Currently I have 2 airplanes...a 737 Max and a 787-8. The former has three domestic flights and the latter has one international flight. As you can see I am operating on paper thin margins, and I desperately need another airplane. My calculations suggest that if I get another "smaller" aircraft with a lower lease payment, operating and fuel costs, I can increase my margins to put me in a more comfortable financial position, and slowly increase my fleet. At this rate I feel like if I wait it out, it will be another 2-3 weeks before I can actually purchase another airplane (without damaging my credit rating or putting me in debt)
So here is my question. My income statement ends on Saturday. If I accumulated enough money to buy another airplane now, but not enough money to pay my all my obligations on Saturday, will the creditors come calling at the end of my statement, or will I have another week to sort it out before creditors start taking my airplanes? It will take (at least) 3 days for the new flight to start accumulating income so I feel like I'm playing with fire.
If you don't have enough money to pay your week-end bill (staff), then you will automatically (normally) get two emergency loans (one week after the other) before on the 3rd week you are shut down. IF you can't afford to pay a lease instalment then the aircraft is returned to the leasing company and you get your deposit back
If you don't have enough money to pay your week-end bill (staff), then you will automatically (normally) get two emergency loans (one week after the other) before on the 3rd week you are shut down. IF you can't afford to pay a lease instalment then the aircraft is returned to the leasing company and you get your deposit back
Okay I see, so I will receive an emergency loan, but the last part confuses me "if you can't afford to pay a lease installment.." Does that mean after the 3rd week or the first week after the emergency loan?
Is there a downside to doing it this way, or should I just wait?
If you cannot pay the leasing payment which is due every week, the plane will be returned immediately to the lessor. If you have bought the planes on credit, you have made some mistakes and it would be worth to restart the company. Don't buy planes in the beginning.
You only get rescue loans for your week-end bill. “Planning” on those loans is quite risky and I guess in most cases won’t work, as you normally start leasing aircraft shortly after setting up a new company.
So if you week-end closing is on Monday 13:00, and your first leasing payment is on Monday 13:30, you will lose the aircraft.
If you can’t fully pay the salaries, you’ll get a rescue loan, but your cash balance will be 0. Then you only have 30 mins to earn enough money to pay the next leasing payment (no rescue loans for that…).
And yes, don’t buy aircraft. Leasing allows you to grow much faster.
You only get rescue loans for your week-end bill. "Planning" on those loans is quite risky and I guess in most cases won't work, as you normally start leasing aircraft shortly after setting up a new company.
So if you week-end closing is on Monday 13:00, and your first leasing payment is on Monday 13:30, you will lose the aircraft.
If you can’t fully pay the salaries, you’ll get a rescue loan, but your cash balance will be 0. Then you only have 30 mins to earn enough money to pay the next leasing payment (no rescue loans for that…).
And yes, don’t buy aircraft. Leasing allows you to grow much faster.
I understand. I knew the idea would be extremely risky so I'll just be patient and wait a few weeks until I can actually afford to lease the airplane and sufficiently make the payment.
Very true, I know that now. :( But, it's okay because it's not too late to fix my issue. I'll just have to wait a little longer than I expected.
My comment is that I like how this thread progressed. It was civil, friendly, and helpful to DasAuto and the original question/scenario posed. This is one of the reasons I enjoy AirlineSim - the community and the opportunity for both trial and error (I've done it myself) and the opportunity to learn from others. Well done to all.