Growing evidence that the downturn is upon us....

[kippax]

IATA were warning goverments to take action to protect our industry :-

'Governments need to take responsibility'

Istanbul - The leaders of the world’s airlines unanimously agreed to a resolution calling for governments, airports and labour to take immediate action to help the industry survive the growing financial crisis. The resolution was made at the International Air Transport Association’s (IATA) 64th Annual General Meeting and World Air Transport Summit.

“Extraordinary times call for extraordinary measures. Airlines are an engine for global prosperity and failure amongst them would send shockwaves throughout the world economy,” said IATA Chairman and TAP Portugal CEO Fernando Pinto.

The resolution comes after a recent spike in fuel prices that has led to two-dozen airlines ceasing operations or filing for bankruptcy. “Many more will not survive,” Pinto said.

The declaration made six specific calls to action:

* Governments must eliminate archaic rules that prevent airlines from restructuring across borders.
* In view of existing fees and charges, governments must refrain from imposing multiple and additional punitive taxes and other measures that will only deepen the crisis.
* State service providers must invest to modernise air transport infrastructure urgently, eliminating wasteful fuel consumption and emissions.
* Business partners, in particular monopoly service providers, must become as efficient as airlines are now. If not, regulators must restrain their appetite with tougher regulation.
* Labour unions must refrain from making irresponsible claims and join the effort to secure jobs in aviation and indeed in other industries.
* In the interest of the global economy and the flying public, we urge authorities to enforce the integrity of markets so that the cost of energy reflects its true value.

“The airline industry is sending a clear message to governments, partners and labour. We are in crisis. Governments, labour and our business partners must understand this. And they must act,” said Giovanni Bisignani, IATA Director General and CEO.

[kippax]

John Kohlsaat is talking about schedule airlines.......

Charter airlines have been merging and will continue to do so in the UK and Europe to remain a going concern

Also, IATA is trying it's best to protect our industry (see their web site)

I agree aviation is going through demanding times and will have to re-adjust, which I believe we will do

I have said before and will say again, pax figures are good for Summer 08 for all charter airlines and the schedule ones I have friends working for

If a wanabee pilot wishes to train for his / her dream, then bloody go for it. Just ensure you do not hit mega debt and be prepared to move in order to achieve first flying job, after waiting maybe 1 or 2 years

[bjkeates]

Interesting stuff from Ryanair this morning, particularly given the doom and gloom at the moment.

http://news.bbc.co.uk/2/hi/business/7432731.stm

When compared to the massive profits of recent years, breaking even doesn't sound so good; however, relative to the massive losses forecast for the industry in recent times, it doesn't sound so bad - particularly if they're completely unhedged.

The question is, will oil stay at around $130ish now it's levelled off a bit after the meteoric rises of the last few months, or will it resume its upward trend? Time will tell...

[mustflywillfly]

More blah, blah blah....this time from Ryanair and the ugly fittle lucker that is O'leary:

http://news.bbc.co.uk/1/hi/business/7432731.stm

EDIT - BJ YOU BEAT ME TO IT. BUGGER !!!!

On a lighter note, don't forget that having the will power, tenacity and balls to put yourself through training and get the fATPL comes across as a bloody good thing to any other employer outside of the industry where you might need to look for an interim job before the flying job. These are all transferrable skills and with a little spin you can make your CV look pretty good.

Consider any interim job, outside of a flying, as a "holding job". I spent over 12 months "holding" in the course of my Military flying training (albeit on Naval Air Squadrons but I wasn't progressing my training). It is frustrating but you just got to live with it.

The "holding job" need not be in Maccy Ds or BK if you do your research and prepare for something a little better! The hold may take along time and I guess there is a chance that the flying job may never happen. That I think is the extreme though. Either way if aviation is eating away at you, surely it is better to try and fail then never to have tried.

Just plan well, particularly with regards to finances and be prepared to market yourself well to other potential employers. Start keeping a note of your marketable qualities, a starter for 10 would be "highly motivited, attention to detail and problem solver" (I think most pilots could get away with that).

Remember the 6 P's! Prior Preparation Prevents Piss Poor Performance

Good luck in all your training / job hunting and stay tenacious!!

MFWF :ok:

[Flying Squid]

MFWF - Cheers for the helpful comments. I am neck deep in training and the prospect of a job with Subway at the end isnt one I relish...no pun intended!

You're right, if the industry turns further south then it will be the smartest that survive and come out the other side with a shot at a RHS!

[john.o.pilot]

"Budget airline Ryanair has said it will ground up to 10% of its fleet this winter to combat soaring airport charges.
The carrier - which unveiled a 17% rise in pre-tax profits to 528 million euro (£419 million) in the year to March 31 - said it would be more profitable to keep 20 aircraft on the ground at Stansted and Dublin than put them in the air."
Mr O'Leary added: "The airlines who will survive this period of higher oil prices and industry downturn are those with new cheaper fuel-efficient aircraft, lower costs, substantial cash balances, low net debt and management who are ready to exploit downturns to drive costs lower and increase efficiency. No airline is better placed in Europe than Ryanair to trade through this downturn."

[Wee Weasley Welshman]

Driving costs lower means Wannabes paying to work.


WWW

[john.o.pilot]

spot on welshman, i think they have to ground these airplanes as there isn't enough wannabes booked in at the moment to pay for the operational costs. :oh:

[nich-av]

Oil dropped 5$ to below 125$ in the past 12 hours, mainly due to a stronger buck.

The people who can't stop gambling are starting to have their first losses.

United is grounding 70 acft, nothing unexpected but very painful for the economy and oil companies... it means over 2 million tons of fuel per day less to sell.

As was always said, increased prices decrease demand.

This particular quote from the IATA guy is the key to the solution:

In the interest of the global economy and the flying public, we urge authorities to enforce the integrity of markets so that the cost of energy reflects its true value.

What is interesting to note is that IATA still predicts a traffic growth of over 3% for this year.

[scroggs]

It's not often these days that I get a chance to check up on what's going on in Wannabes, but I'm at home on Standby at the moment and so here I am. I've had a good read through this thread, chuckled at much of the rubbish spouted and occasionally nodded at some sage advice.

Let me say, right from the start, that you should listen to WWW and heed his advice.

That doesn't mean I necessarily agree with him 100% - those with long memories will know that he and I don't always agree on the world's economy! However, we are both in a position to argue and disagree; our careers may be at risk, but we're not gambling money we haven't yet earned on unquantifiable risks. We did our gambling some years ago (over 30, in my case), and now have to take the rough with the smooth. We're on the rollercoaster, whichever way it goes. You guys (well, most of you) have the choice of whether to get on or not.

Your first choice is whether to begin training or not. If you are borrowing lots of money to fund a fast-track integrated course, then STOP! Right now is not the time to risk your financial future on this industry. If you can fund your training without going into any debt, and can structure it so that you can adjust the time of graduation as fATPL to match the inevitable upturn, then go ahead. If you are somewhere between these two positions, think about how you can change things to be nearer the second rather than the first.

There are no guarantees either way in aviation (or anything else!). It may well be that the downturn is not as serious as WWW postulates; equally, it could be worse. If you don't have to gamble your money on which way it's going to go, why do it? The consequences of getting it wrong and losing all that money are horrible to contemplate; especially when a little prudence now could leave you in a far better position later.

If you can, hang slack for a bit. Get a feel for how things are going to pan out. If oil prices drop considerably (they're about $9 off their peak now, but look for $20 or more) and credit starts to ease, then by all means take up your plans where you left off - but stay cautious. If, as WWW suspects, we are in for a downturn on the scale of 1991/2, your caution will be well rewarded. When WWW's back as an FO and I'm on the dole, unable to get a job at my advanced age, you will be able to exploit your flexibility and cheapness to employers and leap in as things start to improve. I hope it doesn't get that bad, but it might - and the signs aren't exactly good, are they?

Stay solvent and flexible. Good luck - we're all going to need it!

[Wee Weasley Welshman]

Thats as good a summary as you're ever going to read on this topic at this time. Thanks for that.

I don't KNOW how bad things will be and I'm perfectly open to debate here as a means of enlightening both me and any wannabes who care to read it. Dissent is always welcome.

Staying solvent and flexible in the pursuit of your dream is really what this whole topic is about.

Of course. As I expect this to be the collapse of a 60 year super cycle of debt that will result in a Western Depression, then naturally, we'll have plenty of time to discuss it further in the future IF the lights stay on. For now I'm busy burying my gold in my land with my shotgun handy and my cellar stocked with beans :E :uhoh: !!

Good luck,

WWW


ps Nice to see you here Scroggs :)

[Wee Weasley Welshman]

http://www.ft.com/cms/s/0/5a319f02-3230-11dd-9b87-0000779fd2ac.html

United Airlines to cut a fifth of its fleet

NEW YORK, June 4 - UAL Corp, parent of United Airlines, said on Wednesday said it would slash its domestic capacity by 14 per cent in the fourth quarter, remove 100 planes from its fleet and cut up to 1,600 jobs as it grapples with soaring fuel costs and a weakening US economy.

The moves, which extend previous plans to cut staff and phase out old planes, represent about a 3 per cent reduction of United’s staff of 55,000 and a reduction of about 22 per cent of its 460-plane fleet.

The company plans to remove 100 aircraft from its mainline fleet, including the 30 previously announced Boeing 737s. UAL said it expects to retire all of its 94 single-aisle Boeing 737s if it can reach a deal with lessors. UAL also will retire six Boeing 747 jumbos.

Over the 2008 and 2009 period, UAL will reduce its mainline domestic capacity between 17 per cent and 18 per cent, and consolidated capacity -- which includes regional flying -- between 9 per cent and 10 per cent.

United, the No. 2 US airline, has been battered along with the rest of the industry by soaring fuel prices. UAL lost $537m in the first quarter and has been in merger talks with rivals in an effort to offset its fuel bill. UAL recently ended merger talks with US Airways Group, saying it would not seek a merger now.

”With fuel at historically high levels, United and our competitors need to redefine ourselves in this marketplace. The answers are not easy, yet this environment demands that we and the industry act decisively and responsibly,” UAL Chief Executive Glenn Tilton said in a message to employees.


They said that the House Price Crash that happened in the USA last year would never happen in the UK.... :eek:


WWW

[nich-av]

Hey WWW.

You are very late to catch the news. ;) (see my previous post)

70 acft grounded means approx. 6 million tons of oil per day that become available. That is just enough to fulfill the needs for over 1 million households every single day...

Then you wonder why oil has dropped 8 consecutive days to 122$ and will drop further to below 120$ as I predicted lately (though happening 2 weeks later than predicted).

If you really want to help these guys, then why don't you try opening a flight school with reasonable prices and help these people get there at reasonable cost. :ok:
Believe me, that alternative takes more than daily copy-paste articles posted on a tiny thread on the internet, as I'm experiencing evry single day, but it is effective.
Your posts will not stop anyone heading towards training no matter if modular or integrated, they'll just make them feel unsecure.

So if you want to help these people for real, why don't you start by compromising your own comforts? I am compromising my career and a huge investment as a shareholder and still coming on this thread once a day to say that one shall not be scared of the "downturn", keeping people motivated and concentrated with what they're doing, no matter where they train or how they train.

You are not compromising anything for these folks, and you are giving everyone a very bad feeling. Student pilots are not stupid, they can read the newspapers, they can watch the TV and they understand more or less what is going on, no need to tell them.

And what about posting some articles containing the good news?

Like this one: http://www.flightglobal.com/articles/2008/06/04/224452/italys-air-one-orders-12-a350s-and-12-a330s-plus-options.html

or this one:
http://biz.yahoo.com/ap/080604/oil_prices.html


It's not the best times for aviation, but it is not as bad as some here pretend they "know it" to be "from experience". Experience as what? First officer for a LCC?

ps:
Rumours say that Easyjet will cut capacity at its UK bases and send crews to their other bases on mainland Europe due to the UK market doing bad. Ryanair also recently said that they will compete more agressively against Easy, their greatest competitor on the LCC market. Rumours also say that Easy will ground up to 70 aircraft this winter and that they will record losses due to the high fuel. Easy might go down forever.

You love to read that don't you? Or maybe not because it might impact your own pocket :ugh:

Let's stop being selfish.

[Re-Heat]

The problem of the big hole in emerging market airlines' recruitment plans of experienced pilots, solved in one fell swoop - any pilots released will be going directly to China, India or the UAE.

If you think these 737s are going to another airline, think again. They will be parked in the desert for the time being.

[potkettleblack]

Might not even have to move. Look at how airlines like Air India and Korean have been taking on expat contractors with European bases. Emirates might one day wake up and realise that very few people want to actually live in the sandpit.

[heli_port]

http://business.timesonline.co.uk/tol/business/industry_sectors/transport/article4061320.ece



The chief executive of Europe's largest airline says that rising oil prices will force smaller competitors to go bankrupt

Michael O'Leary, the chief executive of Ryanair, has welcomed high oil prices, claiming that it will drive “crappy competitors” out of business.

The boss of Europe's largest airline yesterday identified a number of rivals that he expected to go bankrupt in the coming months because of rapidly rising fuel bills.

He said that Sky Europe, Flybe and Jet2, which are all smaller regional carriers, could be grounded in the coming months.


Edited by me - follow the link WWW

[heli_port]

http://business.timesonline.co.uk/tol/business/industry_sectors/transport/article4053861.ece


The global airline industry has downgraded its forecast for this year for the third time and now is predicting losses in 2008 of $2.3 billion (£1.1 billion) because of sustained high oil prices.

The International Air Transport Association (IATA), which represents airlines, also said that if oil prices stayed at $135 a barrel, the losses could worsen to more than $6 billion....




edited by me to remove the bulk of the quotation - the link is there for people to follow. WWW

[veetwo]

Oil dips to $121 as reserves grow

Oil prices fell by more than $2 a barrel on Wednesday as latest figures showed US petrol reserves had risen more than expected.

Analysts said the increase suggested demand for oil from developing economies was slowing.

As well as indications of falling demand for the commodity, the price of oil has also been falling as the US dollar has strengthened.

Its easy to find positive stories as well as depressing ones.

V2

[heli_port]

v2 please can you post the link to the said story or are you making things up :confused:

:p

[Wee Weasley Welshman]

Yes - and any positive news is welcome here as well as negative. I don't think oil in the range $100 - $135 could ever be classed as positive for the airlines mind.

It will come down - no doubt. As the Fed runs the printing press up to full power they bake inflation into the cake. As the worlds reserve currency the response by global money was always going to be to invest in alternative currencies and alternative assets. Hence the Euro and Gold and Oil and Wheat all skyrocketing. They are immune to dollar depreciation. If you are a Sheik and you have a gazzillion Dollars in the bank and sell you principle goods in dollars (oil) then the plummeting Dollar was an expensive headache that they were always going to do something to relieve.

Next up is a 20% (nominal) 35% (real terms) house price crash in the UK followed by a recession similar to the one that FOLLOWED the last HPC.

Whether we lose a similar amount of airline capacity is something I'm not so sure of.

WWW

[veetwo]

http://news.bbc.co.uk/1/hi/business/7436492.stm

Im sure oil in the range $80-$100 wasn't a positive for the airlines when it first happened. Be bloody good now though wouldnt it? I think the point is that its all relevant and the doomsday scenarios many are speculating on recently are based on oil staying at, or increasing past, the $130 mark.

V2

[saccade]

http://images.salon.com/comics/tomo/2008/06/03/tomo/story.jpg
In Jan 2007, oil was $56.

[heli_port]

http://news.bbc.co.uk/1/hi/business/7437132.stm


UK house prices dropped by 2.4% in May, according to a report by the Halifax, Britain's biggest mortgage lender.

That pushed prices 3.8% lower than a year ago and means that the price of the average home fell to £184,111.

The Bank of England is due to announce its latest interest rate decision at midday, and is widely expected to leave its main interest rate on hold at 5%.

[heli_port]

http://www.bloomberg.com/apps/news?pid=20601087&sid=agR7OAEUpy_M&refer=home


June 5 (Bloomberg) -- Continental Airlines Inc. (http://www.bloomberg.com/apps/quote?ticker=CAL%3AUS) will cut 3,000 jobs and shrink its jet fleet by 18 percent, becoming the fourth major U.S. carrier to slash payrolls and flights as soaring fuel prices (http://www.bloomberg.com/apps/quote?ticker=JETINYPR%3AIND) push the industry to its worst losses since Sept. 11.
``The airline industry is in a crisis,'' Chief Executive Officer Larry Kellner (http://search.bloomberg.com/search?q=Larry+Kellner&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) and President Jeff Smisek (http://search.bloomberg.com/search?q=Jeff+Smisek&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) said in a memo to the Houston-based carrier's employees. ``The actions we are announcing today are necessary to secure our future.''
United Airlines (http://www.bloomberg.com/apps/quote?ticker=UAUA%3AUS), the second-largest U.S. carrier, said yesterday it was shutting its low-fare Ted brand and retiring 70 planes. United and Continental join American Airlines (http://www.bloomberg.com/apps/quote?ticker=AMR%3AUS) and Delta Air Lines Inc. (http://www.bloomberg.com/apps/quote?ticker=DAL%3AUS) in reducing flying after a 71 percent surge in fuel over the past year.

[v6g]

Yes - I particularly liked this line on the article on the Beeb: Delta Airlines is offering redundancy to all 3,000 volunteers who have come forward - despite initially only planning to lay off 2,000 workers.
- says a lot about the company!

[scroggs]

As in the post 9/11 period, US carriers are more vulnerable than their European or Asian counterparts. One obvious reason is that oil (and aviation fuel) is traded in their native currency, which is weak, so there's no exchange-rate factor to help them. More significant is that many US carriers are only just out of Chapter 11 protection, and haven't had time to consolidate the costs they've been protected from for some years. This is a real jump in the deep end for them, and it's not fun. They are also unlikely to be allowed to re-enter Chapter 11 protection so soon after coming out of it, so, if they want to survive, they've got to join the rest of the world in taking it on the chin. They will therefore over- rather than under-react.

Capacity reductions in the US are likely to be around 20 - 25%% this year, it would appear at the moment. Capacity reductions in Europe will be less - but they will be significant. UK, as ever, will follow most closely the USA, but I don't expect to see reductions much greater than 10 - 15% across the market. That still means a very big effect on jobs, which is what most of you are interested in. My advice stands!

House prices and so on are WWW's pet subject, and I'm sure he'll have more apocalyptic predictions for your entertainment shortly! However, I would like to point out that the drop in house prices in May has been recorded in one of the lowest-volume trading months on record, and thus is less reliable as a base from which to extrapolate. Part of the problem is that the transactions which completed in May were negotiated when mortgage funding was at its most difficult to obtain, which had both a slowing effect on the market, and a downward effect on prices. While things aren't exactly rosy now(!), mortgage companies have resumed offering me 'Deals I Can't Refuse (TM)' and Egg have started circulating offers of 0% balance transfers to their cards again. That suggests to me that competition is creeping back in and now the banks want to protect, rather than reduce, their market share. That doesn't mean we're out of the woods by any means, but it does suggest that the credit crunch part of the crisis is easing. If money can start to flow again, and real (as opposed to Central Bank) interest rates start to reduce, the landing is likely to be softer than many fear.

Don't get me wrong, I'm not for one minute suggesting times aren't going to be extremely tough for our industry over the next year or two. They will be more than tough. Oil prices will remain high enough to cap demand in all sorts of energy consumers - not just airlines. The further economic effects of high energy prices in the wider market will have repercussions on the number of people wanting - and affording - to fly, so airlines will get doubly hit. Keep your umbrellas and your Plan B close by your side!

[Rhyspiper]

Being a soon to be fATPL a feel that I shall be absorbing a few years of sun....

[Snowiey]

Mykonos would be right up your street Rhys!:ok:

[Wee Weasley Welshman]

I agree with Scroggs. Apart from the house price crash data. From todays Times:


http://business.timesonline.co.uk/tol/business/economics/article4076212.ece


The emerging threat that the Bank may raise base rates this year will cause worries for families that are struggling with the rising cost of living and declining house prices. These sank by a further 2.4 per cent last month, extending losses that have left them down by 6.6 per cent since January, wiping £13,000 off the value of the average home.

House Prices have fallen twice as fast in the past five months as in the same period in 1992, during the most recent property crash, when they fell by only 3.3 per cent, based on Halifax figures. The decline in prices this year is the biggest five-month fall since records began in 1991. If the deterioration in house prices continues at its present pace, the value of a home will slump by more in six months this year than in the whole of 1992, when prices fell by a total of 7.2 per cent. Some economists forecast that prices could fall by up to 12 per cent this year, followed by further declines next year.

The threat that a brutal housing crash could be more severe if the Bank raised rates is certain to sound alarm bells at the Treasury.

Bradford & Bingley will aggravate the pain today, when the troubled lender increases rates on all of its home-loan products...


I am seeing city centre 2 bed apartments (luxury - natch!) going under the hammer with Allsops and the like for £110k when they sold for £235k early last year.

Its a total crash, faster, harder and deeper than the 1990s.

Thinking that small volumes makes the stats unreliable is dreaming. The real price drops will come in 6 months time when the unemployment figures have ticked up.


WWW

[heli_port]

http://www.ft.com/cms/s/0/e2da38e8-3224-11dd-9b87-0000779fd2ac,dwp_uuid=d3532e34-27ed-11dd-8f1e-000077b07658.html


Air One, an Italian airline, on Wednesday announced its expansion into the long-haul market by signing a $4.7bn deal with Airbus for 24 long-haul aircraft as well as reiterating its interest in buying Alitalia (http://markets.ft.com/tearsheets/performance.asp?s=it:AZA), the loss-making flag-carrier.

“We are interested,” Carlo Toto, owner of Air One, told a Rome news conference, joined by Thomas Enders, chief executive of Airbus, and Claudio Scajola, minister of development

[heli_port]

http://africa.reuters.com/wire/news/usnSP280973.html


SINGAPORE, June 6 (Reuters) - Oil rose by more than $1.00 towards $129 a barrel on Friday, extending gains after its biggest ever one-day rise in the previous session as the U.S. dollar weakened on signals the European Central Bank may raise interest rates this year.
U.S. light crude for July delivery <CLc1> rose 77 cents a barrel to $128.56 a barrel by 0609 GMT, having earlier jumped $1.03 to $128.82.
The contract was up $6.08 to $128.38 in after-hours trading on Thursday in the U.S., its largest outright gain on record and erasing two days of sharp losses triggered by worries that high oil prices were starting to dent demand.
London Brent crude <LCOc1> rose 83 cents to $128.37.
"A $6 jump is quite a major move. Financial flows came back. If oil continues to rise, it could test $135 or $140. The market is in a state of uncertainty after such a move," Marc Lansonneur, Societe Generale's head of commodities derivatives in Asia, said.

[Wee Weasley Welshman]

http://www.pprune.org/forums/showpost.php?p=3789131&postcount=20

midnight cruiser wrote, 21st Dec 2007:


Will you give it a rest, www. Figures you are quoting are from analysts on the outliers eg -40% for house prices in 3 years (which of course tabloids seize on) - the concensus is far less severe. Equally M4 supply has been hit by an exceptional divergence of the LIBOR from base rates - which is predicted to re-converge somewhat next year, as banks and other asset holders regain confidence to loosen their purse strings in the wake of Northern Rock - The LIBOR/EURIBOR - base rate gap is unsustainable in the long run. Unemployment will remain very low and I do not agree that inflation will rise significantly. So many of the fundamentals are sound compared to previous recessions, but you are selectively emphasising the worst bear points.


LIBOR still reflects the credit markets view of the crisis and the BoE will be following the ECB in raising interest rates later this year. Unemployment is sky rocketing but is not shown in the government statistics because funny enough its not worth signing on for £47 a week when that can be earned in a single 14 hr shift in McDonalds. The fundamentals and the inflation are very very bad and the only fix is a serious recession and unemployment.

As for houses - todays Guardian, Mail and Independent (centre, right and left wing) run:


http://www.guardian.co.uk/business/2008/jun/06/housingmarket.interestrates

House prices fall at fastest rate since 90s crash



http://www.dailymail.co.uk/news/article-1024389/Property-plunge-House-prices-falling-fastest-rate-25-years.html

Property plunge: House prices are falling at fastest rate for 25 years



http://www.independent.co.uk/money/mortgages/housing-crash-worse-than-feared-as-prices-slump-by-24-per-cent-841383.html

Housing crash worse than feared as prices slump by 2.4 per cent



I don't think I need say any more on the HPC - its mainstream now and the panic phase is just beginning.


WWW

[scroggs]

WWW, have you been taking lessons in hyperbole from the newspapers?! I'm well aware you are an enthusiast for the apocalyptic style of housepricecrash.co.uk, but there's no need for that kind of frenzied approach here.

UK unemployment is not 'skyrocketing'. It has risen, certainly, but even if you have no time for the official number of unemployed, the rate of change reported does reflect reality. The change in January (last reported figures) was up 0.1%, and affected 0.006% of the working population. That's insignificant by any stretch of the imagination. Unemployment will probably increase over the next few months, but let's keep the descriptions within reasonable bounds.

House prices are declining 'at the fastest rate in 25 years', but as the banks' records only go back 25 years, that doesn't tell me very much. I was a house owner during the last 'crash' in 1990-92, and I, like most house owners, watched the newspaper reporting with some bemusement as, apparently, the world was falling in around me. It wasn't, of course. The price correction of that period was severe, but materially affected a far smaller percentage of people than the newspaper reports would like you to believe. "So my house is worth less? That's a shame! Hey ho," was the general reaction. Sure, some people got caught by the negative equity trap (exacerbated by increasing interest rates which were way out of step with the real economy), but the vast, VAST, majority did not! Many of those who did go into negative equity held on to their homes because they could either afford to continue paying the mortgage, or came to an arrangement with their lender. In time, the problems went away. That will be the case now, even if we hit the worst-case scenario of 40% reduction in value.

So, let's calm down on the end-of-the-world-as-we-know-it predictions. A longer, more balanced perspective will show that, even in 1929, the vast majority of people were just inconvenienced, not thrown out on the street without a penny to their name. The 2008/9 economic hiccough will leave most of us with a bit less spending money and maybe a smaller car, not living in tents, selling the Big Issue and foraging for food in McDonalds' bins. It will be tough for airlines, and a significant but small minority of pilots will find themselves out of work, hopefully temporarily. Wannabes' plans will need to be reassessed, as will those of all investors, but not abandoned.

The world is not going to end!

[Wee Weasley Welshman]

Do you actually know any estate agents, land buyers or building trade workers who have lost their jobs in the last 3 months because I know 4. Not one is signed on to the dole. Did you know any last time or were you safely tucked up in the RAF, fighting Gulf War One and totally immune from the ravaging effects of recession? (to be fair neither did I as I was in school uniform at the time)

This time we have a nation who have been financing a lifestyle they cannot afford by means of Mortgage Equity Withdrawal. MEWing just was not possible in the late eighties. Neither were Buy To Let mortgages and nor were 5 times joint income mortgages and actually self certification (liar loans) were incredibly rare.

In fact house prices affordabilty has NEVER been as strained as it is now in all of history. Even the basic multiples of average income to average price has never poked its head above 7 as it did last year. EVER.

Of course many will be unaffected. Me for one. My parents, my parents in law, several friends, most of my extended family and the bulk of the people at work or play. But that is not the point. Airlines operate right at the margin of the economy for their profits. With the margin contracting the profits evaporate and the airlines have to contract fast. Game over for most wannabes.

For wannabes this is an apocalyptic crisis. You're fine, I'm fine, many are fine and the world will not end. But for Wannabes with £80k of debt and an expiring IR this will be cold comfort.


I agree - plans for being a pilot need not be abandoned. But unless you shout quite loudly Wannabes don't want to hear an important message..

WWW

[Megaton]

Expect BA website to open up again for DEPs in the next few weeks. Keep your eyes open.

[Wee Weasley Welshman]

I hope they've got a *really* stable server!

WWW

ps

Norwich Union to slash 1,800 jobs

guardian.co.uk, Friday June 6 2008

Norwich Union will cut 1,800 jobs over the next two years, the company said today.

The cuts, which will affect the insurance arm of the business, will see 22 sites consolidated into seven...

...The sites singled out for job losses include Dundee, Glasgow city centre, Leeds, Sheffield, Liverpool, Cheadle, Birmingham, Bristol, Southampton, Basildon, Ipswich, Exeter and Worthing.


I bet all of about 5 of them will sign on the dole and show up in the unemployment stats.

[scroggs]

Do you actually know any estate agents, land buyers or building trade workers who have lost their jobs in the last 3 months because I know 4. Not one is signed on to the dole.

Yes, I do - including the guy that sold me the house I'm in now. None that I know has signed on either, as they've all got new jobs in other fields. However, some of their ex-colleagues have signed on because they haven't been re-hired and they need the money. That's how it goes; not all job losses mean a rise in unemployment.

This time we have a nation who have been financing a lifestyle they cannot afford by means of Mortgage Equity Withdrawal. MEWing just was not possible in the late eighties.
Yes it was. I did it, and so did several of my mates - for exactly the same reasons as people have done it over the last ten years!

Neither were Buy To Let mortgages
That's true - at least in the quantity we've seen over the last couple of years. But I well remember the rush to buy terraced properties in university towns in the late eighties, which amounted to the same thing. Not as significant in the market, I agree, but it did happen.

and nor were 5 times joint income mortgages and actually self certification (liar loans) were incredibly rare.
Afraid you're wrong there too. As the bubble started to rise exponentially, mortgages got very nearly as silly in 1988/89 as they were in 2006. The more outrageous loans weren't quite so easy to find as they were in the last few years, but they were there.

In fact house prices affordabilty has NEVER been as strained as it is now in all of history. Even the basic multiples of average income to average price has never poked its head above 7 as it did last year. EVER.
That's true, but the ratio of monthly mortgage repayment to average earnings is not remarkably high just now, and that is the real measure of affordability once you're on the ladder. It seems to me that the number of people who will be severely stretched is likely to be broadly similar to last time. BoE interest rates may well rise, but no more than 0.5% - and as mortgage lenders' interest rates are currently decoupled from base rates anyway, it's the inter-bank lending rates that will determine mortgage rates in the short term. My bet is that that will be down.

Anyway, this is all esoteric crap for the average Wannabe! We could willy-wave over the property market all day, and it will make no difference to them. The fact is, the airline industry is going to take a bit of a pounding over the next year or two, and new jobs will be much scarcer than they have been. Therefore they should plan accordingly.

[Wee Weasley Welshman]

Yeah, fair enough. The housing markets discussion is just a proxy for the airline sector and shouldn't become the focus of discussion.

I think it is factual to say that a HPC preceded the 1991/1992-era recession which caused the demise of several large airlines in the UK (Air Europe bust in March 1991 as the UK's No2 holiday airlines, Dan Air bust in Oct 1992 as the No2 slot holder at Gatwick) which in turn spelt disaster for the Wannabes of that time and for some year to follow.

The peak (Nationwide figures) for the last boom put average house prices at £114,478 in Q2 1989. The low was hit in Q1 1996 at £71,935. A drop of £42,543. Check the figures yourself at:

http://www.nationwide.co.uk/hpi/historical.htm


From the peak in Q3 2007 of £187,886 a 37.16% fall (same as last time - not worse) will take us down to £118,068. The last data available for Q1 2008 stands at £179,363. Do you see how far we are going to fall? Can you imagine the negative equity, the belt tightening the job losses involved? Does the raw data not give you cause for concern?

Oh, and BTW those figures are all adjusted for RPI inflation so reflect inflation and buying power. These are not nominal sums that look horrific but fail to account for increased affluence.

We've only just crested the top of the roller coaster, the ratchet just stopped making its noise and the passengers are just opening their mouths to scream.

I know its alarmist but I'm right. Unfortunately.


WWW

[mustflywillfly]

It isn't a rollercoaster, it's a log flume. When we get to the bottom our trousers will be wet. :eek:.

Hey ho.

[Wee Weasley Welshman]

Rollercoasters go back up. Log flumes don't.

I enjoy both though ;)


WWW



ps This time last year the following was printed by the www.money.scotsman.com

Someone on average earnings buying an average-priced property with a 20 per cent deposit can expect to spend nearly half their take-home pay on mortgage interest repayments if the cost of borrowing rises.

Lender Cheltenham & Gloucester (C&G) said a 0.25 per cent rise in interest rates to 4.75 per cent before the end of the year would mean a typical UK buyer had to spend almost half of their salary on interest repayments alone - the highest level since 1991, when falling prices and unemployment led to record repossessions.


Since then mortgage rates (the base rate means diddle squat these days) including fee has jumped from 4.75% to 6.3% - pick up the phone, call charcol, ask them and tell me that I am wrong..

People with less than 5% equity (10% equity two months ago) will be looking at SVR's of 7% and wincing. Quite a bit of flying is discretionary spending. Airlines operate on fragile margins with high fixed costs. It will be more brutal and quicker than the early 1990's.

Protect youself - avoid debts.

[mustflywillfly]

Ooooh now you are just plain wrong, you're dealing with someone who grew up 4 miles from Blackpool Pleasure Beach. I can categorically say that log flumes do go back up. That would be a rubbish ride, one descent! I think you may be confused with a standard one shot, get absolutely soaked type ride.

:E

Now I MUST stop being distracted from ATPL study. I'm never going to pass at this rate.

[scroggs]

We can compare notes on the housing market in a year or two's time, I guess. Personally, like many home owners, I'm not particularly concerned about the value of my house as I'm not selling it and have no intention of doing so. Should I have to, for instance because my job has disappeared, the capital I shall release will be less than it might have been a year ago - but I knew then that its value was artificially inflated by a distorted market which couldn't last (but will come back a few years down the line). But the cost of any replacement (and much smaller) house will be that much lower. Other than that, it's really of academic interest only.

More important is overall sentiment. That's primarily what affects airline customers, whether leisure or business. It doesn't actually need someone to have less money in their pocket to stop them spending, just for them to feel that they might have less money in the future, so they'd better hang on to it. That's why there are all sorts of illogicalities in recessions - and booms - and why it's so difficult to forecast what's going to happen. The price of oil, which so affects our lives, is itself one of those illogicalities!

You're right that airlines operate on small margins. Not the lowest in the business world, by any means, but they aren't generous. BA's 10% target is extremely optimistic, and has been achieved by only a few airlines in history - usually those with monopoly positions. 3-5% is typical for well-run airlines. Therefore they are indeed vulnerable to changes in market sentiment, and the weak (at least in the more free trading areas of the world) will perish. 24 have gone in the last six months, according to IATA, and undoubtedly more will follow over the next couple of years.

It's extremely difficult to predict which airlines will suffer most over that time. Will it be the new market of the low-cost airlines that contracts so much they struggle to survive? Will it be the more established markets of the charter carriers? Or the business-driven custom of the legacy long-hauliers? Who knows? All - customers and airlines - will tighten their belts, but most will continue flying. Air Europe and Dan Air went last time, and there are some great hindsight-filled explanations of why that was. The marketplace was very different then, however, and now more previously-insulated carriers are exposed to the full force of the market. In the transatlantic marketplace my airline largely inhabits, much capacity has already gone, particularly in business class. More will follow. I can see significant consolidations about to happen in the European low-cost/shorthaul sector. The American carriers, with the exception of Delta & Northwest, seem to have decided that the costs of consolidation are too great, and that wholesale surgery of the current businesses is the only way they can survive. At the moment, the Middle East and Far East carriers are little affected, but they are beginning to make statements downplaying future profits.

How different will the airline field look in a couple of years? Well, after 9/11, everyone forecast that there would be a huge shakeout, and mergers and closures would happen by the bucketload. They didn't, so maybe they're now due. Lufthansa and BA are turning predatory, looking for competitors with access to new markets to swallow. Singapore and Emirates will likely do the same, as may Ryanair and EasyJet in Europe. The net result, in the short term, will be fewer aircraft flying a higher loadfactor - and needing fewer pilots to do it. Pilots' pay and conditions will once more be under severe pressure. Wannabes will be asked for even more money to do licences and type ratings with the hint of a job attached, and the more gullible will front up the cash. And pay for their mistake over the next 30 years!

Go work in McDonald's if you have to; sit this dance out. There'll be another hiring boom in a couple of years. I hope!

[Wee Weasley Welshman]

I certainly can't argue with that even with my argumentative hat on.

Oil has leapt today :(

WWW

[saccade]

There'll be another hiring boom in a couple of years. I hope!I hope the same, but I'm afraid that the golden age of air travel is gone forever. Oil supply's are stagnant, and I don't think anyone believes that they can be increased much more. At the same time global population is increasing, and the living standards (car's etc.) throughout the world are increasing especially in China and India, but also in oil producing nations. It's only a matter of time that supply's are dropping significantly and then the real fireworks start. And I don't think it is realistic to expect a hiring boom with $300- $400 oil. We are entering an energy crisis (Gordon Brown's words) without a solution in sight. Things like air travel, driving car's, globalisation, food production etc will change in the post peak world.

Why the h*ll did we build a society that is addicted to oil without ever questioning ourself whether we could come up with a replacement for oil??

[Wee Weasley Welshman]

I think cars, road haulage and ships can all be changed to run on none Geological energy and that much of industry and electricity generation can transition. Leaving Kerosene for the world of aviation and other specialist areas.

I like the look of the Algae bio-fuel numbers as well.


At the end of the day multi trillion dollar companies such as Airbus and Boeing are spending money today developing aircraft that will be flying in 40 years time. If they think aircraft will still be able to fly then I'll go with their assessment.

The world won't end because of a full scale house price crash and deep recession. Its just part of the cycle - no need to fret unless you've borrowed £80 to buy a piece of paper that expires in a few years..


WWW

[spinnaker]

I've got three engineers staying with me. They are working on land based wells, or proposed wells in NE Scotland. They reckon that there is the same amount of oil, or more, to be had out of the North Sea as that we have already had. Its the price that is now making it economical to extract. Maybe this explains why the government is doing as little as possible to reduce fuel costs, to encourage further oil development. Nice little backfire for the green brigade.

[chrisbl]

A colleague runs a medium sized house building company and he has not sold a house this year. Normally he sells 300 units per year.

New build will probably make 110,000 units this year down from about a norm of 160,000 and a government target of 240,000.

Most of the major house builders are laying off up 15% of staff.

And then it snowballs into the suppliers like the brick makers

http://www.building.co.uk/story.asp?sectioncode=284&storycode=3115350&c=1

If anyone is in denial about the housing market be assured, it is f*cked.

[scroggs]

I hope the same, but I'm afraid that the golden age of air travel is gone forever. Oil supply's are stagnant, and I don't think anyone believes that they can be increased much more. At the same time global population is increasing, and the living standards (car's etc.) throughout the world are increasing especially in China and India, but also in oil producing nations. It's only a matter of time that supply's are dropping significantly and then the real fireworks start. And I don't think it is realistic to expect a hiring boom with $300- $400 oil. We are entering an energy crisis (Gordon Brown's words) without a solution in sight. Things like air travel, driving car's, globalisation, food production etc will change in the post peak world.

Why the h*ll did we build a society that is addicted to oil without ever questioning ourself whether we could come up with a replacement for oil??
I'm sorry, but you're quite, quite wrong!

There is no shortage of oil presently, and none is forecast for any time soon. No cars, ships or aeroplanes are laid up for lack of fuel, no plastics or clothing companies are on short time for lack of raw material, no power stations are struggling for lack of natural gas. The oil producers are comfortably exceeding the world's demand for oil - which is the primary reason why oil price behaviour at the moment can be considered aberrant.

Oil demand worldwide has been increasing only marginally over the last decade as oil consumers become more efficient, despite the rapid increases in China and elsewhere.. Demand in the USA is now dropping faster than China, India and all the developing world can compensate for. Add to that the increasing supplies of alternatives to oil-based fuels, and the problem of 'peak oil' - if it actually exists - shifts rapidly to the right. Replace just 5% of the world's oil consumption with something else and there is not now, nor will there be in yours or my lifetime, any doubt about the ability of the world to provide for its energy supplies, geopolitics aside.

I appreciate your concerns, but it's knowledge that you need to make and dispel your argument, not uninformed speculation.

[Re-Heat]

With apologies to a blog on the finance industry, from which I pinched this, a great anecdote that seems to translate directly to this industry...and some wannabes' attitudes...:

First Year MBA student#1: "Did you hear about the [big foreign bank] presentation yesterday?"
First Year #2: "No."
First Year #1: "This managing director is up in front of the podium answering a question about work-life balance someone asked, the junior guys are sitting in chairs on the stage behind him. Fifteen, maybe twenty seconds after the question one of the junior guys literally passes out and falls out of his chair onto the stage. They called the paramedics and everything. It was crazy."
First Year #2: "Is he ok?"
First Year #1: "Fine, apparently. Exhaustion. Just got off the plane from London, no sleep for a week because of a deal he was working. Right after the managing director just talked about how great the work-life balance is."
First Year #2: "They have a London office? Are they hiring for the London office?"

[Re-Heat]

This just in:

The price of oil has made a record jump to nearly $139 a barrel, amid reports it could reach $150 by July because of rising demand and political tension.

Crude oil in New York gained more than $10 to hit $138.54.

[Thylacine]

Scroggs, I appreciate your concerns, but it's knowledge that you need to make and dispel your argument, not uninformed speculationI thought the role of a Moderator was to moderate not offer an alternative opinion?
Saccade's post merely presents an opinion, albeit an extreme one not backed up by facts, just as you have ventured an opinion that could be equally challenged as in Replace just 5% of the world's oil consumption with something else and there is not now, nor will there be in yours or my lifetime, any doubt about the ability of the world to provide for its energy supplies, geopolitics aside. If only it were that easy we could all sleep well tonight.

That aside, what is this forum if not a Professional Pilots Rumour Network where the views posted may not necessarily be those of the person who posted them and provided that they are not inflammatory, subject to litigation etc all views no matter how speculative should be welcomed?

[chrisbl]

If anyone is in denial about the housing market be assured, it is f*cked.

If there was any doubt about the state of the housing market

http://news.bbc.co.uk/1/hi/business/7440898.stm


The only upside is that you might be able to find a plumber or other building worker to do those jobs you cannot afford to do now.

[expedite08]

Please forgive me Scroggs and WWW for my possible naevity, but is not the TAX that is causing the problems over here, not the price per barrell??? I spoke to a shell garage manager and they said people are forgetting that its the 75p or more tax we are paying per litre that is crippling us all!

The acutaul increase per barrell is in fact negligable! Yes it rises over time, but by a mere few pence! Its the TAX that rises further than the increase per barrell thats the problem! $138 dollars a barrell dosent even make the likes of Shell and BP batter an eye lid!

TAX IS THE ANSWER!!!

[Wee Weasley Welshman]

Aviation fuel is very lightly taxed. Therefore the price per barrel does have a proportionate effect on the price of running a jet engine.

Domestic car fuel is very heavily taxed and is one of the main reasons alongside expensive property and congested transport systems why productivity is so low in the UK. Like all socialist governments this one is running out of other peoples money to spend. Therefore taxes are more likely to go up rather than down.

WWW :(

[scroggs]

Please forgive me Scroggs and WWW for my possible naevity, but is not the TAX that is causing the problems over here, not the price per barrell??? I spoke to a shell garage manager and they said people are forgetting that its the 75p or more tax we are paying per litre that is crippling us all!

The acutaul increase per barrell is in fact negligable! Yes it rises over time, but by a mere few pence! Its the TAX that rises further than the increase per barrell thats the problem! $138 dollars a barrell dosent even make the likes of Shell and BP batter an eye lid!

TAX IS THE ANSWER!!!

We don't buy our aviation fuel from petrol stations. There is NO tax on aviation fuel, by international agreement. Despite that, aviation fuel costs around $4.50 a US gallon (about $1.12 per litre, or $1400 per tonne) at the moment - i.e. a lot more expensive than the pre-tax cost of petrol. The £139 per barrel of oil is a the spot-market price, with no tax applied or applicable. The aviation fuel spot-market price directly tracks the oil price. Fortunately for many commercial pilots, airlines 'hedge' fuel - they buy it when it's relatively cheap for use when it's relatively expensive. Most UK airlines are using fuel now that was bought when oil was $70 - $80 a barrel. The real hit will come in around 12 months' time when that hedging runs out - if the oil price hasn't crashed by then!

Thylacine (should I call you Tazzie? Or Tiger?), the point of the Wannabes forum is for those with the knowledge to dispense it to those without. The role of the moderators in this specific area of Pprune is rather different from that in other forums. And don't get too hung up on the rumour part of our title. Facts are a lot more useful when you're planning to spend a houseful of money on your potential career!

Scroggs

[Adios]

What's in a barrel of oil? See http://www.energy.ca.gov/gasoline/whats_in_barrel_oil.html to find out.

Below is a link to an article giving a broad overview of oil prices going back over 100 years. It has some interesting analysis of OPEC's attempts to control and/or influence price and a conclusion as to why they can no longer do so. If you will recall, George Bush recently visited the Saudis hoping to convince them to turn on the spigots and came back with his tail between his legs. The real reason is because the world uses at least 80 Million Barrels per day an dOPEC only has about 1 Million barrels per day spare capacity, down from 6 Million barrels spare capacity before the 2003 invasion of Iraq. http://www.wtrg.com/prices.htm

As nice as a tax reduction sounds, all it would do is result in higher consumption and there is no spare production capacity, so the price would probably spike even more.

The above article makes two interesting points that are the key to understanding what will effectively bring the price down and both are tied to the current high price as their trigger. First, high prices result in conservation efforts to reduce consumption. Examples are more fuel efficient automobile and aircraft designs, homes being built with better insulation and energy efficiency, nuclear energy becoming comparatively less expensive, etc. Second is the fact that new oil well completions go up when prices are high and down when they are low. Each new well is graded on how many barrels it can produce including accounting for any extra steps that can be taken to get even more from it, such as saltwater, steam or CO2 injection. The cost of completion is high, so the earning potential needs to be higher and it isn't always high enough to justify completion even when there is oil in the hole. Only an increase in spare capacity will bring prices down, but high prices eventually trigger at least these two mechanisms that result in spare capacity, thereby bringing prices down.

[scroggs]

Nice links, Adios. The link between price and demand is well understood - though the markets often have trouble with it, and not just in oil! The turnround in demand right now should already have capped prices, but it hasn't - which means the price reduction, when it inevitably comes, will be the more severe (the parallels with WWWs house market analysis are striking!). The oil industry is indeed ramping up exploration and investing in new recovery technology which will result in recoverable oil reserves increasing substantially. At the same time, the very high price of oil will drive efficiencies in all areas of consumption - and these efficiencies will not be substantially given up even when the oil price starts to reduce, which results in further downward pressure. The short to medium term outlook for oil prices, therefore, must be down. Long term, oil will again get more difficult to extract using the wells and technology that exists, and prices will once again rise - but by then we may well have new fuel technologies which will move us on from oil, as we once moved on from coal.

Interesting stuff - and all directly relevant to the airline industry.

Scroggs

[XX621]

...and if anyone fancies drilling (no pun intended) into even more detail, this is a fascinating read on the modern history of oil politics...

http://www.davidstrahan.com/buy.html

(I am not David Strahan btw!)

[nich-av]

George Soros has been quoted as saying that it is a bubble that will be next to burst, the only question is when and how much damage it will do in the meantime.


Yes, and the longer it takes, the better for us, Europeans.
Why? if 1 or 2 major US airlines flying Atlantic go bust, there'll be that much less competition for European airlines over the Atlantic when oil gets back to normal. The aircraft that are sold for bankruptcy land in Asia or Africa, creating more opportunities for European pilots, once again.

Sure, it will be a pittyful sight to see that happening for the American counter-parts. But the people they have elected have put them in this situation. They are learning their lessons the hard way.

Will such a situation result in pilot overcapacity in the US?
Yes, but the effect will be temporary as the most experienced will find a job in Asia very easily. There is also a market with huge potential that many people tend to forget: South America.

South America is to North America what Africa is to Europe: A set of immense unused opportunities available at hand and not easily reachable from other continents. I can see it becoming a very popular touristic destination for North Americans with some new start-up airlines exclusively serving these destinations in the very near future.


I also think this is THE opportunity for Americans to discover the bicycle and dump their SUV's... it's a huge gain for our ecology.

As you see, this crisis is not only about negative stuff! :ok:

[Electricflyer]

HI there,
My local flying school told me that avgas was hovering around the £1.68 per litre, so I think I'd prefer to fly a PA38 on super unleaded from Texaco in Staines...
Why cant we invent aircraft that run on Nicad batteries??

:D

[Jodiekeyz]

Interesting thread, allot of apocalyptic predictions by a certain mod :p I spotted this so i thought i would share these stories:

http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article4087314.ece

http://news.bbc.co.uk/1/hi/business/7442170.stm

The energy ministers of the world's leading industrialised nations are meeting in Japan amid fears soaring oil prices could damage the global economy.

The Group of Eight (G8) organisation is meeting two days after a record one-day jump in crude oil to $139 a barrel.

[civil aviation]

Although I tend towards the WWW view of the present economic prospects :eek:, 'micro' factors affect pilot and wannabe potential.
Positives include:
-The present high price of oil may be short-term, speculation etc.
-Air travel demand is not only international (related to the 'world economy') but, also, in competition with both time-consuming 'public transport' at ludicrous fares and driving your own car- cost has risen faster than air fares !
-Both demographics (1940/50's baby boom) and greed (=retire anyone on high salary and old pension scheme a.s.a.p.) mean that airlines will need to replace plenty of pilots in the next 10 years.
-Only a small proportion of air travel demand is wholly price sensitive- the majority will not 'stop' simply because fares are much higher than last year.

Hope this makes many feel better, If not, get into hot bath with Stanley knife.

[ExMedevac]

We have moved away from coal because we found oil but we can't move away from oil until we find something else. It's like your boat is sinking and you have to abandon it, but until you find another you'll be swimming with the sharks....

[Adios]

Welcome back Scroggs. I don't completely agree with your assertion that supply is adequate. Crude supply may be, but not finished product. Demand is seasonal in any given country with an uptick in the demand as summer approaches. Crude oil capacity is steady, but refinery capacity is limited and suffers regional influences since it is best to refine near the consumer.

Even though demand is steady or even declining in the West, refining capacity can't always keep up with seasonal demand. The problem is exacerbated by refinery managers delaying maintenance when prices are high and then experiencing even more breakdowns. Some regional markets get hit very hard when several refineries breakdown simultaneously.

The Americans haven't built a new oil refinery in 32 years, not even to replace old, dilapidated ones. While this is an indication of the fact that US oil demand has been kept under control, it does contribute to seasonal and regional shortages there. This in turn drives speculators' attempts to capitalize on these seasonal peaks. Combine that with other aberrant factors in the economy and we end up with the mess you see in today's headlines. $139 oil is caused by more than just supply and demand issues, but erratic refinery output and seasonal demand fluctuations in the more influential markets certainly don't help.

Just after posting the above, I spotted this article where BP's Chairman says almost the same thing, though it seems to me that he refers to well output rather than refinery output when he says production capacity: http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/09/bcnbp109.xml

[heli_port]

Thousands facing negative equity
http://news.bbc.co.uk/1/hi/business/7445324.stm

Oil falls back in volatile trade
http://news.bbc.co.uk/1/hi/business/7443393.stm

:}

[student88]

I've made the decision to go back to college in September and take my A Levels. It's been something I've always wanted to do - I can't think of a better time to do it!

S88

[gfunc]

Just to stick my oar in about the oil issue, I think that we are rapidly going to move away from the sticky stuff below the middle east sands and go towards the 2nd generation biofuels. The most notable one being algae fuels that is becoming a rapidly more viable option.

There was a bit of US govnernment funded research in the 1970's to 1990's, but was abandoned as fuel was only $0.60 per gallon at the time. http://www1.eere.energy.gov/biomass/pdfs/biodiesel_from_algae.pdf

It looks like the best long term alternative as it can basically be used the same way as crude oil (refined into different grades) and it does not freeze at high altitudes. Perhaps as importantly it doesn't compete with food stocks and is more energy dense and faster growing than e.g. corn. Boeing appears to be seriously looking at it: http://www.algalbiomass.org/about/ and KLM are looking to test it this autumn (I can't find at link at the mo).

There are a lot of claims about algae fuels being thrown around, no doubt due to the fact that a lot of the research is performed by independent companies trying to attract funding. BUT the key here is that there is a viable alternative that is just about ready to go, which is one less thing to worry about. It might even be less of a gamble using that £80K loan and investing it in one of companies rather than a cold ATPL :).

Here's some links stolen off tinternet for those interested/bored:

http://en.wikipedia.org/wiki/Algae_fuel

http://www.forbes.com/technology/sciences/2008/05/28/alternative-fuels-biofuels-tech_sciences_cz_kad_0528fuels.html

Cheers,

Gareth.

[heli_port]

gfunc that is very interesting info cheers :ok:

[JB007]

Corporate aircraft market still booming!

Bombardier Triples Net Profit

Bombardier said on Wednesday its quarterly profit nearly tripled on strong demand for its aircraft and rail equipment, sending its stock to a six-year high.



Gulfstream Says Demand For Business Jets Strong

Joe Lombardo, president of Gulfstream Aerospace, said on Wednesday the demand for business jets remains strong, despite a downturn in the world economy.

I'm almost positive without seeing any facts that Cessna will report the same...someones gotta fly 'em!

[Cirrus_Clouds]

This thread is seriously doom and gloom, whilst some interesting posts, we need some postive threads.

Too easy to write about negative stuff!!

[heli_port]

http://www.ft.com/cms/s/0/23928598-36c1-11dd-bc1c-0000779fd2ac,dwp_uuid=f2b40164-cfea-11dc-9309-0000779fd2ac.html?nclick_check=1


Gazprom (http://markets.ft.com/tearsheets/performance.asp?s=ru:GAZP), Russia’s gas monopoly, on Tuesday predicted oil prices (http://www.ft.com/indepth/oil)would reach $250 a barrel in 2009.

[SAB]

Heli port before only posting negative and only including this, you forgot to list the link from yesterday where Arjun Narayan Murti from Goldman Sachs estimated oil price to be around 75$ within xx years. :ok:

It's easy to only focus on the negative, but only tell half the truth IMO is wrong :=

[heli_port]

SAB where is your proof for the above statement or are you just making things up :confused:

making things up is wrong :=

[SAB]

http://borsen.dk/okonomi/nyhed/133588/newsfeeds_rss/

Its in Danish but if you use an translator you'll see that

""Vores langsigtede vurdering over de næste 20 år er, at oliepriserne vil falde tilbage til 75 dollar per tønde. Spørgsmålet er, hvor længe de forbliver høje," siger Arjun Narayan Murti ifølge avisen."

Our longterm estimate over the next 20 years is, that oilprices will continue to fall back to 75 dollars pr barrell. Question is, how long they will stay at this high level", says Arjun Narayan Murti accordingly.

The article is from the Danish "Børsen" which is a financial paper.

I saw the article too on an english website, but I cannot find that anylonger :ok:

[Jonty]

SABs spot on.

http://economictimes.indiatimes.com/Oil_prices_may_dip_to_75_Oil_guru/articleshow/3117947.cms

[Lurking123]

Humble pie, heli_port?

[MTA99]

Anyone else think heli_port might have significant personal interests in Oil Futures? ;)

[Wee Weasley Welshman]

The markets are rife with banks in trouble stories this afternoon. Markets are down, Washington Mutual, Leham, RBS, HBOS, Alliance & Leicester all down >8%. The UK builders like Barratt are down [92%] from last year, Persimmon have stopped building (UK's largest builder), unemployment ticking up, interest rates set to rise whilst house sales plunge the most in 30 years.


They've taken down the Wannabe warning signs and replaced them with 18ft high neon flashing versions with scantily clad ladies handing out flyers in the streets whilst taking out television ads and sponsoring Man U. MAJOR RECESSION happening now - data to follow, several airline bust shortly, DO NOT BORROW large sums to fund training - it will NOT pay off.

WWW

[Wee Weasley Welshman]

Oil will end the day higher from when I post this - I guarantee it.

[Boing7117]

WWW,

What would your advice be to those that have recently completed their training, just about to starting paying back loans and due to start their first airline job very soon....?

[helimutt]

my advice would be to keep everything crossed (fingers, toes, arms, legs) and hope you get that first jet job you talk of. (why do people automatically think they'll go straight into an airliner job after training? There are many people who never get there even after spending thousands)
I'd make sure you have a backup plan/job to be able to pay the loans off. You really dont want to go bankrupt do you?:E



Good luck.

[Wee Weasley Welshman]

Umm, congratulations on securing a first job. Sit tight and hope you get to keep it. Don't buy a house for the next 24 months and research personal insolvency legislation just in case things go wrong.

WWW

[mustflywillfly]

I doubt anyone just finishing training or securing their first job would be in a position to buy a house (unless Mummy and Daddy help). 24 months!! More like 84 (when the CTC loan is paid back). Shame because by then prices will be back up and I for one will be laughing all the way to the bank.

[helimutt]

did a quick google search for todays oil price and got this link:-
http://news.bbc.co.uk/1/hi/business/7068642.stm
Great News!!!


What a shock, then saw the date!!!

Try this site:-
http://www.bloomberg.com/energy/

[heli_port]

cheers SAB nice to hear someone saying something positive amongst all this negativity but i remain sceptical that the price will drop down that low. The reason for this is i also work for Goldman sachs london and every analyst in my office says the price of oil will permanently be above $100.

Anyhow lets see...

Oil rises on crude supply concern
http://news.bbc.co.uk/1/hi/business/7447956.stm

[Wee Weasley Welshman]

$137.30 for US sweet crude as I type :(

The trouble will really start in the UK when Sterling takes a hammering against the dollar as this will spark a sharp (further) increase in the UK fuel price and and the price of all our imported goods and materials. As a net importer of some margin this will drive inflation through the roof.

For this reason UK Interest Rates will be raised to defend the currency. This will send the house price market into full collapse leading to a recession of the scale of the 1990's with several large airline failures and massive consolodation.


Welcome to 1990 - Aceeee'd!! :) (blows whistle, don's white gloves and heat responsive T-shirt)


WWW

[Lurking123]

WWW, may I suggest you moderate yourself? At very least, take a step back and look at your incessant ramblings on this thread.

[spinnaker]

WWW

I actually think your view is optimistic. Factory and farm gate price inflation is now into double figures. So far much of this has been absorbed. When it hits the high street, which it will, I see a recession on a scale of that of the 70's, possibly worse. The big fear is the rising food prices, something people cant economise that much on, so spending on other goods and services will take a big hit. The next bad news to come, is likely to be rising unemployment, later this year maybe. I see in today's news that the EU is to take action over the way the UK government has been spending and borrowing. http://news.bbc.co.uk/1/hi/business/7447531.stm Whether or not the EU is correct, it's a clear indicator that our economy is not just miss-managed, but is in a bad way. :uhoh:

[Honiley]

WWW, may I suggest you moderate yourself

:D:D:D:D

You do have to start questioning the "little mans" motives/what's really going on in his head/life satisfaction levels when it comes to his constant and never ending ramblings/predictions/airlines going bust...it's all really very odd...it goes further than Moderating this forum...

Welcome back Scroggs!:ok::ok: A sound, well reasoned aviator...

[v6g]

Whilst the press has been engaging in endless discussion over who to blame for the current oil crisis, whether it's those nasty Arabs, the greedy politicians, the big bad oil companies or those evil speculators, one thing happened today that got surprisingly little attention - BP published their annual "Statistical Review of World Energy 2008 (http://www.bp.com/productlanding.do?categoryId=6929&contentId=7044622)". It's a rather dry document with very few words but lots of numbers. Published every year it's the closest thing the world has to an authoritative assessment of the state of the world energy market.

Buried in the numbers in the spreadsheet (http://www.bp.com/liveassets/bp_internet/globalbp/globalbp_uk_english/reports_and_publications/statistical_energy_review_2008/STAGING/local_assets/downloads/spreadsheets/statistical_review_full_report_workbook_2008.xls)reveals that last year saw a decline of 0.2% in global oil production. Even juicy OPEC saw a decline of 1.2%. The only region to increase production was Russia (3.9%) but they've since admitted that they've hit their peak (http://news.bbc.co.uk/2/hi/business/7348463.stm). Looking back at past years data (the document goes back to 1965) shows that never before has every region of the world showed either declines or negligibly-tiny growth.

Still, one point of data doth not a trend make, but there's no mistaking that 2006 was a peak in global oil production. Of course, only time will tell if this was "a peak" or "the peak" and besides, global production also showed declines in 2002, 2001, 1999, 1991, 1985, 1983, 1982, 1981, 1980 & 1975 - indeed some much larger than 2007's.

Comparing the global consumption vs production figures against the inflation-adjusted price reveals a more worrying trend: unlike during previous oil crises, consumption today is steadily greater than production and the divergence is increasing. This was not the case in previous crises when production rapidly increased to above consumption whereas today, production is flat (or slightly decreasing).

Oh well, on the upside, yesterday I passed my motorcycle knowledge test!

[JB007]

Good post v6g, thanks - Just love the big picture stuff, away from the world of BBC/Daily Mail! And explains the price of those barrels then!

Speaking of which, off to burn 55 tonnes to the Caribbean, must pack!!!

[heli_port]

http://news.bbc.co.uk/1/hi/business/7449781.stm


It's a great global debate. What has driven oil prices to their current dizzy heights? According to the oil producers' cartel Opec, the blame lies with speculators in the international markets. But Tony Hayward, chief executive of BP, describes that view as "a myth".

European Airlines Reap Benefits of Oil Hedging
http://www.nytimes.com/2008/06/12/business/12air.html?ref=business

PARIS — As United States airlines reel from soaring oil prices and a sinking domestic economy, most of their European rivals appear better placed to ride out the storm.

While no airline can avoid the oil price shock, analysts say, European operators are benefiting from the relatively strong euro, given that jet fuel is priced in dollars. European carriers also fly relatively newer models of Boeing (http://topics.nytimes.com/top/news/business/companies/boeing_company/index.html?inline=nyt-org) and Airbus (http://topics.nytimes.com/top/news/business/companies/airbus_sas/index.html?inline=nyt-org) planes, which burn 30 percent less fuel than models from the 1970s and 1980s, many of which are still in use by United States airlines.

[Grass strip basher]

Lurking123 I think you will find that what WWW is certainly very plausible.... people were harping on back in Jan/Feb when this thread started that WWW was over reacting.... if anything to date he is proved to be fully vindicated. You might not like what he has to say but anyone with half a brain can see we are in for a very rough 2-3 years.... maybe rather than throwing stones yourself you would like to explain why you think there will be more pilot jobs in the UK in 1-2 years time that today??

[spinnaker]

Good post.

Late last year and into this year, I myself made a number of posts on another forum and wrote a couple of articles on the economy and the UK political situation. Broadly speaking, www comments here, follow a similar vein on my own observations about the economy. However, many of the factors that will have a profound effect on our lives, were starting to emerge late 2006 early 2007. Because I could see no corrective action from government or the Bank of England, that prompted me to investigate the economy more deeply and write about it. To begin with, I was slated, particularly when I said a major bank would fail and the financial sector would weaken. People started to listen when Northern Rock failed. To where we are now, I think its quite obvious for all to see.

My motivation to write here is because I know that there are many younger folk who are planning to invest everything they have, into an aviation career. And why not, there is something special about being a pilot and it is a career that is the envy of many. My guess is, a lot of the guys coming into aviation will not know what a recession is or how hard it bites, understandable, because they have not lived it. When you invest in a career, there is no money back guarantees, credit is getting harder, the jobs market for all is shrinking. I feel it appropriate as someone who has lived through recession, to use my past experiences, and highlight the warning signs, so that others can make a better judgement on what lays ahead for their future.

I feel sure that www is of the same mind. Doom and gloom, well for now anyway, but the reality has to be faced. People wont stop flying, people will still sell and buy houses. It's just that there will be a lot less people flying, houses are going to be considerably cheaper, and there is going to be a lot less disposable income in our pockets.

[Wee Weasley Welshman]

My motives are simply to ensure that naive wannabes are disabused of the marketing spin about flying training and are aware of the history of Wannabeism and the economic cycle.

When the next boom comes I will once again return to telling people here that this is a great time to train, that people are walking into jobs and that prospects look magnificent. As I did repeatedly from late 2004 - late 2006.

We are currently in the phoney war phase for Wannabes. There is still some recruiting resulting from business decisions made many many months ago. Airlines have only just finished reporting last years profits. Until now and for much of this year many airlines are fuel hedged and thus not feeling the full horror of the oil price. The consumer is only just starting to tighten their belts and many have already booked holidays or journeys. The house price crash has only just gone mainstream in the media in the last 6 weeks.

What this amounts to is a Tsunami of economic pain that will hit the UK and EU airline sector this winter. There won't be any profits and there won't be so many airlines and there sure as heck won't be as many passengers in as many aircraft.

For low time job hunters in debt and getting rusty this is all you need to know.


WWW

[Wee Weasley Welshman]

Hot on the wires right this second - Continental Airlines announce fleet reduction of 67 aircraft and 3000 job losses.

Recall if you will how last year houses crashed in the USA but hadn't yet in the UK. We are 9 to 12 months behind the USA at this stage. DO NOT remortgage your parents house to blow 90k on flying training!

WWW

[scroggs]

WWW,

What would your advice be to those that have recently completed their training, just about to starting paying back loans and due to start their first airline job very soon....?

While all the news discussion is interesting, this is the nub of the matter for wannabes.

Your first responsibility is to yourself (and your dependent family, if you have one). Remember the back-up plan we always told you to keep up your sleeve? Well, now's the time to get it out and dust it down.

Get yourselves employed in whatever field you can. If you have professional qualifications to fall back on, use them. If you have to stack shelves at Tesco's, so be it. Make sure you can feed yourself and put some kind of a roof over your head. If you're really in it up to your neck in debt that you took out to fund your training, now would be a good time to talk to your bank or whoever lent you the money to discuss ways of reducing your monthly repayments, if you think that's going to be necessary. DON'T stick your heads in the sand and hope it'll all go away, because it won't. You'll just end up in a bigger mess. If you're not sure what you should or can pay, or you have more than one creditor, or you just don't feel you can sort it out on your own, get yourself down to the local Citizens Advice Bureau (http://www.adviceguide.org.uk/).

In the meantime, keep applying for jobs. there will be some, somewhere. Even while things get very tough in Europe and even more so in the USA, it's likely that the 'Tiger economies' of the Far East will continue growing. There will continue to be jobs available out there, though as experienced pilots are released into the market from failed Western airlines (and there will be plenty), the hours requirements of new hires will rise.

If you have a new licence, you'll have to decide whether or not you can afford to keep it current. If you can, do it. Perhaps you can club together with other wannabes to get a few flying hours from time to time. If that's beyond your means, then don't let it get to you. Go and earn what you can elsewhere and come back when things look better. Keep on top of what the current requirements are to reactivate your licence, and make a plan of how you're going to do that when things are more positive.

Don't give up! Whatever happens over the next year or two, whether it's the full-blown economic meltdown that WWW predicts, or simply a period of stagnation, there will still be airlines flying passengers and freight around. Eventually, they will need new pilots. Your task is to make sure you're at the head of the queue once recruiting starts again - which it will.

Scroggs

[craig1975]

Well done Scroggs, I think he summed it up by saying that our role as wannabes is to be at the front of the cue and just be sensible.

I work for the worlds 2nd largest financial institution and we have the most up to date economic/financial data available and whilst the country is in a state of recession at the moment, I don't fully agree with WWW that the economy is in as bad a state as he says.

Yes we are slowing down - oil prices basically run the country and for that matter, a considerable amount of the world - however this is a supply and demand industry - at the moment, oil prices are high worldwide, not just the UK. I appreciate that tax in the UK is high - however it is not a percentage - therefore the government are not gaining on this - in fact they are losing out. As I say - supply & demand - therefore as in the UK, other large users of oil - mainly the US, are also seeing a slowdown in use. This will mean that oil is not being bought in the same quantities as it is currently - which therefore causes them to reduce the price.

This will NOT happen overnight, due to India, China & Russia using larger quantities. The other issue is that Russia, who are the new Saudi Arabia, are not covered under the oil regulators union, therefore there is currently no cost regulation. HOWEVER - this will change in due course.

What we will see in the next 12months is a slow down in the oil industry - this will drive down costs, which will reduce our levels of spend and therefore increase our usage.

In terms of utility cost increases - all are driven in a similar manner. It will turn around!!!!

Unlike the US though, we have a stable economy and although our economy spending is driven by the US spend, our financial institutions are able to control recessions better - hence why we are not seeing the stupid interest rate increases of the 80's - and unless something really stupid/drastic happens - we wont see that - which will cause the major recession.

My advice as an economist is that to do as Scroggs says above. No, you may not walk into a shiny new aircraft on graduation, BUT, there are still jobs available - just work a damn lot harder in networking to get one. We, as wannabes need to know that 12-18months from now, the job market will improve - yes higher experienced pilots will get hired first - but in the mean time - be an FI, join the Air Cadets as a gliding instructor, back-seat in training lessions etc etc - there are lots of ways to be in the air, or low cost outlay.

:ok:

[Wee Weasley Welshman]

Unlike the US though, we have a stable economy and although our economy spending is driven by the US spend, our financial institutions are able to control recessions better - hence why we are not seeing the stupid interest rate increases of the 80's - and unless something really stupid/drastic happens - we wont see that - which will cause the major recession.


WHAT!?

Stable economy? Its made of two thirds consumer spending, a tiny bit of manufacture and tourism and a hefty chunk of financial services. The latter is in crisis and sacking as fast as they can before they follow Bear Sterns and Northern Rock (Lehman and Bradford and Bingley for Act II). The consumer can no longer clear their credit cards by re-mortgaging and spending is contracting and will do viciously in the months to come.

That leaves us whistling in the wind with a tiny manufacturing base, massive export deficit and two decades of ever less impressive school leavers entering the economy.


The UK current account deficit continues to mushroom. It now stands at >3.5% of GDP which is the sort of number you used to associate with Italy.

Consumer debt is reaching an all time high. Total consumer debt now stands at over £1.3 trillion. There are fears that if interest rates rise to 6% (as is likely given recent inflation figures) then many consumers will struggle to finance their debt interest payments.

Government debt continues to rise, despite strong economic growth. The government is forecast to borrow £34 billion in the financial year 07-08. This is after the years of plenty. The years of famine start now and there's nothing put aside.

The UK has a LESS stable economy than the US and exceeds both personal indebtedness and house price unaffordability. It will be worse here than in the US - just like 1990 and 1972.


We are at the point labelled "energy" on the illustration below:



http://www.nowandfutures.com/images/economic_cycle(matt_blackman).jpg





WWW

[Grass strip basher]

Craig the thought of the second biggest financial institution in the world being based in Wigan bought a smile to my face! :}

[MarkColeman]

Good post scroggs, realistic and balanced. WWW has lost alot of credibility on here, after reading his first few hundred doom and gloom posts i realised hes an unbalanced pessimistic, and probably jumps for joy and runs to pprune any time a bit of bad news about the economy or the price of oil hits the headlines. I now skip through his posts because i know they can all be summarised as followed: 'yada yada recession, blah blah airlines are going to start dropping like flies etc. etc.'

Thanks alot WWW, i think we all know exactly where you stand on the aviation market and the world economy at this point, could you maybe stop posting 30 times a day about how ****** we all are now?

[HappyFran]

Mark,
I don't like what WWW has to say either, but I don't think we should shoot the messenger just because we sense a degree of over enthusism and don't like the message.
I agree it seems repetative but that don't make it wrong ! and sometimes those of us in d nile need to be refocused :eek::eek:

[99jolegg]

WWW has lost alot of credibility on here

Why? He posts fact rather than fiction and makes clear he's predicting when not directly relating to fact. Yesit's depressing and gloomy, and no I don't like hearing it, but personally, as someone starting training in the near future, I don't think it's a bad idea to consider the worst case scenario.

could you maybe stop posting 30 times a day about how ****** we all are now?

If you check what he writes, you can see it nearly always ends in a one-liner alluding to a tough time for wannabes, not for everyone as you say. Be reasonable :ok:

On another note, I sometimes question whether it is prudent to back up an argument with an article from the media...after all, when discussing an aviation related incident, do we check what the Mail has to say, and hold it as gospel?

[Wee Weasley Welshman]

Back up an argument with The Mail?! Heaven Forfend. I regularly cite the Telegraph or Times or Economist or specialist source. The tabloids - no.

MarkColeman - unbalanced I may be, I sold my house in April last year because I though the house market was going to crash and went into rented. But tell me I'm wrong.

Tell me I don't put my money where my mouth is. Tell me I wasn't here in Sept warning about a recession in 2008. Tell me I wasn't predicting UK airline failures last year when we've had SilverJet and EuroManx go down already this year.

Shoot the messenger mate. I really can take it and won't need my eyes drying - 10,000hrs in the logbook on Bus and Boeing and I could even go back to instructing punters such as you again if I had to. You chose to come here. You chose to click this thread. You chose to read my comments.

It annoys you? Don't let the door hit your arse on the way out - eh?

I've every sympathy for those that are going to be caught out in the coming recession. Sept11th hurt a lot of my friends and ex-student badly. I wouldn't wish it on my worst enemy. Which perhaps explains why I am somewhat evangelical in my mission to rescue and spare those wannabes that can be rescued and spared from impending financial disaster.

I post nothing that I can't back up with either a graph, a source or an argument and I usually do. Win my respect by countering me or just carry on bitching at the messenger as shooting is not an option.

:)


WWW

[clear prop!!!]

maybe, ...just maybe, it's 'the way you tell it' WWW thats getting people's backs up.
I don't think we need to know how safe you and your family are and that others aren't.....that your driving down the price of some poor b****rs house by submitting offers and withdrawing them etc etc.
It all just seems to be about how right you are and how wrong everyone else is.
No one is doubting how tough it is, but as sure as God made little green apples,... it will get better.
Perhaps it's time to follow the lead of your fellow moderator and offer advice and some hope that in the future, there will still be planes in the sky!
To 'slow down' training and reduce short term debt however is good advice, but it does not need the constant gloom and doom news flashes to back it up!

[CamelhAir]

Having been through the last downturn, one lesson is clear: however bad you wannabes think it will be, it will actually be worse by an order of magnitude.
If you don't like WWW's advice, or tone of, you're in the wrong game as burned you will get.
The only safe place to be right now in aviation is with a logbook containing 000's of hours on a marketable type. And even that is only relative, it just gives you more of a comfort zone if you're unlucky enough to be in a company that flops.
Keep the powder dry, there will no wannabe jobs by next winter and I predict that anyone losing their jobs with less than an a couple of grand BoeingBus hours might be in trouble too.

[cumulus]

This is a fascinating thread. If, as some are predicting, the price of oil heads towards $250 a barrel, I suspect that we will be in a place beyond even senor Welshman's experience - for example, not only airlines, but major regional airfields going bust as well.
Assuming for the moment that we experience the kind of recession that we have come to know in the last thirty years, say of three years duration, at what point in that recession would a wannabe be wise to start his training? my guess would be at the nadir of that recession - if you can judge it.

[Wee Weasley Welshman]

Look - I'm not bigging up myself but people repeatedly insinuate that I must be some sort of suicidal pessimist needing an extra-strong Prozac prescription. When I refute that by saying I believed what I was saying and acted upon that last year people get jealous and displace their anger on me because I chose to be a buyer in a buyers market. Tough **** - life is a call and there usually isn't a safety net.

Many wannabes are TOTALLY ignorant of what happened 18 years ago and what is happening now.

If they read my words they are at least slightly better informed. They probably will press on regardless. At that point my job is done. I will look forward to spending most of 2009/10 in moderating posts about how few jobs there are and how onerous the debts are. Just like 2002/03.

I'm not here to be popular - its an important thing to understand, when you do it clicks into place. :)


WWW

[nich-av]

If they read my words they are at least slightly better informed. They probably will press on regardless. At that point my job is done. I will look forward to spending most of 2009/10 in moderating posts about how few jobs there are and how onerous the debts are. Just like 2002/03.


As I said to you through the private message, you know very well that you won't stop people from jumping into the boat. So if you are committed to help these people, you've got to figure another way to do it, with good results and without compromising or debating stuff the way things are being debated here.

My message to wannabe's:
Let's be reasonable, people, and work hard to get there. It's a job for life!!

My message to rich rgonabe's:
If you can easily afford it and you think that it's more convenient, go integrated. Don't get bored after 2 years, though.

Voilà, no need to debate further.

[MarkColeman]

WWW, im not shooting the messenger, this isnt the 18th century, we can all read the newspapers and turn on bloomberg. I'm shooting the sneering, holier than thou wannabe economist grim reaper of pprune.

The main reason that i personally find your ramblings to be nauseating is that im not, as you labelled me, a 'punter' that you could go back to instructing. I recently finished line training and an RHS on a major carrier. HOWEVER, when i had just started my cpl i read a typical post of yours warning that it was exactly the wrong time to be training, and spending a fortune doing multi engine cpl and ir training. And you know what? it really shook me up, and i considered taking a break from training. If i had listened to you i would now be back at my old crappy job and not flying for a living.

There are opportunities out there, and there will continue to be opportunities out there, whether here or abroad. Yes the current economic climate is dire, but it will not last forever.

So please, a bit of realistic optimism with your misery would go a long way :ok:

[Grass strip basher]

Mark congrats on the job but rather than slagging people off who to date have largely proved to be right please spend a little time outlining where these opportunities are for the majority of wanabees.

Post some evidence that WWW is wrong... we all want cheering up so put you money where your mouth is rather than just saying "it will be okay, please don't say nasty things".... do some hard maths and show people why it is currently worth spending 50-100k rather than waiting 12-18 months and seeing how things shake out..... provide hard evidence please backing up a thesis that the pilot recruitment market will not be very very difficult over the next 2-3 years (please stick to markets where a UK based wanabee has a chance of being employed so don't start talking about India or China)....

I look forward to being cheered up! :}

[heli_port]

If i had listened to you i would now be back at my old crappy job and not flying for a living.

let's hope with the ever increasing fuel price you can keep flying for a living :}. I read a report yesterday which stated that the oil price will hover around $180 before the year is out before increasing to $200 next year.

TBH i think people who are about to start training (like myself) should educate themselves about the current economic climate and then decide if they wish to proceed.

I personally find www & scroggs posts to be quite well written, afterall they are old enough to have been through it before :eek::);)

Oil price rebounds to over $136
http://news.bbc.co.uk/1/hi/business/7451551.stm


Oil - paying the political price
http://newsvote.bbc.co.uk/1/hi/world/7446932.stm

right off to work (sadly not anywhere near a jet) :(

[barké]

4 years at Uni - Starting this September
ATPL after
Coinciding with the Market Recovery

BOOOOOOOOMTOWWWWWN!!!!!

(Only if the Aviation Industry follows suit, or maybe i'll stick with the engineering)

PS i think WWW needs to re-assess his gender, and stop acting as if he's God.

[Wee Weasley Welshman]

Well I am omnipotent... ;)


WWW

[geordiejet]

Guys, people need to remember that WWW has no reason for hidden agenda. I.e. - there is no need for him to get rid of any of his competition for a job, as he is already in seemingly steady employment. So I cannot see why anyone in this position would just make things up/be deliberately biased.

If it was some of the other wannabes in here - I could understand - one less person persuing a career = one less person to compete with to get a first job.

I think it's funny how people will put glossy brochures from a very successful marketing department, with warped stats and figures above something that is coming straight from the horses mouth, as it were.

I don't pretend to agree with everything said, but I think what is being said is of use to a lot of people - particularly those in the "I'm spending £70k - but what the heck, at least I can say 'I tried'" camp or those who talk quite casually about paying off £1000 a month in loan payments for the next 5 years - on top of the mortgage, bills etc etc.

[mustflywillfly]

Anyone else struggling with the will to complete DL ATPL groundschool whilst the world is seemingly falling around us? I come on here usually just before hitting the BGS QB why I do it I don't know it does nothing but dent my motivation.

Then I remember the hour building I have to do and the pure unadulterated pleasure of strapping a C152 to your back and bimbling off around the country visiting friends and family.

I will continue training as I am fortunate enough to be doing this without debt and still have my £good money job to go back to, however I will hold short of the IR for a good year and do the FI instead. If I can grab a few hours on days off and at the weekends when I return back to my full time job then all the better.

I now see this training malarky as a bit of a journey. Taking the motorway is no longer an option and will lead to arriving at the destination at the wrong time and too expensively. The journey is now along a pot hole ridden road meandering it's way through the mountains. I will get there eventually, avoiding the pot holes, taking my time and arriving at the destination at hopefully the right time! Tortoise and Hare story springs to mind.

Cheers

MFWF in philosophical mood and delaying the groundschool!! :ok:

[SAB]

Sorry for not being here for some time. I do think that it's good reasonable arguments WWW and others are coming up with. Although a bit pesimistic and too-much thinking on the UK economy and US.

I do not have the time to post all the time, but I could keep on finding various posts from business related articles like the one listed below.

IMF's Strauss-Kahn sees no global recovery until 2009

"We have good reason to think that the financial crisis is mostly behind us," though the consequences of the turmoil will continue to dampen growth for some time, he added.

http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=0bfc8b57-e08b-44a0-9551-021298d326d2


I'm not trying to say we're not in a heavy crisis, just that it should be expected especially in aviation cause that's shouldn't be a surprise to anyone who knows this industry - and like history tells us it's only a matter of time before we're back on track :ok:

Sorry for the bad english.. :O

[geordiejet]

The journey is now along a pot hole ridden road meandering it's way through the mountains/

And it's a road plagued with highwaymen, waiting to screw you over for every penny you have :{ and leave you for dead in the ditch.

[mustflywillfly]

And it's a road plagued with highwaymen, waiting to screw you over for every penny you have :{ and leave you for dead in the ditch.

Geordie, I feel your pain!! Just been fleeced £80 by the CAA just to have my night rating added! £80 for a one line in blank ink. Dick Turpin has nothing on them or Adam Ant for that matter.

[A and C]

Mustflywillfly has a well reasoned plan using reputable trainning providors......... so what is the problem?

[mustflywillfly]

Very true A and C!!!! :E BTW it all came through ok as you can guess from my previous post.

[saccade]

This shows how high oil prices is changing the industry...
http://s.wsj.net/public/resources/images/PJ-AM539A_pjMID_20080609221235.gif
...and there is more bad news to come:



"The International Energy Agency gives the alarm: The world could run out of oil faster than expected - the danger of a supply shortage is rising.

Schneider: If I understand you correctly, you say that the demand for oil could rise 3 % globally every year, while we have to expect a decrease of 4 % in oil production in the time from now until 2015. That would be 7 % each year which are missing.
International Energy Agency: The demand might increase a little slower. But there could be a large gap between what should be there and what actually will be there, especially if we do not put massive efforts into improving the efficiency of cars or change to other transportation systems. If we don’t take measures on the consumer side, the consumption will continue to grow. And if we have not invested enough into oil production, we will flounder."


http://transitionculture.org/2008/06/12/fatih-birol-offers-the-world-an-oil-health-check/


(Fill' Er Up and Up: http://online.wsj.com/article/SB121304736426558641.html?mod=hps_us_inside_today )

[scroggs]

Oil prices and the supply of oil are interesting subjects, and ones which have commentators with many and varied vested interests. The spread of oil price estimates from those who can reasonably be regarded as experts in the field reveals just how difficult it is to obtain reliable data on which to form an opinion.

However, in this case it seems to me that the IEA have been posted into a corner with 'what if' questions - ie, what happens if the production of oil decreases and the consumption of oil increases? Actually, you could substitute anything for 'oil' in those questions; the answer will still be, 'we have a problem'!

The answer to those questions will come in a number of shapes and sizes; partly the renewed and increased investment in recovery technology will allow oil production to increase in the medium term - at a price. The high price of oil is already giving increased impetus to the development of alternative fuels and energy sources. How will this affect aviation? In a number of ways.

The improvements in efficiency of power generation, domestic heating/cooling, personal transportation and a host of other consumers will likely have a significant effect on total oil consumption. Already, the major European economies have shown that economic growth can be maintained while reducing the use of primary energy sources (oil, gas and coal) . UK was down 3.8% last year, Germany over 5%. That overall reduction may allow aviation to get the breathing space it needs for the lengthy regulatory approval process for algal-based and other alternative fuels to be productionised and put into general use. The importance of this development to aviation is such that it may persuade the international regulatory bodies to get off their arses and start moving at a little more than the snail's pace they're used to.

The same IEA that postulates a potential expanding gap between production and consumption reported, only a couple of days ago, a reduction of 20% in UK petroleum use. While that figure may be inaccurate (and is disputed by the Petrol Retailers Association) there is no doubt that, worldwide, there will be a reduction in oil use in 2008. Once people realise there's good money to be made from oil substitutes (and my boss is way ahead of most of the industry on that), the switch from oil will be up and running. I anticipate flying with fuel that is 15% or more non-oil based within 5 to 10 years.

Scroggs

[craig1975]

FYI - I am able to commute away from Wigan and to a city centre.

WWW - the UK is a more stable economy overall - not at present, but overall it is.

I would maybe suggest sticking to flying aeroplanes and let the economic experts do their jobs as the negative attitudes being displayed by you on this thread I think is not a professional approach and is based on your opinions only with some pretty graphs thrown in.

What I was saying is that the UK is a better controlled economy that the US and in the main - will remain so.

If this is the kind of negative cr@p that is put on the forum, rather than constructive advice that others have posted - mainly by Scroggs, then I would suggest you keep you opinion to yourself.

There are too many people who try to put down the wannabes who are trying to get that coverted licence (me included).

And FYI - the company I work for is the auditor of British Airways Virgin Atlantic & Easyjet in addition to BP - therefore I have information to tap from both sides of the industries - aviation & oil!!!!!

[Lurking123]

GSB, if you had bothered to read my previous posts you would find that I'm not a starry-eyed wannabe who is 'in denial'. My only observation is the apparent manner in which the message has/is being delivered.

[spinnaker]

There are too many people who try to put down the wannabes who are trying to get that coverted licence (me included).

I don't think anyone is putting down the wannabies. What I and www have said is the truth. If you want to deny or ignore the warning signs, then please go ahead. But to suggest people stop posting because the information they have is downbeat, is just plain daft.

[Wee Weasley Welshman]

I would maybe suggest sticking to flying aeroplanes and let the economic experts do their jobs as the negative attitudes being displayed by you on this thread I think is not a professional approach and is based on your opinions only with some pretty graphs thrown in.


Are these the economic experts at the Council of Mortgage Lenders, Northern Rock, Bear Sterns, UBS or SocGen? Perhaps they should take up flying..

A negative attitude towards Western economies and the prospects for airline wannabes is neither a professional or amateur approach. It is merely a view, articulated and illustrated with data or supporting views.

I invite you to, rather than castigate me, expand upon your assertion that the UK economy is more stable than that of the UK. Define your terms, point to your data and make your argument. I'm genuinely interested. From the Lawson boom, through the ERM withdrawal to the DotCom and HousePrice bubbles and now joint recessions I would argue the two economies are fairly evenly unstable with the UK winning on points as we seem to take longer to recover from recession and drive our house price bubbles higher. But its debatable.

Calling for people to quit posting negative crap is not really very useful. I understand that the urge to shoot the messenger and to displace anger are both very strong human instincts.

WWW

[geordiejet]

A and C - there is no "problem".

In fact, his "plan" is prety much identical to my own.

I'm merely referring to the fact that there will always be unscrupulous operators, marketing depts and then there is the CAA and their rip off fees.

As for the FTOs he has chosen - I don't know who they are, so can't comment on them apart from BGS who are great.

They may be "reputable" now, but a repuation can be destroyed in a very short time. What's good now, won't necessarily be good come the advanced training.

[heli_port]

A few stories that i thought would interest wannabes like myself:

EasyJet to close a German base
http://www.ft.com/cms/s/0/314339b2-38b0-11dd-8aed-0000779fd2ac,dwp_uuid=d3532e34-27ed-11dd-8f1e-000077b07658.html?nclick_check=1

Indian airlines lobby PM on rising fuel costs
http://www.ft.com/cms/s/0/0ef6bdae-37d7-11dd-aabb-0000779fd2ac,dwp_uuid=d3532e34-27ed-11dd-8f1e-000077b07658.html

[kj990]

craig,

You say the UK economy is better controlled than the US. I've read recently that some think the BOE MPC have 'lost control' of inflation. When do you think they will get a grip on it?

Apart from savings being eroded we all suffer from inflation, especially if the wage spiral kicks in.

[HappyFran]

My sister has just ‘bought’ a return ticket Bournemouth – Dublin return for £0.00. My Ma and Pa have just about covered the whole RYR network out of BMTH over the last 18 months, never paying more than £20 return.
They know how to avoid the online ticketing traps and are not seduced by the charm of Scratch cards :bored:
So the question is who is paying for them to travel ? :confused:
It can’t be such a long term loss leader because;
They would not travel if cost was > £25.00 or the cost of lunch.
Every week RYR are making similar offers.
What ever you think of MOL he is not prone to acts of spontaneous generousity.

The only people prone to stupid uneconomic actions that I can think of are the Public Sector. Is it the case that MOL has convinced them to pay him to deliver punters to there cities (or vaguely near them). ?

If this is the ‘business model’ for RYR, Is there not a real danger that it will eventual dawn on the nice burghers of provincial euro land that free ticket punters are not big spenders and pull the subsides.

If this happens will suddenly look very sick. :yuk: And unless MOL has a very good plan B there will be one almighty crisis not just in Wannabee land but also in whole industry.

What does our resident omnipotent Economist think ? :8

[Wee Weasley Welshman]

I think that nobody actually knows what will happen to airline ticket sales in a major recession as the shape of the business is so very different from 1990.

Will hard pressed punters flock to low cost tickets. Or value maximizing all inclusive tour holidays. Will they downsize to European short breaks or cut out expensive City Breaks to preserve the main summer holiday. Will business travellers.. blah blah blah.

Nobody knows. Certainly not me.

WWW

[HappyFran]

My thoughts are that, if RYR are relying on Govt subsidies, then it is a very dangerous and fickle place to be.
I assume that is the case, or why is RYR paying for sister to travel ? (it would be cheaper to leave her at home).
I can understand that travellers will move down a brand, but suspect a lot more will fall off the bottom and not bother travelling at all.
Even if RYR is the lowest cost carrier in the business, if the volume drops, and subsides dry up, you can lose a lot of money very quickly :ooh::ooh:

[helimutt]

Craig1975, it's all well and good posting your 'facts' of how well the UK economy is set to ride the storm. Personally, I absolutely agree with everything that WWW has posted thus far, having also seen the previous recession here in the UK and looking at the big picture. Again, he only posts how he sees it. He never claims to be an expert on economies. You only have to wake up and smell the (imported at great cost) coffee to see things are getting worse. Take RYR for example. Laying off 600 now. http://www.pprune.org/forums/showthread.php?t=331187
Hmmm.
This is a rumour network after all.:E
Lets see how the next 6-12 months works out shall we. If I had to put money on which way the economy was gonna go, I know which way i'd bet. Pity I haven't got any money to bet with as I have just 'panic bought' fuel for two cars and been for my weekly supermarket shop! £250+!!!!!!!!!!

[HappyFran]

Hellimutt

Take RYR for example. Laying off 600 now. Hmmm

When was this announced ? :eek::eek:

[heli_port]

http://www.timesonline.co.uk/tol/news/environment/article4133668.ece


Scientists find bugs that eat waste and excrete petrol

Silicon Valley is experimenting with bacteria that have been genetically altered to provide 'renewable petroleum'

“Ten years ago I could never have imagined I’d be doing this,” says Greg Pal, 33, a former software executive, as he squints into the late afternoon Californian sun. “I mean, this is essentially agriculture, right? But the people I talk to – especially the ones coming out of business school – this is the one hot area everyone wants to get into.”
He means bugs. To be more precise: the genetic alteration of bugs – very, very small ones – so that when they feed on agricultural waste such as woodchips or wheat straw, they do something extraordinary. They excrete crude oil.

[thirtysomething]

Hi,

Just popped in to catch up on the news and saw this thread. Airlines are seeing momentum bookings but once next winter comes around and there is less momentum in the market as a whole pax numbers will dwindle. Ryanair are the least prepared ( Micko for all his pomp and ceremony didnt hedge and the big guns did .. he is too mean for his own good ). Inflation is becoming a worry and soon interest rates rise thus dampening spending further. I started down the route of a career change 18 months ago and decided it was a very bad time to continue last September , so glad I did , I would not like to have a variable interest rate loan hanging over me right no with carriers set to cut back ( Already seen in the US , only a matter of time before it arrives to the EU. ) All the marketing folk in flight schools are probably in overdrive telling you its " ok dont worry " and why would they not .. their own jobs are on the line..

When you start to see the share price for airlines begin to trend upwards is the time to start and not before. Bottoming is not the same as trending up.

[nich-av]

When you start to see the share price for airlines begin to trend upwards is the time to start and not before. Bottoming is not the same as trending up.


Then you would certainly wonder why airlines are about to order 500 aircraft from Airbus in about a month, while EADS is valued at below 0!!

People are just not investing into the airline business anymore because they know that it's not profitable and very risky. There are way better investment opportunities in other sectors.

Ryanair are better prepared than one could imagine. If MOL got FR as far as he did, it is not by luck.

If you warn people and tell them not to start today, you must be certain that the actual crisis will last until 2013.

I can see WWW in 2011 saying: "There's a huge pilot shortage now, everyone start training immediately or the airline industry won't keep up with growth (firing press articles on ever rising airline ticket prices due to excessive demand), OA* has still some seats for March, though C*C is already fully booked till August!!". And at the end of each post: "I'm right you're wrong".

You must always look ahead of 3 to 5 years dear doom & gloomers. Can you afford to let people wait 3 to 5 years until skies clear up and see them graduating when we're at the beginning of the next recession?

The economy is like a shot in tennis. You bring your racket back and prepare to hit before or while the ball bounces towards you, not when it's already bounced to the highest point, because then it'll be too late.

But ok, I'm with you guys.
A desastrous pilot shortage resulting from your posts could actually be good as it will push airlines to pay pilots' TR's again.

Flight schools will always keep saying that it'll be the best time to start because it's their business and prospective students would rather believe a person that tells it to them face-to-face rather than a person of whom they might never get to see the face (like that of the retarded guy that's keeping peeping up on this thread saying that he knows everything just because he's sitting in a left hand seat of an A319 :ugh: ). It's just like that and it takes more than a few posts on a website to make people change their minds.

Edit: A little correction: It's Airbus SAS that's valued at below 0, not EADS.

[smith]

WWW will love this one.

Atlas Polar Air Cargo have just announced over 50 engineering redundancies at their Prestwick Hangar.

Don't know if this is due to reduced capacity or government grants running out and relocating their engineering to a new subsidised site elsewhere.

[Wee Weasley Welshman]

Came across this earlier today. Kind of illustrates the problem we now face. This level of debt cannot all be repaid and the effort to do so will cause a deep recession.

Debt in a credit crunch = disaster.


http://www.creditaction.org.uk/assets/images/stats/jun08_personal.jpg


WWW

[SAB]

Saudi Arabia to 'increase oil production'

[/URL]The Saudis are reportedly concerned record prices might dampen economic growth and lead to lower oil demand. (Getty Images: Guang Niu, File photo)


Concerned that skyrocketing oil prices might induce a worldwide economic slump, Saudi Arabia is planning to increase oil production next month by about 500,000 barrels a day, The New York Times reported on its website.

[URL]http://www.abc.net.au/news/stories/2008/06/14/2274786.htm (http://www.abc.net.au/reslib/200803/r232276_929041.jpg)

Repeatedly Saudi Arabia alone can increase production with 2 million barrels a day if necessarie.

Another easy post to illustrate that this is, just like in the past, just another downswing in which this industry is very senstive into. :)

[scroggs]

SAB, I think the figures you report are incorrect. Saudi Arabia has suggested it may increase production by up to 200,000 bls a day, not 500k. The industry and the markets do not believe that they can do more - many doubt they can make good on the promise of 200k. However, in a market where rumour, sentiment, fear and greed are far more influential than fact and fundamentals, any little extra production will help - even if it's not needed!

As heli_port links to above, efforts to source alternatives to oil are now becoming serious and effective, and are starting to promise real results. Eventually, the reality that there will be life post-oil will calm the energy markets - though I suspect that, even without this factor, the oil price bubble will burst sooner or later.

The CBI this morning forecast UK growth to stall at around 1.3% in 2008/09, with inflation at or above 3% for the next four quarters, and unemployment increasing to 1.8m (about 8% up on the current figure). They don't anticipate recession in the UK economy, though to the average family it will certainly feel like one! More importantly to us, the airline industry will certainly be in recession for the next two years or so. Capacity will be taken out of the market, which means existing jobs will be lost and new hires will be few and far between. Some of the airlines you hope to work for will not be here in 2 years' time.

Sit this one out, as I've said before.

Scroggs

[SAB]

Scroggs, if you read on ABC or CNN you will notice that Saudi Arabia has already increased pr june 2008 their oil supply by 300 bls per day and are considering to upper that further with 200 bls per day, so all in all 500 as I mentioned in my previous state. Therefore the figures are correct. This was earlier yesterday stated by the oil minister of Saudi Arabi too.

That in mention, I have the same opinion as you considering the recession and the economic outlook in nearby future.

My point it simple, none of us can see the lenght of the crisis like the IT-bubble 8 years ago. If we could, we would make a ton of money in todays world...

Good luck :ok:

[A and C]

Ryanair lay off 600!

A report on another thread......................... now just what is the truth of all this?

[Re-Heat]

FT.com - Airline capacity
Published: June 15 2008 19:19 | Last updated: June 16 2008 09:56

Some of the planes in US-based Northwest Airlines venerable fleet of DC-9s were rolling off the production line when Lyndon Johnson was still in the White House. The need to replace ageing aircraft with more efficient jets is one reason behind the boom in orders placed with manufacturers Boeing and Airbus. However, the oil price has now gone past the point at which it is a helpful stimulant into a terrific dead weight.

The US airlines, on the whole, have yet to order new aircraft, but since the end of May the budget carriers JetBlue and AirTran have deferred delivery of 39 single-aisle planes out to the middle of the next decade. On Friday US Airlines joined the list of troubled carriers cutting jobs and unprofitable routes.

The shrinking American market points to trouble ahead for the rest of the industry. Global passenger growth in the first quarter of 4 per cent, year on year, was a deceleration from 8 per cent at the end of last year. Business travel globally turned down in March. There is a widening gap between growth in passenger numbers and capacity in the years ahead. For the past four years air traffic growth has averaged 9 per cent annually – the fastest sustained period of expansion since the 1970s. If global gross domestic product growth falls to 3-4 per cent this year, Credit Suisse estimates that passenger growth will be just 2-3 per cent.

On present delivery forecasts the number of seats on narrow-body jets – the single aisle planes used mainly for short-haul flights where competition is brutal – is set to grow by 6 per cent this year, and at a similar level out to 2012. But at current oil prices the airline industry faces an increase in its annual fuel bill – already $136bn last year – equivalent to a fifth of its $500bn annual revenues. Something has to give.

[heli_port]

http://news.bbc.co.uk/1/hi/business/7457157.stm


The price of crude oil has hit a new high of close to $140 a barrel in New York trade, despite Saudi Arabia agreeing to increase output in July.


Honda makes first hydrogen cars

http://news.bbc.co.uk/1/hi/business/7456141.stm


Japanese car manufacturer Honda has begun the first commercial production of a zero-emission, hydrogen fuel-cell powered vehicle.


The future looks bright! Sadly a friend of mine has had enough of all this and decided to leave the dream of becoming a pilot and go back to uni to become a GP :(

This is a career changing event and i won't lie when i say the thought has crossed my mind too :}

[chchflyboy]

new zealand just cut its student loan funding for pilot training, i was one of the lucky last to get in..

[Canada Goose]

i was one of the lucky last to get in... Maybe, but then again, maybe not !

I was only thinking this morning that some of those who were just about to jump into training and have not yet committed at least have the benefit of being able to decide not to forge ahead under the current climate. It's the ones that are bang in the middle or just coming out of the4 sausage machine that are perhaps the unlucky ones !! Time will tell !! :uhoh:

[spinnaker]

Even less money for holidays and travel.

OK officially we are not in a recession, but if fuel costs more, food costs more, and mortgages cost more, it certainly feels like a recession.:uhoh:

[wobble2plank]

Adversity breeds innovation!

Have a look at what the Yanks are doing with their B1-B programme, flying it on a cut of 50% standard Jet A1 and 50% GTL fuel substitute. The cut could become known as Jet A8. Oddly enough, the efficiency of the engine increased and the consumption decreased.

Airbus have also flown a 380 from the UK to Toulouse using the same cut fuel and doing high altitude cavitation trials and low temperature trials, all of which turned out to be successful!


Coming to an airport near you soon!!!

Give it a couple of years at these prices and the quest for an alternate fuel will have ramped so far up that we can give the middle east their sand pit back. :D

[Wee Weasley Welshman]

Even the Independent business writers have noticed what is about to happen:


http://www.independent.co.uk/news/business/news/airlines-flying-into-far-worse-turbulence-than-predicted-analysts-warn-850093.html


Airlines flying into far worse turbulence than predicted, analysts warn

By Danny Fortson, Business Correspondent
Thursday, 19 June 2008

The airline industry will be hit by a downturn far worse than even the most tumultuous periods in recent memory – the post- 9/11 years and the early Nineties recession – new research predicts.

Morgan Stanley slashed its earnings forecasts yesterday for several major European carriers, including British Airways and easyJet, in the latest of a flurry of gloomy assessments of the industry. Penelope Butcher, the analyst who authored the report, warned that although the record oil price has already led to two dozen bankruptcies worldwide in the first half of this year, the worst is yet to come... (article continues)


Every indicator is pointing to the fact that one of the Wannabe engines is about to fail - prepare yourself.


WWW

[potkettleblack]

Flight Intl reporting that Air Berlin is parking 10% of its fleet as well and contracting its longhaul offerings.

[spinnaker]

Every indicator is pointing to the fact that one of the Wannabe engines is about to fail - prepare yourself.

Has already failed, now running the QRH, nearly to the bottom bit that says land as soon as possible, secure the cabin and wallets.

[heli_port]

cheers for the link www, interesting reading..

Today i was talking to one of those 'idiot bankers' that started all this mess and when i asked him what he would do if the company made him redundant he said "Well heli i would go on a world cruise for 2 years and then come back when all is well with the world again, remember i am a millionaire" - barsteward! :mad:

[Re-Heat]

Aer Lingus & Ryanair as well:

Aer Lingus, the Irish carrier, has been forced by record fuel costs to rein in ambitious growth plans prepared for its long-haul network. It is cutting long-haul capacity sharply (LA) in the coming winter season and is highly dependent on gaining all of its 2008 profits during the three summer months.

Aer Lingus had originally – with a current fleet of nine long-haul Airbus A330 jets – planned to take delivery of three new A330s in 2009 and to retire one older plane, leaving a fleet of 11.

Mr Corneille said the plan was now to maintain the fleet at nine next year. A second older plane would be retired and one of the new deliveries from Airbus would be deferred to 2010.



Air Canada plans to slash 2,000 jobs and reduce capacity by 7 per cent, mostly on US routes, while rival Northwest Airlines stepped up its plans to trim flight schedules, as the carriers race to keep pace with fuel costs that have threatened the industry’s financial stability.

[RVR800]

A record level of retail spending in May has provided a respite from gloomy economic predictions

Sales rose by 3.5% during May, the strongest monthly growth since January 1986, statistical office figures show.

Shocked analysts said the figures ran contrary to signs of a slowing economy and weak consumer confidence.

http://news.bbc.co.uk/1/hi/business/7462945.stm

[spinnaker]

"Good News"

Oh if only.

A fair proportion of that growth is probably inflation itself. It could also be a last fling by shoppers before they batten down the hatches.

[Grass strip basher]

RV8 as a result of the strong retail sales data and the ongoing concerns about inflation the UK money markets are now factoring in 4 (yes four) rate rises in the next 12 months..... good news.... unless you have a mortgage... or a big loan related to flight training. As a result of this bank share prices are down 6-7% in 2 days on fears of bad debts and airline share prices continue to fall....

[nich-av]

Oh is that all?

Believe me,some things will get alot worth over the next 6 months.
I see at least 1 major US airline (NW, UA, US??) going down.

But guess what? The housing Cumulonimbus is making place for a recovering Nimbostratus but it'll take time before we get out of the energy crisis we're in at this very moment.

I guess that the OPEC meeting over this weekend will play a crucial role. OPEC is expected to announce a (temporary) rise in oil production. This move is not a bid to bring back a balance in demand/supply but to help OPEC's number one customer out of a crisis. News is the only thing that can change the oil prices right now, and good news can help alot to restore a healthy balance.

Anyone read it in the headlines yesterday? Americans drove 1.4 billion less miles in April 2008. With cars averaging 20mpg, that's 70 million gallons of gas saved over a month and a bit over twice as many gallons of crude! Which approximately equals to 4 million barrels, or a reduction of 0.5~0.6% in total oil consumption in the U.S. compared to a year earlier, if we only consider what's being saved on the roads. With all the airlines grounding up to 25% of their fleets, I see demand for Jet fuel decreasing as well. All in all, oil demand should be decreasing by up to 2% compared to 2007 in the US during the summerly months.

How long is this going to last?
Another 3 months? 6 months? I think that it'll last till December and that we'll see oil start its plundge towards 80$ around Christmas. We have interesting times ahead, and I'm looking forward to see what tricks airlines will come up with and what the recovery will look like.

Pilot jobs for pilots victim of lay-offs?
I talked to a few US Airways pilots a few days ago, and they looked very excited when talking about the Middle East, more specifically EK... so not much to worry about for these folks. By the way, Dubai is expected to sign a 3-digit order for their new LCC operation at the Farnborough show.

And no one noticed this one?


TORONTO - Bombardier Aerospace's (TSX: BBD-B.TO (http://ca.finance.yahoo.com/q?s=BBD-B.TO)) sale of up to 110 Learjet 60 XR mid-sized business aircraft is the largest Learjet order in history, David Coleal, vice-president of the Kansas-based Learjet division, said Friday.
It comes on the heels of another order for 20 of the jets, said Coleal, general manager of operations in Wichita, Kan., where the jets are built.
Twenty-five of the orders announced Friday are firm, worth US$340 million, and the 85 conditional orders would raise the value of the contract to US$1.5 billion, Bombardier said.
The purchase by an undisclosed European customer is "tremendous from the standpoint of the demand for this product in this market segment," Coleal said from Wichita.
While it's a good-sized order, a Toronto-based analyst said it has added significance because it indicates the corporate jet sales cycle still has some steam in it.


http://ca.news.finance.yahoo.com/s/20062008/2/biz-finance-bombardier-racks-largest-learjet-order-110-60-xrs.html

[nich-av]

JEDDAH, Saudi Arabia (CNN) -- Saudi King Abdullah confirmed Sunday that his country will increase daily oil production from 9 million barrels to 9.7 million in the near future to counter the sharp rise in international oil prices.

Saudi Arabia has announced an increase in oil production in a bid to ease the pressure on oil prices.


http://i2.cdn.turner.com/cnn/.element/img/2.0/mosaic/base_skins/baseplate/corner_wire_BL.gif



The Saudi petroleum minister, Ali I. Al-Naimi, said the country will reach the 9.7 million level by July. The announcement comes after Saudi officials announced modest increases.
It would be Saudi Arabia's highest production rate since 1981.
White House Deputy Press Secretary Tony Fratto praised the step, saying, "Any increase in production in today's oil market is welcome. It is important that we also take steps to increase domestic production and our refining capacity."
Meanwhile, the average price of gasoline in the U.S. rose nearly 10 cents in the past two weeks to almost $4.10 a gallon for self-serve regular, according to a national survey released Sunday.
The survey showed the national average was just a fraction of a cent under $4.10 a gallon, said survey publisher Trilby Lundberg. That is up 9.7 cents a gallon from the same survey two weeks ago, Lundberg said.

Don't Miss

<LI _extended="true">CNNMoney.com: Gas prices up a dime in 2 weeks (http://money.cnn.com/2008/06/22/news/economy/gas/index.htm) <LI _extended="true">U.S.: Oil production has not met demand (http://www.cnn.com/2008/WORLD/meast/06/21/oil.rise/index.html) <LI _extended="true">Saudi official blames oil increases on speculators (http://www.cnn.com/2008/WORLD/meast/06/20/saudi.oils/index.html)
Oil prices edge up ahead of U.S. crude report (http://www.cnn.com/2008/BUSINESS/06/18/oil.prices.ap/index.html)

Sen. Charles Schumer, D-New York,(personal comment: see? it's the government that's behind it!) downplayed the Saudi increase.
"Nice try, but no cigar. When gas is at $4 per gallon, demand increases almost daily, (personal comment: I think there is a contradiction there) and the Saudis have millions of barrels per day more in spare capacity," he said.
"This isn't nearly good enough."
Al-Naimi, the petroleum minister, also said the Saudi government will invest in oil projects that would allow Saudi Arabia to have the capacity to produce 12.5 million barrels per day by the end of next year.
King Abdullah's announcement came at the end of the Jeddah energy summit, where he also called for OPEC to set aside $1 billion for a strategy to ease the oil price crisis.
He said $500 million should be given to developing nations to help them get the energy they need.
King Abdullah said there are "many factors that made oil prices high." Along with increased demand, he also cited oil speculators and an increase in taxes in consumer nations.
"Now we see a lot of people point the finger at OPEC as it is solely responsible for this," he said.
The king's statement came a day after U.S. Energy Secretary Samuel Bodman, attending the summit, blamed the record oil prices on lack of production.
"All nations must be better at conservation, and the U.S. is at the top of that list," said Bodman, who met with journalists ahead of the international meeting of oil producing and consuming nations focusing on high oil prices.
Some observers have blamed speculators for driving up oil prices. A key adviser to Saudi Arabia (http://topics.cnn.com/topics/Saudi_Arabia)'s oil minister said Friday that a number of factors, including speculators and currency fluctuations, are to blame for rising oil prices.
"We need stability," Dr. Ibrahim al Muhanna said, adding that Saudi Arabia would like to see producers, consumers and distributors cooperate.
But Bodman said he did not believe that they are the cause. Since 2003, he said, global demand for oil (http://topics.cnn.com/topics/Oil_Production_and_Refining) has increased because of industry in China, India and the Middle East. But from 2005 to 2007, there was very little increase in supply.


I saw an interesting reportage yesterday on CNN on oil, one that would scare the **** out of any uneducated, unconcerned person.
A CNN reporter predicted all transportation to be grounded by October 2009 in the U.S., and a failing economy. He used as main arguments the fact that China and India's increasing oil demand is pushing the prices high up.

But can Chinese households afford oil at 150$ let alone 200$??
Can they afford to pay gas at 5$ a gallon when they earn only 300$ a month?

I don't think so.

[heli_port]

Oil prices have risen after emergency talks among the world's top oil powers and leading consuming nations over the weekend ended with no real resolution.
http://news.bbc.co.uk/1/hi/business/7468555.stm

[sawaya]

hi guys and girls in every dark cloud there is a silver lining,i happened to have bought oil shares at a low price just when bush had invaded Iraq,now guess who is smiling all the way to the bank,news that oil prices will hit 250 a barrel is music to my years:D:D:D

[sketchy]

Well done Sawaya, I'm really pleased for you :ugh:

[PosClimb]

news that oil prices will hit 250 a barrel is music to my years

I hope you're not a pilot, because if that happens you can kiss 95 percent of all aviation good-bye.

[sawaya]

i am a pilot......and one thing is people will always fly relax.....and if all jobs will be gone i will just be sitting happily looking at my stocks grow :D

[lazysundays]

of course people will always fly - but until we can work out how to burn cabbage juice in gas turbines, the number taking to the skies will be tied to the price of that sweet , sweet crude.

[bArt2]

i am a pilot......and one thing is people will always fly relax.....and if all jobs will be gone i will just be sitting happily looking at my stocks grow

And I suppose that you don't give a sh.i.t that there are people that can't afford to have heating in their house anymore in the winter and die by freezing

[sawaya]

And I suppose that you don't give a sh.i.t that there are people that can't afford to have heating in their house anymore in the winter and die by freezing


You are quite right i dont give a :mad: there are many cheap methods of heating a house,wannabees please stop whining its too much....keep of WWW armchair economics genius,

By the way WWW since you are so good at fortune telling why not quit your job as pilot work as a financial consultant to the big financial organizations that collapsed you would make shead loads of cash and probably buy your self a jet.Oh i have remembered you are only good at cutting news paper and magazine articles and scare away the wannabes

I have worked for hedge funds, family runs one. and wannabes i can tell you there is nothing to fear,

You had it first here.....there is a very well oiled European family setting up a low cost business jet company flying embrears firm orders of atleast 30 have been cornfimed and a possible 60 more,i cant disclose further....something in the line leaking company secrets,to all wanabees keep your head down get your licence,its not all doom and gloom mark my words

WWW all you say has some bit of truth in general things are not how you potray them,please dont scare away newbies with newspaper cut outs:ugh:

[sketchy]

Sawaya;


you can all, rant all you want,but fact is there will be more guys willing to go for it than ATP can handle,i am now busy looking for cash,if i dont get the cash to bad for me


If you really are as minted from these oil stocks of yours, why don't you cash some of them in and get on the 'easyJet' ATP scheme?

Troll or Bull****e - can't make my mind up just yet.

[helimutt]

troll or a**e hole?? let me think.:hmm:

[Re-Heat]

It does rather shove it in one's face if you are to talk about your own personal wealth in such a manner.

Hedge fund, or proprieter of a bizjet airline - it does not matter. Many wealthy families have wasted their cash on airlines, and you don't give us any indicator of the success of your family's fund. Neither do you mention if it is fund of funds, proprietary, outside managed, emerging markets, or indeed anything else to indicate that you might anything other than a dreamy, young wannabe - exactly the people to whom this thread is addressed and to whom it should be a wakeup call.

I am at the coalface of the financial industry, and happen to agree with WWW. Life is dire here, many capable people are out of work, and more has yet to hit. The housing market has 15 sellers for every buyer at present, mortage banks are unable to function, and interest rates are going up to prevent the mess of the 1970s.

WWW's preference to fly for a living does not deny him the right to comment upon other areas in which he is interested.

[sawaya]

Sketchy you are a mind reader i am in the ATP scheme already:D

[sawaya]

dont get me wrong guys i was not flaunting sorry if thats how it appeared all i am saying WWW is full of bull i am saying this coming from a family that has dealt with economics for over 40 years and advises all the who is who in the business circle,and as of the bizjet company,its not ours we are advising..and i happen to have spilled the beans so that,all the wanabees can know that are not that bad.

[PosClimb]

and one thing is people will always fly relax

True, but the numbers of people who will be able to afford to fly will be a fraction of the current levels.

Better pray for a magic alternative fuel.

[sawaya]

RE heat

WWW's preference to fly for a living does not deny him the right to comment upon other areas in which he is interested.

same as me i have a right to comment,

[sketchy]

Sketchy you are a mind reader i am in the ATP scheme already

Well congratulations fella! Though it is a pitty you used up all your foresight buying those oil shares...

[sawaya]

SKetchy oh i had not seen your quote, and yes i did not want to ask for parents help but the oil speculators have bailed me out, i love them:p

[sawaya]

It was courtesy of knowing people in the know how,i was advised to buy them,knowing oil value will always be up,never would i thought in a few years it would pay off so well it was more of lack than foresight...

[Re-Heat]

I didn't deny you the right to comment - I simply pointed out that your beliefs are far removed from the reality I witness here daily.

[heli_port]

sawaya you sound like a former pruner known as spacemen :hmm:

www over to you for the proverbial troll spanking ;)

[sawaya]

what a laugh ;)

[Grass strip basher]

This guy is not for real.... this thread has already seen a dozen like him (remember Nichebei Aviation?). Frankly I don't give a monkeys what dad the hedge fund manager thinks... for every hedge fund manager that thinks things "will be fine" believe me there are 10 that are short the market up to the whazzoos...

If you look at his previous posts he has splashed out a lot of cash on an ME/IR and was advocating spending up to €40k on a type rating with 300hr line training... he is in it up to his neck and trying to justify decisions he has already made... anyone who is prepared to pay for line training is part of the problem in my book.

If you are gonna make sweeping statements giving either a positive or negative stance PLEASE PROVIDE SOME FORM OF EVIDENCE OR LOGIC! That way you may add something valuable to this thread! (.... because my gran says so doesn't count.... unless of course she has a nobel prize for economics etc).

... and I forgot to mention this guy doesn't even seem able to write proper English :D

[bArt2]

And I suppose that you don't give a sh.i.t that there are people that can't afford to have heating in their house anymore in the winter and die by freezing

You are quite right i dont give a :mad: there are many cheap methods of heating a house,

Do you mean by burning the furniture, I do not know of any cheap way to heat a house. By the way I have no problems heating my house but I find it a pitty that so many people don't give a rats as,s about the misery of others. Anyway I don't want to drift too much off topic.

Bart

[cumulus]

Sayawa, do you work for P & O? The reason I ask, is that the thought that a semi-literate sociopath such as yourself might one day worm his way onto the flightdeck of a public transport aircraft suddenly makes me want to avoid flight at all costs...

[Wee Weasley Welshman]

sawaya has emailed me apologising for his rambled nonsense postings and promised never to post on this thread again. Which was probably best for all concerned.

I think he may have been drinking or something.

WWW:E

[nich-av]

sawaya has emailed me apologising for his rambled nonsense postings and promised never to post on this thread again. Which was probably best for all concerned.


I can't imagine he e-mailed you and apologised just like that. I'm pretty sure you did something that would force him to do that.


Sayawa, do you work for P & O? The reason I ask, is that the thought that a semi-literate sociopath such as yourself might one day worm his way onto the flightdeck of a public transport aircraft suddenly makes me want to avoid flight at all costs...


Sawaya may not speak perfect English, but he may speak more languages than you do.

English is the common aviation language, but did you know that:

You need to be able to speak and write/read French to get a job with Air France
You need to speak and write/read German to apply with Lufthansa
You need to speak and write/read Italian to apply at any Italian airline
You need to speak and write/read Spanish to apply at most Spanish airlines
Same for Portuguese, Greek and Danish airlines.

Point 2. you don't need to be a master in English literature to become a pilot.


This guy is not for real.... this thread has already seen a dozen like him (remember Nichebei Aviation?).


Sawaya is right.
See, we've seen hundreds of articles posted by WWW and others concerning the housing crisis. How come they've stopped posting these articles?

2 points here:

Point 1: No one's posting them anymore because the housing crisis has not lasted 20 years as some predicted and there's nothing anymore about it in the headlines, simply because the crisis has vanished in no time.

Point 2: The guys who were posting them realised that housing crisis was not interconnecting with ab-initio pilot jobs.
2 reasons: -Reason 1 People who could not pay off their loans can not afford to travel
-Reason 2, interest rates increasing from 6.5% to 7.5% are a non-issue for people loaning 60K for training.

So what's the real issue at this moment?
That's right, energy crisis and the resulting food crisis.

Who are the potential actors who make crude oil sustain a value 4 times higher than its original value?

-Governments and lobbyists who want to make someone electable
-Western oil companies earning record profits
-Financial institutions that lost money in the housing crisis
-Private investors
-Opec

Out of these 5, I think the last is the least likely.
Somehow, the first and the second interact, make a good mix and can explain many things. A fatal question is: why would the US threaten the Middle-East with a new war if they badly need to lower oil prices? Maybe they're simply not trying to lower oil prices.

Only when and if the bubble blows, will we know who's behind it, because those people will lose alot of money. The least detectable will of course be the government.

Future prospects:
After the elections in November there will be two possible patterns:

-bubble bursts and oil price descends to a healthy 90$ in 2009.
-oil rises over 150$, OPEC starts quoting oil in different currencies than the USD. The US economy will crash together with the oil prices and the dollar.(also, a new war in the Middle-East, new issues, maybe even a civil war in the US because of desperation)

Immediate and easy solution?
Opec start quoting oil in euro or any other stable currency, making oil prices crash (because American speculators will no longer be able to hedge their falling buck into oil). Collateral damage: US economy to the ground.

Why is it not applied?
Because the US are still the biggest customer of OPEC, and unless OPEC sees demand from other countries decreasing strongly as a result of the high prices, they won't do it.

[helimutt]

Looks like WWW wasn't painting a scary picture at all. Seems more like he had rather a more optimistic view than some. Has anyone seen the state of the world today? Gas prices to rise 40% further here in the UK this year. House prices falling further. Even India laying off pilots now. So much for far Eastern growth. Another US carrier (US second largest??) laying off 1000+ staff and pilots.:(

Tighten those seat belts, it's gonna be a turbulent spell.:sad:

[heli_port]

Down-to-earth ways sought to cut airlines' soaring costs (http://www.canada.com/topics/travel/story.html?id=1d8db20d-24f9-47fc-8175-edfa123e11a8)


CALGARY - Did that recent flight feel a little longer than usual? Chances are, it was.
As the price of fuel continues to rise, airlines are responding by trying new measures aimed at making flights more fuel efficient - everything from flying slower to reducing weight to using the planes' engines less.
"With fuel the way it is right now, we have been flying slower," WestJet Airlines Ltd. spokesperson Richard Bartrem said.

[spinnaker]

helimutt,

Not just India. China has inflation running at just over twice that in the UK and in India, three times the UK rate.

The immediate future is poo.

[Wee Weasley Welshman]

Certainly the house price crash is happening faster and harder than I expected.

The average North American house is now down 23% in the last three months and we are about 13 months behind them. The British Banking Association figures out yesterday were horrific for the number of mortgage approvals:


May 2008: 27,968
May 2007: 77,443


That is a 74% drop in the number of mortgages approved in May this year compared with May last year. The vast majority of house sales involve a mortgage so its a good indicator of why estate agents and conveyancing solicitors are going bust left right and centre.

This is 1990.

Prepare yourself. Avoid debt. I predict mortgage rates above 9% and a sharp, deep, recession.


WWW

[Grass strip basher]

WWW I agree with you on many things but the average US house price has not fallen 23% in 3 months!

... and on the mortgage approval data are comparing like with like... they are down but not as much as you say... it is about 56% I believe (still Sh*t thought) :ok:

[Bombs Away]

WWW,

After reading your posts you sound like you know what you are talking about, so could you offer some advice. I've been quietly saving for the past few years and could get the ATPL license without going into any debt. As I am 30 should I go ahead and do it now or hold off. I'm not getting any younger. As the aviation market is cyclical, I would imagine it will bounce back eventually and would it be better to have the qualifications ready for when (or if :sad:) that happens?

[Wee Weasley Welshman]

Sorry Grass Strip Basher but they have.

22.8% in three month in the US. Do you want me to post a link or would you prefer to pick up a copy of todays Times and read the piece?

Bombs. No rush - plenty of people don't enter the industry until they are 40 odd. The key is timing. Now is a poor time. Perhaps you could do a PPL and IMC rating and build some hours for a couple of years and then look at it again.

WWW

[PosClimb]

WWW, what's your take an oil prices as they relate to the future of aviation?

I think oil prices are a much larger threat to aviation in the long and short term than economic cycles, because oil prices will remain high and likely climb even higher.

[nich-av]

I think oil prices are a much larger threat to aviation in the long and short term than economic cycles, because oil prices will remain high and likely climb even higher.


Not true.
If worldwide demand starts decreasing because of oil prices steady at 140$, OPEC will start quoting oil in other currencies. Believe me, that's gonna crash oil prices.

But seen the recent developments in Washington, unless we have an other terror attack, everything should start top get back to normal in 2009.

At least, I hope, and I am optimistic.

[Grass strip basher]

With respect WWW I think you will find your average Times journo was not particularly good at maths at school... go to the source not some journo's interpretation... S&P | Indices > Alternative Indices - S&P/Case-Shiller® Home Price Indices - Home Price Values (http://www2.standardandpoors.com/portal/site/sp/en/us/page.topic/indices_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html)


;)

[MarcoFF]

OPEC:s chairman and Algeria's energyminister Chakib Khelil said today that oil price could get 150-170$ per barrel - already in this summer. He claims that dollars weak course is the reason to expensive oil.

Today at Nymex exchange oil barrels was allmost 135$.

Damn.

[SAB]

You forgot to quote the last sentence of the article though. :ugh:

That he also expected a drop in the prize of oil by winther to equalize it.


SWB

[heli_port]

The price of oil has surged to a fresh high passing the $140 a barrel level.

BBC NEWS | Business | Crude oil at a fresh high of $140 (http://news.bbc.co.uk/1/hi/business/7476269.stm)

[hollingworthp]

From the Guardian:

Business jets boom as rich float above oil crisis


Link (http://www.guardian.co.uk/business/feedarticle/7611886)

[doctordoom]

The dollar is weak but we still are paying big money for fuel. The Euro is strong and so is Stirling so why the hell are we being robbed at the pumps in Europe. Some body is making a killing, I think the rest of the world is paying to get the U.S out of its resession and puting everybody else into one.

[clear prop!!!]

Robbed at pumps…that’s just the tip of the iceberg,

Fact is that the UK’s oil story is one of the best kept secrets ever ..for very good political reasons!

Did you know that we produce more oil from the North Sea than the output from Kuwait?..and, we are 97% self sufficient (apart from refinery capacity)

Why then do we not all drive Hummers and wear a Rolex? (apart from the fact that no pilot worth his salt would be seen dead with them!)

Because, we have totally pissed our oil revenues up against the wall!

Whilst Gordon Brown publicly wrings his hands at what increased oil prices are doing for his people and country, he laughing up his sleeve at the additional $40bn income that he is conning us out of in tax revenues as a result of increased oil prices which, is saving his arse!...JUST!!
Our near neighbours in Norway have built up a ‘sovereign wealth fund’ from oil revenues which equate to around $55,000 for every man woman and child, and, they have a budget SURPLUS of $38 billion, an oil windfall just short of that of Kuwait. And the UK? …Zilch…Nothing…Not a Jot!! We have pissed every penny up against the wall on failed education and NHS schemes etc etc.

The big problem for the UK will be if Scotland gets itself independence! If it does,..the rest of the UK is BUST!...big time.

We are in the **** at the moment, but without the additional oil revenues this country is BANKRUPT!

[hollingworthp]

Gotta love our country :ok:

[nich-av]

With respect WWW I think you will find your average Times journo was not particularly good at maths at school... go to the source not some journo's interpretation... S&P | Indices > Alternative Indices - S&P/Case-Shiller® Home Price Indices - Home Price Values (http://www2.standardandpoors.com/portal/site/sp/en/us/page.topic/indices_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html)


Good reading, thanks for posting that Basher.

Your links shows that in April 2008, 33% of States analysed saw an increase in housing prices, and that 100% of the States showing an increase in price had a continuous price decrease during at least the 6 months preceding April 2008.

As said before, for those who understand what this is all about, the housing crisis was nothing but a tool used to increase oil prices.

Some OPEC members today reacted madly to a Republican saying on Monday, the day after the Saudi's announced an increase in oil production, that this increase are not sufficient to cope with actual increase in demand.
Lybia is threatening to decrease output due to oversupply on the market.
Venezuela did not attend the meeting on Sunday because they don't see any reason to increase output.
The Saudi's are doing the US a favor by increasing oil production and bringing the tensions between OPEC memebers to an all-time high but if oil goes above 150$ , it'll be game-over because other OPEC members will disapprove strongly if Saudi's increase production further. I see it more as "the last chance" the Saudi's are giving to a longt ime customer.


So let's read what this newspaper says:
!!!Keep in mind that the newspaper Middle East times is a subsidiary of a conservative US media network.

This article says it all - in one word: propaganda!

I read alot of articles every day but this is what caught my eye:

There is much that Republican and Democratic party leaders alike in the United States could do about this, but they are not.

Now really?
Then he goes on:



We would also recommend to Sen. Barack Obama, D-Ill., the Democrats' front-runner, that he refrains from his hardline rhetoric bashing the major oil companies and vowing to crack down on energy speculators. Those "speculators" are largely rational investors who reflect the hard realities of soaring global hunger for oil and insufficient available production and refining capabilities.

We also note that prominent Democrats have been bending over backwards to deny that there is a critical shortage of oil refining capacity in the United States, or they have argued it isn't such a big problem. But it is a big problem. Republicans and Democrats alike have been complacently negligent about it for more than three decades.

If Obama wants to start a really serious and constructive dialog with the major U.S. oil companies about what they could do to ease the current crisis, getting some serious action going on expanding U.S. domestic refining capacity would be a good place to start. (Personal note: why should he? he doesn't need lobbyist to be elected!!)
In the past, we have taken the position that soaring energy prices will invariably help Obama rather than McCain at the ballot box this November. (personal note: not so sure about that! A crisis/fear will only benefit McCain) But McCain has certainly been fighting his corner hard in the election campaigning so far.



See people, this is what it's all about! It's an election year, that's what it's all about.

This article is supposed to talk about "how demonizing the Saudi's will not help oil prices", in reality it is a stunt by a politically inspired newspaper putting pressure on a presidential candidate.
But since when does a newspaper have any right to recommend a presidential candidate to do anything???

Demonizing the Saudis Will Not Help Cut Oil Prices - Middle East Times (http://www.metimes.com/Editorial/2008/06/25/demonizing_the_saudis_will_not_help_cut_oil_prices/2811/)


JIDDAH, Saudi Arabia -- The U.S. energy secretary said Saturday that insufficient oil production, not financial speculation, was driving soaring crude prices.

Energy secretary to saudi arabia: Insufficient oil production is behind rise in prices :: Beacon News :: News (http://www.suburbanchicagonews.com/beaconnews/news/1018444,2_1_AU22_OIL_S1.article)

What gives me hope in all this mess?
The American youth.

[heli_port]

dam you Gordon liar brown dam you :mad:


(always remember to put liar between GB's first and last name and remember that the next time we have a general election :D)

[ReallyAnnoyed]

Clear Prop, the last figure I saw for the Norwegian Oil Fund was 7,000,000 NOK pr citizen which equates to about 700,000 GBP. However, I think that figure was a forecast based on their total oil reserve :ok: They stole our Danish oil due to some terrible negotiation by the Danish officials, but Denmark is still a net exporter of oil too.

[Re-Heat]

Because, we have totally pissed our oil revenues up against the wall!

Oh, too true. If only those fools in politics knew how to run a business, let alone a country, we might be in a far better position.

Even better is Brown's stupidity is levying tax at 50% against North Sea oil firms. This reduces their profits and leaves them less willing to invest in new development projects in the North Sea that could yield far more oil over the long-term.

As it is, they will not invest in depleted fields as the economic models do not permit sufficient returns - largely due to the tax rate.

When you realise that not even the majority of oil in any one field is extracted before it currently becomes uneconomic to extract more and the field is abandoned, it becomes clear what economic stupidity it is to tax the companies at any rate higher than the UK corporate marginal rate applicable to other companies.

Prudence Brown? More like stupidity Brown. And I don't have much good to say for the other lot who were in for 16 years before that either.

[Re-Heat]

NOK 1.939 trillion / 4,752,735 people = NOK 407,975,618 per head = £40,703,687 per person.

[Grass strip basher]

Does anyone have any idea how much money the UK government raises each year by taxing north sea oil?? Would be interested to know what that looks like on a a per head of population basis....

[Re-Heat]

http://www.hmrc.gov.uk/stats/corporate_tax/table11_11.pdf

[MarcoFF]

SAB sorry if so, didn't read in the articel which i read.

[heli_port]

The price of crude oil has surged to a record, breaking through $142 a barrel, amid concerns about the ability of producer nations to meet demand.

BBC NEWS | Business | Oil price hits record above $142 (http://news.bbc.co.uk/1/hi/business/7476910.stm)

Oil Price Surges To A New All-Time High

Oil Price Surges To New High Of Just Under $142 A Barrel After Libyan Threat |Sky News|Business (http://news.sky.com/skynews/article/0,,30400-1320234,00.html)

:{

[expedite08]

All this will come to a head fairly soon I think and something will give. Its getting silly now. Hopefully like the housing market the oil will crash!

[v6g]

For once a good article from CNN debunking the myth that the current oil price rise is caused by speculators.

In defense of oil 'speculators' - Jun. 27, 2008 (http://money.cnn.com/2008/06/27/news/economy/birger_oil_speculation.fortune/index.htm?postversion=2008062709)

[Grass strip basher]

At $140 a barrel I imagine even Ryanair will be printing a loss!

[chrisbl]

Oil will be $200 Barrel by Christmas.

[maxter]

chrisbl "Oil will be $200 Barrel by Christmas."

Chris I would be very interested in what makes you belive this. You just make a statement with no suport, which makes little sense to me.

I have no idea if you are right or wrong but would love to know the facts as you see it.

[nich-av]

The euro went over 1.58 against the dollar today.

That partially explains today's surge to 142.

Assuming that the dollar retains its actual value against other currencies and that oil would rise to 200$, the world's entire economy would be grounded. The only airlines flying around would be Emirates, Gulf Air, and their likes.

But before anything like that happens, oil countries will swich oil trading to a new currency, leaving the US to their mercy. OPEC has the power to do that.
If oil goes over 150$ before the September OPEC meeting, you can count on that happening.

[heli_port]

chrisbl i personally don't believe it will this year. I think around christmas time we will be looking at a price around the $180 margin. All the traders in my office believe this but then they have been wrong before :}

In 2009 they believe $250 is achievable :{

Libya’s oil cut threat sends out jitters
FT.com / In depth - Libya’s oil cut threat sends out jitters (http://www.ft.com/cms/s/0/b9452ebc-4470-11dd-b151-0000779fd2ac,dwp_uuid=f2b40164-cfea-11dc-9309-0000779fd2ac.html)


Analysts on Friday dismissed a threat by Libya to cut its oil production in response to legislation that would allow the US to sue Opec members for manipulating international oil prices.

The Libyan threat caused oil prices to jump above $142 a barrel for the first time on Friday, serving as a stark reminder of the nervousness in the oil market due to the small amount of spare production capacity available to absorb any supply shock.


Airlines: Flight plans hit by fuel price
FT.com / Reports - Airlines: Flight plans hit by fuel price (http://www.ft.com/cms/s/0/0988deb0-3f43-11dd-8fd9-0000779fd2ac.html)


Europe-based carriers, too, including British Airways, warn that capacity must be trimmed.


:*:p

[A and C]

Most of you are of the opinion that the crash in the UK house market is a result of the over speculation and price hype by estate agents to a point that the market could no longer suport the over inflated prices.

Do we not see exactly the same pressure in the oil market? I cant see oil ever falling to the $80/barrel mark but the speculation bubble will eventualy burst.

[Wee Weasley Welshman]

The key difference is that the House Price Bubble was played by amateurs whereas the Oil Price Bubble is played by professionals.

You don't see many 22yr old hair dressers from Leeds swapping their BuyToDebt "portfolios" for a 6 month Contract-For-Difference on the price of Light Sweet Texas do you?

The oil price also has a fundamental behind it which is lack of refining capacity and the costs of exploration to satisfy the needs of the industrial revolutions taking place on a quarter of the globe.

Whereas house prices were simply a function of relaxed lending practice coupled with classic bubble mentality that made people believe that it was a one way bet. Some believed it so much they created unlimited liability trading companies out of it who used massive gearing and debt to speculate on the market (Buy To Let). As these idiots go bust or have to panic sell their 'portfolios' they are crashing the housing market far faster than it ever crashed in the last crash of the early 1990's. 40% of UK average house prices from peak to trough is now looking highly likely. Worse than last time. And faster.

I can't see a barrel of oil doing anything like that i.e. going to $84. I hope it does though. I really do.

WWW

[dartagnan]

oil will be at over 250$-300$ :eek:the baril before end of 2008. want bet?
the inflation you see is just the top of the iceberg.

[heli_port]

http://i300.photobucket.com/albums/nn3/heli_port/pic2cr.jpg

Two storms are buffeting the world economy: an inflationary commodity-price storm and a deflationary financial one. Last week I argued that exchange-rate regimes were a link between these distinct events. This week, let us look at how to sail on these storm-tossed seas.

http://i300.photobucket.com/albums/nn3/heli_port/piccr2.gif

FT.com / In depth - How to see world economy through two crises (http://www.ft.com/cms/s/0/6459fb74-420b-11dd-a5e8-0000779fd2ac,dwp_uuid=f2b40164-cfea-11dc-9309-0000779fd2ac.html)

[Grass strip basher]

Some truely awful data out on the UK mortgage market from the Bank of England this morning... all ye who still think "everything is going to be fine" really are now pissing into a hurricane.... the storm is a coming folks

[heli_port]

The number of new mortgages being approved for house purchase in Britain has dropped heavily for another month.

The Bank of England said 42,000 homes were approved in May, a 28% fall compared with the previous month and 64% down on a year ago.
This is the lowest since the Bank began reporting the figures in 1993 and lower than many analysts' predictions. Mortgage lending has slumped owing to the credit crunch with institutions reducing their willingness to lend.




BBC NEWS | Business | New low for UK mortgage approvals (http://news.bbc.co.uk/1/hi/business/7480834.stm)

[RVR800]

Dont panic guys it will blow over ... but how soon?

I hope there wont be too many job losses due to this massive fuel surge though.

MOL said that at over $130 Ryanair would be in loss on TV

[Wee Weasley Welshman]

The house price crash of the early 1990's ran from 1989 through to 1994. House prices only started to rise in 1996. All in real terms.

4 years of house price crash and 3 years of recession - John Majors green shoots of recovery kept taking an awful long time to appear. Airlines lead into a downturn but also into a recovery. By 1998 BA were generating massive profits and new Airlines were starting up all over the place and prospering.

2013 looks like a good time to start flying training based on the last recession we saw. Of course, history does not repeat itself - it does rhyme though.

Be in no doubt of the basic chronology. A house price and debt bubble bursts. The causes a recession. The recession makes the house price crash worse. The recession deepens. Airlines go bust. Wannabe go to soup kitchens.

You've already felt the tremours with Oasis, MaxJet, SilverJet, EuroManx and Eos. A big quake is certain for the Autumn/Winter 08/09. It might be enough to set off a Tsunami.

Overnight Dollar Libor just climbed to 3.61% over a spot of 2.5%. This is a huge rise. The Fed has got the printing presses running on overdrive, ignoring inflation and those Sheiks ain't going to lower the price of their crude in exchange for ever more worthless Dollars. And why should they? I wouldn't. The US might default.


WWW

[ReallyAnnoyed]

Now for some good news: The second most expensive international research project in the world (I guess you have to disregard all the Black Ops US Defence projects in this contest) is stable fusion power generation. The scientists hope to have it working by 2050-60 - and scientists are never wrong with theories as you know :E . If it works then there will be enough energy to sustain ten billion people at a Western energy consumption level per citizen for 5,000,000,000 years and by then the Earth has been swallowed by the sun (helium has a far smaller density than hydrogen). So, no worries lads, you'll get that job sooner or later and 40 years is no time to wait for this nice job :}

[heli_port]

Crude oil prices have surged to near $144 a barrel as oil-producing nations and the world's largest oil firms meet in Madrid to discuss soaring prices.
BBC NEWS | Business | Oil breaks new ground above $143 (http://news.bbc.co.uk/1/hi/business/7480703.stm)

[Grass strip basher]

So are any of the big training schools now introducing "fuel surcharges" yet on top of the published prices for their courses?? Will be interesting to see when that starts to filter in

[heli_port]

I would think sooner rather than later grass. I was talking to a very good friend of mine that works in the loans department for HSBC and they are looking seriously at stopping OAA/CTC loans :hmm:

House prices 'fell 0.9% in June'

UK house prices fell by 0.9% on average last month, according to the latest survey from the Nationwide.

BBC NEWS | Business | House prices 'fell 0.9% in June' (http://news.bbc.co.uk/1/hi/business/7482115.stm)

[Wee Weasley Welshman]

Annual house price falls worst since 1992 - Times Online (http://business.timesonline.co.uk/tol/business/money/property_and_mortgages/article4246511.ece)

Annual house price falls worst since 1992 The Times


UK house prices in grip of slump that experts expect to deepen The Telegraph


The growing evidence is now growing fact. Be assured that house prices are a close correlation to airline prosperity. Things are DIRE.

DIRE.

WWW

[chris-squire]

HSBC Loans stopping.......

The only way this will happen is if house prices fall to a level that means any security over the loan becomes a bit shaky. As long as HSBC's money is safe I rekon they'll carry on with it, the amount of money they make out of those loans vs the risk that they face with them means that it's only logical to carry on. However it wouldn't surprise me if they some how changed the way that the loan scheme works. Perhaps they'll reduce the amount of money on offer or maybe shorten the repayment term. Who knows. One thing is for sure....the next year or so looks to be pretty interesting for everyone connected to aviation!

:ok:

[Alex Whittingham]

I would think it would depend on the number of defaults they get, particularly for the unsecured loans.

[chris-squire]

Absolutely, it won't take many defaulted payments to cock the whole thing up. I wasn't aware that they still offered any unsecured loans. When I first approached HSBC to sort out my loan they made it pretty clear that any loan offered would have to be secured. If they are still offering anything unsecured then that's bound to change pretty soon.

To be fair I only have experience with the Cabair/HSBC relationship. I'm sure each of the FTO's that HSBC support have a slightly different deal for their students.

[Wee Weasley Welshman]

This is the fox in the chicken coup.

Very soon some graduates from the various bank-funded schemes that claim sponsorship status (I'm looking at you Dibden) will not find a job. Certainly not one that will pay them a living wage plus loan repayment.

As soon as the first unlucky youungster with no dependents, no assets and a big loan realises that he or she can go bankrupt and have it over with in less than 24 months then the flood gates will open. Bank loans will evaporate in the middle of the afternoon that the judges insolvency judgement is handed down.

You cannot persue a debt against a man who has nothing, no means to pay and a court protecting him.

You certainly can't take his little blue CAA license book away from him.

The banks will work this out eventually.

The schemes as they stand will die on their arse.


WWW

[chris-squire]

WWW - I'm pretty sure the scheme's of old have already died on their arse as a result of guys deliberately going bankrupt. I don't know that they will offer £60k unsecured anymore. When I asked HSBC why they wanted my loan to be 100% secured they basically said that too many people have defaulted on repayments soon after training so it's obviously made them nervous. Hence my surprise to hear of any loans being offered unsecured. Infact, not only did they insist upon having 100% security against the borrowing, they also insited on having a legal charge over my life insurance policy!

It will be a shame if HSBC do call a day on these loans but I fear a few bad apples could really screw it up for everyone else once and for all if they are still offering unsecured loans.

[Wee Weasley Welshman]

Are we talking about loans arranged by CTC for cadets whom they intend to place with airlines?

I am aware that personal loans have died. It is the death of loans arranged by the FTO that I have in mind.


WWW

[chris-squire]

Ah think we've crossed wires. My loan is to train with Cabair. The CTC thing works slighty differently I believe, not sure how but I know it's set up differently.

The bog standard PSL available for trainee pilots now has to be 100% secured I think. I can't speak for the other FTO's but that's certainly the case with Cabair.

[heli_port]

Global oil supplies will grow more slowly than expected over the next five years, the International Energy Agency (IEA) has predicted.

BBC NEWS | Business | Watchdog cuts oil supply forecast (http://news.bbc.co.uk/1/hi/business/7483312.stm)

[v6g]

Global oil supplies will grow more slowly than expected over the next five years, the International Energy Agency (IEA) has predicted.

- I'd be surprised if there's any supply growth at all - it's been declining for the past year and a half already.

[UAV689]

a very interesting topic. Am doing my atpl's now and cannot believe that youngsters are getting these huge loans to fund training.

The safest and most intelligent way is to get a job, go modular and have a fall back plan. As pilots/future pilots we are supposed to be intelligent individuals able to weigh up decisions and always have a back up plan. Get a career, dont get loans, even if you think you can pay them now, you may not in the future.

In my case I am working 7 days a week,2 jobs (next day off is Aug Bank Holiday!) and should have enough money in 12 months to complete the fAtpl, when I get a job it will taste so much sweeter through the hard work I have put in, and if it doesn't I have a good fall back career, keep my license valid, and in the worst case if it doesn't pay off for me I know in my heart I have tried and it will have cost me nothing but time, I will be debt free.

It is very interesting to debate where the economy is going to end up - I work for a large retail company setting the budgets/profit targets to be met for the up coming seasons and certainly we are not predicting declines in sales. I know a number of retailers that are also achieving growths (some massive) and others that are suffering the downturn. The same will happen in aviation, it doesn't take a genius to see that the strongest buisness models are the loco's and the legacy carriers will struggle the most, especially those dictated to by unions.

I agree with Nichibei that traffic volume is best indictator to demand for pilots, not share prices. I think he does speak a lot of sense, he maybe biased due to his own interests (am 90% certain i will contact his school in the future!)

AZ going under is a big worry for me - but they have been on the brink for the last 10 years, and if they do other airlines will take up the slack by flying their routes and hopefully more a/c to do so.

Play Safe, have a back up, stay away from banks - they gain while you lose.

[student88]

Hi Guys and Girls,

Just looking for advice. A friend of mine is due to start at OAA in 5 weeks. He's got the finance on a loan secured by his parents house. I've tried to make it clear to him that I think he's making a bad move starting at Oxford during what seems to be a very rough few years for the industry. He's only 18 and I've suggested maybe he goes to work for a few years, gets some experience from the university of life and maybe saves some cash for when/if the industry starts to pick up again. Now I'm no fool, I have plenty of industry experience, but am I being harsh or am I doing the right thing?

What do you suggest?

S88:ok:

[Wee Weasley Welshman]

Let him be fodder to the machine gun of reality. He will be upholding a noble tradition which keeps flying instructors in Farra trousers and David Clarke headsets.

WWW

[chris-squire]

UAV - I'm not exactly a youngster compared to many people I've come across in FTO's to date but I know what you're getting at. I worked my arse off to make sure I have a back up career to fall back on should all go tits up. Ensuring that I could always make the repayments regardless of the outcome in aviation was a massive part of my financial planning. My parents have been amazingly supportive and were willing to put their house down as security because they know that I can pay it back. The last thing I would do is repay them by dumping £60k's worth of debt on their doorstep.

However if I were 18 again and looking to borrow this much money without a back up plan.....not a chance I would get into flight training given the current economic climate. I was already commited to it with deposits and flights booked etc just before the economy started going haywire. Scary times ahead folks....hold onto your hats!

[A and C]

Tell your mate to get a job, save some money and go modular! by the time he has finished his traning he should be well placed to ge a job as we are coming out of this economic downturn.

I have always recomended spending your own money rather than the banks at a price.................... its about the only thing that you will find WWW and myself agreeing on !!

[bjkeates]

He's got the finance on a loan secured by his parents house

In my humble opinion, anyone who does that in the current climate is stark raving bonkers. I hope both he and his parents understand the risks involved.

[spinnaker]

Cheer up, property prices are rising again.......in Bagdad (http://news.bbc.co.uk/2/hi/middle_east/7482307.stm) :E

[heli_port]

Could the massive untapped Oil fields in Iraq eventually herald a return to sub $100 a barrel levels?



If the reserves are sufficient to quench the thrust of industrial nations I believe so (i.e. if supply meets demand) but I believe it will happen in the long run due to the introduction of alternative fuels.


Cathay expects ‘disappointing’ 2008 results
FT.com / Companies / Transport - Cathay expects disappointing 2008 results (http://www.ft.com/cms/s/0/539e35c4-47fc-11dd-a851-000077b07658.html?nclick_check=1)

HONG KONG, July 2 (Reuters) - Cathay Pacific (http://markets.ft.com/tearsheets/performance.asp?s=hk:293) warned on Wednesday of ”disappointing” first-half earnings after Asia’s third most valuable carrier was forced to pay 60 per cent more for jet fuel in the first six months, on average

[Re-Heat]

I agree with Nichibei that traffic volume is best indictator to demand for pilots, not share prices. I think he does speak a lot of sense
Hence the recent chops in US aircraft fleets should make you very nervous.

Perhaps you thinking only of deliveries, and not what is being sent to the desert.