Coronavirus Impact on Air Travel
Thread Starter
I am less worried about Easyjet / Ryanair and Wizz than I am about IAG / LH / AFKLM, Virgin is finding no great love from anybody based on its founder. IAG / LH AFKLM have significant cost bases which they will find not easy to escape from.
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IAG, LH and KLM/AF will have the backing of their various governments if they need it as they are the flag carriers across Europe. The UK government would never let BA fall and neither would the German with Lufthansa or the Dutch with KLM.
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'British Airways, the UK flag carrier, has extended its dollar revolving credit facility, as the coronavirus-ravaged airline industry continues to reinforce its finances. The facility will now mature in June 2021, after the borrower invoked the first one-year extension option on the loan signed in 2015. BA's owner International Airlines Group said there is $1.38bn available under the extended facility'
Why are all these airlines extending their revolving credit lines when they have no idea how long this is going to last? Surely that is just sinking deeper into someone else's pit of ownership that they will never get out of? Still, no need now to call on UK PLC for support now!
Why are all these airlines extending their revolving credit lines when they have no idea how long this is going to last? Surely that is just sinking deeper into someone else's pit of ownership that they will never get out of? Still, no need now to call on UK PLC for support now!
Let's assume that some time in the next 12 months (ie by late March 2021), the lockdown ends and people are able to fly freely
Let's assume also that businesses, having seen what can be achieved with the likes of Zoom, decide to cut back significantly on business travel
Let's assume also that some measure of confidence returns and people decide they want to fly again for leisure in summer 2021
In effect, business travel demand is reduced long term, while leisure travel demand eventually recovers
What impact would this have on route networks and frequencies, particularly in Europe ? Clearly demand and frequencies on early morning and early evening on weekdays on routes between major cities may decline, with fleets being trimmed. Furthermore, airlines may get pushed more towards a LCC style business model, instead of an all-inclusive fare structure. What will likely happen to other routes and frequencies ?
Let's assume also that businesses, having seen what can be achieved with the likes of Zoom, decide to cut back significantly on business travel
Let's assume also that some measure of confidence returns and people decide they want to fly again for leisure in summer 2021
In effect, business travel demand is reduced long term, while leisure travel demand eventually recovers
What impact would this have on route networks and frequencies, particularly in Europe ? Clearly demand and frequencies on early morning and early evening on weekdays on routes between major cities may decline, with fleets being trimmed. Furthermore, airlines may get pushed more towards a LCC style business model, instead of an all-inclusive fare structure. What will likely happen to other routes and frequencies ?
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Some answers
if you have an hour to spare, some very good insight here: https://www.flightglobal.com/on-dema...137617.article
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DJ6
Do not get too hung up on tele conferencing as I have been doing this for years (and got quite good at it I am told) but still I clocked up more than 400,000 Air miles last year, and that was just LH, never mind the flights / high speed rail trip in Europe. People will do video conferencing when no other option available, which is the current status, but that will most probably change when other options available. Interestingly I do find that many of the younger people I deal with, also have been more prone to request face to face meetings, rather more than those more senior in years, which flies in the face of what you would expect, and what the IT industry sells in their advertising. We will see who is correct later this year, but my own schedule is already filling,
Do not get too hung up on tele conferencing as I have been doing this for years (and got quite good at it I am told) but still I clocked up more than 400,000 Air miles last year, and that was just LH, never mind the flights / high speed rail trip in Europe. People will do video conferencing when no other option available, which is the current status, but that will most probably change when other options available. Interestingly I do find that many of the younger people I deal with, also have been more prone to request face to face meetings, rather more than those more senior in years, which flies in the face of what you would expect, and what the IT industry sells in their advertising. We will see who is correct later this year, but my own schedule is already filling,
Paxing All Over The World
When I worked in Telecommunications (1977~2003) I was involved in audio and video conferencing from the mid 1980s. Despite the fact that quality is now remarkable and cheap - there is NO substitute for face-to-face. Humans are geared to it.
In my current work I often have to audio and video conference with clients (certainly during the current crisis) and, again, this is always the secondary option.
Yes, some will use the new service BUT there is nothing to replace, visiting the people in their office, seeing their working environment and going to their favourite place for lunch. In the process, you pick up untold clues and minor details. Critically, you build a relationship with them that can ONLY happen this way. This is even more important when the people are in a different culture to you. I can readily understand someone 600 miles away in my own country but not 600 miles away on the continent speaking a different language.
In my current work I often have to audio and video conference with clients (certainly during the current crisis) and, again, this is always the secondary option.
Yes, some will use the new service BUT there is nothing to replace, visiting the people in their office, seeing their working environment and going to their favourite place for lunch. In the process, you pick up untold clues and minor details. Critically, you build a relationship with them that can ONLY happen this way. This is even more important when the people are in a different culture to you. I can readily understand someone 600 miles away in my own country but not 600 miles away on the continent speaking a different language.
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So how and when does air travel to foreign countries resume if there are still cases around the world? The UK had its first cases from China then from Italy and then I think Iran. For the first few weeks the UK traced the contacts and then found it was in the community. Will it be a case of daju vu?
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Headline in today's South China Morning Post Coronavirus: Cathay Pacific to cut more flights after carrying just 582 people in a day
This really illustrates the depth of the problem facing airlines worldwide. They have now reduced their HKG/LHR from multiple flights per day to just two per week, whilst BA have discontinued this route which they served double daily.
This really illustrates the depth of the problem facing airlines worldwide. They have now reduced their HKG/LHR from multiple flights per day to just two per week, whilst BA have discontinued this route which they served double daily.
EASA in their wisdom have issued guidelines regarding Recirculation fans and that they now ought to be switched "Off". As around 50% of the air in aircraft cabins is recirculated using these fans, obviously it is not difficult to work out future problems for both passengers/crew health and the servicing of the cabin air conditioning ducting (disinfecting etc.) Good luck to people when flying starts again.
Thread Starter
The assumption is that going forward things stay as they always were. The last month tell us that is not the case.
Nor will it be the case in the future as airlines will be retrofitting to ensure increased quality of air and recirculation of air fits standards the passengers ask about not what the airlines want.
Nor will it be the case in the future as airlines will be retrofitting to ensure increased quality of air and recirculation of air fits standards the passengers ask about not what the airlines want.
Thread Starter
On previous discussions on JB I indicated supply chain to supermarkets had 3-4 days maximum supply on chilled, a bit more on frozen and 10 days on ambient. Tesco (as an example) order on 2nd Jan on say a monday morning and it is in store by Wednesday, sold by Friday and the manufacturer will be paid at end of March after the retailer has taken lots of debit notes and discounts decided by it from the invoices. Manufacturer would have got the stock in during November / December and in many cases paid for it by mid January. Tesco will give you 13 weeks (often less) notice of delisting products or range refreshes as they call it.
I figured it would be 2 weeks before retailers had lots of stock in, it was pretty much bang on, supply chain is fuller, shelves are full a couple of times a day and manufacturers are working flat out with retailers putting in mega orders but will accept whatever is sent.
The scummy screwing of suppliers has changed because they now realise suppliers are just surviving, Aldi pay day delivered, they and Lidl are the best to deal with even before this, the others have changed their terms massively.
One supplier to a major supermarket, still awaiting payment of a massive amount from October (big 6 figures) where retailer queried every invoice claiming 1 case missing per delivery to not pay any invoices. Supplier told the retailer that all production was focusing on a competitor because of massive non payment, retailer said you will never deal with us again and got told ok that is fine. 2 hours board director of retailer called and asked how much was outstanding, 1 hour later all outstanding cash was in the suppliers bank with all queries no longer an issue.
The "Key workers" on production line are 80% migrant labour, predominantely on minimum wage or just above and a bit like what is in the media about how farmers will struggle because nobody is around to pick the crops.
Food shortages haven't yet happened but when you think summer produce comes from Italy and Spain, Chicken from Thailand and Vegetables etc from East Africa then have a look at what is happening there.
Racedo - your understanding is similar to mine, but think your 80% might be a bit low mind. Also, my understanding is that because of the difficulty in recruiting staff in recent years, many are making more than minimum wage (and some a lot more) - but that might just be what I was being told.... 
This years harvest could be a real struggle
From the people I speak to, Aldi and Lidl have by far the best reputation and not just for payments, but straightforward dealing as well and M&S and Waitrose the worst
.
Going off topic, I'm surprised the climate change brigade haven't piled in on the 'miles' of some of our fadish products - would your life be any poorer if you never saw a kumquat again?
In terms of possible shortages, the service sector shuitting up shop has helped, although it's also been pretty disruptive.
This years harvest could be a real struggleFrom the people I speak to, Aldi and Lidl have by far the best reputation and not just for payments, but straightforward dealing as well and M&S and Waitrose the worst
.Going off topic, I'm surprised the climate change brigade haven't piled in on the 'miles' of some of our fadish products - would your life be any poorer if you never saw a kumquat again?
In terms of possible shortages, the service sector shuitting up shop has helped, although it's also been pretty disruptive.
From the BBC website -
Where will be the last place to catch Covid-19?
There are 193 countries which are members of the United Nations. As of 2 April, 18 countries had not reported a Covid-19 case, according to a BBC tally using data from Johns Hopkins University.
The 18 countries without Covid-19Comoros; Kiribati; Lesotho; Marshall Islands; Micronesia; Nauru; North Korea; Palau; Samoa; Sao Tome and Principe; Solomon Islands; South Sudan; Tajikistan; Tonga; Turkmenistan; Tuvalu; Vanuatu, Yemen
The 18 countries without Covid-19Comoros; Kiribati; Lesotho; Marshall Islands; Micronesia; Nauru; North Korea; Palau; Samoa; Sao Tome and Principe; Solomon Islands; South Sudan; Tajikistan; Tonga; Turkmenistan; Tuvalu; Vanuatu, Yemen
Thread Starter
Oh I am conservative on this but it does depend on sector of industry and location as well. Many places are paying National living wage rather than minimun wage. One place I know which has surplus underweight stock is handing a bag of it to the staff every Friday.
Aldi / Lidl agree price for 6 months and you supply, no visit needed or hospitality required. If commodity prices go up then you eat it, if commodity prices go down then you benefit it. Tesco used to demand price decrease immediately but price increase was 13 weeks from agreement and that could take 3 months.
The climate change brigade enjoy their stuff to much and it is easier to lecture.
Had to travel to West Midlands this week and motorways were unbelieveable.
Aldi / Lidl agree price for 6 months and you supply, no visit needed or hospitality required. If commodity prices go up then you eat it, if commodity prices go down then you benefit it. Tesco used to demand price decrease immediately but price increase was 13 weeks from agreement and that could take 3 months.
The climate change brigade enjoy their stuff to much and it is easier to lecture.
Had to travel to West Midlands this week and motorways were unbelieveable.