TAAE about to bite dust? [Archive]

Rudder

16th Jul 2003, 07:11

Hi Buster,

I'm not suggesting that CASA can't or won't move on TAAE if there is something wrong, and I'm not suggesting that their operations aren't OK. From what I know they have some pretty good people in that area that have been trying to do the right thing..

There is always a chance that CASA can move just on the basis of financial viability as someone else hinted at.

What I suggested was that AAE would have to kick in some money to keep it afloat and operating to protect thier network at least in the short term.

Like always there will be people hurt here whether it's staff, contractors or suppliers and that has a ripple effect through the industry and it's not particularly something that is needed at the moment.

Sheep Guts

16th Jul 2003, 07:24

Maybe a foreign entity might be interested. It must still be a money earner. DHL maybe?

Regards
sheep:p

Buster Hyman

16th Jul 2003, 07:28

Hi Rudder.

Therein lies the dangers of a rumour network, especially when CASA probably use it to target their next airline!:mad:

Lets hope AAE do support it & keep it going as you suggest, rather than use the QF way!!

Capt Snooze

16th Jul 2003, 08:36

Sheepie,

TAAE (or TAA, as they prefer to be known of late) are an operator providing aircraft and crews to service the heavy part of AaE’s network. The freight ‘belongs’ to AaE (essentially QF domestic freight and Australia Post). Companies such a DHL use aircraft as large and fast trucks to carry their own product, and are in the main uninterested in carrying other company’s freight other than as top-up, or operating on another company’s behalf.
Whilst a foreign aircraft and crewing company may be interested, it is unlikely to be “a money earner’ at current contracted rates. In fact, this has just been conclusively demonstrated. TAAE was the low bidder in a low cost sector of the market.
The problem confronting AaE is that last year they went from having two 727 contractors, Air Cargo Australia and IAF, to only one, TAAE (a re-badged Air Cargo Australia, with new owners), thus effectively putting all their eggs in one basket. If AaE are forced to prop up TAAE to ensure their own network performance, the ‘low bid’ operator may well have turned out to be the higher cost operator. Red faces indeed!

TSI,

What the ‘new owners’ prefer in the way of equipment, 310 or others, is almost irrelevant in this context. That decision has always been made by the customer, AaE.

Buster,

Not sure what you mean by the QF way? Care to elaborate?

Snooze

Col. Walter E. Kurtz

16th Jul 2003, 09:58

One wonders how hard AaE had the screws into the back of TAAE for the 'lowest' price.

Wouldn't be the first operator to have the screws come out through the chest at the hands of a freight company now would they?

d_concord

16th Jul 2003, 18:13

I've just been told that TAAE has gone into administration.

They will operate tonight and tomorrow night and it is still an uncertian future after that at this stage.

Hope it all works out for the sake of the staff although from reading some of the other posts, I must say it doesn't look good.

TSI. Still think they are in good shape and there is a chance of raising anything for that other basketcase Trans World????

Night Watch

17th Jul 2003, 12:23

Word on the apron last night was that AAe have been told by the administrators that the B727s would not be flying thursday night (tonight).

AAE are apparently throwing money at the administrators on a daily basis to try and keep the aircraft in the air.

If the 727s don't fly tonight...... well what a :mad: fight its going to be to move all that freight.

Hope something can be sorted out, for the sake of the crew and all at TAAE. (not to mention everyone who won't be getting there express fright)

Buster Hyman

17th Jul 2003, 13:09

Best wishes to some of my former colleagues who are there...I hope it all works out!;)

sandpit

17th Jul 2003, 16:41

Does anyone know who the administrator is? I hope not K & M!

Capt Claret

18th Jul 2003, 07:53

I saw a 72 freighter with the freight door open on the ground at Cairns last night (Thurs). Heard the beast talking to BN Ctr on departure for Townsville. They were told to keep the speed up all the way to the field to go number one to Sunstate xxxx. What a race! :p

As an aside, IMHO the 727-200 is the horniest looking aircraft ever built! :cool:

ur2

18th Jul 2003, 09:34

Sound like a lot of BS about it being under administration. Just an ugly rumour eh.

leftfrontside

18th Jul 2003, 10:36

ur2

Its not BS they are under administration and are only airborne because AaE has agreed to pick up the tab for THE MOMENT.

Oblivion is all but a step away :hmm:

(administration went into effect 5 pm on the 16th I think)

dreamin'

18th Jul 2003, 14:00

For a little perspective on this company go here (http://www.pprune.org/forums/showthread.php?s=&threadid=70124).

Truth Seekers Int'nl

18th Jul 2003, 14:22

concorde dave, TAAE are in good shape they are still operating and will do so until a buyer is found.

d_concord

18th Jul 2003, 14:57

TSI,

Wow, that's the best spin I've ever heard put on a company in the predicament of TAAE. You should lay off whatever your smoking!

The fact is that they owe many millions of dollars, can't pay it and the only reason they are operating is because while under administration they don't have to pay any past debts.

The administrator only has to cover ongoing debts after they take over and their own fees. The bigger the job (or mess) they can make of it the better for them. It's like putting the fox in charge of the chicken house. Ask the Ansett guys whether this is true or not.

I'm aware of one creditor, a one man band that is owed $50K and is now in dire straights because he can't walk away from the debts he incured as a result of TAAE.

The fact of the matter is that there is no guarantee that there is anything going forward. The future rests entirely with the wants of AAE as the existing contracts would have toppled due to the act of insolvency. AAE will use the situation to restructure to thier own benifit.

Now lets look at some of your other wisdom on this topic and what is now known as fact.

-----------------------------------------------------------------------------------
Post No 1

"good try d_concord (aka **** ******). TAAE is in good shape except the ex Ansett guys that joined want the same conditions as they had with Ansett and it won't happen. hence EBA negotiations have stalled, five pilots have joined Virgin and the usual bullsh!t rumours abound.
Buster, the A310 is still on schedule, only problem is there may not be any Perth pilots left to crew it."

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Post No 2

TAAE is a subsidary company of Trans World. according to my sources here in HK trans world needs an injection of capital yesterday. looks like TAAE will be put on the market sooner than planned to raise the funds. whether the new owners will go with the A310 who knows (sorry Buster, only found this out today!) but the 727s will be around for a while yet.

-----------------------------------------------------------------------------------

Post No 3

concorde dave, TAAE are in good shape they are still operating and will do so until a buyer is found.

-----------------------------------------------------------------------------------
All a Crock of ****.

The last strike out is that my name isn't Dave or do the letters of my name equal what is in your first post.

leftfrontside

18th Jul 2003, 17:58

It's interesting sitting back and looking at all the defenders here, no one really knows what the adminstrators or AaE will do/decide as I believe now it is completely in there hands.

My bet is that they will walk and that "d_concord" is correct with his info - doubters such as TSI and co take note.

History shows that Compass II was wound up for the sake of 5 mil. my sources tell me that TAAE are in for at least double that and maybe more, one of the guys in maintainance tells me that most of the aircraft if not all are up for major checks in the next 6 - 8 mths, that's big money. Another rumour flying around is that they have been locked out of the simulator by the other partners, from all perspectives life looks fairly dire for them I'd say unless "the Fairy God Mother comes over the hill and pulls a large rabbit out of the hat"

:ouch:

3 Holer

18th Jul 2003, 19:43

TSI - are you joking? Any Company in administration are having corporate / trading difficulties. Now, I would like your clarification on a couple of points:

1. What would a Cathay pilot know about the internal goings on of TAAE ?
2. What evidence do you have to support the claim that TAAE is "in good shape" ?
3. EBA negotiations never stalled at TAAE, they are still on-going!
4. Three (3) pilots, at present, have joined Virgin. Why have you stated five (5) pilots?

D_Concorde - when you say "fact is they owe many millions of dollars". Whom do TAAE owe this money to ?
The "one man band", who you claim, is owed $50K - is that you?
the only reason they are operating is because while under administration they don't have to pay any past debts.

Not true, the only reason we are operating is because the administrator is paying the bills. Chapter 11 rules do not apply here in Oz.

Chocks Away

18th Jul 2003, 19:47

Things are getting interesting...

Pelair may have just purchased the AoC?.

Dog One

18th Jul 2003, 19:58

"As an aside, IMHO the 727-200 is the horniest looking aircraft ever built!"

Got to agree with Claret on the above statement!!

Buster Hyman

18th Jul 2003, 20:58

Well you & Claret must have a full on orgasm when a trident flies by!!!:rolleyes: :p

3 Holer

19th Jul 2003, 06:07

What's the difference between a "full on orgasm" and just an ordinary, everyday, run of the mill orgasm Buster ?:D :O

VTM

19th Jul 2003, 07:51

If its not money that stops operation, it will be the noise next,I agree that the 727 is a great aircraft but age is catching up with it, the 727-100 is over 30 years old :zzz:

Buster Hyman

19th Jul 2003, 08:22

If you're just getting an ordinary, everyday, run of the mill one 3 holer, you're doing it wrong!!;) :p

dingo084

19th Jul 2003, 08:27

Last time I looked, all the 72's were stage 3 compliant.
Last time I listened, they didn't sound like a 72 either.

ding

Aviator in the know

19th Jul 2003, 08:44

You cannot purchase an AOC. CASA will not allow it. You must buy the company . It would be impossible for PELAIR or anyone to slectively take what they want without the administrator doing some crafty moves. Not something that could be done in a few days and something that could open up a can of worms for any administrator with regards creditors. The AOC is the only valuable item in TAAE as the aircraft belong to a US company , not TAAE. To establish a new 727 AOC would cost a bundle. The 727's are AAE's backbone. I suspect AAE will be trying to keep these aircraft in the air at all costs , but they cant influence the administrators decisions too much as he has the responsibilities of the creditors on his shoulders . I have not heard who the Administrators are . Does anyone know ?

Oh and the point about noise. These aircraft are huskitted to comply with Stg 3 regs. There was a ruling that stated all stg 3 hushkitted aircraft had to depart these shores by dec 31 2005. I am not sure if thats still on the books or not - I think it is - which gives the 727's another 2 years of action here . After that a stg 3 by birth or stg 4 aircraft is needed in OZ. That will push the cost into the stratosphere for AAE. A310 or the likes do not come cheap. Lets face it , a 727-200F Stg 3 can be bought in the US for $1.5 mil. What price an A310 - $10M+ for a dog.

Oh and the point about noise. These aircraft are huskitted to comply with Stg 3 regs. There was a ruling that stated all stg 3 hushkitted aircraft had to depart these shores by dec 31 2005. I am not sure if thats still on the books or not - I think it is - which gives the 727's another 2 years of action here . After that a stg 3 by birth or stg 4 aircraft is needed in OZ. That will push the cost into the stratosphere for AAE. A310 or the likes do not come cheap. Lets face it , a 727-200F Stg 3 can be bought in the US for $1.5 mil. What price an A310 - $10M+ for a dog.

Cruze Power

19th Jul 2003, 09:31

Its not really up to Pelair or anyone to "buy" the AOC or the company, rather it is really up to the administrator to make a proposal to creditors that will provide them with some level of compensation for their loss. The sale of the company is solely dependant upon a successfully adopted Deed of Company Arrangement (DOCA), and on day three thats a tall order, especially when the company subject to a DOCA is by default the last thing to be sold.

Whoever the administrator is will not know the true and correct financial position of the company until the directors provide him (or her) with a Statement of Affairs, which takes at least 14 days.

Notwithstanding all this, any administrator is not going to be doing any fast eddie moves to sell any assets, rather his (or her) job is to administrate the affairs of the company over usually a two to three month period (generally 60 days), during which time they normally look for a buyer of the business. The main asset is a business that is a going concern.

To that end, the administrator CAN, WILL, and wants to be influenced by the financial support of AAE to keep the business operating. It is a situation of you sratch my back I'll scratch yours when it comes to AAE and TAAE (trying saying that ten times with a mouth full of Sao's), as each without the other is in rather hot water.

AAE cannot just flip their business to the belly of a 767 at QF on a whim or need, nor can the administrator afford for the business to close its doors because as a result he (or she) will have little to sell. As it has been rigtly pointed out, the aircraft are US assets, an there is not a lot of value of 727 ground support equipment here in Australia to pay the creditors and debts of TAAE.

Oh, and by the way, a 727 operation is not made of a second hand (or third, fourth or fifth) AOC. It takes a little more horesepower than that!:cool:

Capt Claret

19th Jul 2003, 10:29

Sorry to disappoint you but the Trident just doesn't have the p'zazz of the 722.

Not that it's an ugly duckling but it doesn't have the right proportions. It'd be like chosing Kylie Minow-gue over Elle! :}

d_concord

19th Jul 2003, 11:28

3 Holer,

Not quite correct.

While in administartion the current debts are put on hold while the company is restructured to try and keep it as a going concern.

This can be done either to return it to the present ownership once the mess is clkeaned up or with approval for sale as a going concern. If this can't be acheived it will be placed in receivership and eventual liquidation.

You saw this mechanism in action with Ansett.

The only debts the admnistrator is bound to pay are those debts which he is responsible for authorising. The debts prior to administration can either be renegotiated as to their size or payment schedule so they are no longer current debts or they will be realised once the company goes into receivership and the creditors will get "x" cents in the dollar depending on the realised asset value which wlll be very litlle in this case. That is why it is sometimes worthwhile the creditors supporting the administartion and negotiating a payment schedule and also having an ongoing business.

Clearly if it is to be kept as a going concern a lot of parties must be prepared to forgive the debt or part of it.

Contrary to what you say it is very much like chapter 11 in the USA and was in fact modelled on it.

I'm not going to disclose the debts of those individual parties I know here. The point I was making with the 50K creditor is that a lot of small people get hurt in this sort of situation and it sometimes fatal to their enterprises. And as for your inference.... It's not me.

I have heard that there is one creditor alone owed in excess of 2M.

The aircraft are leased from Rothchild (2) DHL (2) and Intrepid (1) don't know who own the others but I'm sure you can imagine the size of those debts if they haven't been paid for some months.

These lessors will also decide whether there is any ongoing future for a lot of good people within TAAE. If they pull the aircraft as they would be entitled to do, there is no future for TAAE in any case.

In relation to the AOC it was issued to Aeromarine and it is rumoured that that company was purchased early in the week by Pelair prior to the administration. I'm not sure of how the shareholdings are structured but if there is any tie back to TAAE, I would suggest that this will be deemed a non commercial transaction under the Act as it would be deemed to detrimental to the creditors and the administrator or reciever could probably have the transaction reversed.

If the transacion did take place the question to be asked is whose AOC has the aircraft been operating on, if any, or does the operation now breach the borrowed AOC provisions.

What a mess!!!

Aviator in the know

19th Jul 2003, 12:51

Hmmm an interesting revelation if true. I know that the Aeromarine operation was sold to TAAE right at the start of this debacle to allow TAAE into the air. Poor Bill got shafted on the sale. I do not think its his AOC to sell anymore . There were 2 727 AOC's - Aeromarine and IAF's . As far as I am aware TAAE has their own AOC now and the Aeromarine AOC and IAF would be dead and burried in typical CASA methodology. If the a'int being used they dont exist and you have to re-apply again if you want to use them ever again. Remember an AOC has to have rego's on it . Without the aircraft you cant have an AOC .
If TAAE have been running on a borrowed AOC then its time for a Royal Commission into this and all the other funny business that has gone on in Melbourne (Ansett) of late . The other issue is the maintenance approval -- I think its in TAAE's name. Without a maintenance agreement you cant have an AOC . They are all intertwined. I would love to know the truth of all of this. My guess is that if the Pelair rumour is true , then they may have purchased IAF's AOC (now defunct) . To get it , or any other AOC active with all the crap that goes with it will be a nightmare. Not something that will happen overnight. Time will tell.

emergencybus

19th Jul 2003, 13:33

VH NJA turned up at MEL this morning with about 25 what looked like "people at work" and proceded to TAAE offices ???

d_concord

19th Jul 2003, 14:37

Aviator in the know,

My understanding is that TAAE or a related party bought out Bill and that the Aeromarine AOC was still the operating AOC. I wasn't implying Bill sold Aeromarine again.

It will depend on how the corporate structure was and what entity or individual held the shares of Aeromarine as to whether there were any rights to dispose of Aeromarine and for what reason. However I'm pretty sure there was an sale agreement in place of some sort. What has happened since I'm not so sure of.

I have an idea of what took place and why but would rather hold off on that until I know for certain.

The IAF AOC is dead and buried. Of course even if it wasn't you still have to have all the structures and other approvals in place as you have indicated to be able to exercise the priviliges. Even if it was active they could only operate RMX subject to the above.

I just checked the CASA website and the AOC is Aeromarine Consulting trading as Transaustralian Air.

Not sure a Royal commission is appropriate just let CASA do their job and be consistent. The Ansett thing well that's a whole new ballgame.

Rudder

19th Jul 2003, 15:01

I had heard the Pelair thing as well but have since also heard that it was reversed or not gone ahead with.

Capt Snooze

19th Jul 2003, 19:10

A little off the mark, but now mainstream news.
ABC News link (http://www.abc.net.au/news/newsitems/s905775.htm)

Snooze

ER2nd.

21st Jul 2003, 05:28

A little tale I heard suggests the toppling of TAAE may have been started by none other than Korda Mentha. The story goes that just prior to all the staff being stood down at the TAAE hangar, TAAE had briefly towed a B727 over to AAES. Once there, its exit was blocked by a hastily positioned Ansett a/c (B767?). A while later it was released (blocking a/c moved out of the way) and towed back to the hangar occupied by TAAE....then the staff at TAAE were stood down. Maybe all innocent and a case of 2+2=5 but.....

sexkitten118

21st Jul 2003, 15:39

So are the 727's operating tonite? If so are the crews requesting their monies up front so they don't get shafted by the administrators like some of them did at Ansett!!!:mad:

Wingnuts

21st Jul 2003, 16:38

TAA For Sale 6.5m

Nat. Jet is the only serious buyer to date.

For anyone with lazy super funds, now might be a good time to make an offer.

The Fleet:

VH-TBS, a 100 ex AN RMS, owned by TAA
VLF, a 200 ex AN RMN, owned by TAA
VLG, a 200 ex AN RMX, owned by TAA
TXH, a 200 ex AN RMV, leased from Prewitt, USA
VLH & VLI, 200LRs, ex AN ANB & ANA, leased from European Air Transport (DHL) Europe
TXE, a 200 ex Japan Airlines, leased from Finova, USA. This one is the orphan. Although a 200 it has a 100 fuel sys. & no aux fuel tank, operates east coast only. Its MZFW is 15000 above standard 200, has -17 engines(15500lbs, 500 more than -15) and is Stage 4 (all others Stage 3). The 31 Dec 2005 date is expected to be extended in the States and hence here also.

These aircraft a running like Singer sewing machines although the odd wheel falls off every now and then. A bargin!

fruitloop

21st Jul 2003, 17:47

ER2nd.
Close but not quite right !! The 727 was at the hanger for weighting, Its return was blocked by a 737,it was removed after Items of a designated value were procurred for outstanding fees !
Cheers

Dan Kelly

22nd Jul 2003, 06:59

I'd heard that maintenance was quite a big issue with the 72's? :confused:

Aviator in the know

22nd Jul 2003, 10:51

I have just read the creditors report. Total owed is just under $ 7 mil. The big loosers are the tax office $ 1.75 mil and the leasing companies - $ 2mil usd.
On the surface of this report I expect this company will find a new owner and survive to fly another day - but nothing is sure in life except death and taxes !

Rudder

22nd Jul 2003, 11:43

I've seen the circular to creditors as well and it's very much a preliminary one. Has some holes (denoted TBA) which I understand in one case is over 1M.

I also spoke to one party that said the figures for them were understated by about 30K.

The administrators have some 28 days to come up with final figures.

NJ, Virgin, Patricks and Horizon are all sniffing around with NJ the favorites it would seem.

Dan Kelly

22nd Jul 2003, 12:32

Surely Virgin would be mad not to try and purchase the business and NJS would be mad to let them

Given that AaE is a joint venture between Qantas and Aust. Post, would AaE be able to reject a bid by Virgin? I can't imagine that Qantas would want to give Virgin a helping hand by awarding them some freight work.

Rudder

22nd Jul 2003, 13:58

I never said that they may be interested in operating for AAE and I'm sure that AAE wouldn't let them.

I'm not sure that NJS will have any say in this unless they are prepared to step up and pay the price.

At the end of the day it will rest with AAE who buys TAAE and operates the aircraft if it is to be for them. It's almost certian that the original contracts have toppled because of the good old act of insolvency clause. AAE will have the right to do what they see fit going forward.

However, a ready made freight operator and network might hold some attractions for Virgin and Patricks to operate in their own right. It would have the added benefit of causing some difficulty for the AAE/QANTAS network while they move on the market ala the demise of Ansett so it has added value to them. It's certianly worth the looking.

Aviator in the know

22nd Jul 2003, 15:03

I cant see Virgin getting anywhere near it. Its not core business at a time when they are looking at a float . Plus the 727 is maintenance intensive - Virgin like the "no maintenance new aircraft approach" . Plus there is not enough money in the operation to excite them. Patricks .... unlikely again , but a slight possibility. Horizon - not enough money . Pelair - same problem but slightly better chances . My bets NJ. They have the money . All it takes is the will.

d_concord

22nd Jul 2003, 16:14

I think a Virgin/Patricks tie up would not be much different from QANTAS and AAE. There is already a Virgin freight component to the company if you look at their website. Freight doesn't have to be core business in a passenger airline, the marginal cost of carrying it utilising spare belly capacity is very low and hence returns very good.

Virgin to carry the belly in thier nice new aircraft pretty much like QANTAS and Patricks to operate the old low utilisation freighters for which the economics don't work with new equipment like AAE( or contractor).

However, I'm with you. my money is on NJS as this is what AAE wants.

Buster Hyman

22nd Jul 2003, 20:53

I guess it all boils down to the question of whether or not there is a need for a freighter airline of this size in Oz?

Sure, Tassie runs are pretty much necessary, but cost is now the driving force these days, so one can only wonder if the Ferries to Tassie will cover this market too.

At the end of the day, airfreight will never beat a truck for price.

:(

d_concord

23rd Jul 2003, 04:21

I don't know what impact that this will have for the operation but I heard tonight that the 727 simulator has been shut down.

I don't know what impact this will have in keeping the operation going but would almost make it almost impossible for a new operator in the short term.

They were evidently one of the bigger creditors.

Dog One

23rd Jul 2003, 07:23

Patrick's loom bigger than most contenders in books. They have the money, and freight is their game. Patrick's have also bought up most of the ex AN ground equipmen around Aus.

Operating a 727 operation would be a large challenge to Pel Air and one would think fraught with major(expensive!) problems. NJS, well, it would depend on what their British masters decree.

Time will only tell - lets hope the three holers keep burning and turning!

Wingnuts

26th Jul 2003, 08:51

Why did TAA go tits up?

In a word, the answer is 'CASA complience'.

The costs of the last 2 'C' checks overran budget due to CASA requirements and the unbudgeted costs associated with 'day to day' complience issues finally blew the liquidity of the company out of the water.
For the C chks, CASA wanted every component that did not have a known history replaced. We're talking 7 figure amounts here for a very marginal if any improvement in safety.

The 3 holer is a reliable workhorse but to operate it within the confines of 2 or 3 pages of MELs is pretty difficult. Hundreds of hours went into trying to improve on Boeing's 727 MELs to bring them to an acceptable standard for CASA but to no avail.

This problem is still unresolved and will be ongoing for the future owner - if there is one.
Every step of the sale process has to be vetted and given the nod by CASA.
It is in the interests of everyone to have the new owners onboard as quickly as possible. However, with CASA's involvement, it will be a miricle if it happens this year.

Unfortunately, CASA is unaccountable.
They are bureacrats, who under the guise of safety, are out of control.

Staff, who are mainly ex Ansett, are about to have another pineapple rammed up the arse. What recourse do they have?
Not much except perhaps to hound their federal member and John Anderson. It maybe opportune with Toller's removal, the man who grounded Ansett's 767s.

ur2

26th Jul 2003, 10:26

Just heard, Patricks out of the race.

Willie Nelson

26th Jul 2003, 11:36

I am of the opinion that AAE has ultimately brought this upon themselves.

You should not be able to walk in the door of an organisation like AAE, place a proposal for tender on the desk and not expect to have a very intensive SWAT (Strenghts, Weakness and Threats) analysis carried out.

I accept that AAE may well have been desperate and at the time the TAAE proposal might well have looked like a solution to a problem that no one else would touch. It is however incumbent on the management team to determine the likelihood of continued solvency of an operator. With the benefit of years of hindsight (before the formation of TAAE), AAE has had the opportunity to analyse the track record of these aged aircraft newstarts. We have all seen this before.

CASA does have a history of going way over the top to cover its ever increasingly vulnerable backside, particularly with new organisations. This is not new!

Operators of older machinery tend to underestimate the costs of maintenace on their aircraft as they "should be faultless" This is not new!

And unfortunately another freight operator looks like going under. Sad to say this is not new!

I do not meen to exonerate TAAE of potentially poor managemnet (I don't have all the facts to say) AAE, however have been at this game for eleven years. If their customers depend primarily on continuation and reliability of service...............:ugh:

Willie

leftfrontside

26th Jul 2003, 12:16

WN you are correct AaE brought this on themselves, however they were not desperate. There were 2 other properly constructed proposals on the table by other operators at the time, at realistic costings.

However TAAE were falling over themselves to grab the operation at an unrealistic bargain basement price, with I have heard "inside" help, such that the other propasals were dismissed out of hand and CASA was in muddying the waters also.

Some heads could and should roll within AaE over this debacle.

d_concord

29th Jul 2003, 07:22

Wingnuts,

TAAE didn't go titsup because of CASA, they wen't titsup despite them.

You can't blame CASA for the fact that these people bought an aircraft which was in effect full of bogus parts. If TAAE had done the job correctly they would have paid a price that reflected the condition of the aircraft and fixed it up correctly. A lot like buying a C172 with a run out engine. Most people wouldn't pay the same price as one with a part life or new engine. CASA shouldn't have allowed this aircraft to fly just to assist these people, every other operator has to toe the line.

You also can't blame CASA for the MEL's. The company tried to grow so fast they just couldn't keep up and didn't have the resources in house. I think the ex CASA ex Ansett person at the top found out it's a lot harder in the real world without the support of dozens of specialist personnel. I'm sure he also found out that it's a lot easier to criticise from the CASA side than actually get in and do the job. I'm also sure that he came across the limitations of the rest of the senior management pretty quick as well. It get's hard to do things when people start screaming for money and moral drops and all your getting is BS out of management.

You also can't blame CASA for the company going broke. The fact is that the company has no banks as creditors in the report given out last week and you would have to assume they had no financial facilities with the banks, they put in little capital if any and right from the outset they set about using the creditors money to try and run the business. CASA should have looked at the financial viability of the company in terms of maintaining standards and safety and there has been no suggestion that they didn't or that the operations weren't OK.

What you can blame CASA for is most of the industry knew this was happening for quite some time and that clearly the company and the crews were stressed and that they didn't step in earlier to assess the situation.

The reality is that CASA cut them more slack than they would have given normally and you would have to think that that was because of the ex CASA now chief pilot without any experience running this type of show. That's a concern in it's inconsitency. Most of the industry has been hamstrung in trying to get new aircraft into the fleet let alone everything else.

As I said, TAAE failed despite CASA not because of them. CASA had no involvement in the actual financial failure of TAAE. It was doomed from the start.

If I take the Circular to Creditors on face value the Chief Pilot is in fact employed by TAAE. How does that work with the AOC held in the name of Aeromarine Consulting. Did Aeromarine in fact meet the requirements to exercise it's privilidges of the AOC. Does this in fact breach the borrowed AOC regs and does it continue to under the administration.

What CASA needs to do is to regulate within its' own charter to be fair, impartial and consistent in it's own duties. This is what frustrates most of the industry. If CASA had insisted that this company meet all the requirements as they are laid down, then right from the start it would have been evident why their pricing was so different from those other establised operators that tendered. CASA in fact rewarded the party taking the shortcuts.

In terms of AAE, they have certainly got themselves in this position. They let a major contract to a company and people of no substance and have exposed their whole network. Your right Willie, the senior management of AAE and the relationship to one of the directors of TAAE should be looked at by the Board. The transaction smells. I'm with you LFS.

ur2

30th Jul 2003, 07:57

Whats the lattest , Do TAAE have a buyer yet ?

Wingnuts

2nd Aug 2003, 13:04

TAA moves about 270 ton of freight, on 21 flights, 5 nights a week with a dispatch reliability of 98%. All maintenance is done in house through to Check Ds. Can you imagine the management and resources required to organise a Check D on a 20-30 year old 727?

The score is on the board.

These facts, numbers do not reflect poor management or a half baked operation.Three weeks into administration, this world class performance is being maintained and the Check D of VLG goes on. This does not reflect low moral. To the contrary. It reflects a group of people who know they have a viable organisation and are prepared to stay and see the process through to the end.

d_concord, you make a number of valid points. However, you do not lessen my beef with CASA. CASA is 'out of control'. Willie says that 'CASA has a history of being way over the top' and you,yourself, say CASA 'needs to be fair, impartial and consistant'. This is all I ask. The longer the aviation industry keeps bending over and taking it up the arse from CASA the longer they will have their pleasure.

CASA's charter is to 'work cooperatively with the aviation industry to maintain and enhance safety'.(Civil Aviation Act 1988 Para.9(1)(c) & Sect. 16) That is a 'c' for 'cooperation' not a 'd' for 'dictation'. CASA should be facilitating airlines such as TAA. Unfortuately, they have moved beyond to power play.

d_concord

2nd Aug 2003, 15:42

Wingnut.

While on the face of it some what you say is true, I think you are giving credit where it's not due.

The management of this company is atrocious. You are giving them credit for the professionalism of the crews and engineers that have had to put up with quite a bit of angst and duress over unpaid bills while they have been at the coalface dealing with the suppliers. Let me assure you this company has been stressed financially for quite some time.

I know a lot of them, both engineers and pilots, they are great blokes and highly professional and I wouldn't expect anything else but a great "operational performance" but to attribute this so called "world class performance" (which it's not by any measure) to management begs belief.

Almost from day one the management of this organisation has been diverting the creditors money to only loose it. If you remember back to very early in the piece there were wages missed just after the current senior management took over. Of course that was a clerical error!!!

There was never enough seed capital or bank facilities for this organisation. It will be interesting to see the final report from the administrator is as to the so called management of this company but knowing what I do, I'd almost bet that they have been insolvent from the first week.

CASA had nothing whatsoever to do with the demise of this company. It's a case of damded if you do, damded if you don't in this case. They just can't win depending on your perspective.

I'm happy to debate CASA in terms of the rights or wrongs in industry general terms anytime you want, but I suspect, from what you have said in your last post, that we will agree on most things.

However it is not CASA's place to ensure or assist the financial success of a company. I'll say it again, they had nothing whatsoever to do with the demise of this company. The demise of this company is purely financial missmanagement. (and that's throwing the kindest light on it you can imagine).

VTM

3rd Aug 2003, 18:57

Unfortunately when you operate aircraft in the RPT category you are in the big league as far as CASA is concerned, if you cannot keep up with the paperwork which seems to be one of the problems this operation has always had, how can you blame CASA.

Aviator in the know

5th Aug 2003, 11:04

****** me. I have just read the Report to Creditors and the compnay has paid "management Fees" totalling over $ 2.5 million between Nov 2002 and July 2003. All went to Transworld Leasing aka Griffin and Brown the Directors of TAAE !

The Administrator gives over a full page to "related party dealings" .

It makes damned good reading . As one of the main creditors are the tax office I am sure that this info will be passed on to them for further action

The future of TAAE will be decided on the 8th August. Tenders close that day.

Truth Seekers Int'nl

5th Aug 2003, 12:50

not a bad screw for 8 months work. can't understand why the EBA negotiations stalled with that sort of money floating around :confused:

Capt Claret

5th Aug 2003, 16:35

Was the Brown you refer to one of the Brown brothers of Nofolk fame? :sad:

Aviator in the know

6th Aug 2003, 08:45

No , the report lists him as Richard Alan Brown. "Dick Brown" - The other partner in Transworld Leasing .

Patriot One

6th Aug 2003, 10:22

I think d-concord has it right on the money. The internal inefficiencies and incompetencies were the primary cause of the collapse. What didn't help was that CASA was allowing them to operate with seeming impunity, when for lesser problems AN's 767 fleet was grounded. The inconsistencies of the regulator are appalling.

Wingnuts - I don't know where you get your data from but the TAA 727 operation is exceptionally unreliable. Ask the customers. Sure, when they operated they were usally pretty good - problem was that more often than not one of the 727's fell over. And in the freight industry in Australia there is simply nowhere else to put that freight. Dispatch reliability as a measure is smoke and mirrors.

Aviator in the know

6th Aug 2003, 11:14

The problem was not so much the operation , the guys have done a great job getting this company in the air , nor casa , nor any other factor that can be attributed to the guys at the coal face. Another disturbing item is mentioned in page 3 of the report. It states that the contract with AAE was calculated on the basis of break even or a slight loss. To be profitable the company required third party charter flights. So , with its aircraft tied up with AAE the company stood no chance of survival in the first place . To expect third party work for these aircraft - presumably only on a Friday , Sat , Sun and hang your whole future on it seems dodgy.

You may wish to rephrase your second para deleted. W

Spotlight

6th Aug 2003, 14:30

AITK

Thats probably sailing a bit close to the wind defamation wise. If he does have 2 and a half million squid he could sure cause you some sleepless nights in reponse.

No relation to me, just the way I see it. (Delete I'd suggest)

Aviator in the know

6th Aug 2003, 15:40

Not my words. Public information . Report to Creditors by William Buck , Chartered accountants , Transaustralian Air Pty Ltd (Administrator appointed) , page 4 , 7 and 8 dated 4th August 2003.

Spotlight

6th Aug 2003, 16:37

"Pilfored, Bled Dry, Siphoning". Quotes from Chartered Accountants 'William Buck and Co'.

Fair enough.

Truth Seekers Int'nl

6th Aug 2003, 17:10

my sources tell me that the disbursement of "management fees" and some other large amounts referred to in section 7 of the report will require further investigations. by the administrator. if these prove to reveal any missappropriation of funds then it will not be AITK that will have sleepless nights.

Spotlight

6th Aug 2003, 18:15

TSI

Crikey, thats a motherhood statement if ever I've heard one.

Aviator in the know

6th Aug 2003, 18:15

OK , I give in , Pilfered, Bled Dry and siphoned were not the words used by the Administrator. But I think they were the words he WANTED to use !
The report is in wide circulation - every creditor got one - that’s about 50 companies. Get a copy and make your own mind up. Its black and white that money was leaving the company on a weekly basis ( nearly $17,000 every week sent to the Singapore company plus other lump sums of $50k here and there) so much so that the administrator felt it necessary to point this out in detail ,and then go on to say that it required further investigation. It was accounted for as "management fees" . This being on top of a $250,000 salary.
I unreservedly apologise if there is a legit reason for this money going out the door like this , but I suspect that if there was , then the Administrator would have been satisfied with the answers and would not have needed to bring it to everyone’s attention. As I have here in this forum .
Sleepless nights - nah , not me.

Spotlight

6th Aug 2003, 18:55

AITK

Don't get me wrong, I sympathise. However having pored over more than one administrators interim report to creditors from the wrong side of the fence, so far so ordinary.

Of course money was flowing all over the place. Thats what money does. Was the law broken technically enough to ever see charges laid?. Who knows, I don't, you don't, the administators don,t. They just make motherhood statements as a matter of course to soothe fevered brow's.

All I am saying is that what you wrote above is by any measure grounds for a threat to sue for defamation.

Chocks Away

7th Aug 2003, 14:49

I'm hearing a Shorts "Belfast" is soon to be here?. (Heavylift)

34 tonne payload, 105 tonne MTOW and with 4 of the ol'Rolls Turbines (Tyes), noisier than a Honeymooners bedhead...

Bringing over a B727 fuselage? or to be launched into the night freight runs?:confused:

d_concord

7th Aug 2003, 15:00

AITK

I think your safe, there's no way known Griffin and Brown would want to test their integrity in a court and that's the only way to challenge you.

They have a few other skeletons in the closet!!

sore-foot

7th Aug 2003, 19:33

Just came back from long service leave and encounter the sad news and assorted comments on TAAE.

However I received the true guts from a close friend who heard it from his next door neighbor’s uncle - who just happened to be familiar with the goings on at National Jet where his old man worked - who in turn was told by a reliable source – the hangar cleaner – that the truth was revealed by a taxi driver with strange eyes – probably from the drugs supplied by his mate’s sister who is now in jail – which is a ****** because she sold them and herself pretty cheaply – that TAAE will be purchased by Aeroflot.

Last night it took me three reads to get the story worked out. And some of the opinions are good. Then – it all looks that way after a full bottle of red.

Today I phoned another source of information - sometimes reliable – sometimes way off beam.

He confirms various aspects reported on PPRUNE.

It seems that d-concord’s comments that TAAE didn’t go titsup because of CASA – but despite them - are correct. And this is now becoming more obvious – and stated well by Aviator-in-the-know – “the company had been bled dry by the owners”.
However d-concord’s reporting reflects some considerable anger for the ex-CASA ex-Ansett now Chief Pilot at TAAE. It would be interesting to know more about what seem to be personal issues between d-concord and the CP.

The blanket statement by d-concord that “The management of this company is atrocious” may be coloured by whatever it is that upsets him with the CP.

Now Wingnuts comments about “CASA compliance” as an explanation for TAAE going titsup also appears to be incorrect.

The “last two C Checks” overrunning budget is off the mark.
TAAE have been in existence for something like 12 months and their contract with AaE has been in place for about 9 months.

Under TAAE – there has been only one major check – and that was on VH-VLF (previously registered as VH-AUP) and involved a complete heavy check – up to a 10C. This check did not involve CASA requiring every component without a known history to be changed. The aircraft has been operating in Australia as a freighter for five or six years.

However one aircraft – being VH-TXH did undergo extensive maintenance in September 2002. But not under TAAE – as it did not exist then. This aircraft apparently come from the USA as a **** bucket and CASA required significant component replacement. This was not unexpected by the more astute observers at Aero Marine (the company that TAAE eventually took over). This aircraft was not inspected prior to its arrival and delivery was arranged by Trans World Leasing – the Company that eventually spawned TAAE.

The more recent aircraft – being VH-VLH and VH-VLI – were sourced from Europe and had numerous components changed prior to their arrival in Oz. But it is unclear whether these costs were borne by TAAE.

These aircraft have yet to undergo heavy maintenance by TAAE – and this may now not happen - with the demise of this Company.

Aviator-in-the-know – any chance of publishing the Report to Creditors on PPRUNE??

Sore-foot

d_concord

8th Aug 2003, 07:26

Sore Foot,

Let me clarify a couple of things.

When I refer to Senior Management, I certianly don't mean the CP. I'm sure he tried to do the best job he could and had nothing whatsoever to do with the demise of TAAE.

The issue with the CP is not a personal one. I've never worked for him, with him, socialisied with him or worked with any company he has any involvement in, including his time with CASA.

My comments about the CP were in response to the premise that CASA had something to do with the demise of TAAE.

This issue is that this company was cut more slack by CASA than any other company in this position would have been and I would suggest that was because of the appointment of this particular CP coming directly from CASA. I don't know his abilities first hand and I'm sure he is a capable person. He may even have been even able to fix the so called deficiencies of this operation given the right environment and support.

However that is irrelevant, CASA should still be consistent. If anything CASA should ensure that they cannot be questioned on their objectivity and err the other way.

I've got all the administrators documents on both companies in administration and then some. This whole situation is a disgrace.

Like I said before, there are a lot of people already hurt in terms of creditors and there are about to be a lot of staff out of jobs including pilots and engineers. Another sad event in aviation.

Truth Seekers Int'nl

8th Aug 2003, 13:27

spotlight.....you say

Of course money was flowing all over the place. Thats what money does. Was the law broken technically enough to ever see charges laid?. Who knows, I don't, you don't, the administators don,t.

well it appears that two of the creditors are not happy with that theory and have sought independent legal advice. not unusual and I agree, makes sense to get "second opinion" when you are owed a lot of money. however the legal firm they have engaged was the same firm that chased a paper trail from the defunct Compass Mk11. their investigations in that case resulted in criminal charges being laid against three of the eight directors in that company. another "motherhood statement" no doubt?

d_concorde i owe you an apology. your sources were closer to the mark than mine in the early days. things are warming up now and i think the creditors and staff may soon have the truth.

sore-foot

13th Aug 2003, 17:18

Truth Seeker – the truth is still out there – buried somewhere.

Was in the pub with an old mate whose son happens to be doing contract work for TAAE at the moment – and he recited some thirty rumours and possibilities on the future of that Company. As you can imagine – I cannot remember much.

But firstly a brief summary of what I understand was reported at the creditors meeting held this Tuesday.

There are four interested parties to buy TAAE.

They are:

(1) National Jet
(2) Airflite (out of Perth)
(3) Qantas
(4) some unnamed party.

None of the bids were acceptable and the bidders will be asked to make a further more realistic bid.

The involvement of the administrators has been extended for a further 60 days.

One of the TAAE directors has been asked to further explain and justify the amounts he took out of TAAE and placed into another Company he owns. A couple of million involved – but some of this amount has been accepted as reasonable by the Administrator.

There may have been additional information – perhaps others can provide an update.

Then there are the more prominent rumours/news circulating around the place. As far as I can recall they are:

The Airflite bid is a cover for Patricks.

AaE are “pressurizing” the administrator to make a quick and cheap deal – with National Jet. To this end they have threatened to remove the indemnity for continued payment for the operation to TAAE. This has seen by the Administrator as a bully-boy bluff.
Although AaE have backed down (for the moment – while they look at plan D) they have obtained the withdrawal of one of the 727’s. But the ever cagey Administrator has put the aircraft to some other use – and secured short term work – not with AaE.

The identity of the unnamed bidder includes Singapore Airlines, Asian Air Express (operator of another B727 on the Australian register), a European consortium, Virgin Blue and possibly a local consortium (Fox and Lou??). But no mention of Aeroflot (pity).

That is about it.

Sore-foot

Spotlight

13th Aug 2003, 17:32

What am I bid?

What am I bid?

Any bids here?

Buster Hyman

13th Aug 2003, 22:10

:hmm: Hmmm, the mysterious mystery bidder again! Do all administrators bring that old chestnut out, or is it limited to aviation?

Geez, the opportunities you see when you've got no money!:(

Whiskery

14th Aug 2003, 08:48

Mystery bidder ? Never in a million years Buster, you and I know it is SINGAPORE AIRLINES. Mentha & Korda are probably the administrators. Why is it every time an airline downunder goes into administration, SQ is always sniffing around?

Same bet goes for this outfit as with AN. A slab of VB says SQ won't have the aggetts to buy an airline down here in OZ.

Another slab says Collingwood to massacre Adelaide tomorrow night at the "Dome".:ok:

Keep the faith:]

VTM

14th Aug 2003, 10:19

Very interesting,

QF as a bidder, 3 aircraft parked, Collingwood to defeat the Crows, I don't think so;)

d_concord

14th Aug 2003, 14:37

TSI,

No apologies needed here. Sorry for the delay replying.

Been away flying... shocking job but someone has to do it!! Must admit I appreciate the job even more when you watch this saga.

A little bit out of the loop of late however I know of one player not mentioned so far in the forum or at the creditors meeting. But I'm not sure if it is the so called mystery bidder.

They have previous extensive experience with 727's so are also not necessarily seeking Aeromarine for the AOC.

They did say they were frustrated with the administrator not responding and have started discussions with some lessors and others to establish what is there.

The reason I say they may not be the bidder is that they believe that there is really nothing that the administrator has to sell. No contract, no aircraft, a few assets worth ten cents in the dollar and an AOC that they can accomodate in other ways if needed.

I also understand that the creditors meeting tomorrow of Aeromarine may be pretty interesting as well.

Interesting times still to come I think. No matter what the outcome I suspect it's looking sad for most of the staff.

sore-foot

14th Aug 2003, 16:15

d-concord,

a very interesting piece of information.

The only player that I can recall that would fit your comments would be Independent Air Freighters. They ran a single 727 operation between Perth and Melbourne – for Ansett Freight. That particular aircraft is now in the TAAE stable – and undergoing some heavy maintenance.

I agree that they would have some experience. But would not that AOC be defunct??

And these days – to obtain a new AOC is one hell of a process. Both time consuming and expensive. So why not make an offer for an existing setup – being TAAE??

Sore-foot

d_concord

14th Aug 2003, 17:08

Sore-foot,

It's not IAF. From my converstion this is how I interprete their position ( and I could be wrong).

I think that as they are not looking to operate for AAE, they don't see the need to pay the inflated cost the administrators would think Aeromarine is worth. The only reason for buying Aeromarine is if you need continuous operations to service AAE. Otherwise why pay the price and still have to go though hoops with CASA. I'd almost guarantee that CASA are going to take the attitude that any significant change in the operation will require a relook anyway and that will include management, ownership etc.

The see the set up as something that needs to be redone and in terms of 727 ops a relatively minor cost in the overall scheme of operating 727's. They have done it before and have some of the necessary structure to accomodate the operation.

They do however see value in the fact that the aircraft are on the register and as we know the aircraft are not in the control of the administrator.

I also know they are concerned about the culture/morale that will have developed within TAA as a result of this little event and would rather have a greenfield site. That said, I'm sure they will probably pick the eyes out of the satff if they go ahead and are they are still available. However they also have number of staff that they will bring back into operation.

I believe they are speaking??? Meeting ??? with the administrators tomorrow but with reservations about there being anything that would come of it. My discussion indicated that they didn't think too much of the administrators.

In summary the parts they want they can get external to the administrator and that is my reason for doubting whether this is the so called mystery bidder.