The Air Transport Industry Crisis in Brazil and in the USA and Companies' Additional Value Due to Real Options Analysis

ABSTRACT This research describes the analysis of a Brazilian international airline of a regular passenger air transport company, modeled according to real options analysis. Such analysis is appropriate since the air transport industry, nowadays, in crisis in Brazil and in the USA, is subjected to strong uncertainties such as passenger revenue and airplane fuel prices. Through real options analysis, we show that flexibility due to the options to expand and reduce flight frequencies or even to abandon operations, together with market uncertainties, adds considerable value to an air carrier's planes, making it possible to show its creditors a less myopic business viability when compared to traditional valuation methods. RESUMEN. Esta investigacion describe el analisis elaborado sobre una empresa brasilena de transporte aereo internacional de pasajeros, trazada de acuerdo a un analisis de las alternativas reales. Este tipo de analisis se considera apropiado, ya que la industria de transporte aereo, que actual...