Filed under: Industry, AMR Corp (AMR), Oil, Delta Air Lines (DAL)
In a move that might be imitated by huge US carriers like AMR (NYSE: AMR), Delta (NYSE: DAL) and Northwest (NYSE: NWA), British Airways will ground part of its fleet to save money because of the rising cost of fuel.
According to The Times of London, “The airline would park its oldest, least fuel-efficient aircraft.”
Analysts are concerned that British Airways may loss money for the next two years. By taking some aircraft out of service, the carrier could ameliorate some of that.
Wall Street might watch to see if large American companies have the sense to do the same thing. Most have debt loads big enough to move them toward Chapter 11, if fuel costs stay high and a rough economy hurts passenger traffic. Major airline mergers, some of which are fairly far along, will not solve the gas price problem. Taking jets out of service may, at least in part.
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Douglas A. McIntyre is an editor at 247wallst.com.
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