ABSTRACT
Financing billions of dollars in flight and ground equipment in the new century presents a tremendous challenge to the airline industry. Airline earnings tend to be cyclical, and industry returns on investment generally have been poor. Most of the finance companies that have been active in the airline field offer a selection of loan and lease packages. The key to good airline cash management and financial planning is the cash forecast, or, more specifically, the cash budget. On a short-term basis, it is extremely important that the airline manage its finances in a manner that will permit it to make maximum use of its available cash. The weak performance of the industry as a whole can be viewed as evidence of a drastic decline that is still under way and that is leading to the collapse of the industry and the concentration of airline service in the hands of a few carriers.
