Fuel bills hit Southwest as banks sign off

The Dallas-based airline has mortgaged 21 planes to raise $600 million for “general corporate purposes.”

In a report Monday, industry analyst Ray Neidl of Calyon Securities called Southwest “the gold standard among airlines when it comes to liquidity.”

Well, we know the truth. Southwest has had a bunch of old fuel hedges expire in the last year or two. It needs the liquidity for that reason, as jet fuel costs have been climbing even more rapidly than gasoline.

So, Southwest isn’t expecting any near-term easing of oil prices.

My question.

Given the amount of airplanes, many owned in fractional shares by various parties, sitting on California desert floors, what is an airplane really worth as collateral? I’m thinking other airlines wouldn’t come close to the nearly $30 million per that Southwest got from its seven lenders.