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Maverick

Airlines at risk

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It will be interesting to see how much stomach governments have for the industry. In the past, the feds tended to offer things like fuel tax rebates that were convertible into future tax liabilities that could be paid off by the carriers within a 10 year timeframe - or something like that. The government could take minority positions in the publicly traded carriers. Or it could pay landing and terminal charges in much the same way it might rebate fuel taxes. But it's hard to say if it would have the stomach to throw money at a carrier that wouldn't be in some form of loan or equity. I mean, are they going to make Air Canada or Chorus shareholders whole? Hardly. Are they going to make Onex whole? Hardly. My bet is that whatever rescue Air Canada gets it has to take on Transat. BTW, UA posted a new intl schedule this afternoon that boils down to most of the Atlantic served from EWR and most of the Pacific from SFO. So the in-between hubs got almost nothing. There is one intercontinental flight for Chicago. I have a hunch that Canada's four intercontinental airports will scope down as pretty much Toronto and Vancouver, with minimal Calgary and Montreal.

I see UA is cutting the YYZ-SFO, YOW-ORD, YVR-IAH and not surprisingly, the YEG-IAH oil patch express.

https://hub.united.com/2020-03-17-united-airlines-further-reduces-domestic-and-international-schedules-2645516655.html

 

 

 

Edited by dagger

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35 minutes ago, dagger said:

I have a hunch that Canada's four intercontinental airports will scope down as pretty much Toronto and Vancouver, with minimal Calgary and Montreal.

 

They might scale down even more than that.  CBC is now reporting that the Canada/US border may soon be closed to non-essential travel.  WestJet had already announced scrapping of all tb flights, so its calculations might not change.  I don't believe that AC factored in shutting down tb when it made its announcements of parking capacity.  On the other hand, I can't imagine that there was going to be much non-essential travel across the border over the near term in any case.

We're already hearing many accounts at work of FAs being laid off from their second jobs as bars, restaurants, gyms, hotels etc adapt to the situation.  Each time I think I have wrapped my head around how bad all of this is going to be for the economy there's an announcement that makes things look even worse.

Edited by FA@AC

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On 3/17/2020 at 10:20 PM, PaulD said:

Has anyone had any luck getting through to and getting a refund from Air Transat.  Apparently a lot of people are getting very frustrated by the lack of contact with and info from the company. My daughter has been trying since last Thursday with no success. 

They are probably overloaded as well...some rumours indicate that some companies are saying the virus is an Act of God and therefore no refunds. I have 1/2 a Transat vacation coming back as a refund but if they don't give me a refund I will go through my travel Insurance, purchased prior to the flight.

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Call centres are hammered right now and they're only half occupied because of distancing.

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15 minutes ago, J.O. said:

Call centres are hammered right now and they're only half occupied because of distancing.

There is simply no way for any of the airlines to maintain normal call centre service levels. I have a question about a booking for a flight that no longer exists, for a trip my wife no longer can make because the country involved has closed its borders to foreigners. But frankly, there is no real need in my case to do anything right now, so I'm not bothering to deal with a call centre. People who don't have a critical issue to raise should just chill. It's not like the airlines can just go out and hire people to staff call centres - or even work from home - without weeks of training on the equipment and to know codes, rules, etc. Sure, they can pay overtime to current, but that's about it and it wouldn't be enough to cope with the massive volume they are dealing with.

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pay overtime is one thing.  Where do they get a phone and PC to work on?  No airline is going to be able to turn around a major infrastructure upgrade in short order let alone getting space to put everyone.

I really wonder where peoples expectations come from.

This is UNPRECEDENTED.  We just have to roll with it until its over.

 

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On 3/17/2020 at 9:13 PM, Trader said:

691 pilots at WestJet/Swoop on lay-off notice. Bad times indeed. 

There were never notices given out to individuals, but a notice to the union was given to start the clock on our contractual timelines before individual notices are given out. An MOA was reached last night between WJ/Swoop and ALPA that prevents any layoffs until at least May 1, 2020 via a reduced MMG, the temporary pause of the ESP interim cash program and a kicking of the can down to Nov for our stock option lump sum payment which was due in May.

Let's hope this thing settles down ASAP. I think all the actions the governments are taking are to eradicate this virus sooner than later to get the world back to some sense of normalcy. We all need to do our part.

Edited by anonymous
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1 hour ago, dagger said:

There is simply no way for any of the airlines to maintain normal call centre service levels. I have a question about a booking for a flight that no longer exists, for a trip my wife no longer can make because the country involved has closed its borders to foreigners. But frankly, there is no real need in my case to do anything right now, so I'm not bothering to deal with a call centre. People who don't have a critical issue to raise should just chill. It's not like the airlines can just go out and hire people to staff call centres - or even work from home - without weeks of training on the equipment and to know codes, rules, etc. Sure, they can pay overtime to current, but that's about it and it wouldn't be enough to cope with the massive volume they are dealing with.

I dealt with DELTA and AC and changed a 4 sector trip on their websites....not a problem 

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In Pictures—Airports Start To Resemble Aircraft Graveyards
 

With airlines around the world grounding as much as 90% of their fleets, airports are reaching capacity due to the amount of parked aircraft. Pictures are emerging of some of the world's busiest international airports that resemble some of the infamous airplane graveyards around the world.
 

https://www.forbes.com/sites/jamesasquith/2020/03/22/in-pictures-airports-start-to-resemble-aircraft-graveyards/#9a9cc88608c4

 

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As outlined in the US letter, the outcome of grants vs loans affects the underlying guarantees emanating from the operators. Hard to feel sorry for the shareholders.

Unless the US government wants to get in the business of owning airlines, my guess is the final bill passed will contain availability of backstopped loans with possible deferment/forgiveness of fees and taxes owing.

Not sure about what the final government package for airlines will be in Canada. AC can survive on backstopped loans but others may never have the capacity to repay.

Heard there may be some significant news about one operator tomorrow.

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Emirates is suspending passenger operations as of Wednesday. Pilots pay cut 50%, housing, education and other benefits remain in place for 90 days. 

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Still no word from the airport authorities other than requests for cash. No layoffs announced there yet.

NavCan - CEO makes close to $700,000, no news of executive wage cuts (as elsewhere). No layoffs.

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4 hours ago, J.O. said:

Emirates is suspending passenger operations as of Wednesday. Pilots pay cut 50%, housing, education and other benefits remain in place for 90 days. 

OMG.....How will they survive on a measly TAX FREE $8000.00 a month. ??🙄

Where do we send the "Care Packages".??😉

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Will this be the final nail in the coffin for Alitalia?? South African was also going into hard times before Covid.

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6 hours ago, rudder said:

As outlined in the US letter, the outcome of grants vs loans affects the underlying guarantees emanating from the operators. Hard to feel sorry for the shareholders.

Unless the US government wants to get in the business of owning airlines, my guess is the final bill passed will contain availability of backstopped loans with possible deferment/forgiveness of fees and taxes owing.

Not sure about what the final government package for airlines will be in Canada. AC can survive on backstopped loans but others may never have the capacity to repay.

Heard there may be some significant news about one operator tomorrow.

Lots of voluntary and involuntary leaves coming. 

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6 hours ago, rudder said:

Heard there may be some significant news about one operator tomorrow.

A Canadian one?  I'm curious what's floating out there, lots of rumours

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29 minutes ago, ng78 said:

A Canadian one?  I'm curious what's floating out there, lots of rumours

I cannot validate the credentials of the originating source so wiser not to repeat.

If accurate, it is significant. And it is Canadian.

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3 minutes ago, rudder said:

I cannot validate the credentials of the originating source so wiser not to repeat.

If accurate, it is significant. And it is Canadian.

That's fair, thanks rudder and good luck to all!

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On 3/22/2020 at 7:52 PM, CanadaEH said:

Lots of voluntary and involuntary leaves coming. 

United, at least, is being open and up front today that even with the bailout, layoffs are inevitable because the economy is not going to come roaring back all at once, or soon.

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