Grabair bust - again !
 

Dropped in to Cranfield this morning to discover that Cabair has gone bust - yet again. Feeling really sorry for the guys and gals, it must be devastating.

It really is time that training organisations were made to keep student prepayments in protected accounts, that would stop this 'pheonix' company behaviour.

(I realise this is covered elsewhere on pprune, but as it hadn't made the private forums yet . . . )

If you forced the use of escrow accounts, the company would not be able to use the money to fund its cash flow, which would defeat the point of giving discounts for up front payments...

To all those why are shocked, welcome to aviation ;)

The problem is that these students are ab initio and being new to aviation are 'soft targets'.
Perhaps I've got the wrong end of the stick, but are you saying that because we know the risks of up-front payments, nothing should be done to protect those who don't?

I would hope that even ab-initio students would put in some proper research before handing over such a large sum of cash. Even 5 mins spent on Pprune would give at least 10 threads with lots of comments in capitals about not paying up front for training.

On the other hand, it is a calculated risk. If I can get x amount of discount, but I risk losing everything, is it worth it? During my PPL I paid in chunks of £1000. At the time, I felt this was a worthwile risk since it meant every 10 hours, I got one free. The company is still going now, and I never lost any money so the risk paid off. Unfortunately for anyone involved with Cabair it has not, and I'm sure the losses will amount to a lot more than £1000 per person.

During my CPL/IR I simply paid as I flew, settling up every day. No discounts were offered for up front payment.

No; I am just saying that nothing (I can think of) can be done.

The school offers discounts because - usually due to poor financing - they need the money paid up front.

If they were banned from using the money, they would not offer discounts, and then only a complete mug would pay up front, but also the FTO business would collapse because most of them would run out of cash.

I agree the ab initio airline pilot wannabees are soft targets. When I started my PPL I knew absolutely zilch too. But 99% of them won't read pprune before they start, and anyway greed always works so a 10% discount will draw the cash in no matter how dodgy the business reportedly is. My sister, who is not particularly dim, lost most of her savings to a ponzi scammer who offered 8% interest per month....

Speaking from a comfortable distance, and from a place where most PPL training is done by clubs i.e. not for profit, I can't help wondering if the real effect would only be sorting the boys from the men. Not talking pilot-wise ((edit: or rather, instructor-wise)), but entrepreneur-wise.

Well, I reckon even the men would struggle. Problem is - aviation.

Too many, chasing too few, who have too little, who look for ever cheaper options.

Notice GROUPON, have yet to discover aviation training:hmm:

That would end it mind you.:uhoh:

Erm... :}

Groupon 50% discount

How many more Cabairs are there left:confused:

SGC

Well I stand corrected, Groupon France is in there. Christ......

On offer ATPL, value £67,000.00, greatly discounted for March, offerred at £37.50. Unlimited places.....

Slippery slope if you ask me:(

Is it actually confirmed they have gone to the wall?

Yikes!

I've seen schools offering their sim at heavily reduced rates, but simply assumed that was a loss maker hoping to make some money on the chance one person might take up a course, or simply the vouchers never being cashed in.

The type of discount offered on that french voucher cannot possibly be sustainable, and if UK schools start doing the same we may well see more go out of business trying to keep up a deal they offered which is simply too lean to be true.

The cost of a sim is directly related to the national CAA approval charge.

In the UK this is very high, but elsewhere it might be peanuts.

The UK FTO scene stays in business largely because they work in English, so a lot of foreign pilots come here (same reason UK universities stay in business) and most UK pilots won't go to "foreign" countries :)

If you read the small print, there's only 10 hours of flying time included so €1758 is hardly unsustainable - rather the opposite - I'd say it was quite lucrative.

I've seen UK based Groupons for 'trial lessons' and they are never competitive. They quote some stupid price like £199 and say that you're getting 66% off. You end up paying £90 for a half hour flight which is no better (if not worse) than you'd get if you turned up at a club.

With sim work there is the cost of the sim and the cost of the person driving it.

If your doing none approved sessions the costs are reduced because anyone can run the sim.

And as most of the sim cost is fixed costs with approvals and maint any thing which increases your cash flow outside when approved courses are run is money in the pocket. If its sitting there doing nothing you get nothing if its running with a bloke getting payed 20 quid an hour and you only have to pay for the leccy its a pretty good profit margin.

Yet most sims are heavily under-used...

It may surprise you to hear that not all flying schools are going bust but that many other businesses in other sectors go bust too. It's just that the nature of flying school cashflow is that going bust is much more likely because you can run on your cashflow and be bust without realising it for months and months.

It may also surprise you to hear that customers "expect" and frequently ask for a discount for payment up front, you have to give your customers what they want and if it's a discount they expect for an up front payment and they get annoyed if you don't offer the facility you'd be a total idiot not to take them up. The most that a flying school is trying to do is to get you locked in to a course of training if it's being badly run, then there are other markers but anyone who pays up front for ANYTHIING on a debit card or by cheque is the one taking the risk.

Most well run schools have quite a busy sim. They are expensive to run, yearly inspection, Quarterly Tests, independent quality manager, other post holders to be an FTO, sim engineer, bulbs (up to 500 quid a go) quite a lot of electricity not to mention the £150k plus to buy the thing and the cost of a guy to run it.

You can tell a she it school quite early on but you don't know how to recognise one until you compare it to a good school :)

I'd love to know what procedures the CAA has for dealing with this kind of thing.

Take a purely hypothetical example.

A student has completed the IR course, done the syllabus, but the FTO goes bust just before the 170A.

Somehow I don't see the student being forced to move to another FTO and spend some considerable time and ££££££ there re-doing the very tail end of his stuff, because no FTO is going to just accept somebody to do one flight. It would be outrageous to force a student to go through that.

Presumably the training record is what really matters.

Silvaire - one can get big variations across the EU too. The problem is that the UK has a near-monopoly on (a) English language FTOs and (b) FTOs with a good reputation. OK, one can argue to hell about these, especially (b) (there are some pretty dodgy revenue raising practices on the UK FTO scene) but if somebody with a business acumen set up an FTO at say Zadar in Croatia, they could undercut the UK system substantially. And they would have a huge airport almost all to themselves. The locals would love the business. But they would still struggle with the perception of dodgy training in the "south".

I wouldn't be anything to do with the CAA they would claim.

If the FTO wanted to do a flight then a 170A thats what the student would have to do. You would also have problems that if there were any syllabus differences, they would have to be covered as well.

And if it was a new type of twin there would also have to be differences training.

I agree with you though it would be twisting the knife after it had been stuck in.

I don't know about Croatia, but...

Flight school Flying Academy - professional flight training

Prices seem to be about in Euros what you'd pay in stirling in the UK.

There are also, I think, JAA FIC schools out in that neck of the woods.

G