<<what if over-capacity is industry-wide?>>
Over-capacity was built due, not only by Chapter 1 being too good to companies in difficulties. CEOs unwillingness to merge keep capacity on the market. They don't agree on where is going to be the HQ, or who is going to be the CEO or people within the company sabotage the deal since deal going on will mean they managing themselves out of job.
Remember ALA trying to merge with LU? But we in the engineering business, (Westinghouse went to Siemens. ASEA merged with Brown Boveri to form ABB and in the "defense" business there is no one single big manufacturer that have not merged.
Parking lot gets filled up, and the car companies start giving rebates. Remember when Chrysler of pre-Lee Iaccocca? Slowy, American Motors, disappeared. Then Chrysler disappeared too by merging with Daimler.
Today's workers concessions to keep them with a job is similar to the discounts to empty carmarkers parking lots. Braniff, Pan Am, Swissair and Sabena all went belly up. Obviously, we need more airlines to disappear. Now we have governments keeping them airborne, employees keep them just as the only means to have a job as American Airlines shows right now. We need is pure and simple liquidation.
Do we need LU, NT, ALA, SI, NEC, MOT, ERICY and MONI? No. we don't. The industry needs consolidation. |
