Airline Survival;- According to Paddy Power
The Advertising Standards Authority has criticised Paddy Power, the Irish based bookmakers from advertising its betting service on which airline would go bust next. And I half sort of agree with the ASA.
The problem with betting like this is that it can become a self perpetuating philosophy. If there is a lot of money placed on an airline going bust people might think that someone has inside information and the airline must be on the skids. If it is publicly quoted, the shares might side; if it is privately owned, creditors might demand quicker payment or cash up front.
Up till about a month ago you could look at the Paddy Power website and get odds on a number of airlines and their chances of going bust. I see that has been removed. And over the period I looked at it, only one of the airlines did go. A perpetual favourite to go bust was Alitalia which this week arose from the ashes as… Alitalia with exactly the same colour scheme. So even there paddy power wasn’t really right.
On the other hand, no-one wants to be in the position of booking a flight on an airline that isn’t going to be around when we want to fly. Or even worse, on an airline when we want to return home. The airline though, has a responsibility to its shareholders and staff to try and keep going so it can’t turn around and say that it has steeply declining passengers booking or creditors at the door or suppliers wanting to be paid in advance. As I said earlier, if that were to happen, the collapse of an airline becomes a self-perpetuating philosophy.
So as I wrote a few weeks ago, a bond scheme for airline passengers should be instituted and quickly. Certainly before next Summer’s holidays get booked. £1 on every ticket, it has been estimated, will be enough. Come on Mr Hoon. As the minister responsible for transport, do something.
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