"My Money is on Etihad"
Don't see it happening; what would be in it for EY (or indeed EK or QR?)
"FR has a reason; kill off a competitor they have been unable to dislodge"
This is why I think we will not be seeing another FR bid for EI. Ask this simple question: what would you do if you were in MO'L's shoes?
Why expend all the effort and publicity on a bid you know is going to be rejected, either by EI or the EU?
The answer: wait ... increase the pressure, bit by bit. EI won't run out of cash this year and MO'L won't have his prize right away, but I'm convinced that he still has his eyes on EI. He will wait, up the pressure, until he is in a position to say to the govt (and other shareholders): "I'll pay €1 for your shareholding or it goes under; I'll keep the name alive, but that's it - massive job cuts; otherwise it's curtains". He won't do this publicly - at least not as far as the govt is concerned. He will simply bank on the govt being willing to choose the lesser of two evils: selling EI to FR, or letting it go under. And I can see MO'L being prepared to wait three or four years for this to happen.
Now, the question is: how does CM avoid this? The reality is that, regardless of the good load factors on s/h, yields are probably fairly poor. Is EI making a profit on short haul? If so, what kind of margins? Is this sustainable? Is it realistic for EI to expect to go head to head with FR, using only 320s; that's the bottom line? It's not just a question of downsizing to survive, but of avoiding being pushed out of key markets, as has happened in the UK. Many of these routes would still be sustainable with a smaller type and EI would be much better placed to compete with FR.
Do we know, for example, what FR's breakeven on the 738 is? Let's say, for argument's sake, that it needs to have around 90-100 pax for flight to be profitable. Now, if EI can have an aircraft that only needs about 40-50 pax for flight to be profitable, it's far less likely to be pushed off a route - and it can re-establish itself on major UK regional routes, which will be important to its efforts to develop a hub.
On long haul, it's going to need to seriously look at its operation, particularly its product - (is the kind of J class that it has - certainly the number of seats) sustainable in the current environment - better to have an aggressive low lost long haul (a la Air Asia/Jetstar) with a Premium Economy alternative. The market is certainly there for long haul operations ex-Ireland - and to much more markets than EI serves, but it's not going to achieve that potential in its current form.