An Assessment Of The Current Crisis

[Luke SkyToddler]

Jeez tailscrape - some of you guys are getting a bit personal in your rebuttals of WWW - he may indeed be 'just' a fresh 737 copilot but that's a damn sight better position than 99% of the rest of us here have got. More to the point if you've been following this website for a few years, you'll know he's done a bit more than your average 'just an FO' and more pertinently that there is probably not a single man alive that's given more of his time and effort for free over the years to help and improve the lot of the internet-connected airline wannabe in this country. Some of the most informative and well considered posts I have ever read have come from WWW and when I see his byline I always sit up and pay attention even if I don't agree with it.

Anyway, to have a go at anyone posting opinions on this issue because of their so called 'junior' position in the industry is bollocks in the extreme. This is a very very complex situation and we're all speculating on the outcome, it doesn't really matter whether it comes out of the mouth of a PPL, a jet FO, or Chuck Yeager himself

I don't personally think that things are gonna be as grim as WWW says they are either, but I for one would like to hear everything he has to say even if it's doom and gloom. A bunch of hugely misplaced optimism has the potential to do a lot more damage to people's lives around here than a dose of sobering analysis.

Final point is that in my opinion it's personal attacks on individuals that bring this place down, not misplaced advice. Unless of course it's attacks on Ronchonner

[Wee Weasley Welshman]

Cool.

WWW

[tailscrape]

Hi Luke and WWW,

Good point about Ronchonner mate!

I do not mean to assassinate or bad mouth or indeed create aggro at all. I am probably more junior than WWW in my respective line, so I am not using that as an angle to strike anyone down.

In such fragile circumstances, a lot of things are decided purely on confidence. I don't want my company and hence my pay packet being harmed by yet more idle chit chat.

WWW, you will be glad to know I am back at work tomorrow. Therefore i won't be here to get on the old p.c.

Good luck everyone and let's get positive!!!!!

[The Greener Grass]

Dear me. The implications I get interpreting some of these posts is that us Wannabees are becoming indoctrinated by bad from WWW, good from IFR & Raw Data and that these are destiny-changing moments.

Whilst I am most grateful that any line pilot is willing to offer their opinion, the contents of their post remains just that.

Tailscrape implies that people may change their future plans based on a handful of posts from WWW within 2 weeks (yes 2 weeks) of the WTC attack. Now I really hope I speak as Mr Average Joe Wannabee and say that I for one am not pushed over the edge by this at all. If that is you concern tailscrape then I appreciate what you are saying, but I think that most of us have the strength of character to make our own minds up based on a whole variety of information we receive, of which a small PART may come from Pprune. Equally I am not moved by IFR and RD's enthusiasm. Please don't misinterpret this post; I am as grateful as anybody for the advice all of you offer, and at times am frankly amazed that you can be bothered to spend your free time doing so for us anonymous wannabees.

The truth is nobody can predict what the future holds - blimey if we had access to a pair of hindsight glasses we all would have done things differently. So past events may give some clue a decision we face in life today regarding the future, but as that event has not yet happened it is speculative and hence the difference of opinion between WWW, tailscrape, IFR and RD.

What is clear (and I think everybody agrees on this) is that a wannabee's life after September 11th 2001 is going to be a whole lot harder that before that day. The length of time and degree of difficulty is not possible to predict, so let's not try. 2 weeks after the event is not the time to consider your approach (no pun intended)! Long-term prospects are excellent, and always will be. Why not postpone that decision for 6 months before forking out 50k for the ab-initio course?

And when that time comes, look and consider the evidence. Still a little unsure by then? Then get on a modular course, where the draggable out factor is much more tuneable, become an instructor afterwards e.t.c. - Basically have a long-term plan and goal. I would have though this is a good plan, or not?

[barry white]

I can see that this has got a lot of people worried about the future of the airline prospects, but I seriously believe that by next March, April time it will be full steam ahead again.
This in my opinion is as a good as any time to start your training or to complete it, yes you might have to wait a few months extra to find a job,at the moment, but this will only be a short interuption.
The airlines were crying out for pilots before this, and they will be again in the near future, OK so there is a few high hour jet time pilots, new on the market but they won't be unemployed for long. The aviation game is one of the fatest growing industries and people will always want to travel, so how do they want to travel? by air of course, you wouldn't want to take the ferry to the Carribean would you
Keep posting and keep training there is light at the end of the tunnel.
PS Look at ATPL Theory Revolution thread and get your self heard.

[The Guvnor]

Reality check, people.

When the dust settles (and no, it isn't going to take 'a couple of months' as some hope), there will probably be at least 20 - and possibly as many as 50,000 qualified and experienced pilots out of a job, worldwide.

I've been around a fair while - I started at Laker Airways in 1981 - and I've been through two recessions. This one will be worse than the other two combined.

What we're going to see is this:

1) Massive pay cuts - which once instituted will remain in place.

2) For every available job that comes up, there will be hundreds of qualified applicants. This means that someone without experience will not even be considered.

3) There will be start-ups to take the place of some of the airlines that go to the wall - but again, their interest will be in experienced people.

4) The previous homes for people looking to build hours - eg flying schools, Africa, corporate flying etc will be closed as again experience is sought. Remember that many an out of work pilot will be prepared to literally "fly for food" as has happened in the past and will happen again now.

5) Companies that laid people off are required to hire back those people in preference to 'outsiders'. It's only once those slots have been filled that new people will be accepted - but again, experienced people will be taken in preference.

6) Prior to the events of the 11th September, Warren Buffet (who knows a thing or two about these things) was predicting that the current recession will last eight years. If things develop the way that they could, you'll see an economic collapse that will make the 1930s look like boom times.

So WWW is 100% correct. If you're in the middle of a course; or are about to start - STOP and assess your options. In my opinion, the chances of you getting an airline job over the next five plus years are nil to non-existent and you're going to need the money for other things in the interim.

I wish I could be more positive - but you lot need to know the true situation as it stands out there. Some of the comments on this thread are absolutely incredible - the naivety shown by some is truly frightening.

A last thought that has stood me in good stead over the years: hope for the best - but plan for the worst. Can't go wrong that way, really!

[Wee Weasley Welshman]

Crikey.

WWW

[Polar_stereographic]

Just to put a bt of balance on this thread, it might be worth reading:
http://www.pprune.org/cgibin/ultimat...c&f=1&t=015662

It looks like opinions differ, even from those who've been arround for a while.

I spoke to a mate of mine over the weekend who's an f/o with BA of around 6 months, so bottom of the seniority. He's spoken to them, and the word is that they are NOT laying off any pilots dispite what the media are saying, but the 300 or so that are talked about will come from retirements etc. So to repeat, not 300 on the market.

I guess the question is more a case of when they will start replacing these. Might also be an indication that they think it will blow over soon, so want to retain some excess. They also use the word 'moth ball' rather than scrap of some of their aircraft, so this might also add some weight to the theory.

PS

[wallup]

Firstly, thanks to WWW for setting up this thread, I tried something similar a few days back, but it was probably too close to the events in NY, Washington and Pittsburg.

Wannabes need to have a full overview of the facts so that they (and only they) can make the right decisions for themselves. We are, afterall, supposed to be "captains of the future" and as such capable of deciding for ourselves what we do. I would raise a couple of points related to WWW's original post and the subsequent bunfight here:

1 - Don't count on the guys in decent jobs who can afford renewals being out of the job market. I'm in that position (only just, it still cripples the bank account but I'm keeping current), if a flying job comes up - I'm off - I haven't come all this way and put all this work in not to pursue my ambitions. I am aware of the risks involved, I was before I took up flying training, I suggest I'm not the only one. I may in the near future do an instructors rating and instruct part time (evenings and weekends), again I don't think I'll be the only one.

2 - The job market is going to be more competitive, we are going to be coming up against experienced, professional aircrews, can't deny that. Now I can only look at that as being part of the challenge, as a 350 hours CPL/IR I have to look at it that way. Until recently Go, easyJet and Ryan were still taking a broad sweep of experience, with being able to fit the company culture a more important criteria. I understand that EZY and GO are concentrating on those with commercial experience now because of a lack of captains, but it won't stay that way forever.

3 - We ain't financial experts and we can't expect to be. I would suggest that even financial experts aren't in a position to predict what is going to happen, this is uncharted territory, will it go down, will it go up who know's? Eddie George was on Breakfast with Frost yesterday morning stating that the current drop in spending is not due to a lack of consumer confidence, but more to do with the fact that we were all glued to our TV's, mouthes and eyes wide open, unable to believe what we were seeing. He predicted that most sectors would pick up fairly soon, in particular retail and the service sector, with "slightly longer term" effects in equity and the ailine industry. I know it's his job to do so but it was a fairly up beat message, and worth listening to.

4 - I'm gonna be a bit bitchy here, sorry, but wannabes who say things like "is it true I can only get easyJet becaue BA sponsorship has ceased?" clearly have NO idea. I would suggest that EZY is not a compromise job - to think of it as second best is really going to work against you if you're applying there.

5 - Charter airlines - this time of year there aren't many bookings anyway. people don't start booking summer holidays until later in the year, that's why you see loads of holiday adverts over Xmas. Bookings may be down 28% for this time of year, but that's 28% of very little. Wait and see.

On friday I received an application form for a cargo airline, and I'm going to go for that job. As I say, it's going to be against tough competition but I can't roll over and let this beat me. I've come this far, I'm in it for the long haul (no pun intended), no matter how long it takes.

5 - WWW, thanks for no longer posting "gentlemen, this is not good" in every post. That was getting just a tad annoying.

And thanks to Tailscrape, Raw Data, IFR, Scroggs et al for saying it how they see it as well. A valuable debate, with well reasoned arguements all round.

Apart from the events in the USA themselves, I feel very sorry for those people losing their jobs and being told they aren't required during or before their courses (see the Britannia thread as one example). It must feel dreadful to have thought "I've made it" to have it taken away from you at such short notice. It is indicative of how cruel our chosen profession can be.

However, I think wait and see is the only solid advice that can be given right now.

Whatever you decide to do - I wish you all the best.

[ 24 September 2001: Message edited by: wallup ]

[Jonty]

Ok, the picture at JMC at the moment: No recruitment is taking place. 3 A320s are going back the the lessor in Sep, this was a planned move and nothing to do with the WTC. The 104 Ryan pilots will be going back to the States at the end of Oct, will they be back? who knows, but if they dont come back we have two choises, ground another 8 A320s or find another 50 crews from some where (whatch this space). Will our A320s be going out the USA this winter, at the moment yes, the holidays have been booked and payed for. This may change.

If you want my input on what is going on, this down turn will last about 6-12 months, it wount be anywhere as bad as the last one 89-90 (intrest rates at 15% and 3Million unemployed at the start of it) currently we have interest rates at about 4% and 0.5million unemployed. also before the WTC attack people were saying the worst is over as regards the down turn. Can someone explain to me what has fundamentaly changed in the economy and the last 10 days? (the answer is: NOTHING)

[The Guvnor]

Polar_Stereographic - you have to bear in mind that this crisis has only just started - the 11th was less than two weeks ago - and has years to run yet.

The European markets will remain more buoyant than the US and Transatlantic ones because - and only because - Europe hasn't been directly affected. Yet.

Stateside, people are stopping flying for a number of reasons:

1) They have had little experience of terrorism and it scares the !!!!! out of them - especially the thought of having an aircraft hijacked with them on board and used as a flying bomb. In Europe, we've had the IRA, ETA, RAF, Red Brigades etc to contend with for many years and it's not a major issue.

2) As has been widely discussed, US domestic aviation security is a complete joke, with passenger convenience rather than safety being the watchword. Passengers are not prepared to put up with two or three hour check in times - especially on the short hop, regional flights - and will now drive those instead of flying. Here in Europe, we've always had the security systems in place which the Americans are now introducing so it doesn't make any difference - and with the exception of (some) UK domestic and European routes served by high speed rail links it's still faster to fly than it is to take the car or train.

3) As the recession starts to bite, so companies start to cut costs. No longer can staff travel at the drop of a hat; and also people tend to downgrade: those flying first will now go business; those in business will go econony; and those in economy on a full-service airline will travel on a 'no frills' carrier. As the lowest common denominator, the people who will do very well out of this will be the Southwests, Ryanairs and easyJets.

So how will European markets be affected?

1) With many US passengers not flying transatlantic, this translates into fewer people using connecting/European flights which affect loads.

2) There has been a marked drop in advance bookings noted by a number of airlines - not those like FR and EZY, of course, as why would you not fly anywhere on their system for 1p or £1 or whatever? But those carriers will have to ramp their fares back up again quickly or they too will be haemmorhaging cash, which in a recession is a Very Bad Thing Indeed.

3) Airline costs are skyrocketing. Insurance premiums have increased 500% on average, and are payable quarterly in advance; which was one of the primary factors Gill went down. The price of fuel is increasing, too - and will go through the roof any military action starts for two reasons: (a) the various airforces will be buying it all; and (b) the oil markets are hypersensitive about any possible interruption of supply from the Middle East caused by war, sanctions or profiteering.

So what will the effects be?

1) Older generation, less fuel efficient aircraft will be parked and their crews retrenched. In a situation where LIFO rules apply at an airline, this will add costs where someone coming off a grounded type has to be retrained onto another type; whilst someone who is trained on that type has to be retrenched because s/he's more junior.

2) New aircraft acquisitions will be cancelled or deferred.

3) Startups (and there will be precious few of those over the next few years!) will use experienced pilots which they will be able to get at a pittance.

4) The charter market will be decimated for two reasons: (a) the economic belt-tightening effects of recession mean that people simply don't have the cash to go off on their holidays; and (b) a general reluctance, especially by infrequent travellers, of travelling by air after the US attacks.

5) Finance is not available for either start-ups or reinvestment into existing airlines. This means that no bail-outs or mergers are likely except if government sponsored in order to avoid catastrophic damage to their own economies. Remember, mergers only happen when one party has something another wants: routes, aircraft, staff etc - and in the present environment to merge two weak carriers will simply make a doubly weak one. So forget thoughts of ba Virgin Midland - it's just not going to happen.

6) If a war does happen, then the effects will be devastating. Expect loads to plummet overnight, as passengers become too nervous to travel even the no frills carriers. Unlike with the Gulf War, where there was an identifiable target which resulted in a massive movement of men and materiel - much of it on chartered airliners - here we have a situation where there is no country involved per se and therefore no attacking army. Most airlines' cash reserves will only allow them to stay grounded for 30 - 60 days before running out, and therefore airlines are cutting back now on aircraft and personnel in order to reduce the burn rate of those reserves. Worst hit will be the major full service airlines, with new (and very expensive) aircraft and heavy infrastructures; least hit will be anyone with older, low capital cost aircraft and small infrastructures.

So if any jobs are available, what are the best options?

The airlines that will be least affected, in my opinion will be:

1) European regional airlines, especially those operating lower cost turboprop equipment

2) Cargo airlines.

Hardest hit will be:

1) Full service airlines

2) Charter airlines

How long will this all last for?

The last recession was effectively from 1990/1 though to 1994/5; and was prompted by the Gulf War. That said, it's roots could be traced back to 1987 when the stockmarket collapsed, followed shortly afterwards by house prices.

This one was already predicted (by Warren Buffett) as lasting double that time - 8 years - and any conflict will have a much more serious effect still.

Within a year, expect to see massive unemployment in all sectors; house prices slashed as an affect of job losses and people no longer being able to afford mortgage repayments; compounded with them being unable to meet demands by the building societies/banks to pay off the 'negative equity'; spiraling costs of all goods (especially imported ones) resulting in greatly increased inflation figures; introduction of a national identity card and all the other police state controls that successive governments have tried for years to impose; and race riots that make those of the 1980s look like childsplay.

The best thing to do at the moment is to maximise your cash reserves - beg, borrow or steal as much as you can; liquidate your assets now for a much better price than you'll get in a few months or years - and then sit on it. This is the lesson that a few - very few - people knew in 1929, when the stockmarket crash led to the Great Depression - from a cash rich position they were able to pick up bargains at pennies in the pound that they could resell, at great profit, when the economic situation improved.

Good luck to us all!

[Wee Weasley Welshman]

Jonty - thanks for that, I am very relieved to hear reasons why all the Charters will not 'do a Britannia' regards recruitment in the short term. Its quite suprising when you start getting into it how disparate the positions of airlines in the same sector actually are.

Just one point which I have made elsewhere but stands repetition re. BA Retirees.

They don't all leave aviation chaps. They may leave BA on their nice pension but then I reckon at least half keep on flying elsewhere often part time or on a contract basis. The reasons are many and varied but include them liking flying or having to fund 3 divorces

So actually the 400 that BA will try to retire in the next 12 months may well turn into actually only 200 leaving the industry. The long fabled 'BA retirement bulge' is therefore somewhat of a myth albeit true over the 5 - 10 year term.

I am starting to see some signs that things are not going to completely pancake in though.

However there are still going to be by my reckoning at least 160 from Virgin, 100 from BA and 60 from Gill filling vacancies in the short term. Plus the failure of foreign JAA airlines plus Ansett and Air New Zealand might lead to perhaps 75 pilots headed over here with work rights. So thats about 400 nicely experienced airline pilots in the hiring market.

Aer Lingus and BMi will be dumping around 100 ex-cadets into the low time pool that weren't supposed to be there.

The colleges are pretty full with at least 250 self sponsored students set to graduate from Integrated courses within the next 12 months. And thats excluding non-British FTO's.

Looking at The Pilots Register and data from the ever helpful IPA records we can see that in the last 12 months - which have seen hiring going at full throttle - there have been about 400 airline vacancies filled.

If this halves down to 200 for the next 12 months then its going to take 18 months to clear out the experienced guys at least. Some low timers will still be hired for various good reasons like keeping training departments occupied and maintaining a balance in hours and experience within the workforce.

It is going to be hellish slow though for the next 18 months or more for those at the bottom of the food chain. :-(

At the moment I am putting my money on things being about 2/3rds as bad as the early 90's.


Cheers,


WWW

[Raw Data]

Well, I don't think many people "in the know" will be sharing the Guv's analysis. Highly pessimistic and leaning heavily towards the "doom" end of the scale, the picture he paints is really only a worst-case scenario. As this situation is somewhat different to all that have gone before, most of his analysis doesn't apply.

Also, Guv, watch the factual errors:

[QUOTE] The last recession was effectively from 1990/1 though to 1994/5; and was prompted by the Gulf War. [/QUOTE

... is complete bollocks. Starter for ten, Guv... when did the Gulf War start? I think you will find it was at the end of that timescale.

There are big holes in the rest of his arguments as well, but I haven't the time to go into them now.... maybe tonight. A shame really, as usually the Guvnor makes more sense than all of his detractors combined.

There is no denying that the current situation calls for steady nerves, and it is clear to me that the world in general is much more prepared to cope this time around. We shall see...

[The Guvnor]

Raw Data - you must be jetlagged or something! Actually, Iraq invaded Kuwait on the 2nd August 1990, which prompted a massive short term oil price increase and which was the final triggering factor for the recession. Desert Storm commenced on the 15th January 1991, with a ceasefire being declared on the 28th February.

My synopsis was indeed 'worst case scenario', following on from my earlier thread where I said: "Plan for the worst; but hope for the best".

Looking forward to debating the other 'gaps' with you later!

[no sponsor]

I think the advice continues to be to wait and see over the next 1-2 months, to determine how the current crisis will develop before deciding on the route/type of training. I'm not saying the crisis will be over in 1-2 months, but that it may be easier an environment to assess objectively.

No-one, as yet, has any facts on the course the economies will take, nor on the precise course of action the US will employ. When these are more certain, the stock markets, Governments and airlines will be assess their environments, and act in a decisive way which will bring stability (albeit in a possible negative way).

Markets and airlines can handle a bear or a bull market, what no-one can handle is uncertainty - which is what we have plenty of at the moment.

So, sit back, and wait - including all the prophets of doom and gloom.

[InFinRetirement]

I think this will be my last post on this subject. I have to repeat some of what I have said on this and my own thread. But I have to take issue with 'The Guvnor'. I respect his right to make his point of view, but I don't have to agree with him and I don't. Except perhaps, in one or two statements. The rest is, I have to say, presumptive speculation based, apparently on his personal views, and nothing else which is strange considering his experience. Either that or he has a very short memory, since history in the industry always repeats itself. I also think that Raw Data is right in his summation of a day or two ago, and today.

I had and ran my own airlines, the first in '77, and I believe you really DO have to have been involved as I was, and RD was, in 3 recessions and one war, to have at least an idea of how the industry has always returned with new vigour and in a relatively short period of time. I can see nothing in the present circumstances that alters that save to say, that the severity of this sad situation will make it a longer recovery - but NOT years. The industry will have to recover sooner than that otherwise the drains all over the world will be full of airlines!

At the risk of repeating myself again I must state again that this very sad situation should be used by the airlines to get rid of the equipment they don't really need, get rid of people they don't really need, get rid of routes they don't really need and get rid the Empire Builders in management they don't need, and who are about as much use to the airlines as a single engined pram! It is an opportunity that will relieve ANY airline of the hurt it has suffered. Think of it as a dialysis machine, it will clean the blood and get rid of muck that made it poorly. JMC is a good example of that, with Thomas Cook getting rid of damn near the whole team! I doubt that Terry Soult will have deserved it but he has taken early retirement anyway - according the Financial Mail on Sunday.

I think there will be a serious look at employment contracts too. With the likelihood that from the boardroom down there will be pretty severe cuts in pay. It is a time to cut costs and cut cloth. To pay attention to the idiotic decisions taken by those who were, perhaps, unecessarily employed in the first place. Trouble is I wonder if those who have to make those decisions are also capable. As you can see I do not have a very high opinion of airline management - but not all management.

It is time to look at every department and change it with relentless fervour - to upgrade the airline to a worthwile business. So that it can recover quickly.

At the time of the Gulf war, the number of charter passengers dropped from 13m to 9.5m and this hit the airlines very hard. Air Europe and Intasun in particular, who both went bust. Two years after the war passenger numbers were back to normal and increased further to 14m. This created new and better airlines. It is also worth stating that our domestic routes are riding high right now. Two weeks after the devastating event. Full loads! What would cause that? Passenger confidence wouldn't you say?

I also repeat what I said on the 20th. An airline works on Costs over Income. What is left is profit. The former has to be the best you can do, but the latter is the essential element to give you profit. But, one thing happened that was highly significant. Passenger confidence came back very quickly just has it has done above. This was and is largely due to the fact that people have very short memories about aircraft incidents - of ANY kind, and airlines just got bigger and better until.................then you have the low-cost airlines. They are on a winner in my opinion. I think they reap an enormous harvest of income from the effects of all this and will grow still more. But watch out for cost cuts. They really do have you by the short an curlies now - if they want to, and I wouldn't take a bet on M.O'Leary!.

In the case of Wannabes, you should not think negatively about this current situation. Be optimistic with a good helping of circumspection at the same time. Don't give up your goal. But be careful with your plans. Don't change your aims but take one step at a time. Don't spend large sums of money, but don't miss out on something important. The airlines WILL make a recovery, they WILL hire pilots again, even those with low hours - just as they did in the years after the Gulf war. Don't be led into believing that the high time pilot is the only type of pilot they will want. It won't be, it never was. However, don't be complacent - but do keep sight of your goal.

Another repetitious statement! If you feel pessimism - find the nearest bin and shove it in there - then shut the lid tight!

Remember, the final decision is yours. Think wisely and when you need to, do not hesitate to seek advice. BUT DON'T GIVE UP. YOU are the airlines future. Stick with it even though it will be tough.

But then no-one ever said aviation was easy - did they?

[ 24 September 2001: Message edited by: InFinRetirement ]

[Flypuppy]

Its good to see a few realistic and vaugely optomistic post in amongst all this doom gloom and misery thread.

Regardless of what happens in the world, and I hope it doesnt get out of hand, there is more to aviation than just the airlines. Think laterally, there are bound to be other ways of making money out of the commercial licence that we are all striving for. I certainly am not giving up, not now, not ever. I have set my course and will sail it until the end (or until I get torpedoed). The amount of half informed opinion that has spewed forth from these hallowed halls has been idiotic at times. With a little more time a new perspective to the aviation world will slowly form.

Who knows, maybe the Guv will tell us stories of his gun running in a beaten up old 707 into the next trouble spot, in between his writing rugby reports and setting up his virtual airline.....

[Wee Weasley Welshman]

Good on ya Flypuppy. I am rooting for you all the way.

Cheers,

WWW

[redsnail]

Ah Flypuppy, you never fail to make me chuckle. From the proverbial Chicken of Despair to this. Onya mate

[Girt_bar]

I don't mean to rub salt in to the wound here guys but it looks like Air New Zealand is on it's way under with a large number of VERY experienced pilots about to pour out into the job market.

I for one have decided to put the training on hold for a while but I will definitely be back.