Sunday, May 25, 2008

Airline Industry Bankruptcies & Profitability

Interesting list of airlines that went bankrupt (like Techcrunch's Deadpool). They say you can't make money with airlines unless you're short selling.


Higher fares are a prerequisite for higher yields which are essential for industry profitability. Yield, a measure of fare levels, is defined as revenue per revenue passenger mile (RPM). RPMs are a measure of traffic volume: one RPM indicates that one passenger has flown one mile.

Lastly, the graph below compares the performance of AMEX Airline Index (composition) with the S&P Index from 1992 to May 2008.

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