Originally Posted by
fliion
Would Deltas codeshares in SkyTeam that are govt subsidized and thus guarantor also use loans that are significantly lower?
I do not know enough of the details of this arrangement to make a comparison to the example of financing subsidies used by the ME3. Guaranteed government business could be considered a subsidy of sort, but this is not nearly as blatant as Qatar simply underwriting loans for no cost (underwriting costs money in the western business world). There is a reason that Qatar alone has just as many A350 orders as the 3 US legacy, They can borrow at cheaper rate and also take more risk.
All of the ME3 are using this to varying degrees to create a competitive advantage using newer equipment. Delta for instance is still trying to squeeze the last dime out 15 and 20 year old Mad Dogs. Why? I'm sure the customers would rather ride in new airframes that don't smell like all the funk that the last C check couldn't quite scrape off seat 29C, but when gallon of Jet A costs less than $3 it make more financial sense to keep the old jt9's burning.
Sometime when you have a little bit of time go download 2014-2015 QA annual report and statements. Try to read through the liabilities sections. First thing you might notice is there is total numbers but very little detail as to what accounts and activities are added to various totals. Basically, it's very hard to drill down comparisons to other operators.
Second thing to notice way down the notes sections is a nice little transaction where the company issued 26.7 Billion QR in new shares to the government in exchange for 100% control of a leasing company that was valued at 18.5 Billion QR (23B or so in aircraft - 4.5B of assumed debt) + plus a cash infusion ...excuse me... investment of another 8 Billion.
What this a good deal for the gov't of Qatar?
Who knows... no telling what due diligence was done, but when someone takes a large share of equity in a company you can say they are buying risk in the company in return for a future payout. Look further in the notes you find liabilities in the form of loans only from the government directly, some government agency, or a government controlled bank, but no other type of financing or financial entity. Also there is little detail from which to infer the cost of borrowing or the terms of the loans, with the exception of one loan being listed as libor plus margin (which libor and what margin??) but that loan was noted as retired anyway.
Now the case for Emirates may be different but I also find no coincidence that they are starting to show symptoms of financial stress. In the case of the other two, the more you look, the harder it becomes to argue that they are not operating in a different environment where shareholder profits are less important than other national goals.