MK Airlines banned from movements Filton
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The classical definition is when its liabilities exceed its assets. However many businesses do trade on with the agreement of their banks should they feel the business is still capable of generating cash long term (short-term downturns would be such an occasion if it is felt the business is fundamentally healthy).
However if the credit runs short (at the banks or the suppliers) and the business find it cannot pay its bills then it's only a matter of time until it cannot buy the means to trade, and that's generally when the shutters come down.
That's why people really need to THINK about what they post in threads like this. Unsubstantiated rumours and speculation can affect the willingness of banks and suppliers to support airlines and become self-fulfilling prophecies. If MK are struggling at the moment (and let's face it aren't most airlines?) the last thing they need in their efforts to trade their way out of trouble is people pushing them downhill.
However if the credit runs short (at the banks or the suppliers) and the business find it cannot pay its bills then it's only a matter of time until it cannot buy the means to trade, and that's generally when the shutters come down.
That's why people really need to THINK about what they post in threads like this. Unsubstantiated rumours and speculation can affect the willingness of banks and suppliers to support airlines and become self-fulfilling prophecies. If MK are struggling at the moment (and let's face it aren't most airlines?) the last thing they need in their efforts to trade their way out of trouble is people pushing them downhill.
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DODO that’s a fine definition, I agree. But “not paying wages” is excluded to make the shutter come down? Funny conclusion you make. Indeed BA and others are having hard times but still pay there personnel! So you are comparing apples and oranges. And btw in a capitalistic free marked system, going down is not so bad… it’s called creative destruction. It takes bad performers and inefficient operators out the marked, and gives more air to others who can grow more easily in a healthy way. The aluminium of the old freighters can be melted for better use in new manifact. produce, the engines used for spares. And people can find new better jobs. Beside, what’s going to happen with the UK as a whole if the Bank of England is continuing printing money like Mugabe does. Sterling is sinking and the country is loosing its AA ranking soon (don’t blame me because I am spreading rumours). Remember MK has to pay it’s fuel in $ and gets paid in?... £?
EXUP I was just joking after your cuckoo entry, never the less why use a 179 pax B727-200ER for shopping in Swiss, is MK planning passenger transport? Or is the plane redecorated with swimming pool, on board casino, horse cabins? What’s is normal use? You seem to know.
Anyone been paid after the protest march?
EXUP I was just joking after your cuckoo entry, never the less why use a 179 pax B727-200ER for shopping in Swiss, is MK planning passenger transport? Or is the plane redecorated with swimming pool, on board casino, horse cabins? What’s is normal use? You seem to know.
Anyone been paid after the protest march?
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Hydroplane I don't really want to get drawn into this discussion as I have no personal involvement with MK for good or ill, however you make some good points that deserve answers.
Staff wages are really no different from any other trade creditors, because while they may bear with you for some time, eventually they won't want to provide any more free credit and will leave. Staff will often be more forgiving than outside suppliers for a company they see as an otherwise good employer, in the hope it can trade out of trouble - or perhaps because they have nowhere better to move to. It's the old story, if you owe your bank $500 you have a problem. If you owe the bank $500M the bank has a problem!
The problem with survival of the fittest is you never really know how fit the next survivor will be. For example how would the cause of safety be served if an EASA operator was replaced by a cheaper provider from a less reputable part of the world? And jobs of course, are not so readily available during a recession which isn't good news for any staff who are thrown out into the wild. Many of those will only find other jobs at lower rates, some especially if they are over 55 may not find work at all. We shouldn't be too quick to accept the free market as a good thing!
And lastly you're right about Sterling - with the £ low, fuel (priced in $) is expensive. This can be hedged against by requesting payment from one's own customers in $ but really it's a consequence of the UK's crazy decision not to enter the Euro (which is a whole new argument!!)
Staff wages are really no different from any other trade creditors, because while they may bear with you for some time, eventually they won't want to provide any more free credit and will leave. Staff will often be more forgiving than outside suppliers for a company they see as an otherwise good employer, in the hope it can trade out of trouble - or perhaps because they have nowhere better to move to. It's the old story, if you owe your bank $500 you have a problem. If you owe the bank $500M the bank has a problem!
The problem with survival of the fittest is you never really know how fit the next survivor will be. For example how would the cause of safety be served if an EASA operator was replaced by a cheaper provider from a less reputable part of the world? And jobs of course, are not so readily available during a recession which isn't good news for any staff who are thrown out into the wild. Many of those will only find other jobs at lower rates, some especially if they are over 55 may not find work at all. We shouldn't be too quick to accept the free market as a good thing!
And lastly you're right about Sterling - with the £ low, fuel (priced in $) is expensive. This can be hedged against by requesting payment from one's own customers in $ but really it's a consequence of the UK's crazy decision not to enter the Euro (which is a whole new argument!!)
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VIP 727
I understand the Geneva trip was even more costly, as they had to pay Biggin £35k in outstanding fees before being allowed to depart!
The definition of insolvency is when a company is unable to pay it's creditors on time (whether the money is borrowed or not) and/or the liabilities exceed the assets. Staff are creditors of the company and therefore if the wages cannot be paid, the company is insolvent and the directors have a legal responsibility to cease trading and advise the authorities (including the CAA). These are the simple facts and are not aimed at MK specifically Exup.
The definition of insolvency is when a company is unable to pay it's creditors on time (whether the money is borrowed or not) and/or the liabilities exceed the assets. Staff are creditors of the company and therefore if the wages cannot be paid, the company is insolvent and the directors have a legal responsibility to cease trading and advise the authorities (including the CAA). These are the simple facts and are not aimed at MK specifically Exup.
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I've never said they deserve special treatment or that the rules do not apply to them, what I have said is let the peolple concerned i.e staff, company & relevant authorities make the correct decesions based on the facts that they are presented with not the people who come on here with what appears to be (maybe mistakenly) a hidden agenda or just a very unhealthy desire to see MK fail.
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Supposing you were running an airline and were unable to pay your staff. What might happen in a few months time to turn things around? What sort of thing would result in a large wedge of money allowing you to pay off what you owe and invest for the future?
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Supposing you were running an airline and were unable to pay your staff. What might happen in a few months time to turn things around? What sort of thing would result in a large wedge of money allowing you to pay off what you owe and invest for the future?
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Clever stuff.
How about ‘Administration’ followed by a ‘MBO’
Just about everything in the foregoing points to this as a distinct possibility, assets being improved (MKJA ‘C’ check etc), loyal staff waiting in the wings and so on.
Well, hats off to them if they can pull it off.
(Above in reply to CatFlaps)
How about ‘Administration’ followed by a ‘MBO’
Just about everything in the foregoing points to this as a distinct possibility, assets being improved (MKJA ‘C’ check etc), loyal staff waiting in the wings and so on.
Well, hats off to them if they can pull it off.
(Above in reply to CatFlaps)
Last edited by RotorArm; 18th Mar 2010 at 22:19. Reason: I am new here
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Mike,
If you really care about your 'family' admit defeat. Pull the plug, give us a chance to claim redundancy. Houses, cars, personal credit ratings are now at stake.
Your tenacity is not open to question, maybe you can pull a pheonix from the ashes and go forwards, but right now your people are suffering. 30+years in aviation and I've never seen the like.
Your people are deserting, you are not stupid Mike do the right thing.
Move on. Rebuild.
If you really care about your 'family' admit defeat. Pull the plug, give us a chance to claim redundancy. Houses, cars, personal credit ratings are now at stake.
Your tenacity is not open to question, maybe you can pull a pheonix from the ashes and go forwards, but right now your people are suffering. 30+years in aviation and I've never seen the like.
Your people are deserting, you are not stupid Mike do the right thing.
Move on. Rebuild.
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The definition of insolvency is when a company is unable to pay it's creditors on time (whether the money is borrowed or not) and/or the liabilities exceed the assets. Staff are creditors of the company and therefore if the wages cannot be paid, the company is insolvent and the directors have a legal responsibility to cease trading and advise the authorities
In practice with the backing of the banks and creditors (including staff as you say) companies can trade for a substantial time while technically insolvent. Some have done so as a matter of course in the past when credit was cheap and easily available!
Corporate creditors tend not to apply for winding up orders as they know a bankrupt customer will only repay a few cents in the dollar. Likewise, withholding supplies can force a company into liquidation with the same effects. A large supplier may be willing to do this to avoid throwing good money after bad but a smaller one (and staff) may not want to precipitate such a situation if they feel the money owed is too great for them to risk losing it. In the end it's down to whether creditors feel the company can trade its way back on an even keel with their support.
Again I must stress I am making no judgements on the position of MK itself, though I'm pleased they are hanging on in there now that the world economy looks a little less bleak than it did a year ago.
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New contracts, better contracts, more revenue, less expenses ...
And DODO why shouldn't one find a job over 55? Look at Barry, started training ground engineers at what age?
Last edited by hydroplane; 20th Mar 2010 at 12:26.
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I don't think Mike gives a toss about his staff. Staff at MK have not been paid for 7 weeks now. Every week comes a fresh rumour about being paid and still we all wait. I think he's forgotten how us "peasants" live, paying mortgages/rent and other outgoings while the fat cat takes his wage every month. Still flying around in his chopper I notice! Quite agree redavenger.....pull the plug and admit defeat.
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As I have always said it is up to the people involved to decide Mk's future not people on this forum who may or may not have an agenda. If this is the feeling of the majority of staff then the decisions will be made for MK, without staff you do not have a company. I hope it works out for all concerned with MK as alot of people have worked very hard if not lets all wish them well in the future. Its not over just yet
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I hear that the CAA and MK's current bankers are all meeting with MK tomorrow at Landhurst. I understand that MK will also be down to two aircraft from next week for the next month.
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I’d hoped that because of all the negative publicity for MK on this forum management, as to avoid more bad publicity, would long have come with a quick solution for all those not receiving wages. Apparently nothing seems to happen. Meaning indeed that TAA (is Mike still in charge?) does take little care for its people. On the whole it’s an incredible story. Normally the human capital of a (durable) company isn’t it’s least important asset. Unless a company is used for a whole other set of reasons.
Do we have to conclude MK management is choosing for the divide and rule politics and a boulevard of broken dreams tactics? Meaning, pay some people some time a little and put others on the holding bay as long as possible etc. Does management count on the fact that starting a law case for an individual is to expensive for the money involved, or (and) that jobs are scarce?
Do we have to conclude MK management is choosing for the divide and rule politics and a boulevard of broken dreams tactics? Meaning, pay some people some time a little and put others on the holding bay as long as possible etc. Does management count on the fact that starting a law case for an individual is to expensive for the money involved, or (and) that jobs are scarce?
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hydro please find something usefull to do i understand you may be lonley and have painted every wall in the house 3 times. please stop filling this forum with 
and move on 
and move on