China Airlines lost nearly a Billion

[armchairpilot94116]

China Airlines lost nearly a Billion US dollars in 2008. This will surely affect its operations I would imagine.


Taipei Times - archives (http://www.taipeitimes.com/News/biz/archives/2009/04/05/2003440265)

quote:

The company will seek shareholder approval for the proposals at the May 18 annual general meeting, which comes after CAL reported a record net loss of NT$32.35 billion, or NT$7.11 per share, last year.

That compared with a net loss of NT$2.52 billion in 2007 and a profit of NT$738 million in 2006, CAL’s previous financial reports showed.

NO PAYOUTS

To make up for its poor performance last year, CAL plans to cancel distribution of dividends to shareholders, while its board of directors will receive no compensation or bonuses as the company has no retained earnings for such payouts, the company said in a statement.

The financially beleaguered carrier said falling demand because of the global economic recession was the main culprit for the losses, despite the benefits of its hedging strategy that achieved a fuel cost saving of NT$12.98 billion for the first three quarters of last year.

Its operational loss was NT$10.21 billion, mainly because fuel costs rose 45 percent year-on-year in the first three quarters of the year, while non-operational losses were NT$26.48 billion for last year, the statement said.

unquote

exchange rate 33.88 nt/ 1 usd april 8,2009

[Hamtarro]

Thats excellent news! Maybe I can have my pay cut back. Oh I forgot there cancelling my contract as my replacement just arrived from High School.

[FO Cokebottle]

Combine the Billion with the 60K fine for transporting radio active material without a permit - that fine is 6.8 years of my paycut...:ugh:

Hamtarro, don't forget that your highschool replacement is wearing glasses..:ok:

FO Coke

[Fubaliera]

The Expats Will Be Back After The Next China Airlines/taiwanese Pilots Screw Up.

[TWN PPL]

The Expats Will Be Back After The Next China Airlines/taiwanese Pilots Screw Up.
What does this have to do with CAL loosing nearly Billion $$$? Isn't it economic issue? BUT what do I know... YES, You're so right. Just hope that everyone is still current and have flown jet transport within the last 12 months by then.

[etops777]

Fubal,

What makes you think that Taiwanese pilots are incapable to fly an airplane??!!

The MD11 that crashed in HKG back in 98 was commanded by an Italian Capt. An expat that landed on 13R in JFK off Carnasie was supposed to have landed on 13L...

So cut your childish remarks!!!:mad:

[Phlap1]

10 day old 747-400 HKG, Airbus FUK, Freighter ANC
I could go on
Keep your comments to yourself!

[etops777]

phalp,

Anyone of us can make a mistake in aviation no one is immune from it..

I can also go on and on about other mishaps of the expats at CI or the airlines here in the middle east.

Sorry to let you all know that I am also an expat!

Grow up.

[tom744]

etops777,

are you in CAL?
I've been there for 6,5 years and really know what's going on.
Well you're right, it's not about nationality but do you really think a 200 hour F/O, freshly graduated can properly fly a long range aircraft like a 747 or 777?
Of course not, might he be chinese or caucasian.
But that's how things were done in CAL, many rookies went direct to the 747 or 340.

Regards,
Tom744

[TWN PPL]

do you really think a 200 hour F/O, freshly graduated can properly fly a long range aircraft like a 747 or 777?
NO!
But, On average a company spends over US$200,000. or more to train zero time pilot. Attending flight school overseas, acquiring license certifications and real-time jet training. it's ab-initio program.
No need to do this in your part of the world, because you have general aviation. We can't even own a private plane. It has to be registered in another country. And you really have to be 1.) very wealthy 2.) very connected to do this here.
No flight school;therefore, they rely on the military in the past. For the airline that have turbo prop to place their newly trained pilot in is a luxury that some don't have.
Where does the Air Force around the world place their Academy pilot graduates in? When they need co-pilots for the likes of KC-10, C-5, C-17 or the AWACS.

[555orange]

Lost a Billion. Funny since the cost of operation has to be lower than anyone. Salaries are way less than competitors overseas, expat contracts are less than competitors, etc etc... no one has cut more cost that CAL. So how is it possible?? I think its all political. Its either smoke and mirrors, or someone is syphoning off the cash. The "foundation" that controls the purse strings for CAL took much of the profit in past years to build a high speed rail. So now where is the Foundation when CAL needs a boost?? And what about that monster new crew center/sim center/hotel et al that is being built at Tayuen Airport? That is bigger than most resorts that I have been to, and is bigger than Cathay City in Hong Kong. They have lost the money because of mismanagement and government sticky fingers. Simple as that. There is no other airline that runs more lean than CAL.

Problem with ab initio pilots has nothing to do with their basic skills. Its because of lack of experience in a large airplane. You need to cut your teeth on something where you do 5 landings a day...not 5 a month. Not to mention something that is way more sophisticated to fly and way more momentum to anticipate. Its just too much for ab initio's.

[macumba]

Any talks of "furloughing"/termination of expats contracts?

[armchairpilot94116]

Well the article does mention some 10 Billion Taiwan dollars in operational loss plus another 26 Billion or so in non-operational losses. It would be interesting to see what exactly these non-operational losses pertain to? Is it for the mega complex mentioned in this thread? Which would really make it an investment.

Also in spite of this they are planning to buy back shares? I thought companies buy back shares when they make a ton of money?

Also I note that CAL remains very competitive on fares. For example a recent quest on Travelocity reveals CAL at about 670 round trip from SFO to /from TPE while the next cheapest was (surprisingly) ANA with about 770 for a round trip and EVA is over 800 dollars. CAL and EVA have nonstops on this route while ANA is a stop and plane change in Narita.

I guess the Airlines Business has really gone from :

How to make a million in the Airline Business by.... starting with a Billion

to:

How to lose a Billion in the Airline Business by .....starting with Billions.

[armchairpilot94116]

CAL made a modest operating profit but sustained an overall loss due to fuel hedging in the first qtr 2009.

Taipei Times - archives (http://www.taipeitimes.com/News/biz/archives/2009/05/01/2003442461)