Monday, October 03, 2005

Continental Airlines Announces Daily Nonstop Service Between New York and Copenhagen, Denmark: Financial News - Yahoo! Finance

Continental Airlines Announces Daily Nonstop Service Between New York and Copenhagen, Denmark: Financial News - Yahoo! Finance

CAL continues to add international flights at a break-neck pace. The competition is virutally nil on many of these flights. Fuel is a bigger factor on international flights but the margins are fat.

One short term risk to CAL is that it might purchase NWAC or DAL. Even if such a deal is made, the purchase would amount to the assumption of debt in exchange for the carriers.

CAL has kept load factors high both domestically and internationally by shifting assests to international flights. One perceived risk to be very high is that new entrants will compete with CAL. This is a big joke. New entrants to the airline business have cost venture capitalist billions. There just are not many folks around who want to start up a company in this very competitive business. In past years, there was hope because new entrants started with much lower labor costs. After the restructurings, the surviving carriers have reduced labor costs dramatically.

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