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EasyJet 'hanging by a thread', says union official

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EasyJet 'hanging by a thread', says union official

Old 26th Sep 2020, 23:19
  #21 (permalink)  
 
Join Date: Aug 1998
Location: London, UK
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he said they're even selling planes and leasing them back to get cash.
Easyjet have done that for years. When they first took delivery of their A319s they had got such a good price from Airbus (from ordering over 100) that they sold them to the leasing company for more than they had paid Airbus for them.
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Old 26th Sep 2020, 23:28
  #22 (permalink)  
 
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EasyJet are sound long term as long as this Covid nonsense doesn’t last beyond one Summer. If they run out of cash they can issue more shares. With this crisis likely to see the demise of smaller carriers they will be in pole position to benefit from a future upturn. EasyJet, Ryanair and Wizz will be net gainers when all this has worked through.
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Old 27th Sep 2020, 05:25
  #23 (permalink)  
 
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Originally Posted by captain g l walker View Post
So... I suppose the question here is: is easyjet hanging by a thread or is it standard policy for BALPA to lie to its members?
It is IMHO, standard policy for the Company to lie to the pilots and their reps.
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Old 27th Sep 2020, 09:51
  #24 (permalink)  
 
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Groundloop

Pretty normal in sale/leaseback deals. Short term financial gain, but then the airline pays lease rates based on the higher sales price. So it evens out over time.
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Old 28th Sep 2020, 09:55
  #25 (permalink)  
 
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Doors to Automatic

the issue facing us is exactly this virus and how long it is going to be around. By many accounts their are fears that it will continue for years. It's a very scary thought for us in aviation as well as other industries. Suggesting that COVID is nonsense and that a particular airline can just issue shares is so out of the real world it's exasperating. This virus could be fateful for many airlines, and will certainly have an adverse impact on the whole economic world. I wouldn't myself put EasyJet in the same bracket as RyanAir for making gains. By many accounts Easyjet may not survive this pandemic. To my knowledge RyanAir, being completely cutthroat in a business sense are the most well placed airline company. Never worked for them for that reason, but you have to admire their ruthlessness. EasyJet are saddled with massive overhead costs just as Jet2 which is probably worse, the silence from them is deafening. Legacy are the best bet for survival, and if you don't understand why then you should go back to school.
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Old 28th Sep 2020, 09:59
  #26 (permalink)  
 
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oceancrosser

no it doesn't even out over time, that's a rubbish statement, some party has to pay. Just to be clear the leasing company isn't the one that pays. Fundamental business practice.

EasyJet are labelling and leasing to help cash flow at this time, they just delay the hit.

give me a break!
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Old 28th Sep 2020, 11:42
  #27 (permalink)  
 
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rotorwills;

As I said, as long as things are back to normal by next Summer (which will hopefully be the case but is not guaranteed), then the likelihood is that easyJet can survive by increasing cash through a number of ways, one of which is to issue more equity. If COVID is around for years, then it is indeed a different matter. I disagree that legacy airlines are in a better position. Their high fixed costs (particularly but not exclusively) centred around operating hubs and long haul networks make them more, not less vulnerable than LCCs.
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Old 28th Sep 2020, 12:10
  #28 (permalink)  
 
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That is a veeery optimistic statement.
We are currently getting our ax hardly beaten in Europe and the winter season with the seasonal flu will only make things more complex in terms of tracing covid infections.
A vaccine will "hopefully" be out by beginning of 2021 but it will take a considerable amount of time to reach a decent level of the population, 1 year minimum.
Therefore I strongly believe we are looking at summer 2022 (best case scenario) as a more or less normal summer.
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Old 28th Sep 2020, 17:37
  #29 (permalink)  
 
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rotorwills

I don't work for Jet2, but I do hold shares in them. From what I've read in their financial report, they seem to be well placed to weather this fiasco. They own a lot of their own aeroplanes, with no lease costs, and as far as I know have a large number of seasonal (cabin) crew. I wouldn't say that they have "massive overhead costs", certainly not compared to easyJet or IAG.
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Old 28th Sep 2020, 17:45
  #30 (permalink)  
1+F
 
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Tartiflette Fan.

I was not proposing debt relief but a debt moratorium and not for airlines only, the global economy is affected and a few years ago private citizens bailed out banks big time. It is time they reciprocated not by accepting defaults but by deferring payments to allow a sensible transition for companies and individuals into some normality.

Banks and the people who run them are but a few.
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Old 28th Sep 2020, 20:01
  #31 (permalink)  
 
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“EasyJet are saddled with massive overhead costs just as Jet2 which is probably worse, the silence from them is deafening.”

Why’s is it a bad thing Jet2 don’t feel the need to air their laundry in public? The company has already made cut backs in staffing and aircraft, to be ready and make it through to S21.

EasyJet’s overhead cost of 300+ aircraft Either grounded or flying around with 20 pax to quarantine destinations.
Jet2 overhead cost of 75 aircraft flying to available Covid safe destinations.

I know who will burn through cash reserves quicker!

This leak is bad news, which it still astounds me why someone would feel the need to put it out in the public domain.

If this continues through S21 - no one survives without government intervention.

Last edited by Crewing Gimp; 29th Sep 2020 at 05:27.
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Old 28th Sep 2020, 20:37
  #32 (permalink)  
 
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I would be curious to see some numbers in terms of route flexibility for EZY and LS. The latter seem to have been very good with this so far, successfully rerouting lots of the traffic from the quarantined markets to the free-travel ones (e.g. by adding quite a lot of extra flights to Cyprus and Turkey in place of the cancelled ones to Spain). "Meeting the demand" is too broad a term. Sometimes it needs this sort of significant adjustment of the offering instead of flying empty into destinations with almost inexistent demand for the sake of maintaining presence there.
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Old 28th Sep 2020, 21:10
  #33 (permalink)  
 
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rotorwills

Methinks someone forgot to take their pills this morning...
Of course the leasing company gets their share based on the higher price they bought the aircraft at. The airline gets short term cash benefit but pays for it. All the way.
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Old 28th Sep 2020, 23:19
  #34 (permalink)  
 
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Originally Posted by PilotLZ View Post
Such headlines have the potential of smashing up whatever is left of consumer confidence. The present situation combining shambolic and unpredictable government policy changes and bombastic headlines left, right and center makes flying look like Russian roulette. When, apart from being at risk of having your flight cancelled or being sent into quarantine, you're also faced with the risk of the airline going bust by the time of your trip, it takes a huge deal of determination and a bit of denial to take any non-essential trip. The average traveller will not delve into the fact that hardly any private airline will survive unless this mess is sorted by next summer. The words "hanging by a thread" is all they need to see.
Completely agree. Personally I have stopped booking my flights with Norwegian.. .I just don't know if they will be around in 3-4 months or not. Travellers want confidence that their flights will happen when they book. This is not the kind of marketing you want if you look at booking 2021 summer travels.
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Old 29th Sep 2020, 14:38
  #35 (permalink)  
 
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Money is a determine factor for the consumer, if you want to book a holiday or flight next year then one should do it as no one can see into the future of wether the flight/holiday will go ahead or not. It's all about the amount of cash available to consumers. If one has the means to book one or two holidays then they should as they will be refunded for any cancellation. The world is not stopping, but don't think we are going to have a vaccine available anytime soon, some have posted to be early next year, Early 2021 is when they may start the first vaccine challenge trials. A vaccine is not going to save us anytime soon. It's about living with it and adjusting to the demands of financial survival of our airlines. I referred earlier to legacy airlines being better place onky due to the fact they will WILl be bailed out by taxpayers money. Some airlines seem to have lost the plot and are trusting in the words coming out of political bodies. My advice is trust in what you see and not what you are preached by elected officials who quite frankly have not a clue of what's really happening in the real world. Mean to say five months ago the UK would have a world class track and trace up and running back then, and still it's not working. The PM can't even answer a question today on who can meet who where and now PR Dept saying it was a mistook. Hmmm. We all want our airlines to survive but boy some of them haven't woke up to smell the coffee. Going to be more painful for some of our esteemed colleagues. KBO.
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Old 29th Sep 2020, 15:39
  #36 (permalink)  
 
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Will they be refunded .... or will they have a sneakily issued voucher instead?
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