Are you looking at your 'month to date' income statement?

Depending on what day of the month you are in, you will show different net incomes due to payroll and other expenses happening at different days of the month.

You could show a profit on the 14th, but when you login on the 16th after payroll is run, you could be running at a net loss.

Since there is not Statement of Cash Flows, it might be a little difficult to understand where your cash is going.

If Airline A didn't have any assets, then giving Player A the proceeds from the sale (goodwill) would be a good solution.

The problem is if Airline A had assets:

Say Airline A has $100M worth of assets and only a debt of $10M so the value of Airline A is $110M.

Airline B purchases Airline A for $150M

$10M goes to pay debts and Airline A is left with $140M that it received from selling their assets and goodwill from Airline B

Airline A restarts as Airline A 2.0 and makes a massive aircraft purchase and then puts their airline up for sale

Airline B (C, D or E) bid to purchase Airline A 2.0 and in essence Airline A becomes an aircraft farm

There would need to be some restrictions to prevent the abuse of M&A for extreme growth

It would be difficult to implement realistic mergers and acquisitions (M&A) into AE.

First, the "sales price" of an airline would be its enterprise value (EV).

EV= Market Cap + Debt - Cash

Without a stock market, you can not figure out market cap (market cap = outstanding shares*market value of shares)

Even if we used an airline's valuation as a stand-in for market cap, we can be stuck with people creating ghost airlines to run up debt and then purchase with their main airlines.

But then we must look at the benefits of purchasing an airline. These include:

All existing assets (terminals + owned aircraft)

Rights to any aircraft leases

Rights to all gate leases (especially those hard to get foreign gates)

Rights to all existing routes

And we also have to look at legit reasons an AE player would want to sell their airline. Some reasons are:

Excessive competition

Excessive Real Life demands

Having other better ranked AE airlines they'd rather focus on.

So there are legit reasons to have M&A

One way that this can be implemented is that only airlines with positive valuations can be sold.

M&A can only be done after an arbitrary amount of AE round years

Only airlines who put themselves up for sale or airlines with positive valuation who are inactive can be part of M&A

Once that airline (Airline A) is put up for sale, that player loses control of their airline

"Airline A" is then announced to be on sale for anyone in the same home country to bid for

Once the bidding window closes, the winner (Airline B ) is announced.

A month or so later, all assets, leases, routes, debts are transferred to the winning airline (Airline B )

If Airline B pays more than what Airline A is worth, that difference shows up as "Goodwill" on the balance sheet

No airline receives the proceeds from the sale.

What are the downsides of M&A?

Decreased employee moral. There will most likely be differences in pay between Airline A & B which will cause an uproar when Airline A's employees get pair more/less then they used to. Also to achieve synergies, redundant positions will be reduced during the first year of merger causing a reduction in employee moral.

Increased payroll. Until synergies are achieved via layoffs, Payroll consists of total payroll of A&B

One-time training costs. Employees of Airline A must learn the best practices of Airline B

Rebranding cost. Painting aircraft, changing logos at airports, new uniforms etc. (just like if you changed your airline's name in game)

Reduced reputation based on the difference between airline's reputations

More advantages?

"Merged" aircraft deliveries. Take over delivery spots of Airline A. You can now receive 2 737s every 2 weeks until Airline A's queue is finished

plus all previously mentioned

Airlines with negative valuations would not go through this process. Without a solid bankruptcy protection program in AE, leasers will repossess all aircraft and placed in used market, airports will remove unpaid gates and place on the market, and airline would be closed as is done currently.

[sorry, I'm bored]

I got the same issue in R2 & R5 with my single digit aircraft I've purchased.

We had a similar issue before (years ago) where a route can become profitable by creating excess demand throwing off the supply/demand algorithms.

I don't know what supply and demand models are used for AE but in theory this could be explained with economics:

We know (or should know) equilibrium price is where supply = demand, thus a high demand route can be flown with a frequency of 1 and we can charge a high price for that route (demand is greater than supply)

but supply and demand curves are not straight lines, but actual curves.

Demand functions are usually 2nd degree functions and form a parabola

So where supply hits the left side of the parabola, you hit equilibrium... but if supply where to continue to increase, it may hit a second equilibrium on the right side of the parabola. here demand will always be greater than supply thus creating "ghost demand"

...just a theory

interesting, you are venting about the airline that vented about O1 players not too long ago

hubs are amazing

DC-10 either Mexicana or AeroMexico, don't remember

727 Mexicana

A319 Mexicana

MD-80 (various) AeroMexico

757-200 AeroMexico

737-400 Alaska Airlines

737-900 Alaska Airlines

777-200ER American Airlines

767-300ER American Airlines

777-300ER Air Canada