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View Full Version : UK government says no industry-wide bailout for aviation


LTNman
24th Mar 2020, 20:32
https://www.theguardian.com/uk-news/2020/mar/24/uk-airlines-and-airports-told-not-to-expect-industry-wide-covid-19-bailout

CaptainProp
24th Mar 2020, 21:16
Was Sunak not just the other day saying that the airline industry would be supported to provide liquidity to help it through these coming months???

CP

TheFiddler
24th Mar 2020, 21:46
Well done EasyJet Senior Management.

Fortissimo
24th Mar 2020, 21:58
The Govt response should be to provide support, less the £X million operators insist they have to pay out as dividends. It will then be up to the shareholders to decide whether to go bust and lose all their dosh or put the dividends back into the business.

lomapaseo
24th Mar 2020, 22:08
The Govt response should be to provide support, less the £X million operators insist they have to pay out as dividends. It will then be up to the shareholders to decide whether to go bust and lose all their dosh or put the dividends back into the business.

If they have to give up their dividends wont they just sell their stock and invest elsewhere?. Thus driving down the price of the stock which ends up defeating the company's value that way?

ORAC
24th Mar 2020, 22:20
........the chancellor’s comments dismayed industry leaders, who accused the government of performing a U-turn on funding for the sector a week after the chancellor floated the suggestion of targeted financial cash to help keep planes in the skies.

The International Air Transport Association (Iata) warned that airlines in Europe would be worst hit by the global decline in travel prompted by the coronavirus pandemic. It said that European airlines were expecting an average 46 per cent drop in income this year compared with 2019. The Airport Operators Association (AOA) said that passenger numbers at some UK airports were “approaching close to zero” and a number were already considering “shutting down for a period of time” after a collapse in income.

Airports are maintaining operations as hubs for air freight, bases for search-and-rescue operations and to provide links to the offshore oil and gas industry. However, Karen Dee, the AOA chief executive, said that “all of that is now put at risk by the government’s decision”.

She added: “While countries across Europe have recognised the vital role airports play and are stepping into the breach, the UK government’s decision to take a case-by-case approach with dozens of UK airports is simply not feasible to provide the support necessary in the coming days. Not only does the decision today leave airports struggling to provide critical services, it will hamper the UK recovery . . . We urge the government to reconsider and at the very least provide a comprehensive package of support for airports and ground-based services, to ensure the UK’s critical aviation infrastructure is ready to take off once the Covid-19 pandemic recedes.”

captain8
24th Mar 2020, 23:23
I can’t feel sad for BA, Virgin , Skyteam et al.
huge profits. Big dividends. Nothing for a rainy day. Stand up for yourselves, and take it on the chin. You won’t make fat and obscene profits this year. And perhaps the public will not be so over indulged with cheap flights anymore, post virus.

The elephant in the room is Norwegian. Cant be too long surely ?

cashash
25th Mar 2020, 00:08
If the airports and airlines are already benefiting from the measure announced last week (tax holidays, employee wage support etc) what more do they need?.

OzzyOzBorn
25th Mar 2020, 01:40
Unfortunately, this young chancellor is mesmerised by the aura of St Greta. He totally buys into the whole armageddonist vision of the global warming religion. No doubt he believes he has single-handedly saved the planet with this ill-judged announcement. He will learn ... but too late for many of our familiar airlines and airports. Sajid Javid was much more pragmatic. Real pity he has returned to the back benches.

marchino61
25th Mar 2020, 05:15
Unfortunately, this young chancellor is mesmerised by the aura of St Greta. He totally buys into the whole armageddonist vision of the global warming religion. No doubt he believes he has single-handedly saved the planet with this ill-judged announcement. He will learn ... but too late for many of our familiar airlines and airports. Sajid Javid was much more pragmatic. Real pity he has returned to the back benches.

Sorry, no bailouts this time. The banks had to be saved last time to prevent the collapse of the financial system. No need for the same for airlines.

I think the government could provide loans where needed, but secured against assets, and with the option of converting to equity in the case of non-payment.

LTNman
25th Mar 2020, 05:32
We have to remember how the likes of BA and Easyjet kicked off at the prospect of Government support for Flybe only a few weeks ago.

robdean
25th Mar 2020, 07:17
Unfortunately, this young chancellor is mesmerised by the aura of St Greta. He totally buys into the whole armageddonist vision of the global warming religion. No doubt he believes he has single-handedly saved the planet with this ill-judged announcement.
This belief of yours is based on robust peer-reviewed data and calculations that are at this moment sensationally overturning expert scientific consensus?
Otherwise you are the deluded cultist.

beardy
25th Mar 2020, 07:58
So no change to Government policy in order to make airlines and airports a 'Special Case'. That's all. So why the anguish and tears? Why should they be treated differently?
​​​​​​

ShyTorque
25th Mar 2020, 09:16
Some airlines will never recover from this and I think we might have seen the end of low cost air fares, at least in the short term.

Atlantic Explorer
25th Mar 2020, 09:26
Some airlines will never recover from this and I think we might have seen the end of low cost air fares, at least in the short term.

Some might say, that’s not a bad thing!

Dan_Brown
25th Mar 2020, 09:59
Unfortunately, this young chancellor is mesmerised by the aura of St Greta. He totally buys into the whole armageddonist vision of the global warming religion. No doubt he believes he has single-handedly saved the planet with this ill-judged announcement. He will learn ... but too late for many of our familiar airlines and airports. Sajid Javid was much more pragmatic. Real pity he has returned to the back benches.

Look, we have all taken a big hit, over this. Let's face it, we have had it good. In fact we never had it so good, in the past. The Govenment aren't perfect, never have been and never will be. Man has made a complete mess of our world.

Stop moaning!! We are all in this together.

If I survive this I want to live in a world where greed and wars (caused by mans greed) won't be there. Dream on? We'll see.

marchino61
25th Mar 2020, 09:59
Some might say, that’s not a bad thing!

As long as this does not go on too long, Ryanair will be hammering the other airlines with low-cost fares, and demand may well be lower than before.

O' Leary will be looking to deal a knockout blow to the competition.

GROUNDHOG
25th Mar 2020, 10:21
The right decision. What is so special about airlines? Ferries, taxi's, coaches, Hotels, tour operators, caravan sites and on and on have all sen their businesses decimated by the travel ban, where do the bailouts end.
If it is the end of cheap flights then so be it, more people will holiday at home creating more employment in the UK leisure sector and improving our economy even further.
No more unnecessary flying just for the hell of it.
( spoken as someone guilty of doing exactly that during the past)

Bob_Harris_721
25th Mar 2020, 10:30
It's horrible to watch an industry that has been so carefully created simply thrown to the dogs. Aviation is as worthy of government support as anything else, though the matter of demanding help whilst paying dividends is unforgivable even if contractual. A million employment contracts have been broken by employers, so why not one to shareholders?

It seems supremely ironic that only yesterday Willie Walsh threw a tantrum over support for Flybe, and now he sees nothing wrong in government money arriving in BA!

When air travel does resume, I think it will be expensive and only for the comparative few.

My heartfelt thoughts are with all those whose futures are in doubt. Being over 65 and past it has its benefits.

flocci_non_faccio
25th Mar 2020, 10:36
When air travel does resume, I think it will be expensive and only for the comparative few.


I personally just can’t see that. I think the aviation industry is going to come out of this smaller than it went in, but there is still going to be the usual demand for bucket and spade, package holiday flying (thinking purely about the UK market here).

I’m a pessimist and I do think for various reasons airline flying as a career is dead, but equally I do think that flying will still be happening in mass market quantities after this.

My heartfelt thoughts are with all those whose futures are in doubt. Being over 65 and past it has its benefits.

On that point I agree completely. A large number of pilots are about to find out that the jobs market is an unforgiving place for those with no real back up plan or qualifications. A lot of people are going to be facing the replacement of £100k+ a year jobs with a career in minimum wage employment at best.

DaveReidUK
25th Mar 2020, 10:43
I think the aviation industry is going to come out of this smaller than it went in, but there is still going to be the usual demand for bucket and spade, package holiday flying (thinking purely about the UK market here).

Because we know that leisure travel isn't at all price-sensitive ...

BRUpax
25th Mar 2020, 11:22
I think that once the virus is away (or under some sort of control) the airlines which survived will do whatever it takes to get bums back on seats. So, I'm not convinced that this will equate to higher fares.

RoyHudd
25th Mar 2020, 11:27
Once this is over, the dictators in Dubai, Abu Dhabi and Qatar will attempt to dominate the world premium air travel market. Subsidised. They will be making plans now.

To avoid this take-over, the UK needs to have its planned and under-written global carrier/s ready to go. Otherwise we will lose again to the Arabs, not a tasty outlook. Protectionist barriers are needed. Stuff EK, ET, QR, and even possibly the Norwegians.

The opportunity will soon exist to beat them at their own game. Let us get ready, with a force of maintained airliners, current crews, and new regulations from the CAA. No red tape.

V12
25th Mar 2020, 11:38
I can’t feel sad for BA, Virgin , Skyteam et al.
huge profits. Big dividends. Nothing for a rainy day. Stand up for yourselves, and take it on the chin. You won’t make fat and obscene profits this year. And perhaps the public will not be so over indulged with cheap flights anymore, post virus.

The elephant in the room is Norwegian. Cant be too long surely ?

Herds of elephants, actually

If this goes on 6+ months, then why save airlines that are not optimally structured for the recovery (which will be torridly slow); then Govt can patch together a nationally-owned carrier and use the optimal equipment to build up an efficient structure for what the new world requires. Like who is going to choose to voluntarily go on holiday in the next year and sit next to 180-400 passengers for 3-12 hours separated by 17" left and right, and 32" fore/aft? The first cough or sneeze and panic will start.

Without being political, what seems most strange is that all the right wing Tory policies that they thought served them best over the last 12 years (corporate super-profits, austerity for the working classes, privatising the NHS, stopping the nanny state, and going ultra-small state intervention, oh and isolating ourselves from our colleagues in Govts across Europe who want a collaborative approach).... are now seen as completely the opposite of what we all are crying out for now (care workers, nurses, delivery drivers, sorters, stackers, ie: all those on minimum wages, gig economy types, and migrants that we apparently thought should go home). Since 2016 we have driven 50,000+ NHS workers out of the country because we didn't want them.

And most ironically, it could be that in 6 months China has the answer to everything we need, and the USA is crippled beyond belief.

But I may be wrong. Hey ho.

Jim59
25th Mar 2020, 12:40
Not being part of the CAT industry I can understand why air transport might be at the bottom of the support list. Without passenger air transport irresponsibly carrying the virus to virtually every corner of this planet in a remarkably short period of time we would not have this pandemic that is causing so much harm to the rest of the economy - not to mention those who unfortunately have not recovered or will not in the future. APT to/from affected areas should have ceased right at the start. It didn't due to greed.

torvalds
25th Mar 2020, 13:32
It is time to cut the umbilical cord. It is called private *business* for a reason. Free market (real capitalism) has to sort itself out. No more of this routine bailout mentality needed.

CaptainProp
25th Mar 2020, 14:14
It is time to cut the umbilical cord. It is called private *business* for a reason. Free market (real capitalism) has to sort itself out. No more of this routine bailout mentality needed.

And what will the cost of this be to the taxpayers? Virtually every other european gov is coming out with packages offering temporary loans to support the industry and save jobs. Loans, not handouts. Some of the British companies have asked only to get access to funds to get through this and then pay back on commercial terms, I can’t really see whats wrong with that??

CP

torvalds
25th Mar 2020, 14:39
And what will the cost of this be to the taxpayers? Virtually every other european gov is coming out with packages offering temporary loans to support the industry and save jobs. Loans, not handouts. Some of the British companies have asked only to get access to funds to get through this and then pay back on commercial terms, I can’t really see whats wrong with that??

CP
Could these companies turn to the banks on their own initiative and ask them directly for these loans?

kontrolor
25th Mar 2020, 14:44
nationalization comes to mind...and kick out those blood sucking CEOs who's wages largly depend on stock exchange values.

torvalds
25th Mar 2020, 15:00
nationalization comes to mind...and kick out those blood sucking CEOs who's wages largly depend on stock exchange values.
That's what aviation needs, government ownership. That will save our jobs and will give us job security. Make the airlines too big to fail. And why stop there, make/designate everything too big/too important to fail. Start with airlines and airports, then we nationalise the road transportation and rails, then agriculture next, car makers, groceries, window cleaners, etc. In the end we need all of these and more. Where is the end of this?
We might as well stop all private businesses and go full Soviet style. You know, just cut the middle man. We have all the "generated" money there is. We can not run out of those.
And please don't try to bring me down with those negative sentiments like "What about responsibilities and commitments, or pursuing unlimited growth while dealing with finite resources on our planet, sustainability of population growth, our freedom, the right to own private properties, the corruption what socialism brings, geopolitical tensions it results in". Those are for schmucks.
Maybe the answer is centralizing the power and control everything. Nobody's ever tried that, so why not give it a go. We could call it erm, I don't know, communism?

Nevertheless, I believe you are right and we are going to go on full retard and chose the easy way out again. At any rate, that's how it is lately, never to solve a problem just kick that can..

cashash
25th Mar 2020, 15:23
It seems supremely ironic that only yesterday Willie Walsh threw a tantrum over support for Flybe, and now he sees nothing wrong in government money arriving in BA!



To be fair to Mr Walsh (and I hate doing it) he has been against a government bailout of the industry. Some say its because BA is sitting on an £8Bn warchest and want to drive the competition (Virgin) out of business, but I couldnt possibly say. ;)

procede
25th Mar 2020, 15:29
We could call it erm, I don't know, communism?
The fundamental goal of the economy is to keep the majority of the people occupied in a meaningful way. The problem with Communism is that there are no proper incentives, which causes people to become lethargic. Capitalism uses a carrot and stick approach to solve this, which means that people who are good at the game start to collect an ever growing part of the pie at the cost of others. Unfortunately the game has stopped now, meaning a lot of people are left with nothing. We need a system that makes a more acceptable trade-off between the two.

CaptainProp
25th Mar 2020, 15:52
Could these companies turn to the banks on their own initiative and ask them directly for these loans?

Commercial equity has all but dried up, even for companies that have preformed very well over long time and that have not required government support before, so I would say probably not.

CP

zfw
25th Mar 2020, 16:13
"Some airlines will never recover from this and I think we might have seen the end of low cost air fares, at least in the short term".

That already seems to be the case. Virgin have been absolutely creaming it at MAN since TCXs demise, there have been some eye watering prices over Christmas like £7k in economy to BGI { £810 from LGW on BA}. Even Jet2 have gone from the usual £275 quid return to over £400.
I can only see that these will rise again when the survivors have a market clamouring for a break.

zfw

torvalds
25th Mar 2020, 16:26
Commercial equity has all but dried up, even for companies that have preformed very well over long time and that have not required government support before, so I would say probably not.

CP
Exactly that is my issue here. If a bank (what is an expert in analysing risks and business finances -and it operates in the private sector) doesn't find a company to be worthy of a loan, then why would we ask the "taxpayer" to underwrite it instead?

Good Business Sense
25th Mar 2020, 16:35
Commercial equity has all but dried up, even for companies that have preformed very well over long time and that have not required government support before, so I would say probably not.

CP

Agree

Unfortunately, the banks turned off the cash to most in January by holding back credit card sales cash.

.... and if 10% of companies get the interruption loans i'll eat my old uniform.... if you need cash the banks will not take the 20% risk and give it to you.

Skipness One Foxtrot
25th Mar 2020, 16:48
I can’t feel sad for BA, Virgin , Skyteam et al.
huge profits. Big dividends. Nothing for a rainy day. Stand up for yourselves, and take it on the chin. You won’t make fat and obscene profits this year. And perhaps the public will not be so over indulged with cheap flights anymore, post virus.

The elephant in the room is Norwegian. Cant be too long surely ?
The only way to pay for the re-equipment is the "fat and obscene profits". Unless you make a lot of money, and aviation over the period doesn't, you can't buy new aircraft. The capital costs are ball crunching. But I agree the timing of paying a dividend to shareholders given where we are now, is insane.

torvalds
25th Mar 2020, 16:50
The fundamental goal of the economy is to keep the majority of the people occupied in a meaningful way. {...}

The game stopped in 1971. Since then we have this funny-money (FIAT) and more recently only digits on computer screens. This accelerated (and made easier) the wealth extraction/transfer. Braking down/dividing the society even further.
Agree, make capitalism great again.

CaptainProp
25th Mar 2020, 16:54
Exactly that is my issue here. If a bank (what is an expert in analysing risks and business finances -and it operates in the private sector) doesn't find a company to be worthy of a loan, then why would we ask the "taxpayer" to underwrite it instead?

That is not the issue here. The banks don’t have access to enough funds to bridge all these companies (not only in aviation) through a crises of this magnitude and the issue will only get worse the deeper in to this crises we get.

Take easyJet for example, never made a loss and owns 70% of their fleet. Why not provide loans secured against assets in the company and save jobs?

CP

torvalds
25th Mar 2020, 17:53
the issue will only get worse the deeper in to this crises we get.

Take easyJet for example, never made a loss and owns 70% of their fleet. Why not provide loans secured against assets in the company and save jobs?

CP

Hence throwing cash at companies in this situation is not a solution. Currently we don't know when are things going back to normal. Therefore it can not be called bridging loan, but a high risk taking for an unknown period of time.
Why is/wasn't there a bail-in?

If there aren't enough funds to loan in the banks, then they must prioritize (or wait for the funny-money getting QE-d). We are indeed in a very bad situation.

I'd feel sorry (not sad, have enough important thing to worry about) to see E/J go, but make no mistake, if there was a market and demand, the "next day" there will be another privately owned airline to replace it. They are going to employ staff, pay taxes, the whole 9 yards.

CaptainProp
25th Mar 2020, 18:13
Hence throwing cash at companies in this situation is not a solution. Currently we don't know when are things going back to normal. Therefore it can not be called bridging loan, but a high risk taking for an unknown period of time.
Why is/wasn't there a bail-in?

If there aren't enough funds to loan in the banks, then they must prioritize (or wait for the funny-money getting QE-d). We are indeed in a very bad situation.

I'd feel sorry (not sad, have enough important thing to worry about) to see E/J go, but make no mistake, if there was a market and demand, the "next day" there will be another privately owned airline to replace it. They are going to employ staff, pay taxes, the whole 9 yards.

With T&Cs that would make today’s bottom feeders looking like amazing old legacy carrier contracts.

CP

JoeyBloggs
25th Mar 2020, 19:07
Well done EasyJet Senior Management.
Awe for the most proud and passionate colleagues, modest, with great erudition and who strive for perfection has been replaced with an incomprehensible anger and disappointment.
The quest for kindness and sincerity amid turbulence, for strength within and leadership by example was an ideal we could only desire.
Unity and appetite for success we believed, together. Yet, with a crisis upon us a display of debauchery unfolds, admonitions for solicitude. Honest and genuine spirit has been overshadowed by inequality and greed.
There is great pride felt for those with modesty, humble in their actions and unfaltering in eforts and willingness. Flabbergasted it appears acquiese was anticipated; but, regardless of acceptance we have been foretold our fate, for we are mere peasants to the affluent.

ajwajw
25th Mar 2020, 20:28
jeez, how short sighted are you torvalds. When a company goes bust it usually leaves huge unpaid creditors, so you are happy that every supplier to these airlines goes bust as well. So short sighted and righteous

Livesinafield
25th Mar 2020, 20:59
"Taxpayers money is not for bailing out airlines owned by billionaires".... what goes around comes around... how does the saying go? "Be careful of the words you say, So keep them soft and sweet. You'll never know from day to day; Which ones you'll have to eat"

I feel for the employees of these carriers but you are led by dishonest folk

torvalds
25th Mar 2020, 21:49
jeez, {...}

Sorry I sure didn't want to hurt your feelings. Some of your neighbour lost their job (recession), or you (depression)?
Our (UK) chancellor doesn't want to bail them out either? What you think he is? Short sighted and righteous too? Just an advice: you should leave your emotions behind when making financial decisions, or you'll get burned.

Satoshi Nakamoto
25th Mar 2020, 21:55
The Govt response should be to provide support, less the £X million operators insist they have to pay out as dividends.

The companies you mention are obliged by law to pay dividends they have declared, it is not optional. They declared their dividends before all the current chaos.

torvalds
25th Mar 2020, 22:09
The companies you mention are obliged by law to pay dividends they have declared, it is not optional. They declared their dividends before all the current chaos.
Absolutely correct and by law, they could summon a meeting of the board and decide on a bail-in (of the paid dividend).

nicolai
25th Mar 2020, 22:25
The airlines, and especially Easyjet's, failure to use all possible means (including extraordinary manoeuvres like a cash call from shareholders equal to the dividend) is why the Chancellor isn't going to give them a lot of money.
I hope Easyjet's shareholders will be thinking about what the management the shareholders installed did to the shareholder's company if the company runs out of cash later and they're left with their dividend and nothing else except worthless shares in a bankrupt company.
You might see the likes of Jet2 get help if they're about to go under but Easy, and therefore also BA, can now forget about a big helping hand from the Government.

"Well done Easyjet senior management" indeed.

hayes67
25th Mar 2020, 22:43
We have to remember how the likes of BA and Easyjet kicked off at the prospect of Government support for Flybe only a few weeks ago.

Absolutely agree, only a week prior to flybe going I spoke about this with a member of their staff and complimented them on their help and how happy I was they were still flying. Funny I cant imagine for a second BA being anything like as helpful on the day. This was about changing a flight to an earlier one at the airport when I finished early one day btw!

I have no axe to grind with EY, but Mr Walsh along with MOL just push my buttons.

Kit Sanbumps KG
25th Mar 2020, 22:53
Happy to see them all go to the wall.

Then someone who values their passengers’ business can step in. I’d got to the point where a trip on BA was nothing but misery, the life of a tethered cash-cow on its way to slaughter. In fairness, easyJet were better, but then they employed Bellend.

vikingivesterled
25th Mar 2020, 23:36
The government could have helped Easy on the cheap. If the airline can't get out of squandering money on the shareholders because of a law, the government (through parliament) can change the law.
Everything is possible in a time of crisis. Probably many other companies that needs the same.

Meester proach
25th Mar 2020, 23:56
Happy to see them all go to the wall.

Then someone who values their passengers’ business can step in. I’d got to the point where a trip on BA was nothing but misery, the life of a tethered cash-cow on its way to slaughter. In fairness, easyJet were better, but then they employed Bellend.


And this is all that is wrong with pprune - used to be a forum for PILOTS, thus you wouldn’t get the general public/ flightless coming here and slagging off our jobs and prospects and moaning they no longer got three peanuts with their orange juice but two.

I eat meat, I don’t go on the vegans page and have a go...

Iv

marchino61
26th Mar 2020, 00:12
And this is all that is wrong with pprune - used to be a forum for PILOTS, thus you wouldn’t get the general public/ flightless coming here and slagging off our jobs and prospects and moaning they no longer got three peanuts with their orange juice but two.

I eat meat, I don’t go on the vegans page and have a go...

Iv

You sound like a real joy to fly with. Pity I don't know which airline you work for, or I'd avoid it.

ChrisVJ
26th Mar 2020, 07:02
In general terms I would agree with the rampant capitalists on here but on this occasion the crisis for airlines is because the government has shut down travel. (I am not commenting on why, only that they have.) I think, therefore, the government might have some responsibility to support them through the crisis, if only with repayable loans.

If the government wants the airlines to suspend already proposed dividends then maybe they should suspend the rules, simple.

I understand the airlines are not at the absolute top of the priority tree just at the moment but the employees and the public will surely punish the government if their jobs and their mobility are permanently destroyed

flocci_non_faccio
26th Mar 2020, 07:13
Sunak is merely engaging in political posturing. Every other country in Europe is going to support its airlines. The UK is not going to be the odd one out.

CaptainProp
26th Mar 2020, 07:36
Now US Congress has also approved a $2 trillion stimulus package that also includes “a $500 billion government lending program for distressed companies reeling from the impact of the crisis”.

UK and its tax payers have happily cashed in on billions paid in airport taxes, corporate taxes, VAT and income taxes from our industry’s employees, especially from healthy companies like easyJet and BA. But now we are told to find our own solutions through a financial system that’s been bailed out (properly bailed out!) by taxpayers and that’s now showing little interest in finding solutions. The irony......

CP

beardy
26th Mar 2020, 07:37
In general terms I would agree with the rampant capitalists on here but on this occasion the crisis for airlines is because the government has shut down travel. (I am not commenting on why, only that they have.) I think, therefore, the government might have some responsibility to support them through the crisis, if only with repayable loans.

If the government wants the airlines to suspend already proposed dividends then maybe they should suspend the rules, simple.

I understand the airlines are not at the absolute top of the priority tree just at the moment but the employees and the public will surely punish the government if their jobs and their mobility are permanently destroyed

The government has affected the airline business, it has also affected many many other businesses. All of them are being supported by a range of measures. The airlines are asking for SPECIAL support, without having what makes their needs so different from any other industry.

Kit Sanbumps KG
26th Mar 2020, 08:04
And this is all that is wrong with pprune - used to be a forum for PILOTS, thus you wouldn’t get the general public/ flightless coming here and slagging off our jobs and prospects and moaning they no longer got three peanuts with their orange juice but two.

I eat meat, I don’t go on the vegans page and have a go...

Iv

Meester, rest assured I am very much a professional pilot, and have been for decades, though I’m fortunate that none of my present work involves CAT passenger flying.

I have been flying as a passenger a lot in recent years, and I mean what I said. The lack of respect airlines and airports show their passengers has been astonishing, epitomised by the abject misery of T5, or the fact that only two weeks ago having disembarked a Eurowings aircraft, and more or less successfully practiced social distancing throughout the trip, we were then crammed like sardines onto a single coach to the terminal. Criminal.

AirportPlanner1
26th Mar 2020, 08:34
Sunak is merely engaging in political posturing. Every other country in Europe is going to support its airlines. The UK is not going to be the odd one out.

Its got to the point, quite literally, that if the EU do it this Government won’t. Just like it wouldn’t take part in pandemic monitoring, and hasn’t taken part in ventilator purchasing.

RickNRoll
26th Mar 2020, 09:50
Unfortunately, this young chancellor is mesmerised by the aura of St Greta. He totally buys into the whole armageddonist vision of the global warming religion. No doubt he believes he has single-handedly saved the planet with this ill-judged announcement. He will learn ... but too late for many of our familiar airlines and airports. Sajid Javid was much more pragmatic. Real pity he has returned to the back benches.
Greta just says listen to the evidence of the scientists.

waco
26th Mar 2020, 11:19
I feel the essential truth is being forgotten.

Providing we can beat this virus and its following waves of infection.

The economic situation is likely to be similar to 1929......only worse.

Who on earth do you think will be going flying.

I'm quite sure the Government has worked out there is no point in pouring vast sums into airlines that wont be able to survive anyway. Its pointless.

Some of you people are very deluded. Your flying days are over. Get used to it.

golfbananajam
26th Mar 2020, 11:31
The Govt response should be to provide support, less the £X million operators insist they have to pay out as dividends. It will then be up to the shareholders to decide whether to go bust and lose all their dosh or put the dividends back into the business.


Just remember that "the shareholders" also include the pension funds of some/most all of us, would you have that plowed back in or are you merely venting at individual so called fat-cats?

flocci_non_faccio
26th Mar 2020, 11:48
Some of you people are very deluded. Your flying days are over. Get used to it.

I'm about as pessimistic as it gets, but even for me your posts just seem like hysterical nonsense. There's no doubt aviation is going to suffer, the industry will contract. However, people will still be flying.

waco
26th Mar 2020, 12:05
yep....people will still fly......but no where near as many as pre virus!

golfbananajam
26th Mar 2020, 12:53
Absolutely correct and by law, they could summon a meeting of the board and decide on a bail-in (of the paid dividend).

That would require an EGM (Extraordinary General Meeting), not a board decision. remember, dividends are paid to ALL shareholders, your pension funds included.

Sallyann1234
26th Mar 2020, 13:07
yep....people will still fly......but no where near as many as pre virus!
I was due to travel to Frankfurt for a meeting next week. it will now be held on Zoom. If that proves satisfactory I expect we will do the same again in future.

clipstone1
26th Mar 2020, 13:29
result in January 2021....the UK will have no airlines, all the other countries will have subsidised airlines and will therefore take all of the UK air travel and cash out of the UK. So immediately that's 150,000 direct employees out of work, plus the tour operating employees of Jet2 and TUI.

LTNman
26th Mar 2020, 13:31
Also used Zoom for the first time yesterday for a meeting. Far more productive. The future is Zoom.

GS-Alpha
26th Mar 2020, 13:35
I was due to travel to Frankfurt for a meeting next week. it will now be held on Zoom. If that proves satisfactory I expect we will do the same again in future.
That is the crux of it. This will go on for an extended period of time, which will cause temporary behaviours such as the one you mention to evolve into business best practice going forwards. In the long term, demand for premium air travel will almost certainly reduce due to current events, regardless of how the economy shapes up. Popular opinion on climate change, and unnecessary squandering of non-renewable energy sources will reinforce these behavioural changes.

LTNman
26th Mar 2020, 13:36
result in January 2021....the UK will have no airlines, all the other countries will have subsidised airlines and will therefore take all of the UK air travel and cash out of the UK. So immediately that's 150,000 direct employees out of work, plus the tour operating employees of Jet2 and TUI.

So should the government bail out Easyjet plc or just Easyjet UK leaving it to the Swiss and Austrians to bail out the other parts of the Easyjet empire?

clipstone1
26th Mar 2020, 13:48
with all my direct family in Australia, I am actually looking at booking now for xmas 2020, on the basis if the travel restrictions have been lifted its a good deal, if not they'll need to refund my cash. If the airline has ceased trading by then, the credit card will refund me the money....very little risk to it.

clipstone1
26th Mar 2020, 13:50
LTN MAN - if your argument is to be followed, the UK Government should not bail out BA, the Spanish government should?

torvalds
26th Mar 2020, 13:56
That would require an EGM (Extraordinary General Meeting), not a board decision. remember, dividends are paid to ALL shareholders, your pension funds included.
Thank you for providing clarity on this matter.
Does it mean it could've been done?

I've noticed that you mentioned earlier (and now) the pension funds. Does it mean I can choose now any random "company" stock and "invest" all my money in it and as long as a pension fund is also an investor my return will be granted for life, because of we are going to keep those companies liquid for ever?
I am sure many of us interested in such game and going to cut back on the lottery. If a stock can only go up without any risk, then sure, please count me in.
TSLA stock "grew" ~300% between 22nd of October 2019 and 19th of February 2020. Now it is a "bit" down (only 100+% up since 22nd of Oct), but I am sure there are pension funds invested in it, so I am standing by and waiting for your answer.

Joe le Taxi
26th Mar 2020, 14:04
That would require an EGM (Extraordinary General Meeting), not a board decision. remember, dividends are paid to ALL shareholders, your pension funds included. Do you KNOW that to be the case? I was pretty close to BP at the time the dividend was cancelled with just days to go to the dividend payment, and I don't recall an EGM, and it was a unilateral board decision.

TURIN
26th Mar 2020, 14:19
I feel the essential truth is being forgotten.

Providing we can beat this virus and its following waves of infection.

The economic situation is likely to be similar to 1929......only worse.

Who on earth do you think will be going flying.

I'm quite sure the Government has worked out there is no point in pouring vast sums into airlines that wont be able to survive anyway. Its pointless.

Some of you people are very deluded. Your flying days are over. Get used to it.

I remember that sort of nonsense being bandied about after 911 and again after the financial crisis.

Yes, there will be a reset, but you are talking about the entire civil aviation business going to the wall. Airports, manufacturing and everything that it supports.
Not going to happen.

cashash
26th Mar 2020, 15:13
LTN MAN - if your argument is to be followed, the UK Government should not bail out BA, the Spanish government should?

Well the argument is that with these multinational groups with diverse ownership patterns then if the airline cannot survive the Government should just nationalise the UK part.

Webby737
26th Mar 2020, 15:44
I remember that sort of nonsense being bandied about after 911 and again after the financial crisis.

Yes, there will be a reset, but you are talking about the entire civil aviation business going to the wall. Airports, manufacturing and everything that it supports.
Not going to happen.

I think it will take longer for things to get back to normal than it did post 9/11,
I would assume that business travel will rebound fairly quickly but the holiday/leisure market will take quite a bit longer. There's just not going to be enough spare cash in the pot for the likes of Barry and Sharon to go and soak up the Spanish culture at the Red Lion in Benidorm for a week or two.
The first companies to feel this will probably be those providing ACMI services such as Smartlynx, HiFly, Air Belgium etc. Up till now due to the problems with the B737 MAX and the B787 they've been doing well but this will have come to an end.
On the maintenance side, we're only working on cargo aircraft at the moment but things will get better, in fact we generally get busier if an airline goes bankrupt, someone has to do the bridging checks before the aircraft go to a new operator, that's assuming that there will be new operators !
As for a government bail out, there's no easy answer, how many airlines are 100% owned in one country ? Not many, so it would be very difficult to allocate the funds where they're needed.
However, the infrastructure needs to be kept in place so I don't see any problem assisting airports, ground handling services etc.

cashash
26th Mar 2020, 16:10
The big difference between now and 9/11 is that after 9/11 most of the economy was intact - when we come out of this great swathes of the economy will have disappeared. The unemployment numbers coming out of the US are truly horrific with forecasts of 40 million job loses by April if the shutdown continues.

LTNman
26th Mar 2020, 16:19
with all my direct family in Australia, I am actually looking at booking now for xmas 2020, on the basis if the travel restrictions have been lifted its a good deal, if not they'll need to refund my cash. If the airline has ceased trading by then, the credit card will refund me the money....very little risk to it.

No Insurance cover for corona virus related issues including medical.

Mr Mac
26th Mar 2020, 17:40
I came across two of my neighbours preparing to peddle off somewhere on their bikes when I drove past (going to top fields before you ask). I stopped to see how they were doing, as both retired (ex Headmaster and his Partner Retired Head of Legal for large council) both on Gold plated pensions, with houses in Spain and apartment in Paris. They made the comment was how "nice it was that there were no aircraft around as you could hear more bird song". I gently pointed out that we are not really that close to any airports, and planes tend to go over us in excess of ten thousand feet if heading for LBA or MAN (very few), with other,s up in the high 30,s, and that my pension was far more reliant on all those planes flying than was there,s is, and I would like them all back ASAP. This was met with "but can you not hear all the birds singing" to which I had to gently point out that it is spring, and they tend to sing more at this time of year for obvious reasons, and this a headmaster !
Anyway as far as Sallyanne comment on Zoom etc we use them a lot as a company, and personally have been using video conferencing since late 80,s when you needed video conferencing suites to do it, but I was still doing a minimum of 2 transatlantic s a month regardless, as people want to interact with you, and know you, and watching a monitor does not appear to work as well as the makers and suppliers would like because we are human. Therefore I do think Business travel will come back, but leisure maybe a little slower, and more so at the lower end of the market as that section of society will financially hurt the most as ever. Personally we have already got two LH holidays planned for later this year, and I have 6 LH Business trips assuming we get back into work in late May. All this assumes of course that we do not die in the Corona virus outbreak, but I work on controlling the controllable and not worry unduly about things I have little control off , and I went through SARS in Hong Kong, so this is my second time through this type of thing, and no it does not make it any easier. As an aside I would say the UK attempts at control are far worse than those in Hong Kong, not enough public sanitise-rs on public transport / stations etc probably get stolen in UK in current climate !.
Kind regards
Mr Mac

dobby88
26th Mar 2020, 19:42
I must say cir-cum is a very funny word.

Jokes aside, this industry will contract, as many industries will and have done. It's going to be a very sad few years, but I can't help but feel some people in this industry are terribly entitled. At least this industry has a healthy underlying trend (you're not miners in the 80s!).

Any government help will be appreciated, but we can't take it for granted one bit. It was only a few weeks ago that EZY, BA & FR were moaning about rescuing flybe not being fair. Not that all the 1000s of employees deserve to pay for the sins of the greedy executives.

hec7or
26th Mar 2020, 20:27
Not that all the 1000s of employees deserve to pay for the sins of the greedy executives.

I really hope that this will throw a spotlight on CEO pay and be a watershed for boardroom greed if any good can come out of it.

hunterboy
26th Mar 2020, 23:27
Quite right. Shouldn’t the owners bail out their own companies first? When they’re on the point of collapse, and if it’s in the public interest, maybe public money should be put in. I’d expect drastic changes in the boardrooms and executive pay and bonuses to be slashed. Hopefully, the government learnt its lesson from the banking bailout.

Fairdealfrank
27th Mar 2020, 01:37
Without being political, what seems most strange is that all the right wing Tory policies that they thought served them best over the last 12 years (corporate super-profits, austerity for the working classes, privatising the NHS, stopping the nanny state, and going ultra-small state intervention, oh and isolating ourselves from our colleagues in Govts across Europe who want a collaborative approach).... are now seen as completely the opposite of what we all are crying out for now (care workers, nurses, delivery drivers, sorters, stackers, ie: all those on minimum wages, gig economy types, and migrants that we apparently thought should go home). Since 2016 we have driven 50,000+ NHS workers out of the country because we didn't want them.

Without being political, privatisation of the NHS has been going on longer than 12 years. It started under Blair (who else!). Just saying.


nationalization comes to mind...and kick out those blood sucking CEOs who's wages largly depend on stock exchange values.

Only when the stockmarket is high: their wages haven't collapsed in line with the stockmarket this last month.

Longtimer
27th Mar 2020, 02:12
I really hope that this will throw a spotlight on CEO pay and be a watershed for boardroom greed if any good can come out of it.
If you take the high end CEO pay and divide it among all the employees, they would end up with squat and a dead company..... HHHHmmMMM

Bidule
27th Mar 2020, 07:09
Anyway as far as Sallyanne comment on Zoom etc we use them a lot as a company, and personally have been using video conferencing since late 80,s when you needed video conferencing suites to do it, but I was still doing a minimum of 2 transatlantic s a month regardless, as people want to interact with you, and know you, and watching a monitor does not appear to work as well as the makers and suppliers would like because we are human. Therefore I do think Business travel will come back, but leisure maybe a little slower, and more so at the lower end of the market as that section of society will financially hurt the most as ever.
Mr Mac

I fully agree! And good luck if you rely only on videoconferencing to do business with persons of other culture, not only language but culture....
.

shamrock_f22
27th Mar 2020, 07:42
Late to the thread but all I can say is good riddance. No bailouts for the banks, aviation or the rail companies should be given.

​​​​​For far too long customers have been squeezed and screwed over by companies in the name of soaring profits and dividend payouts. Especially in aviation employees have been treated like dirt too whilst their senior management teams sat on inflated pay rises and bonuses. We're all in it together? My backside we are.

So kindly take your dwindling profits and sob stories and sod off. Use your bottom line to fight your way through this mess like the rest of us are having to do. If your banking agreements and credit lines don't extend far enough so that you collapse, so be it.

Why is that when there's a crisis like this individuals are expected to be sat on a ton of personal savings to see us through it all with no bailouts and no protection from blatant price gouging by greedy companies. Yet the moment the going gets tough for big companies they go running to the government begging for more of our tax money.

Airlines are rotten to the core anyway. Its time for a shake up.

hec7or
27th Mar 2020, 07:42
If you take the high end CEO pay and divide it among all the employees, they would end up with squat and a dead company.....

with respect, this is precisely the tosh that is always trotted out to justify CEO greed, look at the car crash demonstration of boardroom incompetence over at Boeing and the wreckage they have made of a former world leader.

RexBanner
27th Mar 2020, 09:09
The big difference between now and 9/11 is that after 9/11 most of the economy was intact

no it wasn’t, far from it.

Superpilot
27th Mar 2020, 10:39
If you take the high end CEO pay and divide it among all the employees, they would end up with squat and a dead company.....

Who said you have to divide it among all the employees and leave them with nothing? How much would you need to earn to fund a luxury lifestyle? 1 million, 2, 5 at a push?

https://www.payscale.com/data-packages/ceo-pay/full-list

https://cimg3.ibsrv.net/gimg/pprune.org-vbulletin/617x627/epi_ceo_pay_png_cef6e0962fb9725ff55934dd806691ee84c933de.jpg
Total compensation: https://aflcio.org/paywatch/highest-paid-ceos and https://www.forbes.com/lists/2006/12/Rank_1.html

Sallyann1234
27th Mar 2020, 11:20
I fully agree! And good luck if you rely only on videoconferencing to do business with persons of other culture, not only language but culture....
.
If you're going out into the world to find new business then of course you will fly there, no question.
But for routine progress meetings, why travel? I'm actually looking forward to one that I can do without leaving home. There is little pleasure in airline flight these days.

clipstone1
27th Mar 2020, 11:24
Well the argument is that with these multinational groups with diverse ownership patterns then if the airline cannot survive the Government should just nationalise the UK part.
they can then merge, them, so there is 1 full service long haul, 1 low cost short haul and 1 beach holiday charter type....3 airlines per country max, all on the lowest T&Cs of each get rid of thousands of crew and office staff, bankrupt a few lessor by returning hundreds of aircraft. run for 5 years then start selling bits off again to get some cash back into the government coffers?

Even more complex with the tour operators however, since of course the tour operator is needed for the airline to operate, they can't be treated as separate and many have functions spread across the various countries. They will be a bigger challenge than the scheduled airlines, but guess they could just close the airlines and hope the tour operators survive and force them to fly passengers on the other 2 airlines (shorthaul low cost and longhaul full service)

dboy
27th Mar 2020, 13:44
To be honest and i am talking against my own professional domaine, i hope there will be less air traffic in the post corona era. The customer was simply spoiled with choices of airlines and destinations. All this was leading to eroding terms and conditions. And top of that: why do we have to do 6 city trips a year, going shopping in new york on a friday and coming back on a sunday or having a weekend party in Ibiza?

Why cant we just be happy with a normal trip bike or hike on a sunny day?

To be honest, at the moment i like the peace and hearing the birds again. Or am i just too old fashioned?

lomapaseo
27th Mar 2020, 14:39
with respect, this is precisely the tosh that is always trotted out to justify CEO greed, look at the car crash demonstration of boardroom incompetence over at Boeing and the wreckage they have made of a former world leader.


I don't see where the Board has anything to do with the detailed workings of validating the software-pilot interactions of a single aircraft.

Now if you have other evidence of something that the boardroom affects than carry on with facts analysis

cashash
27th Mar 2020, 15:31
no it wasn’t, far from it.


Not sure how you are measuring that - the country didn't go into recession in 2001 or see a rise in unemployment.

RexBanner
27th Mar 2020, 15:39
By any measure, the US was well into recession by the time 9/11 happened. As was the European Union. If you’re talking the U.K. then no, but only just. It was no bed of roses in 2001. Just look at Enron.

hec7or
27th Mar 2020, 15:59
I don't see where the Board has anything to do with the detailed workings of validating the software-pilot interactions of a single aircraft.

Now if you have other evidence of something that the boardroom affects than carry on with facts analysis

Well they sacked the CEO, I think that constitutes sufficient evidence.

pudoc
27th Mar 2020, 16:07
Airlines are rotten to the core anyway. Its time for a shake up.

And you think less competition will fix the problems of poor staff and customer treatment?

Meester proach
27th Mar 2020, 17:40
You sound like a real joy to fly with. Pity I don't know which airline you work for, or I'd avoid it.

Am i there to entertain you ? Quite the reverse, I’m unfailingly optimistic - I just don’t know why non pilots come on pprune to slag off pilots jobs-

Anyway it won’t matter to you down the back, as long as we are on time and the WiFi works

student88
27th Mar 2020, 18:58
Why should he bailout businesses who are sat on huge piles of cash?

Why should be bailout huge companies who are willing to shaft staff members for the sake of satisfying shareholders?

I think he's doing a good job.

pax britanica
27th Mar 2020, 19:16
The issue here is how will the Government deal with the banks-they got a pass in 2008 when many CEOs should have gone to prison.

Things are different this time and it is indeed the time for the government to call in the cheques they wrote the banks. Essentially they need to freeze the economy for three months and keep it ticking over but in good shape to rebound. This mean nationalising the banks-not in the true sense but not allowing them to take decisions so that all act as one directed by the Gov or BoE and the Chancellor. the Chancellor is a bit of a dubious character because he made money from peoples suffering in 2008 but he is a very clever competent man and he like the banks owes the general population big time.

As we ahve seen it needs central direction to ensure that where one part of an industry shuts down it all will. Otherwise they will all cheat and we will be picking up an even bigger tab than before.

As for the airlines I agree they should be kept afloat but because some are needed-BA and Ez for sure VS less of a case but
.as for Ryanair-sorry Mr O'Leary but its payback time-you are toast.- if Ryanair is helped one of the provsions is that O Leary and any of his henchmen all take a bullet for the rest of the staff.

Once such control measures are in place-they happened in wartime so theres not much new the Government can gradually ease things back to normality in three months or whatever and allow the economy to recover in a structured way. its not capitalism but capitalism soon becomes communism when the chips are really down as we have seen demonstrated all over the world in the last few weeks.
the final point is a years delay to leaving the Eu , the Uk is far far too small and weak to survive two economic shocks in one year and despite the comments on another thread earlier about Britain and punching above its wake in the Falklands-thats ancient history. we didnt then without US abandoning a Munroe doctrine policy and France giving us the specs of Exocets effectively neutralising the only significant Argentine weapon and we cannot do so now.

shamrock_f22
27th Mar 2020, 19:29
And you think less competition will fix the problems of poor staff and customer treatment?

Haha, what competition??? Time and time again, the airlines get caught price fixing and price gouging so how are customers better off now? And I'm sorry but using tax payer money to bail them out isn't going to fix anything.

They will want their cake and to eat it. Just like the banks are doing yet again - they've already been caught out in Ireland trying to charge customers insane rates of interest and backdating interest in payment breaks and misleading them.

A certain airline here has also misguided its customers by saying they can only claim vouchers instead of a refund for flight cancellations.

So really my sympathy is non existent.

​​​​​

Setright
27th Mar 2020, 21:37
yep....people will still fly......but no where near as many as pre virus!

''but no where near as many as pre virus!''

Rubbish.

Longtimer
28th Mar 2020, 02:24
Who said you have to divide it among all the employees and leave them with nothing? How much would you need to earn to fund a luxury lifestyle? 1 million, 2, 5 at a push?

https://www.payscale.com/data-packages/ceo-pay/full-list

https://cimg3.ibsrv.net/gimg/pprune.org-vbulletin/617x627/epi_ceo_pay_png_cef6e0962fb9725ff55934dd806691ee84c933de.jpg
Total compensation: https://aflcio.org/paywatch/highest-paid-ceos and https://www.forbes.com/lists/2006/12/Rank_1.html
I wonder what the same graph would show if we cranked in the average pay of senior pilots on large aircraft? :ugh:

marchino61
28th Mar 2020, 03:08
Am i there to entertain you ? Quite the reverse, I’m unfailingly optimistic - I just don’t know why non pilots come on pprune to slag off pilots jobs-

Anyway it won’t matter to you down the back, as long as we are on time and the WiFi works

But the wifi doesn't work. That's the problem.

shamrock_f22
28th Mar 2020, 07:45
Also a fantastic point made by several news outlets recently - that the same companies begging for handouts are also the best at dodging taxes

"One of the first to seek a government bailout has been the cruise ship industry (https://thehustle.co/the-economics-of-cruise-ships/) in the US. For decades, its ships have flown the colours of Panama, Liberia and other flags of convenience to skirt minimum wage laws as well as get out of paying taxes. Some companies have achieved corporate tax rates that even Google would envy.

In the UK, the airline industry (https://www.theguardian.com/business/2020/mar/16/ryanair-cancels-80-per-cent-of-flights-and-does-not-rule-out-full-grounding-coronavirus) quickly followed suit, with Virgin Atlantic, a company owned by a tax exile (https://www.theguardian.com/business/2013/oct/13/richard-branson-tax-exile-virgin), writing to the government (https://www.theguardian.com/world/2020/mar/15/uk-airlines-call-for-multibillion-bailout-to-survive-covid-19-crisis) to say the entire industry may need support to the tune of £7.5bn. This letter came in the week that easyJet paid a dividend (https://www.theguardian.com/world/2020/mar/22/time-is-running-out-aviation-industry-warns-government) of £60m to its founder, Stelios Haji-Ioannou – tax resident in Monaco (https://www.theguardian.com/business/2014/jul/10/whos-who-britain-legal-offshore-tax-avoidance-james-dyson). Any support to the airline industry will no doubt flow through to aircraft leasing companies based in low-tax Ireland."
So again, I'd reiterate I have no sympathy for airlines whatsoever

bulldog89
28th Mar 2020, 08:06
Praising capitalism and low taxation in good times, socialism and State aids when s*** hit the fan.

Why am I not surprised...

Deltasierra010
28th Mar 2020, 09:11
Airline should be treated no differently to other companies, they can take advantage of the help offered by the Government , they can take a holiday on their loans or leasing deals. If the planes are parked up they are not wearing out, it’s just the same for all of us, if we can’t pay bills, our creditors will just have to wait, some will go bust, the over extended will go first, there are far too many companies that rely on only a few days income to stay solvent and have effectively no assets.

Kit Sanbumps KG
28th Mar 2020, 10:21
the over extended will go first, there are far too many companies that rely on only a few days income to stay solvent and have effectively no assets.

...and sadly they are often vital suppliers to companies whose finances are better managed, and a huge risk is that the former will collapse and take the latter down with them. This is a massive problem for the airlines (mainly freight operators) who are still flying at present, as credit lines are wound in by suppliers who don’t realise that these operators are still buoyant, or the suppliers are seeing their own liquidity disappear. This is where governments need to act most urgently.

covec
28th Mar 2020, 10:28
Also a fantastic point made by several news outlets recently - that the same companies begging for handouts are also the best at dodging taxes

"One of the first to seek a government bailout has been the cruise ship industry (https://thehustle.co/the-economics-of-cruise-ships/) in the US. For decades, its ships have flown the colours of Panama, Liberia and other flags of convenience to skirt minimum wage laws as well as get out of paying taxes. Some companies have achieved corporate tax rates that even Google would envy.

In the UK, the airline industry (https://www.theguardian.com/business/2020/mar/16/ryanair-cancels-80-per-cent-of-flights-and-does-not-rule-out-full-grounding-coronavirus) quickly followed suit, with Virgin Atlantic, a company owned by a tax exile (https://www.theguardian.com/business/2013/oct/13/richard-branson-tax-exile-virgin), writing to the government (https://www.theguardian.com/world/2020/mar/15/uk-airlines-call-for-multibillion-bailout-to-survive-covid-19-crisis) to say the entire industry may need support to the tune of £7.5bn. This letter came in the week that easyJet paid a dividend (https://www.theguardian.com/world/2020/mar/22/time-is-running-out-aviation-industry-warns-government) of £60m to its founder, Stelios Haji-Ioannou – tax resident in Monaco (https://www.theguardian.com/business/2014/jul/10/whos-who-britain-legal-offshore-tax-avoidance-james-dyson). Any support to the airline industry will no doubt flow through to aircraft leasing companies based in low-tax Ireland."
So again, I'd reiterate I have no sympathy for airlines whatsoever

What you said, Shamrock. (From an Ulsterman).

RoyHudd
28th Mar 2020, 14:41
There will be little requirement for airlines that fly to SH/LH holiday destinations primarily (VS, Condor, for example).

The crying need will be for increased cargo ops, and practical services providing links between centres of population. ( Fedex, UPS, and Flybe plus BA in part as examples)

I would suggest that only those companies that provide vital functions should be supported. And with no personal interest, might Flybe not be resurrected and perhaps nationalised?)

London City should not have been permitted to close either. It is too important for financial connections.

Mr Good Cat
28th Mar 2020, 16:07
Who said you have to divide it among all the employees and leave them with nothing? How much would you need to earn to fund a luxury lifestyle? 1 million, 2, 5 at a push?

https://www.payscale.com/data-packages/ceo-pay/full-list

https://cimg3.ibsrv.net/gimg/pprune.org-vbulletin/617x627/epi_ceo_pay_png_cef6e0962fb9725ff55934dd806691ee84c933de.jpg
Total compensation: https://aflcio.org/paywatch/highest-paid-ceos and https://www.forbes.com/lists/2006/12/Rank_1.html

Funny how all curves in finance look identical to that since a particular date in 1971. Coincidence or carefully orchestrated?

shamrock_f22
28th Mar 2020, 16:25
Passengers and agents allege Aer Lingus is breaking law on refundsAirline denies claims while flying near-empty planes to US despite restrictions on arrivals

https://www.irishtimes.com/life-and-style/travel/passengers-and-agents-allege-aer-lingus-is-breaking-law-on-refunds-1.4213285

I know they're not the only ones. BA are doing this too... IAG wide policy?

shamrock_f22
28th Mar 2020, 16:27
What you said, Shamrock. (From an Ulsterman 😉).

Appreciate the solidarity btw I'm a Brit ;)

kpd
28th Mar 2020, 18:28
https://www.independent.ie/life/travel/travel-news/stranded-irish-scrambling-to-get-home-amid-wild-west-of-aviation-39080361.html


In this article Emirates are offering vouchers 12 months ahead- but they arent the only ones

sewushr
28th Mar 2020, 19:43
Air New Zealand are offering me a 'credit' rather than a refund for a cancelled Heathrow to Los Angeles flight next month. This, despite the fact that they are quitting the route in October and some reports suggest they have probably already operated their last ever flight from Heathrow.

You gotta admire the cheek of it! ;-)

LanceHudson
28th Mar 2020, 20:57
I would really recommend calling up your credit card company, I was foolish enough to accept a voucher from Iberia over a flight they cancelled and thus didn't realise I could not longer receive a refund. Called up AMEX, explained the situation, and the money has been credited to my account.

polax52
28th Mar 2020, 21:43
I'm not so negative. I think that market forces should be allowed to run their course. If that were the case then there would be a lot of cheap aircraft, cheap crews and cheap fuel on the market. Airlines would start again without debt. In 5 years time you'd have an industry twice the size of the current one.

Longtimer
29th Mar 2020, 01:33
Air New Zealand are offering me a 'credit' rather than a refund for a cancelled Heathrow to Los Angeles flight next month. This, despite the fact that they are quitting the route in October and some reports suggest they have probably already operated their last ever flight from Heathrow.

You gotta admire the cheek of it! ;-)
curious as to when you booked the flight?

Clandestino
29th Mar 2020, 07:42
Essentially they need to freeze the economy for three months and keep it ticking over but in good shape to rebound.This is the rational thing to do and that's why it won't be done.

Funny how all curves in finance look identical to that since a particular date in 1971. Coincidence or carefully orchestrated?
Neither, just the management class taking what was made available to them.

sewushr
29th Mar 2020, 08:26
curious as to when you booked the flight?
Flight was booked in November last year

hunterboy
29th Mar 2020, 12:33
Looking on the bright side, at least the U.K. will comply with its promised reduction in green houses gases for 2020. If all U.K. airlines go bust, there is a chance we’d comply in 2021 too.
The only downside is would we really want to rely on non U.K. based airlines to get us out of the U.K. on business and leisure? It hardly ties in with the post Brexit “Britain open for business” claptrap that we’ve been sold. I think the poor old Chancellor is going to end up sticking his hand in his pocket if we do all end up confined until the end of June .

cashash
29th Mar 2020, 15:04
Looking on the bright side, at least the U.K. will comply with its promised reduction in green houses gases for 2020. If all U.K. airlines go bust, there is a chance we’d comply in 2021 too.
The only downside is would we really want to rely on non U.K. based airlines to get us out of the U.K. on business and leisure? It hardly ties in with the post Brexit “Britain open for business” claptrap that we’ve been sold. I think the poor old Chancellor is going to end up sticking his hand in his pocket if we do all end up confined until the end of June .


Why wouldn't you have new airlines starting up to fill the void - after all there are going to b a lot of cheap airframes and crews sitting around. Why wouldnt we have new Virgins, Lakers, Easy's etc spring up like they did before?

hunterboy
30th Mar 2020, 08:58
I would say because common sense and the “free market” doesn’t always prevail. There will be a panic as the Daily Mail demands how are Brits going to get to the Costas for a tenner or Oz to visit the relatives and the government will cough up. Sadly, there doesn’t seem to be much joined up thinking in the U.K. anymore, just a sense of making it up as you go along. The whole Covid strategy demonstrates that.

ciderman
30th Mar 2020, 11:58
When you see stories of exorbitant fares for people stuck all over the globe I say "stuff you BA and the rest"

torvalds
30th Mar 2020, 12:10
When you see stories of exorbitant fares for people stuck all over the globe I say "stuff you BA and the rest"
There are now about 40 MP's all of a sudden to demand industry wide bailout. For the children of course.
The major shareholders won't let their money disappear when they can get a free ride. They are lobbying for the bailout and they are going to get it no matter what.

covec
30th Mar 2020, 13:30
I’m surprised that airlines (or any business) do not have “rainy day” contingency funds.

There is a limit to what a government (& ultimately the Tax Payer) can afford.

Here in the UK there is the laudable salary protection costs due CV-19, then the Boris Johnson spending pledges e.g. HS2. Then there’s Trident. And then there will likely be a whopping Benefits bill if more & more self-employed or small businesses go bust. E.g. BrightHouse.

The Tax Payer cannot bail everyone out - the UK is now AA- vice AAA due to these spending issues.

I see Easyjet is getting a kicking by commentators on the online BBC News: not much sympathy there and that may well influence politicians...

runway30
30th Mar 2020, 16:11
I’m surprised that airlines (or any business) do not have “rainy day” contingency funds.

There is a limit to what a government (& ultimately the Tax Payer) can afford.

Here in the UK there is the laudable salary protection costs due CV-19, then the Boris Johnson spending pledges e.g. HS2. Then there’s Trident. And then there will likely be a whopping Benefits bill if more & more self-employed or small businesses go bust. E.g. BrightHouse.

The Tax Payer cannot bail everyone out - the UK is now AA- vice AAA due to these spending issues.

I see Easyjet is getting a kicking by commentators on the online BBC News: not much sympathy there and that may well influence politicians...

In other industries, a skilled workforce and unused assets can be used by new entrants to the market and economic activity can continue. Sometimes there are the wrong assets and the workforce has the wrong skills and you have long term depression, for example the South Wales Valleys.
In the airline industry you have mobile assets and a mobile workforce so you are not constrained geographically. However, there are high costs of entry to the industry and we do not have the new entrants to the business that we used to have. If you have the funds to pass financial fitness with the regulator, you then have to persuade a card processor that you have enough money to operate. The card processor will want to know that in 9 months time you can supply the flight or refund the money. Airlines carry large cash balances but this represents money paid in advance for flights that doesn’t really belong to the airline until the flight takes place. This leads to the tension between card processors and airlines when they get into financial difficulty because the airline wants this money to continue operations and the card processors want the money available to repay passengers if the airline fails.
When an airline is operating it is monitored on a going concern basis. You can assume that historic cash flow from routes will continue. You have large costs and large revenues and so long as there is at least a small positive margin, operations continue and shareholders get a return on their investment. However an interruption to operations causes a huge problem. Revenues cease, you have to repay money in the bank to passengers, fixed costs continue even if you are not flying. The suggestion that airlines should have enough capital in case of a six month shut down is not realistic. Those funds would not provide a return on investment so investors would not fund it, there would be more profitable opportunities elsewhere.
In theory the Government can keep funding as long as someone will lend them money. The problem is that we are already running high levels of debt from the financial crisis. At the moment interest levels are low but if buyers of governement debt lose confidence in the government’s ability to repay then interest rates could rise, the pound could fall as investors sell their off government debt and inflation could rise. At the moment the government is spending this money to try to preserve economic activity for when the crisis is over to preserve future governement income. At the moment we are looking at a very sharp, hopefully short recession. However, the government is walking a tightrope, if we have large numbers of company failures, large numbers of unemployed, falling government revenues and increased government spending then the medical crisis is going to be swiftly followed by a financial one.

PeterWeb
31st Mar 2020, 00:20
At the moment we are looking at a very sharp, hopefully short recession.



Hoping for a V-shaped recession, yes. That's why so much attention is turning now to how governments can successfully navigate their way out of lockdowns.

The problem is that any such strategy has to be plausible. Since a vaccine isn't around the corner, either the virus has to be stopped in its tracks (perhaps possible in NZ) or under very tight control (the South Korea model). And/or we have to lower both the spread and the lethality - via effective treatments - to the point that the average Joe and Jane don't think they are threatening their own lives or their family's and friends' lives by going to work.

The lockdowns are now buying us some time to do that - but it's such a pity that so many of our leaders squandered the warning from events in Wuhan because a lockdown is so much more costly and risky than early action.

One example of post-lockdown planning:
aei.org/research-products/report/national-coronavirus-response-a-road-map-to-reopening

covec
31st Mar 2020, 01:05
runway30. That is a First Class post. Thank you.

Re the financial tightrope - that is what concerns me.

I’ve already given up and withdrawn from 2 interviews which had been placed on hold. I’m paying not one penny more into maintaining ratings bar my FI and will just accept that CV-19 stopped my dream dead. However, God Willing I’ll hit my death bed in my 90s and not sooner like some poor folk due Cv-19. Perspective.

Deltasierra010
31st Mar 2020, 09:09
All businesses have costs and revenues, aviation has always been high risk with regular large failures and investors have to accept those risks, you can make a lot of money when all goes well, if it goes wrong you loose the lot. Many national carriers are government controlled ( for better or worse) they will survive, for the rest the strongest will pick up after the crisis others will be taken over by new investors.
The number of passengers will return to normal with time, until then tough it out like the rest of businesses,

autothrottle
31st Mar 2020, 09:18
In other industries, a skilled workforce and unused assets can be used by new entrants to the market and economic activity can continue. Sometimes there are the wrong assets and the workforce has the wrong skills and you have long term depression, for example the South Wales Valleys.
In the airline industry you have mobile assets and a mobile workforce so you are not constrained geographically. However, there are high costs of entry to the industry and we do not have the new entrants to the business that we used to have. If you have the funds to pass financial fitness with the regulator, you then have to persuade a card processor that you have enough money to operate. The card processor will want to know that in 9 months time you can supply the flight or refund the money. Airlines carry large cash balances but this represents money paid in advance for flights that doesn’t really belong to the airline until the flight takes place. This leads to the tension between card processors and airlines when they get into financial difficulty because the airline wants this money to continue operations and the card processors want the money available to repay passengers if the airline fails.
When an airline is operating it is monitored on a going concern basis. You can assume that historic cash flow from routes will continue. You have large costs and large revenues and so long as there is at least a small positive margin, operations continue and shareholders get a return on their investment. However an interruption to operations causes a huge problem. Revenues cease, you have to repay money in the bank to passengers, fixed costs continue even if you are not flying. The suggestion that airlines should have enough capital in case of a six month shut down is not realistic. Those funds would not provide a return on investment so investors would not fund it, there would be more profitable opportunities elsewhere.
In theory the Government can keep funding as long as someone will lend them money. The problem is that we are already running high levels of debt from the financial crisis. At the moment interest levels are low but if buyers of governement debt lose confidence in the government’s ability to repay then interest rates could rise, the pound could fall as investors sell their off government debt and inflation could rise. At the moment the government is spending this money to try to preserve economic activity for when the crisis is over to preserve future governement income. At the moment we are looking at a very sharp, hopefully short recession. However, the government is walking a tightrope, if we have large numbers of company failures, large numbers of unemployed, falling government revenues and increased government spending then the medical crisis is going to be swiftly followed by a financial one.


Great post 👍🏻

peter we
31st Mar 2020, 09:23
Why wouldn't you have new airlines starting up to fill the void - after all there are going to b a lot of cheap airframes and crews sitting around. Why wouldnt we have new Virgins, Lakers, Easy's etc spring up like they did before?

Shareholders get wiped out, directors fired. New companies setup to buy up the assets for pennies, away you go...

yoganmahew
31st Mar 2020, 09:45
I’m surprised that airlines (or any business) do not have “rainy day” contingency funds.
The way modern capitalism has been allowed to work is that any company that is cash rich (has reserves) is a target for an LBO or a take over by a competitor with the competition watchdogs asleep all over the world. The superairlines should never have been allowed, the benefits of scale are overstated and you end up with small numbrs of systemically important players (cf the banks). Nationalise them if they need a bailout and break them up.

Deltasierra010
31st Mar 2020, 10:13
“Shareholders get wiped out, directors fired. New companies setup to buy up the assets for pennies, away you go...“

Most airline have very little tangible assets, everything is leased if you can persuade investors you are credible they will provide the working capital, then you form an alliance (cartel) to reduce competition, wish we all were allowed to do that.

cashash
31st Mar 2020, 15:33
“Shareholders get wiped out, directors fired. New companies setup to buy up the assets for pennies, away you go...“

Most airline have very little tangible assets, everything is leased if you can persuade investors you are credible they will provide the working capital, then you form an alliance (cartel) to reduce competition, wish we all were allowed to do that.

It doesn't really matter who owns the airframe whether its the airline itself or a leasing company, there are still going to be hundreds sitting in the desert that are looking for new owners going very cheap.

Gove N.T.
31st Mar 2020, 19:31
Why wouldn't you have new airlines starting up to fill the void - after all there are going to b a lot of cheap airframes and crews sitting around. Why wouldnt we have new Virgins, Lakers, Easy's etc spring up like they did before?
why start a new airline when there are ready made ones ready to start back up.

cashash
31st Mar 2020, 19:36
why start a new airline when there are ready made ones ready to start back up.

The new ones wont need taxpayer support.

torvalds
31st Mar 2020, 19:40
why start a new airline when there are ready made ones ready to start back up.
1) To let the market evolve instead of artificially keeping the same lot (owners/shareholders) in power for centuries.
2) To allow a natural development of the aviation business to serve a genuine demand instead of pursuing the race to the bottom strategy we saw over the last decade.

ORAC
31st Mar 2020, 21:39
why start a new airline when there are ready made ones ready to start back up.

Because many are pension schemes with massive deficits and a marginally profitable airline on the side. Start a new airline and you eliminated one of the major costs. e.g.

https://www.ipe.com/british-airways-accelerates-pension-funding-recovery-measures/10034124.article

https://www.pionline.com/article/20170315/ONLINE/170319922/lufthansa-to-freeze-pension-plan-for-pilots-introduce-new-dc-plan

https://www.ft.com/content/249be7da-12d1-11e8-8cb6-b9ccc4c4dbbb

Private jet
1st Apr 2020, 13:31
Because many are pension schemes with massive deficits and a marginally profitable airline on the side. Start a new airline and you eliminated one of the major costs.

Maybe if the virus took out a significant number of pensioners in said schemes then the deficits would be much reduced, don'tcha think so?

Holer Moler
1st Apr 2020, 14:35
https://news.sky.com/story/coronavirus-aviation-giants-lobby-for-virgin-atlantic-bailout-11966892

Will be interesting to hear WW & MOL reaction to this.

Sick
1st Apr 2020, 14:50
Getting Airbus, RR and LHR to write pleading letters on their behalf - sounds like panic mode for Virgin

77
1st Apr 2020, 16:40
LTN MAN - if your argument is to be followed, the UK Government should not bail out BA, the Spanish government should?

So you are saying IAG is a Spainish company??

nicolai
1st Apr 2020, 17:16
So you are saying IAG is a Spainish company??
Yes, it is.
It is a company with Registered Office in Madrid, quoted on the London Stock Exchange and the Madrid Stock Exchange. The Head Office is in London.

RexBanner
1st Apr 2020, 19:25
Yes, it is.
It is a company with Registered Office in Madrid, quoted on the London Stock Exchange and the Madrid Stock Exchange. The Head Office is in London.

Glencore has its registered office in Jersey. I’ve been there to have a look, it’s a PO Box. Are Glencore (the biggest mining and commodities corporation in the world as understand it) a Jersey company? No they absolutely are not.

flash8
1st Apr 2020, 19:51
Getting Airbus, RR and LHR to write pleading letters on their behalf - sounds like panic mode for VirginEspecially, as they themselves have refused to comment!

Private jet
1st Apr 2020, 21:58
Glencore has its registered office in Jersey. I’ve been there to have a look, it’s a PO Box. Are Glencore (the biggest mining and commodities corporation in the world as understand it) a Jersey company? No they absolutely are not.
Errrmmm yes they are. An analogy for example, an aircraft complies with the rules of it's state of registry and follows the rules of the airspace it flies through and jurisdictions it flies to. No different to any other business that operates internationally. If you have a problem with that then it's back to the stone age for us all with definately no air travel!

a1anx
1st Apr 2020, 22:23
......oh and isolating ourselves from our colleagues in Govts across Europe who want a collaborative approach).... .

I have to say that EU govts don't appear too collaborative at present.

RexBanner
2nd Apr 2020, 00:15
Errrmmm yes they are. An analogy for example, an aircraft complies with the rules of it's state of registry and follows the rules of the airspace it flies through and jurisdictions it flies to. No different to any other business that operates internationally. If you have a problem with that then it's back to the stone age for us all with definately no air travel!

So they’ve got a PO Box in Jersey for tax purposes, no footprint in terms of staff and no operational nerve centre there whatsoever, just a PO Box, it’s in name only. You genuinely believe they’re really a Jersey company? Good one. Keep them coming.

yoganmahew
2nd Apr 2020, 13:39
Not being part of the CAT industry I can understand why air transport might be at the bottom of the support list. Without passenger air transport irresponsibly carrying the virus to virtually every corner of this planet in a remarkably short period of time we would not have this pandemic that is causing so much harm to the rest of the economy - not to mention those who unfortunately have not recovered or will not in the future. APT to/from affected areas should have ceased right at the start. It didn't due to greed.
Quite right, third time too, it was the commercial air carriers during Spanish Flu and the Black Death.

covec
2nd Apr 2020, 23:17
UK’’s alleged Patient Zero was a GP who flew back into the UK...via a brief stop over with friends who got infected. So that must be at least two flights.

And the UK was flying into Northern Italy during the worsening crisis. Incredible. Still, hindsight I guess.

torvalds
2nd Apr 2020, 23:35
UK’’s alleged Patient Zero was a GP who flew back into the UK...via a brief stop over with friends who got infected. So that must be at least two flights.

And the UK was flying into Northern Italy during the worsening crisis. Incredible. Still, hindsight I guess.

It is similar to blaming TV shows and computer games for the violence on the streets. I see what you mean, but I believe you can not blame the medium (ie: the airline) in this situation. The issue here is the irresponsible passenger. That "doctor" knew very well the consequences of his/her actions. I know, people still booked holidays/trips after the WHO declared it pandemic. Because it is now all about "me-me-me", not because they just wanted to keep the airlines liquid.

esscee
3rd Apr 2020, 09:32
That is the problem when you have fully open borders. Notice Singapore have installed temperature sensing equipment at entry points, so they can check each arrival's body temp. Airport operators, airlines and Governments together are going to have to come up with some solutions to prevent this happening again. Take a look how a Sky journalist re-entered China, hoping to go to Beijing and ended in some location away from there in a 14 day lockdown and checked many times by people in full Hazmat gear! Now if China is doing that to prevent people bringing the virus back in to their country, then they must know much more about it than what they have released to the rest of the world. As for the World Health Organisation, less said just another agency without "many teeth".

Private jet
3rd Apr 2020, 10:50
So they’ve got a PO Box in Jersey for tax purposes, no footprint in terms of staff and no operational nerve centre there whatsoever, just a PO Box, it’s in name only. You genuinely believe they’re really a Jersey company? Good one. Keep them coming.
A company on the companies register in Jersey is a Jersey registered company. What part of that do you not understand? A company that operates in several jurisdictions has to be registered somewhere and where they choose is a matter between them and the country concerned, be it for tax advantages, operational advantages or anything else. There's a very well known reason for not debating with people like you.....so I won't

meleagertoo
3rd Apr 2020, 12:08
Odd, isn't it?
A completely unimportant event (in terms of the essential overall economic health of the country) like Wimbledon gets an immediate £100M (today's papers) yet aviation is more or less told to look after itself.
What a peculiar sense of priorities!

Ex Cargo Clown
3rd Apr 2020, 12:38
Odd, isn't it?
A completely unimportant event (in terms of the essential overall economic health of the country) like Wimbledon gets an immediate £100M (today's papers) yet aviation is more or less told to look after itself.
What a peculiar sense of priorities!

Wimbledon were insured

sheikhthecamel
3rd Apr 2020, 17:41
Once this is over, the dictators in Dubai, Abu Dhabi and Qatar will attempt to dominate the world premium air travel market. Subsidised. They will be making plans now..

Not at current oil prices they won't....

sheikhthecamel
3rd Apr 2020, 17:52
jeez, how short sighted are you torvalds. When a company goes bust it usually leaves huge unpaid creditors, so you are happy that every supplier to these airlines goes bust as well. So short sighted and righteous
And a whole lot of unemployed people who are consuming less, paying less tax and drawing benefits. There are several "layers" of indirect consequences.

RexBanner
3rd Apr 2020, 19:18
A company on the companies register in Jersey is a Jersey registered company. What part of that do you not understand?

I understand that perfectly well thanks, it’s clear that most would be able to see the argument that I was making. People have suggested that BA have no right to be bailed out by the U.K. taxpayer because the holding company that holds the shares is registered in Spain and by implication that it isn’t a British airline. That’s essentially a technicality in a situation like this, the airline is operationally a U.K. airline, it contributes enormously to U.K. coffers through paying corporation tax and employing tens of thousands of U.K. based employees who carry the British flag to all corners of the globe. I very much doubt that if push came to shove and there was a rescue package needed it would be denied because IAG (the holding company) is registered in Spain. Anyway if you want to throw your toys out the pram and storm off because someone disagrees with you on what constitutes nationality then fine, it’s clear that it’s a pretty pointless debate anyway.

torvalds
3rd Apr 2020, 22:51
And a whole lot of unemployed people who are consuming less, paying less tax and drawing benefits. There are several "layers" of indirect consequences.
The chancellor doesn't want to bail them out either... I guess he (and his team) knows a thing or two about this whole situation we are in right now.
An airline will be replaced by another airline and the unemployed will be employed again (paying tax, etc). Or is it going to be the end of mankind as we know it?

covec
4th Apr 2020, 02:11
The chancellor doesn't want to bail them out either... I guess he (and his team) knows a thing or two about this whole situation we are in right now.
An airline will be replaced by another airline and the unemployed will be employed again (paying tax, etc). Or is it going to be the end of mankind as we know it?

Just wondering in the light of your comment if governments - and airlines - have their fingers deep inside the Derivatives Pie...those self-same financial vehicles that helped fuel the 2007-2008 crisis.

Derivatives are such a large part of the global flow of cash as to be unquantifiable. Someone somewhere is going to be left with a very large bill/loss. And I suspect that that is why bail-outs are not popular with governments at present. I hope not.

PeterWeb
5th Apr 2020, 00:10
Notice Singapore have installed temperature sensing equipment at entry points, so they can check each arrival's body temp.


Yes, and in other public spaces - though they are aware that fever is sometimes a short-term and sometimes a non-existent symptom of Covid-19, so it's just another layer of protection.
(See https://www.todayonline.com/singapore/covid-19-temperature-screening-still-useful-detecting-cases-despite-limitations-experts )

Singapore - along with South Korea and Taiwan and maybe Hong Kong - are among the early success stories in this disaster, and we should all be paying close attention to them.


[Sky journalist] checked many times by people in full Hazmat gear! Now if China is doing that to prevent people bringing the virus back in to their country, then they must know much more about it than what they have released to the rest of the world.


I disagree. The infection rate and mortality rate estimates released to the world as far back as late January were plenty bad enough to warrant serious concern everywhere. But a lot of people chose not to trust those numbers and to minimise the risk they represented - this in spite of years of warnings from those most knowledgeable about the world's vulnerability to a new pandemic.

There were plenty of correct arguments about "it's way too soon to take these numbers as firm" and an equal number of specious arguments about how much better health systems or population health might be elsewhere, or how the virus (somehow) wouldn't get to the rest of us, so we needn't worry.

That worked out well.

wisecaptain
5th Apr 2020, 00:58
Rexbanner , IAG have no right to a bailout until they take steps to raise equity. As usual 'employees' are taking a hit while shareholders are given priority.
IAG must sell off/dilute its share base by selling all those hundreds of millions of stock buybacks they did . Then they must go to the debt markets to raise further capital if required.
Only then if that is insufficient can they be considered for govt loans.
These airlines have failed to ensure sufficient capital backstops , 1 month is not enough so they must do the above to ensure their survival .
If they dont then they dont deserve to survive at the tax payers expense .

marchino61
5th Apr 2020, 01:21
Rexbanner , IAG have no right to a bailout until they take steps to raise equity. As usual 'employees' are taking a hit while shareholders are given priority.
IAG must sell off/dilute its share base by selling all those hundreds of millions of stock buybacks they did . Then they must go to the debt markets to raise further capital if required.
Only then if that is insufficient can they be considered for govt loans.
These airlines have failed to ensure sufficient capital backstops , 1 month is not enough so they must do the above to ensure their survival .
If they dont then they dont deserve to survive at the tax payers expense .

Who exactly do you think will buy IAG equity - at any price?

Debt maybe, but equity is a non-starter.

cashash
5th Apr 2020, 01:45
Who exactly do you think will buy IAG equity - at any price?



IAG currently trading at £1.98 - so someone must be buying.

marchino61
5th Apr 2020, 07:06
IAG currently trading at £1.98 - so someone must be buying.

I suppose a rights issue at say £1.00 might be possible, but that might only raise a billion or two. I don't know if that would be enough, given its revenue last year was closer to 20 billion.

covec
6th Apr 2020, 12:08
Radio Scotland reporting easyjet has funds until August?

If they can cancel their new aircraft order then the situation improves?