Is Cabair going to stay alive?
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Is Cabair going to stay alive?
It was not so long ago that there was a thread on here about Cabair making a number of redundancies and someone was talking about the company folding. Does anyone know of any further news on this matter as I believe that this might be of a little importance to those considering paying their deposits for flight training at said organisation?
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This is a very relevant post, not just from Cabair but other FTO's as well.
If Cabair does fold, how will this affect other FTO's? Will this give others more of a monopoly over course prices or will it cause others to reduce their course fees??
If Cabair does fold, how will this affect other FTO's? Will this give others more of a monopoly over course prices or will it cause others to reduce their course fees??
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Can't comment on the financial aspect but I was talking to friend of mine last night who is on the Cabair Integrated course and according to him things aren't going to well up at Cranfield for all concerned......
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I have a friend currently on an Integrated at Cranfield, just wrapping up ground school before setting of to Valencia.
There was alarm a couple weeks ago as about 2/3rds of the fleet were hearding off back to their leasing company somewhere in the states/australia but assured the worried students this was due to the leasing company going pop not Cabair!
I do hope he gets through okay, though if the worst happens, he like many other students will have insurance so though a nightmare, wouldn't be the end of their 70K entirely if the worst did happen to Cabair.
Choppy waters though for sure.
There was alarm a couple weeks ago as about 2/3rds of the fleet were hearding off back to their leasing company somewhere in the states/australia but assured the worried students this was due to the leasing company going pop not Cabair!
I do hope he gets through okay, though if the worst happens, he like many other students will have insurance so though a nightmare, wouldn't be the end of their 70K entirely if the worst did happen to Cabair.
Choppy waters though for sure.
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he like many other students will have insurance so though a nightmare, wouldn't be the end of their 70K entirely
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Memories of 1991? when Trent Air Services went tits up and Cabair bought them out for £1 (iirc).
I think amongst the biggest financial sufferers were the students. In those days (and probably still), you paid 4 equal instalments for the course. But the nature of it had all the expensive elements (the flying and esp the twin flying) at the back end.
Good luck to all
I think amongst the biggest financial sufferers were the students. In those days (and probably still), you paid 4 equal instalments for the course. But the nature of it had all the expensive elements (the flying and esp the twin flying) at the back end.
Good luck to all
I don't think there is a particular reason to think Cabair would be the first to go bust. They are consulting with their employees as they look to downsize.
That's not really a secret and I wouldn't read too much into it as I think all the other schools will be doing the same either already or soon.
The only sensible strategy is to pay as go. No reason at all why you can't pay a £1,000 a day by instant debit card if need be. Then your exposure is minimal. If they offer an upfront payment discount tell them you want the discount but without the upfront requirement or your business goes to a competitor. Turning away turn over is something none of the FTO's are in a position to do right now.
WWW
That's not really a secret and I wouldn't read too much into it as I think all the other schools will be doing the same either already or soon.
The only sensible strategy is to pay as go. No reason at all why you can't pay a £1,000 a day by instant debit card if need be. Then your exposure is minimal. If they offer an upfront payment discount tell them you want the discount but without the upfront requirement or your business goes to a competitor. Turning away turn over is something none of the FTO's are in a position to do right now.
WWW
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Cabair
Re the aircraft leasing company that went bust, the day after cabair had them back online under their leasing company and things where back up and running, regards to cabair going under i dont see this in the immediate future if they are willing to turn around aircraft like that. Instructor redundencies look like good business sense with the current economic climate.
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www
Isn't Cabair's integrated course the cheapest around at the moment? Negotiable with them may sound good idea at this current climate. But I don't think they are negotiable as they are the cheapest integrated course now compared to other FTOs (as far as I know). Maybe, it will work with other FTOs????
n.david
Isn't Cabair's integrated course the cheapest around at the moment? Negotiable with them may sound good idea at this current climate. But I don't think they are negotiable as they are the cheapest integrated course now compared to other FTOs (as far as I know). Maybe, it will work with other FTOs????
n.david
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Instructor redundancies would lag any drop in enrollment by many months. If their 2008 courses were chocker, then they'd be halfway through 2009 before any drop in FI requirements starts to show up and probably closer to the end of 2009 before they'd need to make any FIs redundant. I don't know how full their 2008 courses were, but that is the best indicator as to when a drop in revenue and human resource requirements would lead to redundancies.
I don't think FTO's will drop prices, they will seek to contain and cut costs. When a business has money, particularly borrowed money, tied up in inventory, they drop prices to move it. We probably all got some nice Crimbo prezzies last week as a result. But FTO's don't have inventory, so staff redundancies become the cost containment technique of choice, but this lags any drop in sales by at least the length of ground school. Going to the wall only happens if sales revenue drops below the absolute break even point after staff is reduced to the bare minimum and cash is exhausted. Obviously, too much existing debt can accelerate failure while new financing or capital investment from deep pocketed owners can serve as effective life support to stave off failure until enrollment grows again.
Cabair has had a strong business for many years, so if their owners have not abused leverage, they could ride out a down cycle like they have before. Unless anyone has some solid sources indicating trouble, I'd chalk this up to unfounded rumours, particularly this early in a downturn. The fiscal soundness of an FTO merits very strong consideration by any wannabe though, not just in a down cycle, but in an upward one as well, so there is value in the topic even if Cabair is fine.
I don't think FTO's will drop prices, they will seek to contain and cut costs. When a business has money, particularly borrowed money, tied up in inventory, they drop prices to move it. We probably all got some nice Crimbo prezzies last week as a result. But FTO's don't have inventory, so staff redundancies become the cost containment technique of choice, but this lags any drop in sales by at least the length of ground school. Going to the wall only happens if sales revenue drops below the absolute break even point after staff is reduced to the bare minimum and cash is exhausted. Obviously, too much existing debt can accelerate failure while new financing or capital investment from deep pocketed owners can serve as effective life support to stave off failure until enrollment grows again.
Cabair has had a strong business for many years, so if their owners have not abused leverage, they could ride out a down cycle like they have before. Unless anyone has some solid sources indicating trouble, I'd chalk this up to unfounded rumours, particularly this early in a downturn. The fiscal soundness of an FTO merits very strong consideration by any wannabe though, not just in a down cycle, but in an upward one as well, so there is value in the topic even if Cabair is fine.
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Guys I've been in aviation for 10 years now, this problem of flight training organisations going bust is nothing new, just as WWW has said pay as you go is as important now as it's ever been.
Dont put yourselves in a situation where any training organisation has lots of your hard earned (or financed) cash in their bank account.
I trained modular and was never more than a few hundred quid in credit at any time.
If any company wants thousands of cash upfront, politely decline and say that your quite happy to keep your account in credit, and stick to your word, it's going to be tough times for FTO's and it's a bit of a buyers market just now (possible understatement).
For those of you training or looking for a job stick with it, I don't doubt you already know that the aviation market is very cyclical (7 years I was told during training and that has been the case in my experience) It will recover from bust to ..... well maybe not boom but it wil recover.
Regards
Dont put yourselves in a situation where any training organisation has lots of your hard earned (or financed) cash in their bank account.
I trained modular and was never more than a few hundred quid in credit at any time.
If any company wants thousands of cash upfront, politely decline and say that your quite happy to keep your account in credit, and stick to your word, it's going to be tough times for FTO's and it's a bit of a buyers market just now (possible understatement).
For those of you training or looking for a job stick with it, I don't doubt you already know that the aviation market is very cyclical (7 years I was told during training and that has been the case in my experience) It will recover from bust to ..... well maybe not boom but it wil recover.
Regards
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The only sensible strategy is to pay as go. No reason at all why you can't pay a £1,000 a day by instant debit card if need be. Then your exposure is minimal. If they offer an upfront payment discount tell them you want the discount but without the upfront requirement or your business goes to a competitor. Turning away turn over is something none of the FTO's are in a position to do right now.