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I'd be keen to see some hard data to support the contention that the airlines have had negative retained earnings since their inception.  An equity business can be viable for a period even though it is racking up loses, but not for as long as the airlines have been collectively in business.  One can argue that the airline business could not survive without government subsidies; although as I have shown, most of the subsidies have been paid indirectly by the users.  It is true that Southwest Airlines, as well as the other new carriers, have a financial advantage over the legacy carriers.  Instead of opting for expensive legacy pension plans, they gave their employees 401ks.  Most of them supplement employee contributions to the 401ks, but at the end of the day they are less expensive than the traditional pension plans.  This is part of the advantage.  But a bigger part of the advantage accrues to better management.  Southwest Airlines decisions to use just one model of airplane and hedge its fuel are two examples of smart management.To the best of my knowledge American has never been in bankruptcy or at least not for as long as I have lived in Texas, which is coming up on 33 years.I would be equally keen to see the Laidlaw financials, by operating division, to assess whether Greyhound dragged them into bankruptcy.  I have heard, although not been able to verify it, that sloppy management and the other operations did the trick.First Group executives, i.e. CEO, CFO, and COO for North American Operations, are stating publicly that Greyhound is generating a positive cash flow.  Given the sensitivity to honest financial reporting in a post Enron world, I would be surprise if they are cooking the numbers.  It is interesting to note that First Group, because of hedging, paid an average of $74 a barrel for oil in 2007.  This is slated to increase to slightly more than $80 in 2008.  Pretty smart management if you ask me.According to Greyhound's site, they purchased a limited number of new buses in 2006.  I understand that they have upgraded others, as per a friend who works for Greyhound in Dallas.  During the same period Greyhound, as well as other carriers, have restructured their routes, dropped many smaller communities, and streamlines their operations.  As a result they don't need as much equipment as they had.I note that airlines and bus operators adjust their business model to fit a changing environment, which competitive businesses must do if they want to survive.  However, Amtrak seems to run with the same old model.
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