All Over for Aer Lingus in Four Weeks as BA Gives Thumbs Down to Investment

[The Guvnor]

From today's Sunday Times:

AER LINGUS is just four weeks from
being wound up after British Airways and a number of other potential investors turned down its pleas for cash.

Sources close to Rod Eddington, the BA chief executive, said that he met the Irish airline in London last week and told it he would not invest at present.

Aer Lingus directors say the company is on the verge of liquidation unless the unions agree to redundancies or the Irish government can persuade the European Union to relax its rules on state aid.

The board of the government-owned carrier was told on Thursday that nobody was intrerested in investing.

With no sign of a "white knight" investor and severe restrictions on the amount the government can inject, industry sources say
the company's only chance of survival is an early agreement with the unions on laying off 2,000 of its 6,200 workers.

However, a deal is unlikely as, according to Irish government sources, workers will receive only slightly more than Ireland's
statutory redundancy entitlement. This means that some workers with 20 years' service could receive little more than £3,000.

Senior union sources in Dublin said this weekend that workers "will burn the building" rather than accept the redundancy package. They had expected to get as much as £90,000.

Aer Lingus had hoped that BA might fly to its rescue but Lord Marshall, chairman of the British airline, told The Sunday Times that it is unlikely to take a stake.

Marshall was sceptical about any possible investment. He said Eddington met Aer Lingus but added that BA had been constantly approached by other airlines since the September 11 attacks on America.

He said: "The Irish government has approached, directly and indirectly, several parties, including us. Rod spoke to Aer Lingus in the context of a One World alliance meeting in London. But we would have to be very, very careful before we make any investment or take any interest in any other carrier in the current climate. It depends on what is on offer on what terms and at what price."

It is generally accepted that Aer Lingus will face liquidation if a rescue plan is not implemented. At a bleak board meeting on
Thursday, directors were told they had four weeks to put the company's survival plan into action or face insolvency.

Government and Aer Lingus sources have dismissed suggestions this week that a consortium of Irish businessmen may be interested in taking a strategic stake in the airline.

Non-Irish investors are, in effect, blocked from taking a majority stake in Aer Lingus under the terms of the US-Ireland agreement that allows Aer Lingus to fly into America. Although the agreement prohibits only non-Irish concerns from taking more than 49% of the airline, Aer Lingus sources this weekend said it was unlikely that the US Department of Trade would allow non-Irish interests to take more than 25%.

The EU has ruled out state aid to the airline, which is losing £2m a day, leaving the future of Aer Lingus in the hands of the
unions. Negotiations over redundancies are now the main obstacle to the company's survival.

Any attempt to use public money to save Aer Lingus would not only require a volte face by the EU but would also be met by a legal challenge from Ryanair. The Dublin-based regional airline CityJet, which is a subsidiary of Air France, has also said it
would oppose state aid to Aer Lingus.

[Magplug]

Have you really got nothing better to do at a quarter to eight on a sunday morning than to reproduce articles out of the national newspaper that we are all in the process of reading ? Why don't you try some other hobby.

[E. MORSE]

Excellent point Magplug !

[gyrohead]

I think the topic is important and worthy of inclusion. Positive responses to the crises at Aer Lingus would be more welcome than a couple of gripy comments from some heavily stressed in need of therapy individuals. Keep scanning the news Guvnor (I might have missed that one as I don't get the Times on a sunday!) ;)

[Jet A1]

Guvnor --- You really are showing your true qualities.....Over the last couple of weeks you have offered nothing either towards PPrune or its members......You have either ripped people to pieces ie Malgus scheme and enjoy giving out about airlines which are in trouble, some of us face the prospect of no job by the end of next week, we do not need you, who obviously deosn't appreicate the true facts passing opinion .......It is obvious you have some issues which only you can sort out !

[E. MORSE]

Well Gyrohead ,

You are excused for calling me names.

[Whirlybird]

I rarely read Sunday papers, and I don't often read "Rumours & News". So I suspect there's something long term going on here that I don't understand. But will someone please explain to me in simple terms how it can be in any way inappropriate to post news of an airline going down the tubes on an airline rumours and news forum.

This seems to be a case of Guv bashing and/or I don't like it so I'll shoot the messenger.

[gyrohead]

My point exactly! :confused:

[Saab 2000 Driver]

Now who on earth has tought The Guvnor that ´copy and paste´ trick ??? :D :D :D :D

But seriously Guvnor, keep up the good work ! If nobody wants to read it, then it´s their problem.

Best regards,

Saab 2000 Driver

[Fr8t M8te]

A lot of guys and gals log in from abroad and if any Ppruner takes it upon himself or herself to post some relevant news then I welcome it.

I do not condone the style of certain individuals but there again I, like the rest of you, am not forced into reading this Bulletin Board.

WE HAVE A CHOICE

[The Guvnor]

Actually, the reason I posted this article - amongst many others - is that it is highly relevant both in that it is (a) an airline; and (b) a company that a number of PPRuNers are employed by.

In addition, whist a large proportion of PPRuNers are UK based, it is incredibly naive on the part of certain people to assume that everyone sits down with the London Sunday Times every Sunday morning! :rolleyes: :eek: :rolleyes:

Jet A1 - if you didn't appreciate the fact that the Malgus scheme's figures simply didn't make logical sense - as was pointed out by numerous people including WWW and IFR as well as myself - then I think you're in the wrong game as a decent grasp of basic maths is essential even for a PPL!

I certainly take no pleasure in posting downbeat stories - I would much rather be posting stories that show business is recovering but over the last week I've only found one of those (confirming that Blue Fox was still intending to launch next spring as planned). Unfortunately, some people preferred to 7500 it to attack a 767 captain with whom they had problems.

At the same time, it's important to be realistic - there are too many people out there saying that everything will be fine in a couple of months which patently isn't going to be the case. This recession is going to take years - not months - and it's only just started. And this, by the way, is one forecast that I would be only too happy to be proven wrong on!

[Stagnation Point]

I find it sad that a work force would rather burn the building down rather than rally around and get the business back into shape so it can fight on another day. But I guess out of the ashes a Pheonix grew. It was a similar situation that caused the downfall of Ansett, to high a cost structure and not enough revenue and an owner that couldn't restructure.

Why can't an owner re invest into there company, regardless of whether they are a government or a privetly owned company.

Find somthing else to bash rather than the guv, if it wasn't for him there would only be half the threads on this web than there is .

[maxalt]

So Guvnor, can you clarify, the original post was merely 'news' and not just gloating?

If so, do you believe everything you read in the papers, or do you have a personal opinion?

If you have a personal opinion, would you be prepared to put some money where your mouth is?

The bet is "Aer Lingus to close within four weeks." I think that's November 25th. The term 'close' means 'shut down permanently in present form...brand dead'. What do you say?

[Mad Mitch]

Guv
Keep posting the threads and take no notice of the professional wingers that seem to have taken over pprune lately and who knock everybody that wishes to say something they don't agree with. There was a poor BA cadet on Wannabees who got slaughtered by these a------es for posting a quite innocent thread.
If you only want pretty good news stories guys log off and go somewhere else and do us all a favour please.

[Suggs]

Jet A1

How'd the whatsit go in the Crawley region last week. You know what I mean!

[skymarshal 1]

Sounds like some EI employees have the same mentality as those at sabena.

Most likely outcome of all this will also be similar to this ailing airline, regardless of EU, I think.

[Arkroyal]

magplug and E MORSE,

Have you got nothing better to do at 8.15 on a Sunday Morning than scan pprune for a chance of Guv bating? :D

[maxalt]

Whoever wrote that article for the Sunday Times must realise that by publishing a piece of pure speculation such as that is they are increasing the chances of it actually happening substantially.
Would you, as an ordinary punter, buy a ticket to travel with Aer Lingus at Christmas if the Sunday Times says it's going to be bust by then?

I can't understand how they can get away with it. It is pure mischief making, all for the sake of flogging their rag.

Mischievous...now that's a good adjective to describe The Guvnor too I think. :p

[bigjarv]

Recently I have found myself having to filter through huge ammounts of arguments, pats on backs and blatent personal attacks on pprune!! For gods sake get a grip!! Everyone has to justify their points over and over. It is boring!! If you don't have something constructive to say then don't say it! If you don't like what you read don't read it but I think everyones opinion is valid cause it gives me the big picture to make up my own opinion! Grow up and stop slagging everyone off!

Please excuse the outburst but I had to say something!!!!!

Smile and be happy!! :D

[CI300]

Magplug. living where its Sunday night by the time you get your Sunday morning paper. I would be waiting sometime before my copy arrived. Think outside your bed-sit.

Aer Lingus seem on the surface to have similar problems as Ansett, the only fix is to start fresh with the staff that want to work.

[maxalt]

I agree.

[Ontheairwaves]

MAD MITCH
The BA cadet on the wannabes deserved to get a thrashing....there he was just out of school from BA with 200hrs....wondering who next should spoon feed him and give him a plane free so that he could build some hours and then at the end says he's going back to Daddy's business....just shows that he probably won't get to command since he evidently can't make up his mind after atleast 1yrs intensive training, what he should do next......if he was REALLY interested in his career and not being spoon fed then he would know what to do.....
He was advised to do his instructors rating...but i guess he decided he was too good for that....and Daddy probably will pay him to sit on his a**e and lose all his touch flying ...rather than slum it as an instructor and get some good experience under his belt.....

As for The Guvnor.....i've already pointed out in his many many many other posts....that most likely he's one of the anoraks at the side of the runway....the nearest he gets to a plane in riding in one or on his Microsoft Flight Sim....
A guy like him with sooo many posts has to be flying a desk.....or just a nerd.....

My advice is ignore the fool......i don't think ALT will be allowed to close, it will most likely be a more trimmed company considering the amount of dead wood in the place already it can only do some good.
I see that ALT management are taking the greatest percentage of cuts.....well about bloody time....during the last 2 cuts...management lost 0%....so what goes around.......
:D :cool: ;)

[Epsom Hold 2]

I don't know what's wrong with some people. Guv has introduced a vital issue - the national flag carrier of Ireland is about to collapse and Guv has reprinted an article to introduce the subject with some substance. And half the responses are slagging the bloke off instead of debating a very serious issue and it's many facets (EU, low-cost airlines, unions et al). May I also remind you if you disapprove of a thread, by adding petty crap to it you are also putting it back at the top of the pile. I agree Guv has made a few gaffs but even those have served to amuse. The man's a cult figure.

Idiots.

[eeper]

Ontheairwaves
- The BA cadet posting on Wannabes asked a perfectly straightforward and justifiable question. He was unjustly flamed purely on the basis that he was a BA cadet. Had he posted as a self improver asking for advice as to his next steps then you can bet that the response would have been nowhere near as vociferous. Double standards...?

[ElNino]

Eeper , quite agree, the BA's guys question was perfectly legitimate. No question that double standards are in evidence here. Its quite laughable actually, as if any of his many detractors would have turned down the chance of a BA cadetship. Yeah, I can see it now: "Hmmm, a free CPR/IR with a jet job afterwards, no thanks mate, I rather like the idea of spending 50k of my own money so I can take the moral high ground afterwards."
Ontheairwaves : "if he was REALLY interested in his career"??? No of course he isn't, his question on Pprune was simply an ingenious method to **** off those with chips on their shoulders (you wouldn't be one of them surely?). Obviously his question had no real interest in aviation and he was merely wondering which of Daddy's companies it would be best to work for. The sad thing is that people unable to see the irony of the "daddy's company" bit are actually flying pax out there. Very scary.
Let's hope there ain't too many like you out there, otherwise no one would have any knowledge of the aviation world, any legitimate question getting quashed by the "professionals".
So all you pathetic detractors out there, get a grip, though I guess it was nice to be born with 4000 hours... And a perfect knowledge of the world of aviation!

[AffableGuy]

I mean, this is a "Rumours & News" forum. I'm sure people would want to validate this one way or another themselves.

In any case, it's worth commenting on, true or not. A lot of people were skeptical when they first heard that Swissair may fold, I remember.

The Guv posts it, everyone can debate it. Isn't that what a forum is all about? If there were no posts like what the Guv is doing, then what is 'news'? What some pilot did for a joke a couple of weeks ago at a party?

[spud]

Cult figure. A spelling mistake surely?

[gyrohead]

No! Spud. The word "figure" was correct! :p

[ 29 October 2001: Message edited by: gyrohead ]

[TimeisShort]

MagPlug, E.Morse, JetA1, OnTheAirwaves.

It would be fair and reasonable to conclude that you all suffer from a Chronic case of Self-Imposed Torment.
The same can be said in relation to all of the other 'Questionably Intelligent' 'Guv-Bashers' that seem to develop an 'Enormous-Chubby' by slinging off at 'The Guvnor'.

Anyhow, in relation to the 'Self-Imposed Torment' , relief is available for all of you. The solution has been staring you in the face for the whole time you've been members of PPRuNe, but quite obviously the simple solution has evaded you all for far too long.

Let me give you all a helping hand along the road of enlightenment and with a bit of luck we can free you from the Chains of which your all so hopelessly entangled.

Ok, here we go. Now, upon entering PPRuNe and the chosen Forum, you are faced with a choice of thingis called 'Topics'.
To the right-hand side of the 'Topics' column is another column. This column has a heading that reads, 'Topic-Starter'.
It is so aptly-named, because it explains who started the 'Topic'.
Now, start the Progressive-Scan and while doing so, keep your eyes peeled for the following words, ' The Guvnor'.

At this particular critical moment, one must make a decision to Click or not to Click.
It's also called, ' Making a Choice'.

When a PPRuNe-Member clicks on a Topic started by 'The Guvnor', or any other PPRuNe-Member, they should read the initial posting and then the Replies that follow below.
Then that person decides whether they have any 'worthwhile comments' to contribute. If no 'worthwhile comments' can be contributed, it is time to continue to the next Topic.

However, if previous readings of 'Guvnor' started Topics or Topics created by any other PPPRuNe-Member have induced feelings of Torment or Contempt, a choice can be made.

In the case of the above persons and fellow like-minded individuals, the only logical and intelligent choice is not to Click on the Topic, full stop.
Once again, it's called a Choice. If you don't like the 'Topic-Starter', move on to another Topic and gain knowledge or give input wherever it is appropriate and more importantly, where it can be beneficial reading for the Members who peruse the Thread.

Then, PPRuNe can have extra Bandwidth available to all the legitimate PPPRuNers who frequent this Site.

See, it's so un-complicated. The choice is, be wise, or be the opposite.

-------------------------------------------
HATRED IS THE COWARD'S REVENGE FOR BEING INTIMIDATED

[maxalt]

So Guvnor, can you clarify, the original post was merely 'news' and not just gloating?
If so, do you believe everything you read in the papers, or do you have a personal opinion?

If you have a personal opinion, would you be prepared to put some money where your mouth is?

The bet is "Aer Lingus to close within four weeks." I think that's November 25th. The term 'close' means 'shut down permanently in present form...brand dead'. What do you say?

I threw down that challenge to The Guvnor four weeks ago (it's on page one of this thread). As you can see he chose to avoid the challenge.
Just as well for him because in about 30 hours from now he'd have stood to lose a few bucks.

You see, sadly for The Guvnor...AER LINGUS IS STILL HERE.

I'll tell you what Guv. Here's a new bet, and you don't even have to risk your limited funds.

If Aer Lingus is still in business on Christmas morning you'll give us the best Xmas present ever by getting off the forum for one month...in all your identities!

And if it goes bust? You'll of course have the endless satisfaction of saying 'I told you so', not to mention knowing they're all on the dole for next year.

I dare you.

[The Guvnor]

Nope, coz I know that the Irish government are planning a typically Irish solution to the problem - they're apparently going to use taxpayer's funds to buy (at a grossly overinflated price) one of the EI 737-400s apparently as a new Head of State aircraft. Strangely, the aircraft already appears to be owned by the taxpayers! :eek: :rolleyes: :eek:

They seem to think that this will manage to avoid the state subsidy rules ... but will Lola allow it? :D :D :D

[maxalt]

Guvnor you just can't ever admit being wrong, can you? Rather than simply admit you were wrong you start up a whole new line of blather. Do you ever give up? I probably should be pleased that you at least aren't predicting the demise of the company in another four weeks!

You're full of it matey. Do you have any friends? Or is this the only life you know? Although I've never met you I can picture you as the kind of guy who sits alone in the pub with a half glass of shandy boring everyone within earshot while they attempt to back away quietly.
Do you wear corduroy trousers and those stupid looking golf sweaters? I'll bet you do. I know your type. Pain in the a**e.

Oh, and by the way :D :D :D :rolleyes: :D :mad: :D :eek:

I'll out-smiley you too!

[Raas767]

If Aer Lingus can't compete and operate on its own than maybe it should be allowed to fail. The EU decided awhile back to try and privatize all the European flag carriers and to put limits on the amount of state aide that is allowed to flow in to airlines. If the Europeans want their airlines to operate in an environment where competion and free trade determines weather or not an airline is succesful than airlines that cannot compete should go by the wayside. Now, Sept 11 is a different story. The United States injected capital in to the airlines in order to compensate them for losses sustained because of the closing of national airspace, but those airlines with poor balance sheets will probably fail anyway, and they should. Why should healthy airlines have to spend money to compete with airlines that are either protected from creditors while in chapter 11 or enjoy full scale subsidies from their governments. Either we run airlines as a business or we run them as a post office, but not both.
I know all this sounds harsh and that jobs are at stake here, but that's capitalism.

[flypastpastfast]

Epsom hold 2 you said Guv is a cult figure mmmmm....I thinketh not.

Its ok to have opinions and all the rest but for someone from the industry to continually 'bet' on the FAILURE of part of the industry is bizarre at the very least.

Guv, and your chums, I've never had a problem with many of your posts but lately they are those of a doom monger, and that can dent investors confidence. Why not try talking the industry up and not down.

[The Guvnor]

Maxalt - stop being childish. You're perfectly well aware that I didn't write that article and this - in case you hadn't seen it - is the Rumours and News forum. The possibility of ALT folding is very obviously news - and that's why it was posted. Reading through the responses, rather more people appreciate its being posted than object.

Logical? I thought so! :rolleyes:

As I didn't write the article, I'm therefore not right or wrong. You'll want to take that particular issue up with the author!

flypastflyfast - if I only posted good news, there would be lots of articles about Go, Ryanair, and easyJet (all of which strangely enough I have posted) - and not a lot of anything else. You might be one of those people who prefers to do an ostrich and stick his head in the sand, hoping all the 'bad stuff' will go away - but that's a rather shortsighted view and one that's likely to get you kicked up the backside.

raas767 - I completely agree. In reality, there's not a lot of point in a country like Ireland having a long haul operation in any case; and short haul services are perfectly well covered by Ryanair, bmi etc.

There's far too much in the way of national egos getting in the way of economic reality here - the restart of SN under the guise of DAT+ is one such instance - far better to take the short term pain for long term gain rather than the other way round!

[akerosid]

There are times, Guvnor, when I'm not sure if you're being serious or if you're setting out to wind people up.

"There's not much point in a country like Ireland having a long haul operation." Why not? We have as much need and as much right as any other country in Europe or anywhere else to develop new markets. You cannot compare airlines in central Europe with those in a peripheral economy, many of which have - for various good (or, in the case of the SNN stopover, bad) reasons - been forced to carry out government policy.

If the EU really wanted to do something useful, it would crack down on the Irish government on the issue of the US bilateral, which is holding up every other country in Europe; what have we heard on this recently? Not a dickie bird!

SN collapsed because it was monstrously inefficient and a perennial and perpetual basket case. How an airline could be based in the centre of Europe, with all the high revenue traffic potential from the EU gravy train and other agencies and not make a profit is beyond me. Yet EI never had this, and had the government working against it on its most lucrative routes and still managed a fairly good business.

Raas767, you say this is capitalism. Well, I'm all for it, but there comes a time when society has to take precedence over capitalism. When a crisis such as 9/11 takes place, governments should be in a position to protect the interests of their countries; EI is in the position its in largely because of government policies. Why shouldn't it be given a chance to recover? Why should our economy be placed in a precarious situation, purely in the name of some obscure and misplaced economic theory?

As for the proposed 734, I certainly hope it does go ahead and EI deserves no less and, since this will come out of the defence budget, it will not be subject to EU interference.

[overstress]

Maxalt etc:

You should try to come to terms with this:

regrettably, the Guv will not go away and replying to him just pours petrol (gasoline) on the flames. The best remedy is to ignore, difficult though I find it myself.

Try having a beer!

[Willit Run]

Guys and gals,
Its only Saturday evening here in the mountains of central Idaho, and I was shocked to hear of the possible demise of the Irish Flag Carrier. My best wishes to those of you that might be affected. I had the chance a few years ago to do some sub-sevice for Aer Lingus while I was at American International, and we all enjoyed working with the staff there! Hold your heads high! :D :rolleyes: :eek:

[HugMonster]

Well, it's nice to know that the playing field is a little more level. US Airlines have been receiving government money. FR has been benfitting from public subisides. And now, not only will EI survive a little longer, but yet another journo has egg on his face. :D

[MarkD]

hmmm... at the rate EI is alleged by management to be burning dough, how much would even an overpriced 737 raise? Remember that means a cutback in service, as no way would the EU commission sanction a straight replacement of say a 20m 737 on the open market for the 40m "defence" 737.

Anyway since Atron aren't selling IAC are hardly buying :D although... it would mean an even faster ticket into the airlines for the mil boys, not only trained for free but type-rated too!

[OpsMon]

I thought that thw whole function of this setup was to spread news and rumours. As already stated - some of us do not have the Times delivered (with our croissants and truffles) - some of us (even ex Aer Lingus employees)live in the sandpit or elsewhere, and welcome what snippets the others can dig up for us. So if you don't like what's posted don't read it ! :p

[waffler]

As an a Aer Lingus employee I feel I have to reply to this as all I have read since the original posting has been mostly drivel for such an important topic.While it is true that Aer Lingus is going through a difficult time I believe we will emerge as a strong and profitable airline as a lot of the government imposed fat will be trimmed away and proper managment will be in place.Unfortunately it took the events of Sep.11 to highlight what years of profit were hiding.
That line about the staff burning down the building was given by some union **** to try to increase the redundency package and even he knows that it will not happen.The employees will accept the changes required and the company will emerge leaner and fitter in 2002 not as a sub division of British Airways but as an Irish airline.
While I cannot predict the future all the ingredients are there for this outcome.
So please, no more doom and gloom about Aer Lingus It is not Sabena, it is in a much stronger position and will survive.
P.s. let the Gov. post what he wants sometimes he is right even if some people dont want to hear it.

[fms146]

I support Mad Mitch and all the others that have come out in Support of The Guvnor. We should all be free to express our views so long as we dont cross the fence into insensitve or callous areas.

Whilst the Guvnors posts can be contraversial at times he does put a lot of effort into gathering information reported in the media. I say well done and keep it up Guv.

[ElNino]

Actually, Aer Lingus sold the 734's in question to ILFC, not to the government. No chance the politicians would accept second hand goods. No, instead tax payers money will be wasted on a brand new BBJ that is completely unnecessary. Everything aviation related that this government touches turns to lead...

[maxalt]

The 'government jet' idea touted by Guvnor was first 'rumoured' on an Irish aviation Bulletin Board by a well known teenage reggie spotter.

Complete and utter guff...but swallowed by Guv, hook line and sinker.

He tried to extract the name of the company that had purchased the EI 737s, but nobody seemed to know, and I wasn't gonna tell him because his only aim would be to get on the PPRune site and credit himself with 'all knowingness' while simultaneously criticising EI further.

Here's his quote from the Irish board;


Current market value of the two -400s is no more than US$20m for the pair. I could sell you B767-200s tomorrow for $8m each - so at firesale prices I reckon they'd be looking at even less than that - maybe $15m for the pair.

So now you know Guv. ILFC. £40M. Deal done. Happy?

The comments about Ireland not needing a long haul service are arrogant in the extreme. Just what you'd expect from this opinionated twit.

fms146 are you new around here? Since when did the sensationalist doomsaying of the gutter press come to constitute 'information'?
If there were any hacks reading this could I suggest you stick to reporting and desist from your expressions of personal opinion. We'd all get better information.

If the Guvnor could discern the difference between the news and journalistic opinion I'd welcome his contributions...but he prefers lurid headlines like the title on this thread. A 'Sun' reader if I ever saw one.

:D :D

[ 25 November 2001: Message edited by: maxalt ]

[pdalla]

Seems to be a lot of hyperbole surrounding this. Why not look at the facts ???? A fair point has been raised. Look at ex SR & SN, what about KL & AZ?? True, my view is from afar but I have had close dealings with EI in the past and know they are sound and full of great expertise - so the management question should be how to capitalise on the strengths ? It has a sound regional operation, (MAN, LHR, some bits of EUR etc), a secure long haul market (JFK, BOS) so there is a good kernel therein, and the Irish economy generally is in good shape (best call centres in the world) so maybe the question should be how do you turn EI into a profitable airline ?? I used to work for Pan-Am and that was a great operation once too but its overheads & management style never adjusted to a newer business model.... I flew Southwest 6 sectors last week and almost every flight was full, so someone is doing something right out there !!

[maxalt]

Thanks StagN8, fair comment.

The fact is though that even after Sept 11th the majority of Aer Lingus flights are operating at maximum loads. The average London flight during weekdays is working out at 50% biz cabin (full) and 50% economy (full).

While Aer Lingus management try putting on the poor mouth the troops are seeing the truth at the coal face. The management try playing down the load factors saying the seats are mostly low revenue economy class deals they've been promoting. But they don't explain why having half the cabin full of top revenue earning biz class pax is losing money!

If they can't make a profit on a LHR flight with 100 biz class pax (as they've been getting) then they're never ever gonna make money.

The point being of course...they're making money alright. :rolleyes:

[The Guvnor]

maxalt - you're demonstrating you don't know the first thing about airline economics. The load factors don't matter a jot - it's the yield that matters. ALT's nett yields are the lowest around (in fact they're in negative territory at the present due to their attempts to stimulate traffic growth - but then so were FRs £5 and £10 fares).

If ALT can't make itself profitable, then it shouldn't be here - rather it should fold and make way for a new operator. Perhaps then the government might realise that all the warnings people have been giving them about the SNN stop-over killing airlines are, in fact true - but the problem is that right now they have been told that so often it's a case of "yeah, yeah, so what? People are still flying, aren't they? Let's keep the westerners (and their votes in the Dial) sweet ...)

Latest on the ALT situation...

As negotiations to secure the future of Aer Lingus continue, unions representing the airline's employees have urged the Irish Government to come to the rescue.
Since the September 11th terrorist attacks, Aer Lingus, which relies heavily on transatlantic routes, has been forced to cut up to 40% of its workforce, reduce its schedule by a quarter and slash prices to fend off competition from budget operator Ryanair. Noel Dowling of the SIPTU union told news channel UTV that there was still some way to go before the future of the business and its remaining employees could be assured, urging the Government to play bigger role.
The European Commissioner for Transport Loyola De Palacio, who has refused to relax the laws governing state aid in order to protect competition, will strictly regulate any intervention from the Irish Government.

[maxalt]

100 pax at a sample biz class fare of £400IEP is £40,000IEP. 85 economy pax at a sample £100IEP (promotional) economy fare is £8,500IEP. Total of £48,500IEP revenue on an Aer Lingus A321 from Dublin to LHR.

The 'net yield' on the above revenue is a matter of dispute matey, and you don't know any better than I do exactly what it is because it is highly confidential info.

I'd agree that it's probably not as high as we'd like it, but 2026 jobs are about to be shed, and if that can't yield a substasntial turnaround in the net figure then there is no hope.
The most interesting fact is that thousands of punters want to pay biz class fares every day to travel between Dublin and London, so even if ALT goes tomorrow someone else is going to pick up the biz, and it ain't gonna be a Ryanair cattle car.

By the way...any explanations on how you were so wildly off target with your pronouncements on the aircraft sale?

Keep it coming...you're definitely good for a laugh. :p :p :p :p :p :p

[The Guvnor]

maxalt - you're assuming there that every pax is point to point which is blatantly incorrect. You'll need to dilute those revenues substantially (like by at least 50%) to take into account prorate. Next, you're again assuming that everyone is paying market fares. There will be a lot of corporate customers and government employees in C class - so knock off a few percent for that as well (like 25%). Next, factor in all the staff passengers plus people travelling on ID and AD tickets and I would be very surprised indeed if the average A321 is yielding much over IR£20k - if that.

[MarkD]

maxalt,

hate to quibble but...

I have yet to see an EI SH flight with 20 biz rows... how else do you get 100 biz pax in an A32x?

On my recent excursions to LHR the biz seats were 1-7 outbound [35] and 1-6 inbound [30] ex SNN. Same ex ORK last time I flew that sector.

[minuteman]

Guvnor much as you wil hate it, but maxalt is right. Flights ex LHR and DUB and other UK routes are overflowing with execs. 90-100 execs is not unusual. MAN has had up to 60 on the 146! LGW is full both way too. Never mind the pax, but there is a lot of freight going EI's way so tell me where the yield is so low. Staff can't get on the flights they're full!!!!!
Regardless of what FR say their profits will be DOWN this year, DUB is still waiting for all these new routes MOL has touted for ages!
The EI 321s have movable curtains, how many times have you heard Premier boarded up to row 17??????

[maxalt]

MarkD, quibble away. Aer Lingus' A320s and A321s have variable geometry seating. They can convert the whole cabin to exec config in a matter of minutes.
If you want to trust someone, trust me...don't be another mug hanging on every word of a spoofer like The Guvnor. He has a big enough fan club on here already.

[Bearcat]

I have always said The Guvnor is M O'L in disguise!!

[MarkD]

maxalt,

DUB-LHR is not the only route EI flies. If it was, your maths would be spot on. What I said was, an A320/321 CAN have 15-20 biz rows, but the other routes never see more than 8 or 9. On average, it surely works out at no better than 11-12??

Your figures assume every flight is a peak time biz heavy flight, I'm merely saying it's a bit of a stretch.

[Bramble]

The point here is that LHR flights ex-Dub ARE full.You say those tickets are low-price..but did the EI ticket sale not specify that all low cost tickets were for use before Nov.1st? Exec can go back to row 21 on a 321 or 16 on a 320.Yes they are on business deals but its still a big hunk of cash compared to FR.Lately we staff have had difficulty getting on those flights during the week.
The flights quoted by MarkD are ex-ORK and ex-SHN,these routes are not as full and never have been.EI has to keep these routes as Gov. policy.I will agree with him that these route seldom have more than 10 rows of exec.But as a staff member we are told that DUB-LHR is our major source of income after the trans-atlantic routes.

[The Guvnor]

Minuteman - I'm not disagreeing at all with maxalt's assessment of the mix between C and Y on the DUB-LHR route. However, I am strongly disagreeing with him as far as the nett yields on the route are concerned; as I happen to know that a very large percentage of traffic is connecting traffic (mainly onto BA - EI of course being a OneWorld member).

On top of that, MarkD is right about the average composition on most other routes.

The problem with ALT is that if you take away the transatlantic traffic (which was also comparatively low yield) the whole house of cards collapses. It's therefore - as I've said here and on the Irish board - an unsustainable business model and deserves to go the same way as SR, SN etc.

Only when it actually goes out of business will the people at the Dial get their collective fingers out and comprehend the amount of commercial and economic damage that the SNN stopover policy causes Ireland; and hopefully get rid of it. This will then allow ALT2 to be a considerably more viable operation than what exists at present.

[Tom the Tenor]

Bramble, EI keeping on to Cork-Heathrow just because it is Government policy? You must be kidding but I concede that EI on Shannon-Heathrow is something that is far more likely to be politically influenced by the Shannon mafia all right. DUB-LHR may well be EI's major source of income now becuse of the increase of business passengers but I would argue strongly that say up to four to five years ago that per capita ORK-LHR gave a greater return to EI that DUB-LHR did.

[Flight_Finder]

Dear Members,

Yield is the priority. In fairness over the past couple of years, yield management has held the figures pretty well. I know from the amount of times I've checked into flights that most of them were in an oversold state and with pretty decent fares. The weak ones into Heathrow were early morning with the prorates onwards to the States in particular. This has now been stopped with the first few flights in the morning restricted to normal fares.
ON the US. LAX appears to have lowish loads with JFK staying pretty strong from both Shannon and Dublin. I would imagine, Italy and Germany hold decent yields, they certainly hold high fares with the lowest on Rome at the moment over £250iep.
EI needs to contract while the Irish economy is doing it's current thing. Consumer's are starting to spend again after last months list of job cuts, so it all remains to be seen if they spend on travel or not.

Slan Leat

FF
:cool: :cool: null

[JRF]

Where are you'll getting this here fare information? From the EI website today!

ORIG: IRELAND
Heathrow from IR £54
Paris from IR £79
Amsterdam from IR £102
Dusseldorf from IR £102
Munich from IR £134
Milan from IR £134
Rome from IR £213
New York (JFK) from IR £250

ORIG: UK
Dublin from GB £30
Cork from GB £50

ORIG: USA

Dublin from GB £30
Cork from GB £50
Shannon from US $228
Dublin from US $338

ORIG: EUROPE
Dublin from NL 251
Cork from FR 859

Also, on the Irishtimes website they had an add for EI tickets from JFK to DUB/Shannon for $199 return.

Now, does EI want to make money or are they trying to go broke?

[Raas767]

I have to admit that I know very little about Aer Lingus and the current financial problems that they now face. I am sure, however, that they are driven by the same economic realities that every airline has to deal with. The profit margins in aviation, even in good times, are raisor thin. Airlines that survive the inevitable economic downturns are the ones that have the most cash on hand and the ones that can squeeze out the most revenue out of every seat, so called yield management. Bob Crandell at American Airlines pioneered this in the early 80's and almost singlehandedly used it to drive Peoples Express into bankrupcy and in to the hands of Frank Lorenzo and Texas Air corporation.
Related to yield is capacity. To much capacity not enough yield and we are back to square one. This is where the European carriers are at a huge dissadvantage. Through deregulation in the states the entire industry was forced to rationalize in to a few very large compettitors with a few low cost carriers existing on the fringes. Once proud airlines such as PanAm, Eastern, and Branniff ceised to exist all together because they failed to transform themselves in to lean competitors. Others such as Western, Southern, Hughes Airwest and Piedmont were forced in to merger.
No such transformation has been allowed to occur in Europe yet. The current situation where every country within the union is fiercly, through nationalistic pride, trying to hang on to their flagg carriers is destructive and anti competitive. Europe may in the end be able to sustain 4 large airlines and a few others that exist to feed their traffic. It is inevitable, and the quicker it is allowed to happen the better for all concerned. It will be extremly painful for all involved, as it was in the U.S. but it has to happen. Otherwize you might as well reregulate the whole business. :(

[MissChief]

Aer Lingus do not belong in the present aviation world..good people flying for them, but a thoroughly disreputable and commercially incompetent management. Let them re-form in a new and viable airline, with the same pilots and cabin crew.

[Bramble]

Aer Lingus do not belong in the present aviation world..good people flying for them, but a thoroughly disreputable and commercially incompetent management. Let them re-form in a new and viable airline, with the same pilots and cabin crew.


While many of the CCM and flight crew would agree it is a frightening prospect to the employees that the ppl making the rationalisation plan are the ppl that need to be stripped from the company to make it efficient.I am generalising about (mis)management but look at the fact that cabin crew refuse to talk to out mangers as they have lied consistently to us since Sept.11.
It is the ppl at the coal-face that will be hurt.Many ppl here have grievences against EI.As an EI staff member I have serious problems with my company but want to change it so it can compete.We can but hope.