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Author Topic: Buying Airlines  (Read 2973 times)

MAS737

  • Former member
Buying Airlines
« on: December 24, 2011, 06:22:02 PM »
I know the idea of a stock market has already been discussed and was quickly overturned as a bad idea, but I think buying other players airlines could be a good idea. A player would make a bid to another player for their airline. They could make as many as they wanted. To make sure no cheating happens, the minimum bid would be the value of the company. The player who currently owns the airline could accept, decline or set a minimum price. If the price was high, it could be a win-win situation as the buyer would gain benefits such as slots and the seller would gain loads of capital to start another airline somewhere else in the world, potentially in an un-served market. This idea could be extended to some form of 'stock market' idea for part ownership as well. I think this would add in an exciting twist to the game.

alfkan

  • Former member
Re: Buying Airlines
« Reply #1 on: December 27, 2011, 10:01:19 AM »
I like it!   :)

MAS737

  • Former member
Re: Buying Airlines
« Reply #2 on: January 07, 2012, 12:47:01 AM »
Good! I'm glad there is SOME support for my idea! :)

Offline ARASKA

  • Members
  • Posts: 1336
Re: Buying Airlines
« Reply #3 on: January 07, 2012, 01:17:42 AM »
I also like this idea. 

forsberc

  • Former member
Re: Buying Airlines
« Reply #4 on: January 07, 2012, 07:15:55 AM »
i also like this, because it is a choice for the airline being purchased. this idea has been tossed around a bit though.

dhtdkcug

  • Former member
Re: Buying Airlines
« Reply #5 on: January 07, 2012, 10:02:54 AM »
I like it too but I think that it must have a limited amount of time that the airline can be bought until all the aircraft are going to the used market and then the airline cannot be bought.
If you buy the airline you can operate from it base? for example if I am based in Atlanta and I am buying an airline in Rome do rome count as my second base? can I open new routes from there? and can I open bases in italy/european union?
Thank you
Guy

MAS737

  • Former member
Re: Buying Airlines
« Reply #6 on: January 07, 2012, 02:12:03 PM »
I like it too but I think that it must have a limited amount of time that the airline can be bought until all the aircraft are going to the used market and then the airline cannot be bought.
If you buy the airline you can operate from it base? for example if I am based in Atlanta and I am buying an airline in Rome do rome count as my second base? can I open new routes from there? and can I open bases in italy/european union?
Thank you
Guy

Yes, but also don't forget I envisage people buying other people's smaller, successful airlines and then those players who accept the buying of their airline then have capital to set up another airline elsewhere. As for the different locations, Sami would  have to decide the rules on this. An airline could become very powerful if over the years it acquired multiple airlines on different continents. Therefore I would say there would have to be a limit on the number of airlines bought (maybe 2) but those airlines could be based in any country globally. You would then become the CEO of a new holding company which owned all 3 airlines. You could then sell loss-making areas of the business.

Online EYguy

  • Members
  • Posts: 563
Re: Buying Airlines
« Reply #7 on: January 07, 2012, 03:28:11 PM »
I'd say that, if we ever get to this point, it will be necessary to have an anti-trust authority as in real life... :)

forsberc

  • Former member
Re: Buying Airlines
« Reply #8 on: January 08, 2012, 04:52:40 AM »
It's my understanding that in real-life airlines can't purchase foreign airlines for exactly this reason. If this works, an airline should not be able to purchase foreign airlines- thus avoiding basing complications.

There should be negatives to the merger though as well. Perhaps adding a retirement pension fee, increased commonality fees, higher wages, etc. PLUS of course adding the expenses of the purchased airline.

Realistically, the purchased airline would probably be on the verge of failing, thus having higher than normal expenses and a failing company image. This CI should also be "merged" together with the purchasing airline's score (perhaps averaging it?)

tm07x

  • Former member
Re: Buying Airlines
« Reply #9 on: January 08, 2012, 05:39:32 AM »

If say Holding company A owns 100% of the shares in Airline A, which is based in the US. They could only sell the Airline to a company that has US based airline(s).

If HC A no longer owns any airlines, they should be able to start up new operations where they want. But if they want to sell or buy again, they are restricted to the market where the Airline is based.


This means that players can start up in smaller regions, sell of the airline, move to a bigger market with their cash, build a new airline and sell it off and move over to even bigger markets.

I think the idea of being able to buy and sell airlines is a brilliant idea and would fit well with the longer running Airwaysim gameworlds. :)

It would even help the exodus of players mid-game. More competition and it adds a third dimension.

MAS737

  • Former member
Re: Buying Airlines
« Reply #10 on: January 08, 2012, 12:38:10 PM »
If say Holding company A owns 100% of the shares in Airline A, which is based in the US. They could only sell the Airline to a company that has US based airline(s).

If HC A no longer owns any airlines, they should be able to start up new operations where they want. But if they want to sell or buy again, they are restricted to the market where the Airline is based.


This means that players can start up in smaller regions, sell of the airline, move to a bigger market with their cash, build a new airline and sell it off and move over to even bigger markets.

I think the idea of being able to buy and sell airlines is a brilliant idea and would fit well with the longer running Airwaysim gameworlds. :)

It would even help the exodus of players mid-game. More competition and it adds a third dimension.

Interesting concept of rules which are more limiting than mine, possibly for the best reasons (mine could be too open and cause competition problems). Towards the end you summed up perfectly how I see this new feature.  :)

Online EYguy

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  • Posts: 563
Re: Buying Airlines
« Reply #11 on: January 08, 2012, 01:21:02 PM »
It's my understanding that in real-life airlines can't purchase foreign airlines for exactly this reason. If this works, an airline should not be able to purchase foreign airlines- thus avoiding basing complications.

There should be negatives to the merger though as well. Perhaps adding a retirement pension fee, increased commonality fees, higher wages, etc. PLUS of course adding the expenses of the purchased airline.

Realistically, the purchased airline would probably be on the verge of failing, thus having higher than normal expenses and a failing company image. This CI should also be "merged" together with the purchasing airline's score (perhaps averaging it?)

The guyhas a point here... In the USA it is forbidden for any individual/s who is/are not an american citizen/entity (or entity controlled for more than 25% by a non US citizen) to own more than the 25% of an airline's shares. In a nutshell: at any time no more than the 25% of the shares cannot be owned by foreign persons/entities. Do not know why, but I reckon this has something to do with protectionist laws...
Btw, it is not unusual here in Europe to have airlines buying out airlines not chartered in their own countries. Examples? Lufthansa owns SWISS and Austrian Airlines, plus British Midland (even though it looks like they're going to sell that company), Brussels Airlines and Luxair (somewhere around 50%), LOT airlines (controlling stake), Adria Airways, plus a stake in SAS (rumors say that if SAS can stop its losses, LH would buy them very quickly).

Offline TK1244

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Re: Buying Airlines
« Reply #12 on: January 08, 2012, 06:58:23 PM »
Realistically, the purchased airline would probably be on the verge of failing, thus having higher than normal expenses and a failing company image. This CI should also be "merged" together with the purchasing airline's score (perhaps averaging it?)
Not quite sure about the "merged" CI. Why would ones CI decrease if it purchases a failing company and bring it under its own brand? The company could actually increase its CI because it is able to offer more options to its passengers (more flights, more destinations, new base airports, etc). At least that is how I'm thinking ;)
TK Regional

MAS737

  • Former member
Re: Buying Airlines
« Reply #13 on: January 08, 2012, 07:50:38 PM »
The guyhas a point here... In the USA it is forbidden for any individual/s who is/are not an american citizen/entity (or entity controlled for more than 25% by a non US citizen) to own more than the 25% of an airline's shares. In a nutshell: at any time no more than the 25% of the shares cannot be owned by foreign persons/entities. Do not know why, but I reckon this has something to do with protectionist laws...
Btw, it is not unusual here in Europe to have airlines buying out airlines not chartered in their own countries. Examples? Lufthansa owns SWISS and Austrian Airlines, plus British Midland (even though it looks like they're going to sell that company), Brussels Airlines and Luxair (somewhere around 50%), LOT airlines (controlling stake), Adria Airways, plus a stake in SAS (rumors say that if SAS can stop its losses, LH would buy them very quickly).

Not quite sure about the "merged" CI. Why would ones CI decrease if it purchases a failing company and bring it under its own brand? The company could actually increase its CI because it is able to offer more options to its passengers (more flights, more destinations, new base airports, etc). At least that is how I'm thinking ;)

I would agree with both of you here. I'm not completely sure why in America the case is that a foreign person can't own more than 25% of an airline, when here in Europe airlines such as LH, IAG and Air France-KLM are multi-national companies. Furthermore, there are examples such as Singapore Airlines owning 49% of Virgin Atlantic Airways. I know this isn't a controlling stake but it is a truly international partnership... and talking of Virgin they own not just Virgin Atlantic, but V Australia and Virgin America and previously Virgin Blue, Pacific Blue and Virgin Nigeria!

Online EYguy

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Re: Buying Airlines
« Reply #14 on: January 08, 2012, 08:03:29 PM »
Talking about Virgin America, I'm pretty sure when I say that Richard Branson owns no more than 25% of the company, either through Virgin Atlantic or personally. If I remember correctly, there is a group of american manager/enterpreneurs behind Virgin America, and they basically worked with Richard Branson. Btw, this feat of the american market exists because the Department of Defense allows airlines to buy a/c using federal funds (the so called Civil Reserve Air Fleet). If we had foreign companies doing this kind of tricks, you could have LH using american funds to buy Airbus a/c. The CRAF system says that airlines should be ready to move the a/c bought using federal funds, and put them under the control of the USAF in case any emergency arises. This would be quite unconvenient for european carriers, even though they could benefit of a few a/c paid using money of the american taxpayer! :)

MAS737

  • Former member
Re: Buying Airlines
« Reply #15 on: January 08, 2012, 08:21:19 PM »
Talking about Virgin America, I'm pretty sure when I say that Richard Branson owns no more than 25% of the company, either through Virgin Atlantic or personally. If I remember correctly, there is a group of american manager/enterpreneurs behind Virgin America, and they basically worked with Richard Branson. Btw, this feat of the american market exists because the Department of Defense allows airlines to buy a/c using federal funds (the so called Civil Reserve Air Fleet). If we had foreign companies doing this kind of tricks, you could have LH using american funds to buy Airbus a/c. The CRAF system says that airlines should be ready to move the a/c bought using federal funds, and put them under the control of the USAF in case any emergency arises. This would be quite unconvenient for european carriers, even though they could benefit of a few a/c paid using money of the american taxpayer! :)

Oh yeah, I forgot about Virgin America... very true about what you said. I didn't realise that was the reason either, like you say, the <25% rule is there for a good reason then! Would this have to apply in AWS though?

MAS737

  • Former member
Re: Buying Airlines
« Reply #16 on: January 08, 2012, 08:42:49 PM »

Offline ARASKA

  • Members
  • Posts: 1336
Re: Buying Airlines
« Reply #17 on: January 09, 2012, 02:45:32 AM »
Talking about Virgin America, I'm pretty sure when I say that Richard Branson owns no more than 25% of the company,
He owns 25% of the voting stock and 49% of the total equity in the airline.

Online EYguy

  • Members
  • Posts: 563
Re: Buying Airlines
« Reply #18 on: January 09, 2012, 07:43:27 PM »
Yeah, right, I do not know how the agreement actually works, but the share above that 25% are kind of "dead" when talking about voting at shareholders meeting, or something similar... I really should have a look at this issue, it's quite interesting.

Going back to the topic: I reckon that this is one of those problem that could actually make pretty hard to implement this kind of agreement here on AWS. There are esier and more appealing features that had been requested in the past and could not be implemented for various reason. Some of them will be included in the 1.4 version of the game, but I do not which of them! :)

MAS737

  • Former member
Re: Buying Airlines
« Reply #19 on: January 09, 2012, 10:59:43 PM »
Yeah, right, I do not know how the agreement actually works, but the share above that 25% are kind of "dead" when talking about voting at shareholders meeting, or something similar... I really should have a look at this issue, it's quite interesting.

Going back to the topic: I reckon that this is one of those problem that could actually make pretty hard to implement this kind of agreement here on AWS. There are esier and more appealing features that had been requested in the past and could not be implemented for various reason. Some of them will be included in the 1.4 version of the game, but I do not which of them! :)

Yes, I understand this would be a major change to the game, but it would bring benefits like you say, it's whether the time/cost of implementing them would be the final decider...

 

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