I have a question. What does it take to acquire an AAA rating for airline in A/S. It use to be simply profitability but of recent I think the requirement has been changed somewhat. I know that with the purchase of asset, one could attain it however in the past, it simply was a function of profitability. For instance, when all the various ‘financial indices’ sustained a rating of AAA through the week then you have an overall rating of AAA (see image below). Of recent however, even with a sustained overall rating of AAA, the airline rating seems to stay stuck in A. I even tried to amass cash which exceeded the initial start up capital but it has changed nothing. I however notice some airlines with far less passenger volume or financial prowess attain AAA while much bigger airlines with huge capital seem stuck in A.
I always thought that the Airline rating was an indication of the general financial health of the company. I was always of the belief that AAA is a factor of healthy profitability but I am not so sure anymore - I have a very healthy airline (financially) but the AAA rating seems to remain elusive! Any insight into this matter??
You will receive AAA rating if you are profitable, have some money in your account and don't have too many loans compared to your equity. Passagers dont care about it nor does the ORS. I think it is used as a warning and when it is red your are in big trouble. Though don't trust it as it is quite bugged and usually wrong.
According to an AS member, the financial rating is currently bugged. I have tried it my self, with a sub - which is perfectly healthy - and had green bars AAA all the way - but were still rated BBB.
it could have been corrected, no? a healthy sub of mine which used to be BBB just now is AAA.
My experience is if you have a company and have never lost profit since started, your rating will stay at A even though it might be perfectly good enough to have an AAA rating. I was able to push one of my company from A to AAA when i left nearly as much amount of money as i needed to pay for the salaries. After paying for the week, the company nearly have no cash left, so the instant rating was pretty bad. When the company gathered more money later, the rating jumped to AAA.
Might be just an incident, but you can manage to change the rating even the system is somehow broken.
Thanks, guys. This thing had me twisted - I was going crazy trying to figure out what I was missing! I will ignore it from now on and just focus on my instant rating (financial indices) instead.
One more question - Now that I know that the financial rating system is broken, I can free up my cash (it is ridiculous, I stashed up so much cash trying to get a better rating! :D ). I was wondering about ordering aircraft from manufacturers - you know how some of such planes may require 36 hours or whatever to be delivered? I know that the time multiplies when you order multiple planes however, does that time multiply if you are ordering multiple models from the same manufacturer? For instance, if rather than order six CRJ-700s of a single model, ....I ordered one CRJ-700, one CRJ-700ER, one CRJ-700LR, one CRJ-900, one CRJ-900ER and one CRJ-900LR. Would the orders be treated as a singular order thus having delivery times queued up and multiplied just as if it were a single order OR will the orders be treated separately and be given concurrent slots on the production line??
I could find out by simply doing it but I prefer to ask others first. My problem is that I hate having my lease charges spread all over the week! I usually prefer all my lease charges and week-end charges to fall on the same day!
All orders placed for single manufacturing plant are stacked one atop the another. So CR7 and CR9 would be delivered one after the other every 12 hours. 737 and 320 series have two manufacturing plants.
All orders placed for single manufacturing plant are stacked one atop the another. So CR7 and CR9 would be delivered one after the other every 12 hours. 737 and 320 series have two manufacturing plants.
Slightly more clarification, all A320s, both the A320-100/200 and A320neo are manufactured at one site. The rest of the family (318, 319, 321) are manufactured at the other. From the Boeing side, the 737-200/300/400/500/800/900 from one site, the 737-600/700s from another.
As Rubio said, orders for a single plant are stacked together, so an A320 and A321 can be manufactured simultaneously, but ordering an A319 and A321 would be manufactured sequentially. Meanwhile, ordering a 737-800 and 737-900 would be sequential, but a 737-700 and 737-900 would be simultaneous.
Why would you want that anyway? The more spread-out through the week the costs are the better, as so long as the company is making a profit, the daily revenue should be more than enough to cover the costs and you never have to worry about having enough money ever again. If all the costs are clustered on the same day you may find you suddenly lack the necessary funds if you miscalculate.
Why would you want that anyway? The more spread-out through the week the costs are the better, as so long as the company is making a profit, the daily revenue should be more than enough to cover the costs and you never have to worry about having enough money ever again. If all the costs are clustered on the same day you may find you suddenly lack the necessary funds if you miscalculate.
Not for me! I have a compulsive disorder! :D
Seriously, I like it that way cos that financial model gives me a fail-proof picture of my true financial condition in a single sweep. I like to take the big ‘hit’ once and then shake it off - by the end of the day, you have an accurate summation of your true strength. If you are financially strong then there comes a point where you can take the big ‘hit’ and even purchase two more planes without batting an eyelid! However, if your profit margin is down or your overhead has grown to the point where your profit is dwindling (perhaps due to competition) then you get the picture quickly on such a day. I call it the ‘Report card day’! :D
For instance, the image of instant financial rating shown above (showing numerous financial indices) was taken on a billing day! It simply works great for me and it is also tidy… I am sure others have their way too.
AAA