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Author Topic: Transfer of airline ownership / CEO  (Read 5395 times)

Offline alexgv1

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Re: Transfer of airline ownership / CEO
« Reply #40 on: March 15, 2012, 08:57:10 PM »
But the argument may be that the airline is so small that you are just as well to start off yourself without the disadvantage.

I guess the idea of turning around small airlines will be appealing to some players though, so it's a matter of opinion.
CEO of South Where Airlines (SWA|WH)

Offline Sami

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Re: Transfer of airline ownership / CEO
« Reply #41 on: March 15, 2012, 09:26:16 PM »
Sami, would you be so kind and give some more insight into the ways of determining whether the airline is in too bad shape or too small for a new CEO to take over?

Let's say less than 10 planes, or cash balance below (-$5million * local inflation rate  .. = $5mil 2005 year money) .. or that way. Keeping it simple.

ICEcoldair881

  • Former member
Re: Transfer of airline ownership / CEO
« Reply #42 on: March 20, 2012, 04:27:31 PM »
I 100% agree with pretty much everything that has been said - but to keep it simple let's just use option 1, maybe if we do scenarios like EU-NA or (even better) Asia-NA-Oceania? That would be a cool way of making scenarios and gameworlds... ;)

Cheers,
ICEcold

twothousandgt

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Re: Transfer of airline ownership / CEO
« Reply #43 on: March 25, 2012, 02:37:35 AM »
Let's say less than 10 planes, or cash balance below (-$5million * local inflation rate  .. = $5mil 2005 year money) .. or that way. Keeping it simple.

What about no restrictions?

What I mean is if user starts an airline and exits the game, regardless of circumstances (with obvious prevision to allow them to return relatively quickly), the airline is then turned over to AI management. You, sami, would setup the default logic for said AI airlines and so it would be adjustable by you at any time. Any new players joining that game world would get the previously mentioned prompt to start a new airline or accept an existing one. It would be up to the player to decide if it was a good bet or not. Meanwhile the game worlds would remain populated instead of the existing model where you can literally poach another player's setup if you know enough ahead of time.

Sorry I did not read every reply as yet, maybe this was already covered.  :-[

Offline Sami

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Re: Transfer of airline ownership / CEO
« Reply #44 on: March 25, 2012, 02:25:08 PM »
There is no sense in keeping "complele failure" airlines there. What I meant that it will just remove the worst of worst....

ICEcoldair881

  • Former member
Re: Transfer of airline ownership / CEO
« Reply #45 on: March 26, 2012, 06:37:21 PM »
e.g. when Dutch Airlines went under and had a value of $-1 billion USD and finally was chopped by the game's bankruptcy thing. ;)

Offline BobTheCactus

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Re: Transfer of airline ownership / CEO
« Reply #46 on: March 28, 2012, 05:09:27 PM »
I would think that while airlines closed by the bank should not be eligible, any airline closed voluntarily by a player should qualify, regardless of the financial standing.
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Glob-Al

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Re: Transfer of airline ownership / CEO
« Reply #47 on: April 26, 2012, 03:13:33 PM »
I'm someone who would very much like to see a full stock market, M&A type system implemented in to the game but I agree this would be a good step in the meantime. The one thing I would disagree with is this...

It will basically be in a way that if an airline is closed due player inactivity, it enters to AI management and goes under "looking for new manager" status. Then it will be first come, first served basis where the fastest player can grab the airline and become the operating CEO there If no interested players in certain time the airline will be closed.

I think one of the opportunities that airlines continuing could provide is the chance for people to "move up" as CEOs from a small airline to a medium sized one to a large one. So I think it would be better if who becomes manager of an airline is in some way based on skill / past performance, rather than just on who happens to be online at the right moment. At the same time though I recognise part of the idea is that new players joining the game take over an airline and they would no doubt want to do this immediately, so how about the following compromise?

If an airline has less than 20 aircraft when it's manager leaves the airline CEO position is made available on a first come first served basis for 72hrs real time. If no one takes it on the airline closes.

If an airline has more than 20 aircraft when its manager leaves "applications" are invited and after 48hrs real time the person with the highest CEO wealth or CV on their previous airline is awarded the position, and their previous airline is in turn listed as looking for a new manager.

Offline spiff23

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Re: Transfer of airline ownership / CEO
« Reply #48 on: May 06, 2012, 04:07:42 AM »
having played a number of emerging markets and top notch airports (bases ORD, LHR), I have to say I don't really like this idea at all.  If someone chooses to walk away, so be it.  Let the airline run its course and shut down.  Part of the fun it starting in a scramble of 6 airlines at some of these hubs.  It a "#$#@#%" lot of work to build a competitive airline at some of these places.  The idea that someone gets to walk away and then someone else just takes over seems to be rigging the system if you ask me.  The walking away by some players is what ultimately make it fun for those who plan to sign up for the whole scenario. 

Playing LHR last year with the strict slot controls...part of the fun was someone leaving and then having a window of time to get new planes and use up the open slots.  If two months into the scenario you have something like.  BritAir 1000 slots; BritishInternational 800 slots; BritishWorld 800slots; BritishFareastern 600 slots; BritishDomestic 500 slots; BritishAtlantic 500 slots...what's really the point to play if this is how it's going to be for the next 4 months?

If you don't want to play for the length of the scenario, then let someone new into the hub and let the survivors keep fighting it our for market share or let someone new open a hub.  

  People walk away all the time; maybe too busy running other airlines in other scenarios.  Really we don't know; but I know I've gotten into 2 scenarios and neglected one airline at certain times.  Sometimes the neglected one fails and sometime it takes a hiatus and then I can get it back on track.  All and all, If someone abandons the airline, then let it fail or let the competition exapand around it.  While the the idea is interesting, I think you are proposping to open a pandorra's box of issues.

I would be for a the ability to buy an airline that a CEOwants to put up for sale. or have the game engine divide the hubs and sell them with the planes and staff.  That would be a lot fairer with the same 100 plane restriction (i.e., if the HQ hub goes on the market then you are limited to buying 100 planes and there routes...or something like that)

If you insist on something like this; then I think you should seriously consider some exclusions, like this can't happen at the world's top 25 airports or something like that.  Otherwise I see a significant disincentive to play these large hubs as alliances will just move things around rather than really competing.  I also see the opportunity for a relay race of malfeseance (unfortunately there are just way too many examples of past players woring together to make the game less fun for others) this seems like a perfect way to perptuate some of these bad habits without a lot of controls in place --that's in my humble opinion.
« Last Edit: May 06, 2012, 04:24:39 AM by spiff23 »

libertyairlines

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Re: Transfer of airline ownership / CEO
« Reply #49 on: May 28, 2012, 02:24:22 AM »
While option 1 would work, could there also be an option to say, buy airplanes that the bankrupted airline owned or the whole airline that declared bankruptcy to try and expand and than take the other airlines hub and make it another base airport but than have to create new route(s) to try and create new competition between airlines?

Offline alexgv1

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Re: Transfer of airline ownership / CEO
« Reply #50 on: May 28, 2012, 10:05:49 AM »
While option 1 would work, could there also be an option to say, buy airplanes that the bankrupted airline owned or the whole airline that declared bankruptcy to try and expand and than take the other airlines hub and make it another base airport but than have to create new route(s) to try and create new competition between airlines?

The planes of bankrupted airlines already go to the AI brokers to be sold on the used market. Is that what you meant? Or a scheme to get these planes directly to newbies? I kind of like having an equal shot at these planes, plus it takes pressure of the new aircraft market.
CEO of South Where Airlines (SWA|WH)

libertyairlines

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Re: Transfer of airline ownership / CEO
« Reply #51 on: May 28, 2012, 03:28:36 PM »
My thought was that if they owned a plane than that could be sold off with the rest of the airline. The leased planes would still go back to the market was my thought.

Glob-Al

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Re: Transfer of airline ownership / CEO
« Reply #52 on: September 22, 2012, 08:48:13 AM »
Bumping this thread back up as I have been giving some thought recently to how a simple-ish but at least somewhat (only somewhat!) realistic system for buying and selling airlines might work. Here's my suggested model:

Basic Principles:

(1) Every player acts as an investor. At the same time they can be CEO of one airline at a time.
(2) Ownership of any airline is split in to 25 "blocks" of 4% equity. One person could own all 25 blocks, 25 people could own a block each, or somewhere in between. The CEO salary line of staff costs would be removed - players make their money through investments.
(3) Each year, every airline has an AGM. In advance of this date, all investors in an airline select two things on a special screen: whether they want to retain the current CEO or advertise for a new one; and what percentage of revenues (within a fixed range, say 1% to 20%) they want to be distributed to investors. These two decisions are then taken based on ownership percentages - the dividend calculated proportionally.
- Example: London Airlines is 60% owned by Player A, 24% owned by Player B and 16% owned by Player C. Player A votes to retain the CEO and for a 5% dividend, Player B votes to retain the CEO but for a 12% dividend, Player C is not happy and votes to sack the CEO and have a 20% dividend. As 84% of the shareholdings voted to retain the CEO he stays in place, and the dividend will work out as 9% (average of 60x5%, 24x12%, 16x20%, rounded to nearest 1%) so 9% of revenues will be distributed amongst the investors based on their shareholdings.
(4) At any time, an airline's CEO can choose to make a special dividend payout to shareholders, which will be divided up according to shareholding. The CEO can also choose to inject cash in to the airline from their own funds at any time. Other investors cannot do this (to stop an essentially bankrupt airline being propped up indefinitely by benevolent investors).

At Game Start:
Each player is given a certain amount of money. They can use this money to found an airline of which they own 100% or they can accept investments from a number of AI "investors" - each of whom will have certain demands in order for the CEO to retain their vote at the AGM, but based on different things (Investor A might demand a fleet size of at least 10, Investor B that the average age of the fleet is less than 10 years, Investor C a CI of at least 40 etc). This gives the players a strategic choice at the start - accept (comparatively small amounts of) funding and dilute your influence or retain 100% control of the company yourself.

After Three Years:
Three years after the GW starts (I suggest one year for those airlines established after the GW is at least 3 years old) these investors will put their investments on to the open market. The player can also choose to put some of their equity up for sale (in blocks of 4%) or use their own funds to buy equity in other airlines. This would probably be on something very much like the current used market (although I'd love it if ebay style auctions could be put in). A player can put more than half their equity up for sale (e.g. 13% chunks of 4% would be 52%) but they will get big flashing warnings if they do that they could end up losing control of the CEO position if the other investors disapprove of them! One slightly difficult situation here is that if somebody wants to buy a stake in the company they should be allowed to see the balance sheet first - but this means players having to give away their data. I'd suggest there is a "deposit" charge of about 10% of the cost of the equity to view the balance sheet, discouraging those who are not serious about investing from nosing in to their competitors' business.

When an airline bankrupts:
When an airline BKs for whatever reason, their airline is put up for sale with 60 days to submit bids. Anyone taking on the airline assumes its assets - aircraft owned, slots etc - but also its liabilities - debts, loans and aircraft leases. If an airline was actually quite healthy (just BKing because the owner got bored for example) its loans are repaid and then bidding starts from the amount of cash on hand the airline had, to stop people from getting free money by buying defunct airlines.

There would be two ways to submit bids for a defunct airline: one to bid for the whole airline; two to bid for a bit part of it. An airline would be split in to parts based on two things: its bases; and the division of domestic, international short-haul and international long-haul that the game already makes. So a big airline with 2 bases that flew all three of these categories could potentially be divided in to 6 parts: each part coming with a certain number of slots and appropriate aircraft, as well as a share of the company debts (perhaps proportional to the total seat capacity of the aircraft being acquired). This approach is necessary to stop a situation where a huge airline going BK can't be bought by anyone because no-one has enough cash!

After 60 days the system looks at whether more money can be made from selling the airline as a whole, or from selling it off in different parts. It will then accept the offer (or combination of offers) that earns the most money and pass this to the investors of the BKed airline. If any parts of the airline are not sold they will be liquidated with the slots returned to the pool, the leased a/c returned to the owner/broker and any owned aircraft sold to a broker at a discount and the money distributed to investors.

Upon taking control of an airline:
When a player takes control of more than 50% of an airline - either through buying part or all of a BKed one, or through buying equity in an ongoing airline, they have up to four choices of what to do with it:
(1) Merge it in to another airline of which they own more than 50%. However, this is subject to the usual basing rules so if you are based in Canada you can't buy an airline based in Singapore and merge. Also if a merger would mean the new airline owned more than 60% of the 0500-2300 slots in a class 5 airport, 70% in a class 4, 80% in a class 3 or 90% in a class 2 they will have to surrender some slots to the public pool as a result of anti-monopoly provisions.
(2) Found a new airline and establish themselves as the CEO. In this case, the airline of which they were previously CEO (if any) will advertise for a new CEO.
(3) Found a new airline and advertise for someone else to take over as CEO. In this case, an advertisement runs for 60 days after which the owner can select the person they would like to take over.
(4) Liquidate the airline, paying off any debts themselves and transferring any owned a/c to any other airline they own more than 50% of. Slots are returned to the public pool and leased a/c to their owners.
(Incidentally I know that IRL there are lots of rules in every country about foreign investors but I think these should be set aside - other than the basing rules - to make the simulation more interesting. Otherwise everyone who may want to buy an airline in future will all base in EU or US, making the whole thing less interesting).

Advantages of this system
(1) Reduce mid-game boredom for big airlines.
(2) Clear measure of "winning" a GW = person (not airline) with highest value at game end.
(3) BKed airlines don't just disappear, more realistic.
(4) More options for people joining a game midway through - start your own airline or apply to be CEO of another one.
(5) I think it's about as simple as a genuine system for buying and selling equity can be.

Disadvantages

Probably loads. There are bound to be loopholes through which this system could be abused, but if something like this were to go ahead I'm sure the community would help sami figure out what these might be and how to close them. It's also still pretty complicated, despite being as straightforward as I could make it - a hindrance to new players? Perhaps it would be best only applied to super-long gameworlds (e.g. 1960 - 2030) of the type that have been talked about.

Nick E.

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Re: Transfer of airline ownership / CEO
« Reply #53 on: September 22, 2012, 11:46:46 AM »
I like the sound of that, but I think you should be able to be CEO of more than one airline at a time, a subsidiary. You could operate one main airline, and then maybe 3 subsidiaries. You would have to pay more credits if you wanted to own a subsidiary of course, because that is like another airline.

Glob-Al

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Re: Transfer of airline ownership / CEO
« Reply #54 on: September 22, 2012, 02:11:23 PM »
Thanks for the feedback! I'm a bit concerned about allowing people to manage subsidies because it could open up a lot of opportunities for abuse (same as you're not allowed to have two airlines in the same gameworld currently). It might also take away part of the point because a successful player might have several huge airlines, squeezing out the potential for new players to either find good CEO jobs or to build up an airline from scratch.

There might however be a good case for allowing someone who takes over an airline to run it for say 90 days whilst they are advertising for a new CEO. Leaving on auto-pilot an airline that was going bankrupt for 2/3 months might be a bit of a potential disaster!

One problem I've realised with my suggestion is that if someone bought 52% of an airline and then merged it in to their own, what would happen to the investors who owned the other 48%? Perhaps we'd have to stop people being able to merge an airline unless it was one they had bought out of bankruptcy. Or give the other investors a share in the newly merged airline, but that might get complicated!

Offline Mr.HP

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Re: Transfer of airline ownership / CEO
« Reply #55 on: September 23, 2012, 02:17:44 PM »
Are we doing RPG here? We should add CEO "specialty" and level up to increase the specialty effect.....

All right, I suggest 2 options

Option 1: Simple solution

- The airlines would still operate normally in "auto-pilot" mode
- Then, each routes will be closed, one by one to open up opportunities for other players
- We can start with routes with lowest LF, or lowest revenue rate, or we can start with returning the closest expiry date leased A/C. Routes associates with the A/C will, of course, be closed. All the closing/withdrawing is done one after another at a constant rate/speed (10% each week/month?)
- After all the leased A/C are returned, owned A/C can be sold by auction. Players can put their bid on specific A/C as soon as the CEO quit, and receive the A/C after the last leased A/C returned. Starting bid is at 50% of the A/C value, for example.
- We can add in many small stuffs, like after the CEO quit, even the airlines are operating normally, but staff start leaving, make flight delay/cancel, CI goes down. Together with the routes closing, the airlines are weakened so much that competitors can start attacking its still-operating-routes, and hasten its end date


Option 2: to support Sami's idea of giving the airlines to players.

We should have AI airlines at every major airports at the beginning of any world. It's not right when the whole world is un-served until 600+ airlines start operating on 1 day, right?

Players can choose to be an employed CEO or start his/her own airlines
The AI airlines should have the following "characteristics"
- Small to mid sized (how about less than 50 A/C?)
- High fleet commonality cost due to operating 10+ fleets types
- Poor CI, lots of delay/cancel flight, due to lack of maintaining, lack of staff
- Poor A/C utilization rate, says 5-6 hour/day/plane or each plane only flies one route
- Other stuffs, you guys name it

If no one choose an AI airlines, it will eventually go BKed due to competition, and we can have Option 1 here, to give an end to the airline

Cheers

Offline Transtar

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Re: Transfer of airline ownership / CEO
« Reply #56 on: March 29, 2013, 09:33:28 PM »
I think what the game needs to take it to the next level, and increase reality would be a system of how the airlines in the game are owned. So maybe for example, new airlines would start with only a loan's worth of cash, and would be owned 100% by the player who is that airline's CEO. Over the course of time, as airlines get bigger and have cash to play with, they could start buying stakes in each other. This would make the game a lot more realistic, and mirror the real world (ie like Luthansa owning Swiss, Brussels, Austrian and UIA), or minority stakes of investment (ie the 13% of Luxair Lufthansa owns), or how airlines can use buying shares to rescue companies (ie the 25% of Alitalia that Airfrance-KLM owns). To add further realism you could have real world ownership laws (ie like how both USA and India only allow up to a 49% ownership of airlines by foreign companies). When airlines do start to lose money, other airlines could potentially inject money into them by buying shares. This could also tie into the loans system, so that each airline has the ability to loan money to other airlines.

BD

  • Former member
Re: Transfer of airline ownership / CEO
« Reply #57 on: November 19, 2013, 12:30:40 AM »
Are we doing RPG here? We should add CEO "specialty" and level up to increase the specialty effect.....

All right, I suggest 2 options

Option 1: Simple solution

- The airlines would still operate normally in "auto-pilot" mode
- Then, each routes will be closed, one by one to open up opportunities for other players
- We can start with routes with lowest LF, or lowest revenue rate, or we can start with returning the closest expiry date leased A/C. Routes associates with the A/C will, of course, be closed. All the closing/withdrawing is done one after another at a constant rate/speed (10% each week/month?)
- After all the leased A/C are returned, owned A/C can be sold by auction. Players can put their bid on specific A/C as soon as the CEO quit, and receive the A/C after the last leased A/C returned. Starting bid is at 50% of the A/C value, for example.
- We can add in many small stuffs, like after the CEO quit, even the airlines are operating normally, but staff start leaving, make flight delay/cancel, CI goes down. Together with the routes closing, the airlines are weakened so much that competitors can start attacking its still-operating-routes, and hasten its end date


Option 2: to support Sami's idea of giving the airlines to players.

We should have AI airlines at every major airports at the beginning of any world. It's not right when the whole world is un-served until 600+ airlines start operating on 1 day, right?

Players can choose to be an employed CEO or start his/her own airlines
The AI airlines should have the following "characteristics"
- Small to mid sized (how about less than 50 A/C?)
- High fleet commonality cost due to operating 10+ fleets types
- Poor CI, lots of delay/cancel flight, due to lack of maintaining, lack of staff
- Poor A/C utilization rate, says 5-6 hour/day/plane or each plane only flies one route
- Other stuffs, you guys name it

If no one choose an AI airlines, it will eventually go BKed due to competition, and we can have Option 1 here, to give an end to the airline

Cheers
I came across this in my research on another topic, but since it is still on the table, IMHO...

If the goal is for more realism regarding abandoned airlines,  I like HP's option 1, for a gradual wind-down of profitable airlines.  Keeping them going on "autopilot" indefinitely, in a way, penalizes the other players at those bases, or players who may be thinking of basing there.  Having slots become available over a set period gives "smaller" airlines or new entrants a better chance to grow against a better financed foe.  Likewise for aircraft slowly re-introduced to the used market.

I do differ on the auction part.  Once leased aircraft are returned, the process continues with offering owned aircraft to the used market at the same pace.  Use whatever algorithm exists today with the brokers for randomizing the timing of their release to the market.

Unprofitable airlines should just be closed, as they are today.  As HP says, eventually the slow dissolution of the abandoned airline will encourage competition and likely turn it into an unprofitable one, whereby it gets closed.  Otherwise, it gets closed after a minimum size is reached (say, 10 aircraft, per sami's original post).

On option #2 (and variations discussed in earlier posts) - I see more downside in the CEO as employee idea in improving today's realism (we already are pretending to be CEOs, IMHO).  The AI airlines at start of (throughout?) the game has its own merits for other problems.  But on any employment/airline transfer scheme or auction/buy/sell process for changing airlines,  I could foresee potential for abuse or other unintended consequences which could take significant more time to digest and fix.  This would be a huge change, and, as sami says in the op, it is a bit drastic approach to solve a problem of lack of realism with abandoned airlines - the original problem this thread is to address.



Offline 11Air

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Re: Transfer of airline ownership / CEO
« Reply #58 on: December 05, 2013, 09:53:08 AM »
Sami - posted here in the hope you'll see it.

This issue with aircraft being put to lease without, or limited time to, the C and D checks

Perhaps the solution lies with making cost of C and D checks automatically chargeable to the Owner. If the Owner is bankrupt then ownership passes to the leaser IF they accept the C/D costs.

And on the above topic 'failed' airline assets should also pass to the authorities, run for a while while a CEO is sought as suggested, but then assets 'Siezed' and sent to the storage where their value is - say five time - the C+D costs. With C and D checks of less than 1 or 3 years respectively they can be passed to the 'Pound' and put on the market for new airlines to consider.

There is no option to SCRAP an aircraft. Effectively any unwanted a/c should be passed/sold to the 'Pound' at some fraction of the value.

Thanks for all your efforts, I'm happy to pay your fees for an excellent game. I cannot imagine the depths of programming you have had to get involved in with this.

 

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