5 ms·
But without this deal they will go bankrupt and then there will be no Dollar General of the skies and the customer loses. Maybe allowing private markets to wor
by iclosem 3y ago
But without this deal they will go bankrupt and then there will be no Dollar General of the skies and the customer loses. Maybe allowing private markets to work would have been a good idea?
- corethree 3y agoIt's utterly clear that free markets can fail and can eventually lead to all kinds of additional problems like wealth inequality and monopolies. This is clear. Nobody is clear about the right move on how to deal with this problem. There's no sure fire conclusion.
- SOLAR_FIELDS 3y agoCan we even say that JetBlue succeeding and/or the merger moving forward would be a win for the consumer though? The problem with aerospace is that it has a very high barrier to entry, so consolidation ends up hurting the consumer more often than not. Same as other infra related industries like telcos and civil engineering work that require fairly massive upfront capital and regulatory investments to operate. Better to leave a hole in the market to encourage new entrants, even if it means consumers suffer in the short term.
- squirrel6 3y agoI agree with you even though I think some will view this as a hot take. It is interesting that the US government has historically subsidized both smaller telcos and airlines to fill these types of small gaps where they exist.
- pxx 3y agoConsidering reorganization under bankruptcy is not equivalent to going out of business.
- deleted 3y ago[deleted]
- HWR_14 3y agoWhile true, it is equivalent to shareholders in that they get wiped out.
- no_wizard 3y agoI don't feel sorry for shareholders here. There are risks with all investments and its not as if Spirit mislead investors or acted fraudulently. Sometimes, investments go bad, thats the risk. We shouldn't prioritize shareholders over the general health of a marketplace
- HWR_14 3y agoBut it makes sense that with those alternatives shareholders would vote in favor of a buyout or a merger.
- squirrel6 3y agoThere’s not a lot of room for effective restructuring here — for Spirit it’s more of a revenue problem rather than just a debt service problem. They’d probably end up in Chapter 7 (liquidation) pretty soon after starting Chapter 11 proceedings
- tyingq 3y agoSpirit runs with a 28 inch seat pitch, which is often physically shorter than the distance between someone's rear end and knee caps[1]. It's an unusual choice. Most other low cost carriers have 31 inches or more. I'm not sure Dollar General is the right comparison. [1] Once you account for the padding, the angle you have to sit at, etc. Even if you aren't unusually tall, it is noticeably awkward and cramped.
- edgyquant 3y agoSounds like spirit is not a sustainable business and that is an issue unrelated to the merger. Unsustainable businesses fail, so let them fail
- closeparen 3y agoThe purpose of blocking mergers is to promote competition, which is plainly not achieved if the acquisition target is not sustainable on its own.