Aviation Crystal Ball
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Aviation Crystal Ball
My take on the industry due entirely to the Pilot Shortage!
The Big Boys:
Early December Virgin, QF and PornStar will start cancelling flights. They will book everyone over xmas and take their money, then stuff everyone around over xmas.
This will lead into next year with cancellations a dailly event (yield management).
From about March you will start to see the Business Class seats increase to keep the yeild up on the reduced number of flights. Eventually City Flyer will be business class only!
Wages will go up to try and stop the flood to the sand pit! Captains will probably go to $400K
The Litlle Boys:
Pilot wages have already started to rise. Companies have 2 choices.
1. Go broke due to no crew.
2. Pay the market rate for Pilots.
Now this is where it gets interesting. Up until now Pilot pay rates have been based on Aircraft Size. Small Aircraft = Small Salary, Large Aircraft = Large Salary.
Market Rates will be Captain or F/O regardless of aircraft size.
By next June a Line Captain on any pressurised 2 crew aircraft will be paid $150K plus super. F/O's will be about $70K plus super.
It will be up to the management of all the regionals to adjust their thinking, pricing structure and attitude to stay in business.
The real competition for Pilots is now the Big Boys and Pilots will for the first time since WW2 make choices based on everything other than Pay Scale.
Every regional now has serious crewing problems and current management thinking is to up the pay scale to poach crews from other regionals.
This will not work as the pay has to compete with airlines or most will still take the Jet Job!
All that is required is 100 to stay in the regional environment and not go to the Big Boys.
Casual Captains
By June next year the number of freelance Captains will increase.
Most will be 2 weeks on 2 weeks off, fully found with travel and a daily rate of between $1000 and $1500 for T & C Captains. ie $180K to $270K
CASA
CASA now has a serious problem with low houred crew becoming Captains and the number of Captains flying the same type for different companies.
CASA and the companies now have to get together and standardise SOP's for the same type. Part 119 by CAO!
Interesting times ahead.
Call me an idiot, but I see no other way for the industry to stay an industry.
Niles
The Big Boys:
Early December Virgin, QF and PornStar will start cancelling flights. They will book everyone over xmas and take their money, then stuff everyone around over xmas.
This will lead into next year with cancellations a dailly event (yield management).
From about March you will start to see the Business Class seats increase to keep the yeild up on the reduced number of flights. Eventually City Flyer will be business class only!
Wages will go up to try and stop the flood to the sand pit! Captains will probably go to $400K
The Litlle Boys:
Pilot wages have already started to rise. Companies have 2 choices.
1. Go broke due to no crew.
2. Pay the market rate for Pilots.
Now this is where it gets interesting. Up until now Pilot pay rates have been based on Aircraft Size. Small Aircraft = Small Salary, Large Aircraft = Large Salary.
Market Rates will be Captain or F/O regardless of aircraft size.
By next June a Line Captain on any pressurised 2 crew aircraft will be paid $150K plus super. F/O's will be about $70K plus super.
It will be up to the management of all the regionals to adjust their thinking, pricing structure and attitude to stay in business.
The real competition for Pilots is now the Big Boys and Pilots will for the first time since WW2 make choices based on everything other than Pay Scale.
Every regional now has serious crewing problems and current management thinking is to up the pay scale to poach crews from other regionals.
This will not work as the pay has to compete with airlines or most will still take the Jet Job!
All that is required is 100 to stay in the regional environment and not go to the Big Boys.
Casual Captains
By June next year the number of freelance Captains will increase.
Most will be 2 weeks on 2 weeks off, fully found with travel and a daily rate of between $1000 and $1500 for T & C Captains. ie $180K to $270K
CASA
CASA now has a serious problem with low houred crew becoming Captains and the number of Captains flying the same type for different companies.
CASA and the companies now have to get together and standardise SOP's for the same type. Part 119 by CAO!
Interesting times ahead.
Call me an idiot, but I see no other way for the industry to stay an industry.
Niles
Mate, things are getting better for pilots by the day at the moment. I appreciate your optimism but we are a long way from anything like this, a reeeeaaaal long way.
Keep the dream alive.
Keep the dream alive.
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Dead right, TA. Seniority is an idea whose time has come... and gone. The concept serves to apply a brake on flight crew terms and conditions. Seniority also acts to retard the development of a positive operational culture within evolving companies. Examples of both facets are already manifest within the Australian industry.
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Ok my take:
The airlines will have no problem crewing their aircraft, as there will always be a steady supply of airline hopefuls! They will however become a training ground for higher paying foreign airlines.
Sim slots all over South East Asia/Pacific will be at a premium (this has already started).
The regionals will be crewed by direct entry captains, the f/o's will be a mixture of cadets and anyone else who has a bare CPL and IFR rating!
But then I wake up...
The airlines will have no problem crewing their aircraft, as there will always be a steady supply of airline hopefuls! They will however become a training ground for higher paying foreign airlines.
Sim slots all over South East Asia/Pacific will be at a premium (this has already started).
The regionals will be crewed by direct entry captains, the f/o's will be a mixture of cadets and anyone else who has a bare CPL and IFR rating!
But then I wake up...
Niles Crane said:
I hate having to always be the stick in the mud, but where is the money for this going to come from? Do these airlines have a great big pot of money they keep hidden away in some back room?
The money can only come from the fare paying public, which means increased ticket prices. But, increase the ticket price and what will happen? Some people will still buy the ticket but some will no longer be able to afford to. Increases of as little as $5 can begin to result in less sales. For the kind of pay increases alluded to by Niles Crane, a lot more than $5 extra per ticket will have to come in.
So, can you see that, as you increase the ticket price, although you get more money per ticket, you sell less tickets?
Once you have increased the ticket price by more than some critical amount, the total amount of revenue will end up being less than before the price rises.
How much is that "critical amount"? There are many variables, but it can be as little as $2 to a $100 ticket.
The most likely outcome then, of increased ticket prices, is not greater pay for pilots, but less passengers travelling and less flights. And this of course means less pilots required, so there would no longer be a pilot "shortage"!
And the pilot pay would probably end up around the same as before the price rises! Funny that!
Sorry to always have to be the stick in the mud but somebody has to.
By next June a Line Captain on any pressurised 2 crew aircraft will be paid $150K plus super. F/O's will be about $70K plus super.
The money can only come from the fare paying public, which means increased ticket prices. But, increase the ticket price and what will happen? Some people will still buy the ticket but some will no longer be able to afford to. Increases of as little as $5 can begin to result in less sales. For the kind of pay increases alluded to by Niles Crane, a lot more than $5 extra per ticket will have to come in.
So, can you see that, as you increase the ticket price, although you get more money per ticket, you sell less tickets?
Once you have increased the ticket price by more than some critical amount, the total amount of revenue will end up being less than before the price rises.
How much is that "critical amount"? There are many variables, but it can be as little as $2 to a $100 ticket.
The most likely outcome then, of increased ticket prices, is not greater pay for pilots, but less passengers travelling and less flights. And this of course means less pilots required, so there would no longer be a pilot "shortage"!
And the pilot pay would probably end up around the same as before the price rises! Funny that!
Sorry to always have to be the stick in the mud but somebody has to.
WA is one place where salaries will go up as the mining companies HAVE to to have experienced pilots to fly their aircraft. They also have to fly. I don't think the east coast will go as crazy, but mining charter will be where the coin will be. Given the sort of dough they pay mine workers and the amount of money that mining companies have floating around paying a pilots 100G wouldn't be a problem.
Aircraft of course would argue that charter companies should ground aircraft instead of paying decent money.
Also by paying real money the charter companies will keep people as there are plenty of sand grophers who want to remain in WA.
Aircraft of course would argue that charter companies should ground aircraft instead of paying decent money.
Also by paying real money the charter companies will keep people as there are plenty of sand grophers who want to remain in WA.
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Reality Check Required
Guys,
Employment prospects may be improving for aviation but the "name your price" days are not going to eventuate any time soon. Other factors will intrude, market forces always adjust, it's not just employment or skills numbers that drive wages. GA has had golden days in the past too and wages and conditions in GA have never been massive, not even when GA was booming in thsi country. Lets not forget that the last few years have seen a significant reduction in jet salaries in many sectors too. You think that Jetstar F/O's are getting what Ansett pilots were getting before it went bust and this website is chock full of pilots bleating about poor wages and conditons and job security.
Some of you punters are like amatuer stockbrokers, you see one little jump in the chart and think it means boom times forever .... when the average trend is still slightly down on last years price.
Employment prospects may be improving for aviation but the "name your price" days are not going to eventuate any time soon. Other factors will intrude, market forces always adjust, it's not just employment or skills numbers that drive wages. GA has had golden days in the past too and wages and conditions in GA have never been massive, not even when GA was booming in thsi country. Lets not forget that the last few years have seen a significant reduction in jet salaries in many sectors too. You think that Jetstar F/O's are getting what Ansett pilots were getting before it went bust and this website is chock full of pilots bleating about poor wages and conditons and job security.
Some of you punters are like amatuer stockbrokers, you see one little jump in the chart and think it means boom times forever .... when the average trend is still slightly down on last years price.
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Don't want to reduce your profit?
I understand really I do as you are, after all, Management, and your bonus is tied to profit. Fine, don't cough up.
No pilots? Gee, that's just too bad. Plane stays against the fence. Punters go to Tiger. You lose profit, and your bonus dries up like an apricot.
Okay, back to the drawing board. You and your mates act like cats as you choke and spit and cough up a fur ball of money. Your profit dries up, but not too much mind you. A billion goes a long way, now.
Nonetheless, your shareholders freak, they toss your ****ty little stock, you get less bonus, but here's the kicker: punters couldn't give a toss about the share price. They need to get to their o/s destination in one piece, and to do that they want you to pay THEIR (not your) pilots properly.
Don't like pilots, do you, aircraft. It hurts, shelling out what would otherwise be YOUR bonus that YOU earned.
What the hell, you could leave those pretty little planes against the fence
.
I understand really I do as you are, after all, Management, and your bonus is tied to profit. Fine, don't cough up.
No pilots? Gee, that's just too bad. Plane stays against the fence. Punters go to Tiger. You lose profit, and your bonus dries up like an apricot.
Okay, back to the drawing board. You and your mates act like cats as you choke and spit and cough up a fur ball of money. Your profit dries up, but not too much mind you. A billion goes a long way, now.
Nonetheless, your shareholders freak, they toss your ****ty little stock, you get less bonus, but here's the kicker: punters couldn't give a toss about the share price. They need to get to their o/s destination in one piece, and to do that they want you to pay THEIR (not your) pilots properly.
Don't like pilots, do you, aircraft. It hurts, shelling out what would otherwise be YOUR bonus that YOU earned.
What the hell, you could leave those pretty little planes against the fence
.
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appears that the majority of pilots being trained these days are from the asian countrys. Could we see an influx of these O/S pilots being imported back into the country at a later stage to keep the supply of lower paid staff coming in?
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Could we see an influx of these O/S pilots being imported back into the country
Aircraft of course would argue that charter companies should ground aircraft instead of paying decent money.
Given the sort of dough they pay mine workers and the amount of money that mining companies have floating around paying a pilots 100G wouldn't be a problem.
If Skippers, for example, were to bid on a mining contract with prices that would bring their pilots "decent money", guess what would happen? Skippers would not win the contract - one of the other 9 or 10 turbine operators operating from Perth would undercut them!
Sadly, tendering for a contract with "sensible" prices and margins in your bid is a guaranteed way to lose the bidding. Welcome to the cutthroat world of commercial aviation. But surely you didn't need welcoming - you knew this already didn't you?
Time to roll out a favourite quote of mine from the excellent book "Qantas Flightpaths" by Geoffrey Thomas and Christine Forbes Smith again. This quote is from C.R. Smith, President of American Airlines. Don't think he is only referring to American aviation, or that aviation in that country is somehow different to Australia:
These days no one can make money on the goddam airline business. The economics represent sheer hell.
4PW's,
No airline in their right mind would use profits to increase pilot salary. Profits are just way too fickle. Sure, some airlines are profitable this year, but next year, and the year after?
No pilots? Gee, that's just too bad. Plane stays against the fence. Punters go to Tiger.
Don't like pilots, do you, aircraft. It hurts, shelling out what would otherwise be YOUR bonus that YOU earned.
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If Skippers, for example, were to bid on a mining contract with prices that would bring their pilots "decent money", guess what would happen? Skippers would not win the contract - one of the other 9 or 10 turbine operators operating from Perth would undercut them!
Sadly, tendering for a contract with "sensible" prices and margins in your bid is a guaranteed way to lose the bidding. Welcome to the cutthroat world of commercial aviation. But surely you didn't need welcoming - you knew this already didn't you?
Sadly, tendering for a contract with "sensible" prices and margins in your bid is a guaranteed way to lose the bidding. Welcome to the cutthroat world of commercial aviation. But surely you didn't need welcoming - you knew this already didn't you?
I know what your suggesting but the fact is the market will eventually have to pay for the skills shortage. If the economics of the market are such that an increased cost base results in a shrinking of that market then there will be less demand for pilots. ie a higher cost base results in less work meaning less demand for pilots. The pilot market will then find its equilibrium, but only after the market has payed for the skills shortage.