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May 20, 2005
Airline Hedging And The Future Of The Industry
Hedging oil prices mitigates the short-term risk of price spikes, but it doesn't solve long-term price increases nor does it solve underlying operational inefficiencies.
Hedges also cost money, like any insurance. Some cash-strapped carriers, like Delta Air Lines, have sold their hedges to raise money. Other U.S. carriers, including Continental Airlines, Northwest Airlines and US Airways Group, are opting to forgo hedges and pay market prices for fuel this year. Profitable, low-cost carrier Southwest Airlines still hedges aggressively, however.
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Posted on May 20, 2005 12:24 AM by contin128.
Filed in Travel Blog under continental airlines.
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