Growing evidence that the downturn is upon us....
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The 'Hamble years' refers to the 60's and 70's when BA had their own flight training establishment at Hamble in southern England. Times were good for those fellows, on the whole. Long careers, with huge salaries awaited them in BA. The last of the Hamble guys are now close to retirement in BA. However, it was not all milk and honey. In the first oil crisis, in the early 70's, many of those cadets didn't get to go to BA since they stopped recruitment. Many went on to fly in Qantas and Singapore airlines. One of those chaps now flies for my airline, after spending his first 7 years in Singapore before joining BA and retiring a couple of years ago at 55.
In India times are good, but there are now far too many CPL/IR holders than there are jobs currently.
In India times are good, but there are now far too many CPL/IR holders than there are jobs currently.
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My view:-
Airline mergers will happen not just in Europe but across the pond, in a bid to remain a going concern
Take a look at FCA / TUI on a typical Sat, last summer they would of had 4 flights going to PMI for example, this summer it will be two full acft in total. TCX & MYT same type of scenario
You have strong airlines currently EZY, Monarch, TUI & TCX I feel however, there is one more airline that will go (I hope to god I am wrong!)
Airlines will and are sending back gas drinking machines when off lease, i.e EZY getting rid of their B737's, but are replacing these with A319's up to the end of 2009 according to my contact
I feel if you train while you earn, kept your debts low, you will be able to have a life and survive once finished - you may end up waiting 1 / 2 years for your first job, but you still want to go on holiday, buy clothes, treat the wife etc etc??
Contacts is also the name of the game, ensure you network and talk to current line pilots down your flying school
At the end of the day, if it's your dream then train, but please keep an eye on your financial situation, oh and having an understanding wife / girlfriend helps
Good luck to one and all
KP
Airlines will review their routes and pax numbers
Airline mergers will happen not just in Europe but across the pond, in a bid to remain a going concern
Take a look at FCA / TUI on a typical Sat, last summer they would of had 4 flights going to PMI for example, this summer it will be two full acft in total. TCX & MYT same type of scenario
You have strong airlines currently EZY, Monarch, TUI & TCX I feel however, there is one more airline that will go (I hope to god I am wrong!)
Airlines will and are sending back gas drinking machines when off lease, i.e EZY getting rid of their B737's, but are replacing these with A319's up to the end of 2009 according to my contact
I feel if you train while you earn, kept your debts low, you will be able to have a life and survive once finished - you may end up waiting 1 / 2 years for your first job, but you still want to go on holiday, buy clothes, treat the wife etc etc??
Contacts is also the name of the game, ensure you network and talk to current line pilots down your flying school
At the end of the day, if it's your dream then train, but please keep an eye on your financial situation, oh and having an understanding wife / girlfriend helps
Good luck to one and all
KP
Airlines will review their routes and pax numbers
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Soaring oil price sets airlines on course to recession, expert says
Suzy Jagger in New York div#related-article-links p a, div#related-article-links p a:visited { color:#06c; } The global airline industry is facing a recession far more severe than the slowdown endured after the terrorist attacks of 2001, a leading aviation expert claims.
William Swelbar, a consultant to the Massachusetts Institute of Technology, told The Times that the true health of the aviation market - especially in the United States - will not become clear until this autumn, after the key holiday season.
“Many flights ... over the next few months were booked months ago, so it distorts the true picture of what is happening. What is for sure is that we are headed towards a severe slowdown. We may already be in a recession,” Mr Swelbar said.
His comments came as SilverJet, the business-only airline, left passengers stranded after admitting that it had run out of cash and had suspended operations.
Experts and aviation executives have said that record oil prices have fractured the traditional business model of most airlines.
Steve Lott, a spokesman for the International Air Transport Association (IATA), yesterday described a “perfect storm” that is heading for world airlines, to which the American market is especially sensitive.
“The economic slowdown in the US, the oil price and the weakness of the dollar are all conspiring to hit the aviation market. Americans are going to be thinking hard about whether they can afford to travel. It's not just economy travel. In March, globally, we saw the fastest decline in premium traffic for five years. The outlook is grim.”
Mr Lott said that airlines were being squeezed on two fronts: falling passenger traffic and rising costs, driven by the oil price.
According to IATA, global passenger traffic slowed to a 4 per cent growth rate in the first three months of this year, compared with 6.7 per cent for the same period a year earlier. Many expect traffic to shrink much further by the end of the year.
One airline executive said: “The problem is that we have already cut the fat - we did so after 9/11. There really are no more jobs to cut. The way forward is to cut capacity, big time. You are going to see planes grounded just to stem the losses and fares are just going to have to go up.”
British Airways, having bolstered its balance sheet after the 9/11 attacks with a £5.9 billion rights issue, is in better health than many rivals, but is believed to be considering ways of grounding about a fifth of its fleet.
Frances Farrow, chief executive of Virgin USA, said that if airlines fail to raise prices to respond to the increasing oil price, “everybody is in trouble by the end of the year. Everybody. Something has to happen.”
She said that older “legacy” airlines such as American Airlines and United Airlines run older and less fuel-efficient aircraft, so face an immediate disadvantage. However, United and US Airways confirmed yesterday that a merger of the two carriers would not happen “at this time”.
Many airlines have tried to avoid raising fares bacause the slowdown in passenger traffic has made competition more fierce. Instead, some have imposed fuel surcharges and extras.
Jet Blue has recently started to charge between $20 and $30 (£10 to £15) for a window seat, while American Airlines this month introduced a fee for checked-in luggage. How can low cost airlines make a profit?Take Ryonair ,for example.They were complacent budgeting for an oil price of just $37.They should have budgeted for $137.
stephen hulton, eure, france
Peak Oil observers have known without doubt that new runways for example at Heathrow would never end up being justified because of this effect. Everyone else just wouldnt listen.
Dan Cassidy, Middlesbrough, UK
Airlines can charge for everything they possibly can but I think they will now be forced to stop treating passengers like 'cattle' and start improving customer service on board to maintain numbers and repeat custom. Welcome to a new golden age of flying.
Khaled Shivji, London,
William Swelbar, a consultant to the Massachusetts Institute of Technology, told The Times that the true health of the aviation market - especially in the United States - will not become clear until this autumn, after the key holiday season.
“Many flights ... over the next few months were booked months ago, so it distorts the true picture of what is happening. What is for sure is that we are headed towards a severe slowdown. We may already be in a recession,” Mr Swelbar said.
His comments came as SilverJet, the business-only airline, left passengers stranded after admitting that it had run out of cash and had suspended operations.
Experts and aviation executives have said that record oil prices have fractured the traditional business model of most airlines.
Steve Lott, a spokesman for the International Air Transport Association (IATA), yesterday described a “perfect storm” that is heading for world airlines, to which the American market is especially sensitive.
“The economic slowdown in the US, the oil price and the weakness of the dollar are all conspiring to hit the aviation market. Americans are going to be thinking hard about whether they can afford to travel. It's not just economy travel. In March, globally, we saw the fastest decline in premium traffic for five years. The outlook is grim.”
Mr Lott said that airlines were being squeezed on two fronts: falling passenger traffic and rising costs, driven by the oil price.
According to IATA, global passenger traffic slowed to a 4 per cent growth rate in the first three months of this year, compared with 6.7 per cent for the same period a year earlier. Many expect traffic to shrink much further by the end of the year.
One airline executive said: “The problem is that we have already cut the fat - we did so after 9/11. There really are no more jobs to cut. The way forward is to cut capacity, big time. You are going to see planes grounded just to stem the losses and fares are just going to have to go up.”
British Airways, having bolstered its balance sheet after the 9/11 attacks with a £5.9 billion rights issue, is in better health than many rivals, but is believed to be considering ways of grounding about a fifth of its fleet.
Frances Farrow, chief executive of Virgin USA, said that if airlines fail to raise prices to respond to the increasing oil price, “everybody is in trouble by the end of the year. Everybody. Something has to happen.”
She said that older “legacy” airlines such as American Airlines and United Airlines run older and less fuel-efficient aircraft, so face an immediate disadvantage. However, United and US Airways confirmed yesterday that a merger of the two carriers would not happen “at this time”.
Many airlines have tried to avoid raising fares bacause the slowdown in passenger traffic has made competition more fierce. Instead, some have imposed fuel surcharges and extras.
Jet Blue has recently started to charge between $20 and $30 (£10 to £15) for a window seat, while American Airlines this month introduced a fee for checked-in luggage. How can low cost airlines make a profit?Take Ryonair ,for example.They were complacent budgeting for an oil price of just $37.They should have budgeted for $137.
stephen hulton, eure, france
Peak Oil observers have known without doubt that new runways for example at Heathrow would never end up being justified because of this effect. Everyone else just wouldnt listen.
Dan Cassidy, Middlesbrough, UK
Airlines can charge for everything they possibly can but I think they will now be forced to stop treating passengers like 'cattle' and start improving customer service on board to maintain numbers and repeat custom. Welcome to a new golden age of flying.
Khaled Shivji, London,
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Glass of wine is definitely now half empty
http://business.timesonline.co.uk/to...cle4036769.ece
Those passengers sipping the better vintage wines at the front of an aircraft have subsidised economy travellers squashed in cattle class down the back for decades.
A £1,500 ticket to fly business class across the Atlantic has managed to offset the modest £20 profit each way that British Airways and Virgin Atlantic are estimated to make on every economy seat between London and New York.
But as the price of oil shot through $130 a barrel this month and shows no sign of slowing, that business model is broken.
Struggling to stay competitive amid falling passenger numbers, airlines have been loath to raise fares. Instead, a “bargain” £266 return air fare secured on the web between Heathrow and JFK has been supplemented with extra charges for bags checked in, for window seats and fuel surcharges. The extra free glass of wine went long ago for most airlines. There is a limit to how much airlines can patch over the discrepancy between their soaring costs and revenues.
Virgin Atlantic estimates that a transatlantic flight costs an airline between $200 and $400 per passenger, depending on how efficient (that is new) its aircraft is, and how well the company has hedged against the oil price.
With the number of business travellers falling at its fastest rate since 2002, the front end of the jet can no longer pick up most of the bill. And it is going to get worse.
Consumer confidence is widely perceived as an accurate way of plotting the trajectory of demand for air travel. Ominously, US statistics this week pointed to the lowest level of consumption since the 1950s in America.
While airlines have experienced financial turbulence before, it is only seven years since they were forced to cut costs through redundancies after the September 11 2001 terrorist attacks. There is less fat to trim this time around.
As Delta, the US airline pointed out, cutting capacity is an inevitability. The carrier believes that most airlines will have to ground fleets to stem the losses incurred on many routes.
The other option is for airlines to consolidate and remove overlapping costs such as headquarters, ground staff and duplicated routes. So far, this has failed to work.
United Airlines, fresh from the Chapter 11 bankruptcy protection it sought after the September 11 2001 attacks, tried to merge with Continental but talks failed. It then looked at opening negotiations with US Airways, which had also attempted to do a deal with Continental. The heads of United and US Airways said yesterday that merger talks had been suspended. “We are evaluating other options,” Glenn Tilton, chief executive of United, said.
MIT, the US university, is not alone in believing that a major American airline will go bust within a year. There may be many more stranded passengers, stuck with worthless tickets issued by bust airlines before the year is out.
Those passengers sipping the better vintage wines at the front of an aircraft have subsidised economy travellers squashed in cattle class down the back for decades.
A £1,500 ticket to fly business class across the Atlantic has managed to offset the modest £20 profit each way that British Airways and Virgin Atlantic are estimated to make on every economy seat between London and New York.
But as the price of oil shot through $130 a barrel this month and shows no sign of slowing, that business model is broken.
Struggling to stay competitive amid falling passenger numbers, airlines have been loath to raise fares. Instead, a “bargain” £266 return air fare secured on the web between Heathrow and JFK has been supplemented with extra charges for bags checked in, for window seats and fuel surcharges. The extra free glass of wine went long ago for most airlines. There is a limit to how much airlines can patch over the discrepancy between their soaring costs and revenues.
Virgin Atlantic estimates that a transatlantic flight costs an airline between $200 and $400 per passenger, depending on how efficient (that is new) its aircraft is, and how well the company has hedged against the oil price.
With the number of business travellers falling at its fastest rate since 2002, the front end of the jet can no longer pick up most of the bill. And it is going to get worse.
Consumer confidence is widely perceived as an accurate way of plotting the trajectory of demand for air travel. Ominously, US statistics this week pointed to the lowest level of consumption since the 1950s in America.
While airlines have experienced financial turbulence before, it is only seven years since they were forced to cut costs through redundancies after the September 11 2001 terrorist attacks. There is less fat to trim this time around.
As Delta, the US airline pointed out, cutting capacity is an inevitability. The carrier believes that most airlines will have to ground fleets to stem the losses incurred on many routes.
The other option is for airlines to consolidate and remove overlapping costs such as headquarters, ground staff and duplicated routes. So far, this has failed to work.
United Airlines, fresh from the Chapter 11 bankruptcy protection it sought after the September 11 2001 attacks, tried to merge with Continental but talks failed. It then looked at opening negotiations with US Airways, which had also attempted to do a deal with Continental. The heads of United and US Airways said yesterday that merger talks had been suspended. “We are evaluating other options,” Glenn Tilton, chief executive of United, said.
MIT, the US university, is not alone in believing that a major American airline will go bust within a year. There may be many more stranded passengers, stuck with worthless tickets issued by bust airlines before the year is out.
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I think that we needed to start developing alternative fuels 20 years ago and needed them to be ready for consumption last year. Unfortunately that hasn't happened and airlines now have a stark choice between filling up with kerosene at whatever the price and grounding their planes. It appears that leaving the planes parked is starting to look more profitable than flying them. Perhaps the best license to get right now is a tug license!
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Oil and airlines
With every cloud there is a silver lining. Just as Silverjet was closing its doors, shares in rival airlines, including British Airways, were climbing despite the flag carrier's well publicised difficulties with fuel costs.
BA yesterday risked losing holiday traffic by announcing that it will charge a £218 surcharge on return flights to Florida and California. Customers may look askance, but investors were pleased to see it passing its extra costs on to passengers.
The collapse of Silverjet also provides the happy, for BA, situation that business class capacity has been taken out of the market. Analysts at Citigroup reckon that net business class capacity has fallen by a fifth since the beginning of the year.
Since December all three business class-only airlines - MaxJet, Eos and Silverjet - have collapsed, reducing the business class capacity across the Atlantic by roughly 30 per cent. American Airlines has also terminated its London Stansted/ New York service. This more than offsets the increase in capacity that the launch of open skies ushered in, when Delta and Continental added new services this spring.
BA has invested heavily in its transatlantic business-class product in the last year in the face of these upstarts. Now the opportunity is there for it to cease almost half the critical transatlantic market, on the back of Silverjet's demise.
But the main reason airline shares, including easyJet, have recovered steadily in the last two days is the easing oil price.
Having hit an all-time high of $135 a barrel last week, oil has slipped back to $127 a barrel. The price has weakened as there has been mounting evidence that high prices are starting to erode demand in the short term.
Even at this level however, it is far in excess of the $70 - $80 a barrel on which airlines have traditionally budgeted. Shares in BA may have had a respite today - but it is only a few days' breathing space.
BA yesterday risked losing holiday traffic by announcing that it will charge a £218 surcharge on return flights to Florida and California. Customers may look askance, but investors were pleased to see it passing its extra costs on to passengers.
The collapse of Silverjet also provides the happy, for BA, situation that business class capacity has been taken out of the market. Analysts at Citigroup reckon that net business class capacity has fallen by a fifth since the beginning of the year.
Since December all three business class-only airlines - MaxJet, Eos and Silverjet - have collapsed, reducing the business class capacity across the Atlantic by roughly 30 per cent. American Airlines has also terminated its London Stansted/ New York service. This more than offsets the increase in capacity that the launch of open skies ushered in, when Delta and Continental added new services this spring.
BA has invested heavily in its transatlantic business-class product in the last year in the face of these upstarts. Now the opportunity is there for it to cease almost half the critical transatlantic market, on the back of Silverjet's demise.
But the main reason airline shares, including easyJet, have recovered steadily in the last two days is the easing oil price.
Having hit an all-time high of $135 a barrel last week, oil has slipped back to $127 a barrel. The price has weakened as there has been mounting evidence that high prices are starting to erode demand in the short term.
Even at this level however, it is far in excess of the $70 - $80 a barrel on which airlines have traditionally budgeted. Shares in BA may have had a respite today - but it is only a few days' breathing space.
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peterinmadrid,
I suggest you do a little research into the so called "peak oil theory" rather that just worrying about it. There is are many untapped oil reserves which were once unfeasible due to the low price of oil. Besides, in a couple of decades or so, many planes will be probably be using some sort of biofuel. Two airlines globally have already run successful trials.
The economy will eventually recover, and it comes down to the question, would you rather be qualified during an downturn or would you rather be unqualified during a boom period? I know which I would choose.
I suggest you do a little research into the so called "peak oil theory" rather that just worrying about it. There is are many untapped oil reserves which were once unfeasible due to the low price of oil. Besides, in a couple of decades or so, many planes will be probably be using some sort of biofuel. Two airlines globally have already run successful trials.
The economy will eventually recover, and it comes down to the question, would you rather be qualified during an downturn or would you rather be unqualified during a boom period? I know which I would choose.
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I hope that you are right, Ideal Line. Regarding peak oil, there is a huge amount of information on the internet but depending on where you look predictions range from end of civilisation as we know it to a short transition period to new fuels. I don't know who is right but it is a major concern. I don't subscribe to the doomsday scenarios - war, famine, economic disaster etc, but I do think that there it has a lot to do with why fuel prices are rising so quickly. I think that alternative fuels and non-conventional sources of oil will help us avoid total disaster, but developing all of this takes a long time. What the price of oil does in the meantime and how that affects the aviation industry is what worries me.
Some analysts are predicting prices to go a lot higher (around 200$ by the end of the year) and if you look at a graph for the price of oil over the past couple of years and extrapolate it the future really doesn't look good. Recently I have been looking at bloomberg.com to see the price of oil - today it has gone up another dollar.
Some analysts are predicting prices to go a lot higher (around 200$ by the end of the year) and if you look at a graph for the price of oil over the past couple of years and extrapolate it the future really doesn't look good. Recently I have been looking at bloomberg.com to see the price of oil - today it has gone up another dollar.
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Things are going to be bad but we have just lost two people from our base alone, both of which will have to be replaced by new First Officers.
Finish your training and get an FI rating which are now seamingly unfashionable, get some flying under your belt and before you know it things will be picking up. Who would you recruit, the quitter or the bod that kept going and flying whatever he or she could?
It is worth it, but took me nearly seven years!
Finish your training and get an FI rating which are now seamingly unfashionable, get some flying under your belt and before you know it things will be picking up. Who would you recruit, the quitter or the bod that kept going and flying whatever he or she could?
It is worth it, but took me nearly seven years!
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"Terrible economic outlook - Time to quit?"
Me myself, im now looking to slow things down a bit rather than quitting. I've got my last(hopefully) ground exams next week. Then about 35 hrs of hourbuilding left, which I now intend to take my time on. Big long enjoyable trips. Now planning on doing CPL at a local airfield, again taking my time making the most of it.
The best thing is rather than doing it all full time like I was initially planning I can now do it all part time and save 15k for the IR in about 30 months time. All going to plan the industry will then be on its way back up I will have a fresh IR with good currency.
Hell if the industry dosent recover 15k buys a share in a nice a/c, sports car etc will also have had some fantastic and enjoyable flying.
Me myself, im now looking to slow things down a bit rather than quitting. I've got my last(hopefully) ground exams next week. Then about 35 hrs of hourbuilding left, which I now intend to take my time on. Big long enjoyable trips. Now planning on doing CPL at a local airfield, again taking my time making the most of it.
The best thing is rather than doing it all full time like I was initially planning I can now do it all part time and save 15k for the IR in about 30 months time. All going to plan the industry will then be on its way back up I will have a fresh IR with good currency.
Hell if the industry dosent recover 15k buys a share in a nice a/c, sports car etc
will also have had some fantastic and enjoyable flying.
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That's the way Moona.
Don't totally give up, just slow down a little and enjoy the process. If you have a true love for flying you'll continue flying anyways.
So just go forward and enjoy.
Don't totally give up, just slow down a little and enjoy the process. If you have a true love for flying you'll continue flying anyways.
So just go forward and enjoy.
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The oil industry aka The Government has all the power in the world to stop oil prices rising but it's something that needs to be done to curb human society's thirst for oil. The current increase is due to speculation as well as legitimate fears over lack of output.
On the other hand, the Government is a massive problem. Idiot Brown increasing North Sea oil taxes to 50% compounded an issue of falling extraction rates, by dissuading additional investment in those fields, which could lead to many being abandoned as uneconomic far before they would be uneconomic in fairer tax environments.
Other countries have ridiculous subsidies that lead to misaligned incentives to use oil-based products, and largely subsidise middle-class car use instead of helping the poor - as is often incorrectly claimed.
Back to the issue at hand...
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I beleive that ryanair even with the rising fuel costs are almost doubling their fleet. Apparently taking on 200 pilots each year, and according to their website thats not just experienced but also cadets.
I think that their will be a shift in travelers however. Gone will be the ages when everyone uses an airline to go abroad but holidays will be less frequent abroad anyway. However Buisnessman will pay whatever price to travel abroad because it's a necessity. And fedex and royal mail will always use aircraft for express mail. Sure there will be less jobs but it's all about determination because i beleive that if you apply enough and put inenough effort then you will get the jobs that are out there.
I think that their will be a shift in travelers however. Gone will be the ages when everyone uses an airline to go abroad but holidays will be less frequent abroad anyway. However Buisnessman will pay whatever price to travel abroad because it's a necessity. And fedex and royal mail will always use aircraft for express mail. Sure there will be less jobs but it's all about determination because i beleive that if you apply enough and put inenough effort then you will get the jobs that are out there.
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I wish that were true. The fact is there are far more cadets than there are jobs for cadets, I don't believe there are many people who will spend upwards of 40k and not apply themselves or put in the effort.
And ryan are actually grounding airframes at the moment, although i believe they have loads on order.
Personally i don't see it affecting holidays abroad a great deal, as the weather is the uk is so piss poor that a holiday at home is pretty much unbearable. In my view it will be the city breaks that will suffer first when people make their cutbacks, which will screw the likes of ryan and easy, and possible bankrupt the smaller loco's.
That above para is my opinion, and obviously not fact!
And ryan are actually grounding airframes at the moment, although i believe they have loads on order.
Personally i don't see it affecting holidays abroad a great deal, as the weather is the uk is so piss poor that a holiday at home is pretty much unbearable. In my view it will be the city breaks that will suffer first when people make their cutbacks, which will screw the likes of ryan and easy, and possible bankrupt the smaller loco's.
That above para is my opinion, and obviously not fact!
And this morning the Bradford & Bingley has been suspended from the London Stock Exchange. Absolutely no suprise from me as I've been expecting this since October.
Whilst some sort of rescue is doubtless being knocked up in the Treasury this morning this will only seal the fast growing impression amongst the public that something serious isn't right with the housing market. Buy To Regret is going to be like saying Endowment Mortgage. There were just under 1 million BTL mortgages sold last year. Most to amateur landlords many using insane gearing. Personal insolvency will result in Auctioning. Auctions are currently needing a 40% discount to achieve a sale.
These losses could be epic.
WWW
Whilst some sort of rescue is doubtless being knocked up in the Treasury this morning this will only seal the fast growing impression amongst the public that something serious isn't right with the housing market. Buy To Regret is going to be like saying Endowment Mortgage. There were just under 1 million BTL mortgages sold last year. Most to amateur landlords many using insane gearing. Personal insolvency will result in Auctioning. Auctions are currently needing a 40% discount to achieve a sale.
These losses could be epic.
WWW
And this morning the Bradford & Bingley has been suspended from the London Stock Exchange. Absolutely no suprise from me as I've been expecting this since October
http://news.bbc.co.uk/1/hi/business/7430460.stm