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Author Topic: Extreme Low Value Airlines  (Read 2607 times)

Offline RushmoreAir

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Extreme Low Value Airlines
« on: July 20, 2009, 11:28:23 PM »
I would like to know how some companies are functioning with such low values in Jet Age 2. For Example, Air Lisboa: How can it have -50 million value and not go bankrupt. My airline has received a bankruptcy warning, and I would like to know how Air Lisboa does it.  ??? I'm due to go out of business early to morrow morning.

Offline Sigma

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Re: Extreme Low Value Airlines
« Reply #1 on: July 21, 2009, 12:59:40 AM »
There's quite a few ways it can be done.  But the important thing to remember is that Bankruptcy status is based off Cash-on-Hand, not on Net Worth.  You can have a great Value and no Cash or vice versa.

Probably the most prevalent reason you see that is due to Loans.

Say you took out $300M in loans and spent that money on Plane orders.  You have $50M in cash-on-hand but $300M in liabilities -- leaving a Net Value of $-250M.  But you've got plenty of cash, so no problem.

An airline also gets a full real week (in most cases) to get out of bankruptcy.  And that clock resets if they ever post a substantial positive cash flow.  So an airline can get into trouble, get deep into negative cash and a few days into their warning.  But say that they then sell some aircraft they owned and get a big boost to their cashflow (but still negative on-hand) and the clock will reset because the "Bank" thinks they're making they're way out of bankruptcy and cuts them a break.  They will then get another warning the next game-week which can last several more real-days.  Doing this a company can have negative cash-on-hand for a very long time, more than a few real-life weeks sometimes.

Offline RushmoreAir

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  • Posts: 887
Re: Extreme Low Value Airlines
« Reply #2 on: July 24, 2009, 12:47:59 PM »
Thanks for the info ;D.

 

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