Fasten seat-belts
The classic victims of financial recession are airlines. Their assets are their routes and their aircraft — but the routes, as TWA is finding, may not be theirs to sell, and if the aircraft are not leased they are probably mortgaged. In fact airlines live by cash flow. If it covers their costs, fine, but if their borrowing and leasing costs go up and revenues go down, they are up in the stratosphere without a parachute. British Airways is trying to maintain it buoyancy by making the crew jump out. Lloyds Bank seems to have taken to the air on its own account — or rather, on the troubled accounts of customers. It is like a scene from a disaster movie, with Lloyds cast against type as the little old lady who, after the in-flight explosion, has to take over the controls and land the jumbo. I do hope the script-writers can think up a happy ending. The reality is, though, that businesses in the air and out are finding that they cannot live on their cash-flow, and some of them will go down in flames.
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