The primary subject matter of this case is the financial and business risks of airlines. Secondary issues examined include impact of the financial structure and different growth strategies on financial risks of airlines. The case has a difficulty level of three and should be appropriate for undergraduate and graduate courses in financial and strategic management. The case is designed to be taught in one to two class hours, with three hours of outside preparation by students.
Over the last twenty years, all airlines, from large international carriers such as United Airlines, Swiss Air, and Air Canada to small short haul carriers such …