Chapter 209 Entering the Aviation Industry

Since Seryozha asked Dounia to go to Italy to set up a shipping company, Dounia has not returned to the Soviet Union for a long time, and she is now residing in Switzerland with her mother. Although they couldn't see Seryozha often, the relationship between the two did not change. After all, what they have experienced over the years is definitely beyond the imagination of an ordinary woman.

The Mediterranean Shipping Company that Tonya is currently running was previously founded by an Italian mafia family. At the beginning, the Italian Mafia extended its hands into the shipping industry for money laundering. It is said that the first few Suez-class freighters of MSC were paid in cash. But later, as the world, especially the European economy, fell into a downturn. The Mediterranean Shipping Company suddenly became a black hole of funds. As a last resort, the Italian Mafia abandoned the company. Sergey took over the company and let his wife take the helm.

After several years of development, MSC has become the second largest shipping company in the world, and the gap with Maersk, the largest shipping company, is gradually narrowing. However, MSC is the shipping company that places the most orders to shipyards in the world this year. In the first half of the year alone, it spent US$5 billion to order nearly 30 VLCCs. This is simply an order that shocked the global shipbuilding market.

The shipping business is different from the high-tech industry, which emphasizes stable profits and long-term customers. So Dongnia has always been the most low-key among Seryozha's lovers. However, Dongnia, who is deeply involved in the shipping industry, has also realized that the global shipping market is gradually shrinking. Although it is not impossible to surpass Maersk, the profits obtained are simply not proportional to the efforts. So Dongnia turned her attention to a new business field, that is, the air transport industry.

Tonya now owns an air cargo company, which operates the air cargo business between Warsaw and Italy, which is basically used internally by the Gorky Brotherhood. Tonya used to be a flight attendant when she was in the Soviet Union, and later she became a key training target in the organization thanks to Sergey Sha. She once worked in a management position for a while, and also studied at the Aviation Management Institute of the Soviet Union. The passion for the civil aviation industry made Tonya always want to enter this field.

Over the years, Donia has been looking for suitable investment targets. Just a few months ago, Donia met Schwarzman, a partner of Blackstone Group, in New York. Schwarzman introduced Pan Am to her. Airline major shareholder. So Tonya came up with the idea of ​​buying the iconic American airline.

But when Tonya got the financial report about Pan American Airlines, she couldn't help but retreat. The world-renowned intercontinental luxury travel airline is not doing well. It has been in a loss state for several years in a row, and even the headquarters building of Pan American Airlines in Manhattan, New York has been sold to MetLife Insurance. At present, the most valuable thing of Pan American Airlines is probably the large number of jumbo jets with more than 400 seats in the company's hands, as well as the operating rights of airports in New York and other places.

Schwarzman suggested that Tonya should wait for some days and not rush to decide on investment. Because Pan Am is already heavily in debt, and because it is an iconic American airline that operates businesses all over the world, Pan Am's planes are often targeted by terrorists. Moreover, the U.S. economy is still sluggish, and the market for luxury intercontinental air travel is not as good as it used to be. Pan Am's operating conditions are indeed very bad, but his old rival Delta Air Lines, United Airlines' operating conditions are not much better.

In the final analysis, this phenomenon is due to too many factors restricting the aviation industry, including international oil prices, political situation, economic prosperity and other factors. This is not an easy business. So after careful consideration, Tonya resolutely gave up the plan to acquire the world's number one Pan American Airlines, and decided to acquire a smaller airline in the United States.

Just like running a shipping business, take it slow and steady.

So under the matchmaking of the Blackstone Group, Tonya visited Southwest Airlines, a small airline headquartered in Dallas, Texas. The Blackstone Group recommended this company to Tonya because the company has a simple financial structure, small assets, and low management difficulty, making it easy for inexperienced market entrants to start. Southwest Airlines has more than one hundred aircraft, but these more than one hundred aircraft are all unified Boeing 737 aircraft. Just because there is only this one model, the problem of pilot cost caused by multiple types of aircraft is avoided.

Tonya’s team operates in the cruel shipping industry, so they naturally know how to evaluate a company’s competitiveness, which is cost. On the contrary, the airlines are more interested in Tonya.

After initial contact, Donia brought an irresistible proposal to the current shareholders of Southwest Airlines. One is that Donia can merge her European routes into the assets of Southwest Airlines. Second, Enron Energy and Occidental Petroleum under the Gorky Brotherhood will provide this company with more favorable aviation fuel. These two conditions plus the abundant funds brought by Dongnia, Southwest Airlines did not have any thought of refusing, and readily agreed to Dongia's request to hold the company.

So after completing the acquisition and privatization, Tonya spent a month carrying out new reforms to the management of Southwest Airlines. Under the leadership of Tonya's team, the operating methods of some shipping companies have been applied to the aviation industry, that is, to save expenses and reduce costs by all means.

The first step after Tonya took office was to dismantle all the business class seats on all the company's planes and replace them with regular class seats. Such a plane can carry a few more passengers. Although business class and first class can bring more benefits, Tonya thinks that no matter how hard Southwest Airlines tries in this respect, it is impossible to compare with Pan American Airlines, so she simply gave up. Focus on what Southwest can do well.

Years of slump in the shipping industry has made Tonya accustomed to cost reduction, which has never been done before in the aviation industry. After all, the history of airlines is only a few decades, and it has always been a kind of luxury travel in the past. lifestyle to promote. Therefore, Dongnia’s reform made it difficult for Southwest Airlines’ employees to adapt. In order to stabilize the morale of the army, Dongnia generously launched an employee stock ownership plan, so that the income of most Southwest Airlines employees began to be linked to the company’s earnings. Tonya wanted Southwest to be a disruptor in the international airline market. ...