SKYWEST Airlines said yesterday...
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Captain Laptop: This is not about my loyalty its about reality. I am sure than in all cases contracts are looked at both on a case by case basis then in the bigger regional picture and then even in an overall company Australia wide objective.
Thus NJS may elect to go in on a break even situation to establish itself in a market or retain a critical market. It also needs economy of scale, something that Skywest is battling to establish as it downsizes.
Overall NJS is doing well in a difficult market and picking up a few from Skippers I understand. I am sure there are contracts that may be break even or perhaps in a slightly negative position but overall the company is in good shape---which is way better than most right now.
GT
Thus NJS may elect to go in on a break even situation to establish itself in a market or retain a critical market. It also needs economy of scale, something that Skywest is battling to establish as it downsizes.
Overall NJS is doing well in a difficult market and picking up a few from Skippers I understand. I am sure there are contracts that may be break even or perhaps in a slightly negative position but overall the company is in good shape---which is way better than most right now.
GT
Last edited by geoffrey thomas; 13th May 2003 at 20:32.
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Throw in my 2 cents worth here, NJS are not really losing 5 146s as they picked up 3 when Southern was closed down, so really only losing 2 and as GT says, certainly not HDs fault.
However I do believe that if good old Wazza was still around, Q/Link ( NJS wise ) would be looking alot healthier, so turn your withering stares about 3000KMs east
" you will see that the hourly rate charged is not enough "
Laptop, I assume you are NJS management, coz in my 10 years there as a grunt, I never got close to learning the true lease costs etc. of the 146s, apart from the rumoured costs IE. NJS getting paid to keep NJY
However I do believe that if good old Wazza was still around, Q/Link ( NJS wise ) would be looking alot healthier, so turn your withering stares about 3000KMs east
" you will see that the hourly rate charged is not enough "
Laptop, I assume you are NJS management, coz in my 10 years there as a grunt, I never got close to learning the true lease costs etc. of the 146s, apart from the rumoured costs IE. NJS getting paid to keep NJY
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MU2...I am still waiting for your reply to back up your allegation that I report every "in and out at Skywest". Would you like me to post all my articles in the past six months on PPrune for everyone to see to help you out?
And for your info I understand from my spies in the CTB that they are going to tick off the continued leases of the F-50s by the end of the week,as The West predicted some months ago.
That I expect will allow Price Waterhouse to signoff on a letter to the State Government confirming that Skywest can currently meet all its obligations.
As you probably know Price Waterhouse are assisting in the capital raising, with regard to audits etc.
Over to you MU2....I am waiting with great interest.
GT
And for your info I understand from my spies in the CTB that they are going to tick off the continued leases of the F-50s by the end of the week,as The West predicted some months ago.
That I expect will allow Price Waterhouse to signoff on a letter to the State Government confirming that Skywest can currently meet all its obligations.
As you probably know Price Waterhouse are assisting in the capital raising, with regard to audits etc.
Over to you MU2....I am waiting with great interest.
GT
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GT, you can probably stop with the MU2 chase now - we all see MU2 cowering and embarrased.
By the way, it is becoming increasingly obvious how you are getting your information - don't let your enthusiasm for the kill trip you, or your source, up.
How are the Skywest crew rating XR management at this stage of the re .... structure?
By the way, it is becoming increasingly obvious how you are getting your information - don't let your enthusiasm for the kill trip you, or your source, up.
How are the Skywest crew rating XR management at this stage of the re .... structure?
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Stupid,
Actually if you read the series of posts, I was referring in particular to the Dash-8 hourly price, which is fairly common knowledge throughout the FIFO industry.
Not the 146 hourly lease rate!
(Which is surprisingly high in comparison to other types I might add)
The point I was making is that if you CHARGE an hourly rate for your aeroplanes that does not exceed your hourly COSTS, you may as well not have bothered with the contract because you are going to lose money
Other, more educated types, such as journalists and salesman, can't see that running at a loss for YEARS is not the smartest way to make money. Sure go in with a cheap price to get the work when you are getting established and you have other streams of income (Airlink) but when it goes on for years to shifts from cunning salesmanship to utter stupidity.
When you then pull the rug out from the cash producing side of the operation (Airlink) you don't have the backup anymore and the operations where you went in cheap to get the work now have to stand on their own feet.
Actually if you read the series of posts, I was referring in particular to the Dash-8 hourly price, which is fairly common knowledge throughout the FIFO industry.
Not the 146 hourly lease rate!
(Which is surprisingly high in comparison to other types I might add)
The point I was making is that if you CHARGE an hourly rate for your aeroplanes that does not exceed your hourly COSTS, you may as well not have bothered with the contract because you are going to lose money
Other, more educated types, such as journalists and salesman, can't see that running at a loss for YEARS is not the smartest way to make money. Sure go in with a cheap price to get the work when you are getting established and you have other streams of income (Airlink) but when it goes on for years to shifts from cunning salesmanship to utter stupidity.
When you then pull the rug out from the cash producing side of the operation (Airlink) you don't have the backup anymore and the operations where you went in cheap to get the work now have to stand on their own feet.
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Yeah, sorry about that Cap'n Lapdancer, I think you are correct.My understanding was that, almost without exception, charter has always lost money. One of the best examples of that was actually Wazza's favourite toy, the 737.
Not sure I can agree with you on the lease costs of the 146 though, they can't be that bad if they have held onto them for 13 years, and I still maintain that unless you are or were upper management, you would'nt know the actual costs.
Not sure I can agree with you on the lease costs of the 146 though, they can't be that bad if they have held onto them for 13 years, and I still maintain that unless you are or were upper management, you would'nt know the actual costs.
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There you go again GT, just gunning for a fight with MU2!! How about you grow up and just get on with reporting the facts!!Although my opinion probably means stuff all to you, I have said all along skywest will make it and they need not have worried about the leasing issues. What they need to do is get bums on seats and keep it that way. The rest is just mathmatics.
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rubyredlive: MU2 has been gunning for me non-stop with a constant stream of allegations and the abuse of me and others was censored..... check his posts. So please have a look for yourself.
We also said the CTB would get the lease extended...they have no choice in the current market.
"Bums on seats? The rest is just mathematics."
Well maybe but at what price. Its leftover not turnover you know.
Part of Skywest's restructure/business plan was a 7% rise in airfares BUT when Virgin and QF are charging $112 one way Perth to Sydney they face an uphill battle in extracting another 7% on intrastate routes.
The next test for Skywest is the float that I guess they will launch soon. Remember this was the float they wanted to kick off
middle of last year and then in December.
I know a number of large shareholders who will not subscribe. This will be a real challenge for them and the airline's forecasts will be interesting.
Skywest survival depends on key shareholders forking out another $2 million plus. Will they have the nerve?
But I think the real key to this problem is a Skywest/Skippers merger then a public float. That would work in theory BUT there are many roadblocks.
Consider this. Skywest brings the RPT experience and Government blessing while Skippers has the lower end of the market and lower costs. Finally you would have economies of scale.
GT
We also said the CTB would get the lease extended...they have no choice in the current market.
"Bums on seats? The rest is just mathematics."
Well maybe but at what price. Its leftover not turnover you know.
Part of Skywest's restructure/business plan was a 7% rise in airfares BUT when Virgin and QF are charging $112 one way Perth to Sydney they face an uphill battle in extracting another 7% on intrastate routes.
The next test for Skywest is the float that I guess they will launch soon. Remember this was the float they wanted to kick off
middle of last year and then in December.
I know a number of large shareholders who will not subscribe. This will be a real challenge for them and the airline's forecasts will be interesting.
Skywest survival depends on key shareholders forking out another $2 million plus. Will they have the nerve?
But I think the real key to this problem is a Skywest/Skippers merger then a public float. That would work in theory BUT there are many roadblocks.
Consider this. Skywest brings the RPT experience and Government blessing while Skippers has the lower end of the market and lower costs. Finally you would have economies of scale.
GT
Last edited by geoffrey thomas; 16th May 2003 at 06:00.
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I can tell you that the lease rates for the -300's (507's) is higher than for a 737-300 in good nick in the current lease market.
This is because the lease rates on the 737-300's have fallen SIGNIFICANTLY since the leases for the 146's were negotiated.
NJT was always higher in terms of monthly rental, with rates on that machine comparable to a new 737-700 now.
The reason that they stuck with them for the last 13 years was that BAe Asset management virtually gave them away in the early days (and NJY is a really good example of that). As the aircraft became more popular - as witnessed by the lack of airframes on the market - the rates went up each time the lease came up for re-negotiation. In the days when Airlink was basically cost plus that really didn't make a great deal of difference.
Now days where the 717 is operated by a subsidiary company (and James Strong is gone) the cost pressures are different.
The problem now is that they can't move into cheap 737's because of the politics within QF (and the 737 can't do what the 146 does in a lot of cases), a replacement aeroplane is very expensive and a few years away - the EMB170/190 - and will require a significant committment from QF to make that happen - NJS are not silly enough to lease a fleet of them on the off chance - they have done that once before with Embraer jets!!
Make no mistake NJS did and does a very good job for QF. I just think that the aeroplane has basically run its race in terms of cost efficiencies, and the political tide is turning away from having outsourced contracts such as NJS. I think that this is a mistake by the way - the way that NJS operates is quite good for QF - they pay a fixed amount per hour and the aeroplane turns up (mostly!) no hassles with people wanting to integrate into mainline, no staff travel hassles, no industrial hassles (they are NJS problems).
The charter side however is a dud.
This is because the lease rates on the 737-300's have fallen SIGNIFICANTLY since the leases for the 146's were negotiated.
NJT was always higher in terms of monthly rental, with rates on that machine comparable to a new 737-700 now.
The reason that they stuck with them for the last 13 years was that BAe Asset management virtually gave them away in the early days (and NJY is a really good example of that). As the aircraft became more popular - as witnessed by the lack of airframes on the market - the rates went up each time the lease came up for re-negotiation. In the days when Airlink was basically cost plus that really didn't make a great deal of difference.
Now days where the 717 is operated by a subsidiary company (and James Strong is gone) the cost pressures are different.
The problem now is that they can't move into cheap 737's because of the politics within QF (and the 737 can't do what the 146 does in a lot of cases), a replacement aeroplane is very expensive and a few years away - the EMB170/190 - and will require a significant committment from QF to make that happen - NJS are not silly enough to lease a fleet of them on the off chance - they have done that once before with Embraer jets!!
Make no mistake NJS did and does a very good job for QF. I just think that the aeroplane has basically run its race in terms of cost efficiencies, and the political tide is turning away from having outsourced contracts such as NJS. I think that this is a mistake by the way - the way that NJS operates is quite good for QF - they pay a fixed amount per hour and the aeroplane turns up (mostly!) no hassles with people wanting to integrate into mainline, no staff travel hassles, no industrial hassles (they are NJS problems).
The charter side however is a dud.
