Why do airlines sponsor?

[worzel]

Now that the job market is starting to pick up, the rumours of sponsorship have started. At the moment there are hundreds some people say possibly 1000 unemployed licence holders in the UK, with experience ranging from low hours to JET/Turboprop time.

Now we can say that approximately 1/3rd of them (us), you wouldn't want to give a job to and possibly another third aren't up to flying commercially in big(ish) jets. Even if this is the case there are still a load of good unemployed pilots out there willing to move anywhere and work their arses off.

So why sponsor? Some people say that Airlines like to mould you to their way, well they can do that in the sim when you start your training. I think that if you have a good school/instructor, you can be taught the importance of professionalism but lets face it VFR Nav in a single piston, is not Airline Flying.

Airlines are always trying to save money, so why dont they save the cash their throwing at sponsorships and just employ someone who's already qualified.

Or is there another reason why they sponsor?

[oxford blue]

Because major players (BA, bmi, etc) want only the best for their pilots. They can afford to be quite incredibly selective if they're going to shell out the training costs, so they are.

They then tend to keep these very high calibre young men and women. It works out cheaply enough in the long run and it keeps the standard very high indeed.

[Windy]

Also in terms of cost - most the airlines recover all the costs of the sponsorship partially through up front payments (Britannia, Air 2000, British European, etc...) and then lower salaries when the individuals qualify (all the above inc. BA).

Therefore the companies get the people they want through though selection processes and recoup all the training costs over a number of years - they get the best people for free, win / win situation.

[worzel]

Thanks for the reply's, but it still seems to me that they're wasting their money. There are so many pilots out there looking for work, so they can still be incredibley selective in their interviews and get just the kind of people they're looking for. Also it's been mentioned on this forum many times before that a lot of wannabes are willing to work for next to nothing (be it a bad thing or not), so they can keep the salaries low to start with. Therefore they achieve the same result and save in the region of £50 000 a head. In addition to this they dont take the gamble that their cadets will fail any exams/flight tests as they have passed them all already.

Its basic economics. I recommend all Chief Pilots recruit self sponsored pilots from now on....Starting with me.

[VFE]

In my experience of training alongside both self-sponsored and airline sponsored cadets I can honestly say that there wasn't a great deal between them in terms of ability on the whole. Sure, there was the odd CEP who was above the above-average standard but then so were some of the self sponsored students, even more so in some cases.

I do find it strange that an airline would still be willing to sponsor a cadet especially after 11th September as there are so many qualified pilots in the pool and will continue to be so for some time. I think the airlines would be throwing money away to be honest. Far cheaper for them to tap into the integrated schools database and seek out above average self-sponsored pilots then give them a contract they must stick to for two years or whatever to ensure loyalty.

Sorry - just my opinion.

VFE.

[foghorn]

IMHO, airline sponsorship schemes exist for two reasons:

Firstly, to keep the government off the industry's back. The Government (at least the Treasury) considers that all pilot training ab initio should be paid for by the industry. That line is regularly churned out in their justification for charging VAT on training fees, as companies can claim the VAT back. If all sponsorship schemes were cancelled full stop the government would castigate the industry for being elitist etc. (despite the fact that plenty of humble people manage to self-sponsor). During bad times industry can get away with not running CEP schemes, but governments (of any colour) would get seriously shirty if it never happened, as there are few major careers in the UK where training fees are not at least in part paid for by either industry or the government.

Secondly, it is a prestige thing for some airlines. This is the only other justification I can think of.

I don't buy the argument that airlines need to sponsor to guarantee a reliable supply of high-calibre pilots - the last ten years have proven that there is a relatively large oversupply of unemployed or instructing CPL/IRs at all points in the economic cycle.

Nor do I buy the argument that CEPs are more loyal - airlines will get loyalty from DEPs by bonding for a type rating anyway, plus much of the loyalty that CEPs give to their sponsoring company comes from the fact that the airlines that sponsor tend to be those at the top of the food chain with the best remuneration/best crew lifestyles/best crew employment prospects etc. etc.

It must be possible for an airline to construct a scheme to deliver a reliable and relatively large supply of low-hour DEPs with no airline experience who are 'airline material'. Even if a major selection process were required over and above that usually used to filter more experienced DEPs, surely it would still be much cheaper than running a CEP scheme (especially a fully-funded one like BA's)? After all an Instrument Rating skills test pass is one hell of an initial filter to applicants, and it costs nothing to a hiring company to demand a CPL/IR as an application pre-requisite.

It is therefore surprising that none try to do this. Either they know something that I don't (quite feasible), or they are just overlooking a big cost-saving opportunity. In fact, thinking about it, there are two schemes that do exactly this however they are both small, one is the Astraeus/pprune scheme (in its infancy; long may it continue), the other is not directly run by an airline and requires payment of course fees as a part of the selection process: CTC's ATP scheme.

Overall, I agree with the posters above, with such a large pool of self-sponsored CPL/IRs sat around unemployed/instructing, the industry would be seriously wasting money and resources by running CEP schemes so soon after the Sep-11 shock without attempting to capture the better of those unemployed pilots already with licenses (this does not necessarily mean those with the highest hours). However in my position I would say that, wouldn't I?

cheers!
foggy.

(edited because I forgot about Astraeus!)

[VFE]

Hmmm, interesting theory Foggy. Never thought about the Government aspect of this but the more I think about it after reading your post the more it seems quite probable!
Would be nice to think the government could be getting a little concerned seeing as there are a whole bunch of CEP's still waiting to go into JOC & line training with no sign of things improving 10 months on. Then again..... :rolleyes:

VFE.

[foghorn]

Just to clarify I don't think that there is any government intervention at the moment, or has been in the (near) past, I just think that the large players are aware that the government may not be happy if they didn't provide an industry-funded ab initio route to at least some people.

foggy.

[Stealth]

Airline sponsorship schemes are there to provide free education for captains’ sons and not a filter for the best of the best. This is true for most of the airlines around. :D

[Saint00]

It is very diffrent from country to country. I think Sweden is the only country that have fully funded university program up to ATPL. In Sweden there is also goverment funded highschool pilot programs. The question in here is why the airlines have sponsored traning instead of using self sponsored pilots. Like in every other country there are to many pilots and to few jobs. Then you can ask yourself why the goverment is training more than ever when there are many self sponsored pilots out there without a job. That the goverment should pay is a trend that started just a couple of years ago.
I can not se any logical explanation for either airline sponsored programs or goverment sponsored programs when the market is as it is.

[worzel]

Foggy, I like your theory about government intervention and I think you've got a point.

Apart from VAT are there any other taxes or training costs the airlines can claim back? If they could offer sponsorships, look good in the political and public eye for providing free training and jobs, soak up the publicity, then claim near enough all the money back they really would have a win/win situation.

worzel

[foghorn]

Airlines can claim the VAT back on training as a legitimate input for their business.

The cost of the training is also a legitimate business expense for corporation tax purposes which means that they pay for the training out of untaxed income. This saves them up to 40% of the costs relative to an ordinary person (who is paying out of post-tax income).

Annoying isn't it. Once you include AVGAS duty of 27.34p per litre (which no-one can reclaim unless you leave the country) nearly 50% of the hard-earned money you pay for your training goes straight to Gordon Brown. As if paying for your own education is a luxury to be taxed to death.

And people wonder where the term 'rip-off Britain' comes from. We have a poster on the wall at work that says 'WORK HARDER: Millions on benefits depend on YOU!' Not so far from the truth...

foggy.

[GonvilleBromhead]

Don't work for the DSS do you foggy ? ;) :D