Emerald Airlines
Join Date: Mar 2007
Location: Netherlands
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Emerald Airlines records start-up related losses of €21.35m in first year of operatio
Emerald Airlines posts start-up related losses of €21.3m (rte.ie)
That is the 16M cash in hand gonzo... but they will have turbulent times ahead already. Their COVID start-up advanatges are all gone now or on the way out.
- Unions are already inn
- Covid leases (cheap or even PBH) are over / ending
- Fuelcost and handling and overflights up +25% since start
Its a tough cookie and not viable to be an franchise for EI.. history proven that and Emerald will confirm this in due time, EI will need to take it inhouse if they want too, but they know there will always be an operator happy to stand on the curb corner and be the next to be ...
That is the 16M cash in hand gonzo... but they will have turbulent times ahead already. Their COVID start-up advanatges are all gone now or on the way out.
- Unions are already inn
- Covid leases (cheap or even PBH) are over / ending
- Fuelcost and handling and overflights up +25% since start
Its a tough cookie and not viable to be an franchise for EI.. history proven that and Emerald will confirm this in due time, EI will need to take it inhouse if they want too, but they know there will always be an operator happy to stand on the curb corner and be the next to be ...
The financials aren't great - but I don't think some of what you say is accurate. Several airlines managed to secure long-term leases at very low rates during Covid and still have more than a few years to run on leases at those favourable rentals. I think you'll find Emerald is one of them, so although overall cost inflation on things like handling and nav charges will be impacting, ATR aircraft leases will not be hurting. And for the Aer Lingus franchise, it was always going to be the case that the operator would have to recognise unions.
One operator before has failed as an EI franchise (Stobart). It failed pretty much only because it sold and leased back ATR72s at a huge lease rental to allow its then-shareholder to take cash out of the business as a dividend. When those huge lease rates couldn't continue be paid, it all went horribly wrong very quickly.
That is not the case for the current or any future Aer Lingus Regional franchise carrier, so this is not an inherently "bust" business model as you claim. You do seem to enjoy prophesising the demise of regional airlines, but it seems to be heavily from a position of ignorance of the facts.
One operator before has failed as an EI franchise (Stobart). It failed pretty much only because it sold and leased back ATR72s at a huge lease rental to allow its then-shareholder to take cash out of the business as a dividend. When those huge lease rates couldn't continue be paid, it all went horribly wrong very quickly.
That is not the case for the current or any future Aer Lingus Regional franchise carrier, so this is not an inherently "bust" business model as you claim. You do seem to enjoy prophesising the demise of regional airlines, but it seems to be heavily from a position of ignorance of the facts.
Join Date: Mar 2007
Location: Netherlands
Posts: 165
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Hi Flightrider, I am just being realistic, and do hope they sucseed but its just very hard / impossible. And in between the lines you agree, their best advantage was low leases, assume they were all long term, what I think they will not be, than in Summer 2026 - 2028 all these aircarft are going significat up in price on top, all their metal they will get inn from now onwards will be sky high again compared their leases. Crew turnover and new recruitment at much higher costs, and DOC that are rising 25%, that are very serious drainers of cash. So it will again be very hard for them. EI play this smart and as mentioned there is always an operator willing to take it, so this cycle continues. but I see hard times ahead... that all..
