It rather looks like the love-affair with flying everywhere for nothing – no matter the inconveniece involved - is fading, so both routes and service frequency might have to fall. The parallel with Starbucks over-expansion of stores is uncanny.

With the downturn accelerating, there will be many more examples of weak firms forced to surrender potentially valuable resources – especially capacity and people – to those whose sound strategic management avoided getting into trouble. In the extreme, this will involve absorbing those weaklings in total. Smart firms in cyclical industries, from petrochemicals to paper to insurance to construction, have long known how to exploit the short-sightedness of others. See for example ‘Managing Capacity in Basic Materials‘ – though the principles are far more widely applicable than just in ‘basic materials’.

Next – who is the smart money on during the down-turn? Those who did some or all the above should be in great shape now to cash in on their good sense – there will be fire-sale oppportunities out there to acquire assets or whole businesses at knock-down prices. I see, for example, Lufthansa taking a stake in Brussels Airlines.