dagger Posted March 31, 2003 Share Posted March 31, 2003 Guess the Toronto Star has it wrong. http://biz.yahoo.com/rf/030331/airlines_aircanada_aid_1.html Link to comment Share on other sites More sharing options...
Guest V1 Posted March 31, 2003 Share Posted March 31, 2003 A cash injection isnt going to fix Air Canada anyway, especially with the strings that would be attached. A single injection either from the Feds or from the employees, in wage cuts, is not going to resolve the problems at Air Canada and in my opinion are only bandaids that would enable a delay to a time that these problems may be even more difficult to address. Right now there is War, Disease, poor economy, bad business decsions and bad policy but also an economy and industry that would be badly hurt by an outright shutdown. There are many reasons now why AC should not fail and those reasons become fewer and fewer if we limp along weak and in decline for years. Imagine if the suppliers to AC all lose their primary source of revenue, the ripples would become tidal waves. Inject cash now and the GTAA (and other airports) will merrily continue in their way , NavCanada won't need to adjust to the new world nor would the employees have the need to make sacrifices. Today ACs problem is an industry problem, another day it could be ours alone. So my view is cancel any route or flight that is not making money atleast till the end of the war. If necessary file CCAA and wash out the system. Reduce wages, numbers of employees, Fees payed to NavCan and the airports. Regnegotiate leases and rents and EVERTHING else that AC pays for. No one would be unscathed but the time is now and the only reason not to is fear of change and of the unknown. Heck something good may come of it. One pay cut now and we do this again all over next year. Imho Link to comment Share on other sites More sharing options...
groundeffect Posted March 31, 2003 Share Posted March 31, 2003 On ctv, they announced the govt. offered AC a half a billion if it goes to ccaa restructuring. Air Canada said they are asking for NO AID other than reduced travellers taxes/fees. Link to comment Share on other sites More sharing options...
dagger Posted March 31, 2003 Author Share Posted March 31, 2003 First you say, "if necessary file CCAA and wash out the system. Reduce wages, numbers of employees...." Then you say... "One pay cut now and we do this again all over next year." So which is it? Link to comment Share on other sites More sharing options...
dagger Posted March 31, 2003 Author Share Posted March 31, 2003 By the way, you never wash out the system with a reorganization.Everybody gets a haircut, but not necessarily a scalping. AC will still have debt, still have leases... Not every lease is renegotiable. Aircraft leases can be marked down to market, but how do you mark down an airport lease? It's not like you can switch airports. You can stiff creditors who supply goods and services, and will they want to work with you again? Some will, some won't. It's not the panacea you believe. US Airways emerged from Chapter 11 today and it's STILL losing money. Link to comment Share on other sites More sharing options...
Guest V1 Posted March 31, 2003 Share Posted March 31, 2003 That was a typo/grammer problem. I meant with just a pay cut we will be doing this again in a year from now. We need real and comprehensive change from everyone. I meant to say with just a pay cut we dont resolve anything nor do we resolve anything with any other ONE thing Link to comment Share on other sites More sharing options...
Guest V1 Posted March 31, 2003 Share Posted March 31, 2003 I see. Link to comment Share on other sites More sharing options...
dagger Posted March 31, 2003 Author Share Posted March 31, 2003 Also, on airports, here is how much luck United is having with its major airports. Think they give a damn. They gave them 15 more days to make its rent payments. Otherwise, they are ready to boot UA out. Think they are bluffing? Maybe, maybe not. "Come on punk, do you feel lucky today?" Link to comment Share on other sites More sharing options...
dagger Posted March 31, 2003 Author Share Posted March 31, 2003 Here's the link http://biz.yahoo.com/ap/030331/airports_ual_1.html CCAA is more creditor friendly than Chapter 11. You might find that the haircut you take is not a pay cheque, but your career. Link to comment Share on other sites More sharing options...
dagger Posted March 31, 2003 Author Share Posted March 31, 2003 I would agree with you normally, except that the company is not just proposing wage cuts. And it is not saying the pain won't be shared by various stakeholders. The fact is, ACPA is still doing due diligence so it is impossible to conclude that what the company is asking for wouldn't be enough. There have been no negotiations. Link to comment Share on other sites More sharing options...
Guest V1 Posted March 31, 2003 Share Posted March 31, 2003 Would it not allow a large portion of the "non-aircraft" debt to be converted into "equity" That is tell the creditors that instead of owning the cash value of the instruments they have they own the airline. NavCanada's revenue would be reduced and the GTAA's rent and fees would be re-set to a manageable level as would layoff clause and other contractual provision with employees all under the protection of a court. Is that not how it works?? Is that not what it is for?? Unions do not have a mandate nor are they set up to give away contracts and to ask them is silly. Link to comment Share on other sites More sharing options...
Guest V1 Posted March 31, 2003 Share Posted March 31, 2003 Well if that is the case then perhaps the die is already cast. I have no way to to know that. If liquidation is in the card then it is in the cards. I'd prefer to get at this now. I don't see our chances to meaningfully fix this better than they are now. I wonder what would happen if the GTAA locked AC out of Pearson. I do feel pretty lucky today. was that five or six shots hmmmm. Link to comment Share on other sites More sharing options...
dagger Posted March 31, 2003 Author Share Posted March 31, 2003 I don't know about your philosophy of life but mine would be to get negotiations started to see if this can be saved, rather than be defeatist. If the prospect of concessions is so great, I suppose you should be circulating your C.V, but I would want my leaders at the table. I don't think the debt thing is so crippling. Roughly half of Air Canada's costs - labor, aircraft leases, some supplies - can be renegotiated. I am betting that sooner or later the government will come round with something for the industry as a whole. I don't believe the die is cast - but if the unions all sit on their butts or gaze at their navels, I am willing to bet that you will either get a liquidation or a worse result in CCAA than you could have negotiated short of CCAA. Link to comment Share on other sites More sharing options...
ChicoChico Posted March 31, 2003 Share Posted March 31, 2003 The information we have is that the due dilligence is taking a longer because of the company..I'm all for getting on with this process! Chico Link to comment Share on other sites More sharing options...
Guest V1 Posted April 1, 2003 Share Posted April 1, 2003 I dont feel "defeatist" at all. I do think that what ever process we go through needs to include everyone. I for one want to get on with it. I would hate to see at the end though the GTAA think they have unlimited funds available to try to rival the art collection at Vancouver or to see Murray and his collegues continue to send aircraft on 30 minute long taxis with multiple intermediate stops just to follow "procedure" that makes no sense. Link to comment Share on other sites More sharing options...
dagger Posted April 1, 2003 Author Share Posted April 1, 2003 You should read the new Airport Act that was quietly brought forward a few weeks ago. It has the fat cats running the airports howling. I think the message about these guys has started to get through to the politicians Link to comment Share on other sites More sharing options...
Guest V1 Posted April 1, 2003 Share Posted April 1, 2003 Oh really do tell more. Link to comment Share on other sites More sharing options...
dagger Posted April 1, 2003 Author Share Posted April 1, 2003 http://www.tc.gc.ca/mediaroom/releases/nat/2003/03-h022e.htm#backgrounder The part on fees basically says the airports won't be able to charge more than they have to, and increases can be appealed. Link to comment Share on other sites More sharing options...
dagger Posted April 1, 2003 Author Share Posted April 1, 2003 Debt, including lease debt, can be converted to equity. But no debtholder is going to convert unless the airline's operating plan offers a reasonable prospect of success. Right now, the airline's debt payments are a lot less than its losses. Even if you cram down rent payments and bond/debenture interest, you might have a breakeven or insufficiently profitable airline. The lessors and bondholders have heard a lot of Air Canada's problems with low-cost competition. So operating costs have to be addressed before any debt-for-equity swap. That means labor costs, government and airport costs, etc. This will be the case whether a restructuring occurs inside or without CCAA. Link to comment Share on other sites More sharing options...
MURRAY Posted April 1, 2003 Share Posted April 1, 2003 I guess you are pig-headed enough to lobby for a return to the ATT. And don't mistake your "30 minute long taxis" for some of your ROT's. Link to comment Share on other sites More sharing options...
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