thing for airlines correct.
-- -- because though -- oil prices and jet fuel can go on a different direction do a lot of reasons.
I think you'd airlines will lock in price of of jet fuel to know what they're going to be paying -- the drop below that well they left little bit of money on the table well.
By the way our airlines buying oil right now as we see it coming down it hasn't been a slow and long time.
Well -- it depends on what's happening with jet fuel itself -- that.
Another all smoke -- mean a big portion of jet fuel today is imported refined product in places like fun places like Venezuela.
So we have a big uncertainty in terms of what the price is no matter what oil.
Which helps airlines more though cheaper fuel prices -- a better economy because that those two things don't always go together.
I think that the bottom line.
Cheaper fuel because they can adjust how much product they put out their capacity.
To to match the economy which they're doing now.
Capacity number of seats in this -- gonna be down probably about 4% this year compared to last year that means they can ratchet up prices on fewer state.
All right let's talk specifically about some companies share American.
How is America doing whether bankruptcy.
Well you -- -- they went into live without a lot of warning if you will in terms of planning and a management change.
But -- they're gonna have to get focused they're gonna have to stop you know paying consultants 50000 dollars a day to figure out how to manage -- company.
Make a plan and go with it or otherwise they are gonna get forced into a merger with US Airways which would necessarily be all bad.
We'll talk about mergers what about the continental united merger house -- Well you know.
They have a glitch over the fallen for seven hours trying to get 151000 dollars with a business -- gonna go to China take seven hours to get -- money.
I think they're got they've gotten over that now so I think overall that's gonna get a lot smoother going forward are right now regional airlines US AB where regional airlines -- -- -- -- was out there but you do like SkyWest.
-- SkyWest overall for the best managed companies in America.
They have a lot of cash and as that portion of the industry becomes smaller and small look at fifty -- -- -- We're being being retired -- have a lot of them they're gonna go and other other areas so I would say long term.
SkyWest is a company to watch and I'm getting a -- but is there are no other airline that is well managed in the industry.
Ominous -- -- here US Airways I think is very well managed they just don't get credit for.
But at the top they know what they're doing and they know where they're going Michael Boyd blocks targeted this guy knows his stuff thank you Michael -- -- thank.
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