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calpsafltskeds
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Corona virus Bailout Bill (US)

Tue Mar 17, 2020 10:09 pm

The bailout bill is up for grabs, I guess. And, per usual, Democrats want to push against airlines for a one-side protection of their interests, which they portray as worker and traveler rights.
https://www.businessinsider.com/airline ... 020-3?op=1

I would propose a balanced measure that would include do some of the below:

Airlines would be required to reduce capacity within 10% of each other's domestic capacity. I'll estimate 50% domestic capacity cut for now.

Executives making over $200 would take something like a 33% cut in pay.

Airlines would be able to retain slots if service is reduced in slot controlled airports

Airlines would have some type of bidding system to temporarily suspend service to smaller airports - groups of like-sized airports could lose 1 or 2 of the Big 3 temporarily under a draft type system. The airline that operates in the small airport can't start new routes or add permanent gates.
I'm not sure how WN would be treated.

Airlines would be allowed to ground any fleet type that would just temporarily allow scope rules to be relaxed.

Employee compensation would need to be addressed, first offering time w/o pay, pay guarantees for those with temporary station closures, minimum pay or cash for crew members whether working or not.

To minimize virus spread, temporarily aircraft should utilize seating to spread out passengers in the Y cabin, regardless of fare paid. If flight is under 60% full E+ passengers would get E+ seating and be guaranteed an empty middle seat before any Y passenger would be reseated to minimize 3 seats in a row are all full in Y.

Prevent airline buyback of shares at these current low prices.

Ban additional fees, but should not include a mandated rollback of current fee structure.

It's silly to do something about carbon as this downturn will ground and most likely remove older aircraft from the fleet. The airlines are in trouble now and aren't going to be able to accelerate phas out of older aircraft if it means new expenses.
Last edited by atcsundevil on Wed Mar 18, 2020 1:23 pm, edited 1 time in total.
Reason: Edited title for clarity
 
dallasnewark
Posts: 393
Joined: Tue Nov 08, 2005 4:33 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:24 pm

There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge
B732/3/4/5/6/7/8/9, B742/4, B752/3,B762/3/4, B772/3, A306, A318/9/20/21, A332/3, A343/6, MD80/83/88, L1011, TU104/134, F
 
Atlwarrior
Posts: 477
Joined: Sun Jul 29, 2012 3:42 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:28 pm

dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.
 
32andBelow
Posts: 5037
Joined: Mon Sep 03, 2012 2:54 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:29 pm

How bout offering stock from the stock they bought back from all their profits.
 
Squeezix
Posts: 22
Joined: Fri Dec 23, 2016 5:10 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:31 pm

Atlwarrior wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.


And how many hundreds of thousands of jobs will be lost because of this attitude?
 
32andBelow
Posts: 5037
Joined: Mon Sep 03, 2012 2:54 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:33 pm

Squeezix wrote:
Atlwarrior wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.


And how many hundreds of thousands of jobs will be lost because of this attitude?

They can work at the airlines that fill the gap. Air travel won’t just end on these routes.
 
Aceskywalker
Posts: 150
Joined: Sat Nov 17, 2018 4:55 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:33 pm

EU261-like consumer protection rules and further protections for workers should be a condition for accepting any money from the government. Otherwise, airlines can ask for money from the government in the form of loans they have to pay back, or use shares in the company as collateral.

The practices that airlines have been doing have earned them record profits, at the expense of burning through good will in the court of public opinion.
 
picarus
Posts: 332
Joined: Fri Dec 29, 2000 6:51 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:36 pm

Wow, that's bit harsh. I don't work in the industry anymore, but I don't think that putting over 250K people out of work benefits anyone, particularly those of us who need to travel and generate economic activity. And before you flame me, I'm not aligned with any politcal party and am fairly fiscally conversative--meaning I agree with you about stock buybacks being folly and self-serving.

But, It's not as simple as filling a void...we're not talking about the corner Taco Bell closing down. Allowing airlines that control 80% of traffic in U.S. to disappear would be devastating.
 
flyoregon
Posts: 784
Joined: Thu Jul 09, 2015 5:29 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:37 pm

I'm no airline, and certainly don't have the revenue nor the expenses that any of the airlines have, but in the 3 years that I've had my business in aviation, I've made it a habit to set aside 15% of revenue to ensure there's some cushion for times like this. I'd be able to stay "open" if I didn't have a single flight or a single sale for about 8 months. So airlines that were making record profits the last few years I feel like should have been a little more prepared financially for economic downturns...which inevitably would have happened at some point COVID-19 or not.
 
Triple7Lr
Posts: 135
Joined: Mon Sep 17, 2012 2:17 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:37 pm

dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


And what do you purpose for the airline employees who can’t control how management decides to use profits like the Ticket and Ramp Agents? I do agree that the airlines have been irresponsible with their profits. The buybacks were out of control but I don’t think we should punish the little guy because of the corporate fat cats.

If they get bailed out maybe there can be a stipulation that prohibits buybacks and requires some type of rainy day fund.
 
TYWoolman
Posts: 634
Joined: Sat Jun 24, 2017 8:24 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:38 pm

The airline industry's life--blood is its passengers. What precedent exists in total similarity that would have enabled carriers to predict that the government itself would be advocating passengers not to fly? Cut the airlines some slack!
Last edited by TYWoolman on Tue Mar 17, 2020 10:40 pm, edited 2 times in total.
 
32andBelow
Posts: 5037
Joined: Mon Sep 03, 2012 2:54 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:39 pm

picarus wrote:
Wow, that's bit harsh. I don't work in the industry anymore, but I don't think that putting over 250K people out of work benefits anyone, particularly those of us who need to travel and generate economic activity. And before you flame me, I'm not aligned with any politcal party and am fairly fiscally conversative--meaning I agree with you about stock buybacks being folly and self-serving.

But, It's not as simple as filling a void...we're not talking about the corner Taco Bell closing down. Allowing airlines that control 80% of traffic in U.S. to disappear would be devastating.

It’s folly to think the big 3 are actually going to shut down if we don’t bail them out.
 
Swadian
Posts: 562
Joined: Sun Sep 11, 2016 4:56 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:40 pm

Squeezix wrote:
Atlwarrior wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.


And how many hundreds of thousands of jobs will be lost because of this attitude?


Then bail out the employees. Not the airlines.

32andBelow wrote:
picarus wrote:
Wow, that's bit harsh. I don't work in the industry anymore, but I don't think that putting over 250K people out of work benefits anyone, particularly those of us who need to travel and generate economic activity. And before you flame me, I'm not aligned with any politcal party and am fairly fiscally conversative--meaning I agree with you about stock buybacks being folly and self-serving.

But, It's not as simple as filling a void...we're not talking about the corner Taco Bell closing down. Allowing airlines that control 80% of traffic in U.S. to disappear would be devastating.

It’s folly to think the big 3 are actually going to shut down if we don’t bail them out.


Agreed. If they bail out the airlines, they should bail out Greyhound too. Unless the airline employees want to start driving buses instead.
 
picarus
Posts: 332
Joined: Fri Dec 29, 2000 6:51 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:44 pm

32andBelow wrote:
picarus wrote:
Wow, that's bit harsh. I don't work in the industry anymore, but I don't think that putting over 250K people out of work benefits anyone, particularly those of us who need to travel and generate economic activity. And before you flame me, I'm not aligned with any politcal party and am fairly fiscally conversative--meaning I agree with you about stock buybacks being folly and self-serving.

But, It's not as simple as filling a void...we're not talking about the corner Taco Bell closing down. Allowing airlines that control 80% of traffic in U.S. to disappear would be devastating.

It’s folly to think the big 3 are actually going to shut down if we don’t bail them out.


I never said I believed they were going to shut down. I was responding directly to the assertion that someone else would step into the void to replace them. That's not going to happen either. One way or another, taxpayers will foot the bill.
 
Scotron12
Posts: 496
Joined: Fri Mar 01, 2019 2:13 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 10:54 pm

Triple7Lr wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


And what do you purpose for the airline employees who can’t control how management decides to use profits like the Ticket and Ramp Agents? I do agree that the airlines have been irresponsible with their profits. The buybacks were out of control but I don’t think we should punish the little guy because of the corporate fat cats.

If they get bailed out maybe there can be a stipulation that prohibits buybacks and requires some type of rainy day fund.


Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??
 
panamair
Posts: 4348
Joined: Fri Oct 12, 2001 2:24 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:02 pm

32andBelow wrote:
It’s folly to think the big 3 are actually going to shut down if we don’t bail them out.


Depends on how long it lasts. Even the strongest carriers will run out of cash by the end of the year if the current situation persists.

flyoregon wrote:
I'd be able to stay "open" if I didn't have a single flight or a single sale for about 8 months.


Well, guess what? That is currently what is being predicted if the situation does not improve - even the strongest airlines could run out of cash by the end of the year (i.e., in about 8 months time)
 
32andBelow
Posts: 5037
Joined: Mon Sep 03, 2012 2:54 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:03 pm

panamair wrote:
32andBelow wrote:
It’s folly to think the big 3 are actually going to shut down if we don’t bail them out.


Depends on how long it lasts. Even the strongest carriers will run out of cash by the end of the year if the current situation persists.

flyoregon wrote:
I'd be able to stay "open" if I didn't have a single flight or a single sale for about 8 months.


Well, guess what? That is currently what is being predicted if the situation does not improve - even the strongest airlines could run out of cash by the end of the year (i.e., in about 8 months time)

Then they can raise money.
 
Triple7Lr
Posts: 135
Joined: Mon Sep 17, 2012 2:17 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:03 pm

Scotron12 wrote:
Triple7Lr wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


And what do you purpose for the airline employees who can’t control how management decides to use profits like the Ticket and Ramp Agents? I do agree that the airlines have been irresponsible with their profits. The buybacks were out of control but I don’t think we should punish the little guy because of the corporate fat cats.

If they get bailed out maybe there can be a stipulation that prohibits buybacks and requires some type of rainy day fund.


Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??



No doubt about it. They were greedy and foolish. Trust me when I tell you many of their employees feel that way. I just feel for the every day employees who couldn’t do anything about it and are now unsure if they’ll even have a job. They’ve already started asking them to take pay cuts and unpaid leaves of absence.
 
Mightyflyer86
Posts: 26
Joined: Sat Dec 28, 2019 3:50 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:04 pm

Squeezix wrote:
Atlwarrior wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.


And how many hundreds of thousands of jobs will be lost because of this attitude?


Worried about job losses now? Airlines weren’t worried back when they spent billions of dollars in stock buybacks.

If people lose their jobs, then they have to look for another one. As simple as that
 
Waterbomber2
Posts: 1353
Joined: Mon Feb 04, 2019 3:44 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:05 pm

dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


Atlwarrior wrote:
dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.
32andBelow wrote:
How bout offering stock from the stock they bought back from all their profits.
32andBelow wrote:
How bout offering stock from the stock they bought back from all their profits.


32andBelow wrote:
How bout offering stock from the stock they bought back from all their profits.


Thank you very much.
I'm glad to see that I'm not the only one to think this way.

calpsafltskeds wrote:
The bailout bill is up for grabs, I guess. And, per usual, Democrats want to push against airlines for a one-side protection of their interests, which they portray as worker and traveler rights.
https://www.businessinsider.com/airline ... 020-3?op=1

I would propose a balanced measure that would include do some of the below:

Airlines would be required to reduce capacity within 10% of each other's domestic capacity. I'll estimate 50% domestic capacity cut for now.

Executives making over $200 would take something like a 33% cut in pay.

Airlines would be able to retain slots if service is reduced in slot controlled airports

Airlines would have some type of bidding system to temporarily suspend service to smaller airports - groups of like-sized airports could lose 1 or 2 of the Big 3 temporarily under a draft type system. The airline that operates in the small airport can't start new routes or add permanent gates.
I'm not sure how WN would be treated.

Airlines would be allowed to ground any fleet type that would just temporarily allow scope rules to be relaxed.

Employee compensation would need to be addressed, first offering time w/o pay, pay guarantees for those with temporary station closures, minimum pay or cash for crew members whether working or not.

To minimize virus spread, temporarily aircraft should utilize seating to spread out passengers in the Y cabin, regardless of fare paid. If flight is under 60% full E+ passengers would get E+ seating and be guaranteed an empty middle seat before any Y passenger would be reseated to minimize 3 seats in a row are all full in Y.

Prevent airline buyback of shares at these current low prices.

Ban additional fees, but should not include a mandated rollback of current fee structure.

It's silly to do something about carbon as this downturn will ground and most likely remove older aircraft from the fleet. The airlines are in trouble now and aren't going to be able to accelerate phas out of older aircraft if it means new expenses.


My suggestions

-Top airline executives who did not save a penny for a rainy day should be fired. So basically CEO's and CFO's and whomever facilitated it.
The commercial aviation business is cyclical and we were at the top of a cycle, stock markets were overvalued, so a downturn was on the horizon anyway. Covid19 was just a trigger.

-Remaining executives take a haircut, payscale reduced to top scale of operational staff, ie captains.

-Financial assistance to employees of airlines equivalent to bottom scale employees until the airline starts flying again.

-Financial assistance only to airlines grounding their entire fleets, including subsidiaries and contracted flying and where all booking within 3 months are fully refunded. No financial assistance to airlines who continue to fly and spread the virus, that would be counterproductive. Financial assistance in the form of short-term loans, either high interest, or low interest + warrants with low strike price without expiry date. No grants, otherwise there would be WTO implications.

-Strict future capitalisation requirements for airlines receiving financial assistance: minimum a quarter revenue's worth of liquidity.
Not applicable to airlines not making use of financial assistance or future start-ups, however requirement to retain 50% of earnings until above liquidity level is reached, for all airlines. That should make investors think twice before starting up an airline and we should see airline failures reduce dramatically.
 
MIflyer12
Posts: 8525
Joined: Mon Feb 18, 2013 11:58 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:06 pm

Some carriers spent a bigger potion of free cash flow on stock buybacks than others. AA doesn't even fit on the chart.

https://www.bloomberg.com/news/articles ... acks-chart

Much of the S&P 500 spent big $ on buybacks. It's a feature of modern American capitalism.

Demanding better consumer protections - capped change fees, refunds with a 2 hr schedule change, interlining to other carriers with a 2 hr delay, checked bag fees based on costs, an end to hidden-city prohibitions to promote competition - U.S. consumers ought to get something for the $ Billions they're about to gift to carriers. Or, do pre-packaged bankruptcies (government owning the equity, offering loans) as were practiced for GM and Chrysler.
 
panamair
Posts: 4348
Joined: Fri Oct 12, 2001 2:24 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:06 pm

Scotron12 wrote:
Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??


It's not just Boeing or the airlines...it's CORPORATE AMERICA. You guys have an issue with CAPITALISM in America. It's so easy to blame shareholders but under the Capitalist system, shareholders are key; who do you think provides the CAPITAL in capitalism? And lest we forget, many employees are shareholders as well. Share buybacks benefit all shareholders, be they employees, grandmas, management or institutional investors...
 
panamair
Posts: 4348
Joined: Fri Oct 12, 2001 2:24 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:09 pm

32andBelow wrote:
Then they can raise money.


Which they are already trying to do. United has drawn down $2 billion on a revolving facility. Delta is negotiating right now for a $2-4 billion line etc.
 
jumpseat67
Posts: 85
Joined: Sat Jun 30, 2007 3:07 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:14 pm

dallasnewark wrote:
There is no need for the bail out. If the airline was too shortsighted in using all the profits for equity buyback to increase the share prices, they deserve to be out of business. If there is a demand or need, a new company will emerge


Great idea, as soon as we are all out of business we can have either Boutique or Cape Air just step right in while servicing NYC-London without missing a beat. I am sure they planned for all of this also (just waiting for the exact moment in time) and have all of their infrastructure in place to run multiple daily service. Sorry peeps, both Coke and Pepsi are gone also, so please enjoy RC Cola instead.
 
Triple7Lr
Posts: 135
Joined: Mon Sep 17, 2012 2:17 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:14 pm

calpsafltskeds wrote:
The bailout bill is up for grabs, I guess. And, per usual, Democrats want to push against airlines for a one-side protection of their interests, which they portray as worker and traveler rights.
https://www.businessinsider.com/airline ... 020-3?op=1

I would propose a balanced measure that would include do some of the below:

Airlines would be required to reduce capacity within 10% of each other's domestic capacity. I'll estimate 50% domestic capacity cut for now.

Executives making over $200 would take something like a 33% cut in pay.

Airlines would be able to retain slots if service is reduced in slot controlled airports

Airlines would have some type of bidding system to temporarily suspend service to smaller airports - groups of like-sized airports could lose 1 or 2 of the Big 3 temporarily under a draft type system. The airline that operates in the small airport can't start new routes or add permanent gates.
I'm not sure how WN would be treated.

Airlines would be allowed to ground any fleet type that would just temporarily allow scope rules to be relaxed.

Employee compensation would need to be addressed, first offering time w/o pay, pay guarantees for those with temporary station closures, minimum pay or cash for crew members whether working or not.

To minimize virus spread, temporarily aircraft should utilize seating to spread out passengers in the Y cabin, regardless of fare paid. If flight is under 60% full E+ passengers would get E+ seating and be guaranteed an empty middle seat before any Y passenger would be reseated to minimize 3 seats in a row are all full in Y.

Prevent airline buyback of shares at these current low prices.

Ban additional fees, but should not include a mandated rollback of current fee structure.

It's silly to do something about carbon as this downturn will ground and most likely remove older aircraft from the fleet. The airlines are in trouble now and aren't going to be able to accelerate phas out of older aircraft if it means new expenses.



That’s a lot of regulation. Some of these things are being self addressed. Executive Pay, unpaid time off, capacity reductions, pay guarantees(although I’ve only seen pilots addressed in most cases).

Ancillary fees are the lifeblood of ULCC so eliminating new ways to make money may just eliminate some ULCC.
 
User avatar
Midwestindy
Posts: 5436
Joined: Sun Mar 12, 2017 3:56 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:19 pm

panamair wrote:
Scotron12 wrote:
Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??


It's not just Boeing or the airlines...it's CORPORATE AMERICA. You guys have an issue with CAPITALISM in America. It's so easy to blame shareholders but under the Capitalist system, shareholders are key; who do you think provides the CAPITAL in capitalism? And lest we forget, many employees are shareholders as well. Share buybacks benefit all shareholders, be they employees, grandmas, management or institutional investors...


However, all of Corporate America is not asking for a bail out, at least not yet
Status for 2019/2020: AAdvantage Platinum, Delta Gold, Southwest A-List
 
planecane
Posts: 1585
Joined: Thu Feb 09, 2017 4:58 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:21 pm

Swadian wrote:
Squeezix wrote:
Atlwarrior wrote:

I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.


And how many hundreds of thousands of jobs will be lost because of this attitude?


Then bail out the employees. Not the airlines.


The airlines pay the employees. Are you suggesting the government should pay all airline employees their salary to do nothing?

This is unprecedented. The governments made the decision to essentially shut down certain parts of the economy. You expect that airlines should have had a financial plan for something like that? If it was just reduced demand out of fear or a recession then you have a point. What is happening is basically a decision by governments to turn off revenue.
 
panamair
Posts: 4348
Joined: Fri Oct 12, 2001 2:24 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:22 pm

Midwestindy wrote:
panamair wrote:
Scotron12 wrote:
Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??


It's not just Boeing or the airlines...it's CORPORATE AMERICA. You guys have an issue with CAPITALISM in America. It's so easy to blame shareholders but under the Capitalist system, shareholders are key; who do you think provides the CAPITAL in capitalism? And lest we forget, many employees are shareholders as well. Share buybacks benefit all shareholders, be they employees, grandmas, management or institutional investors...


However, all of Corporate America is not asking for a bail out, at least not yet


Don't worry. It's coming...the travel industry was the first one to be hit hardest...other industries will follow.
 
planecane
Posts: 1585
Joined: Thu Feb 09, 2017 4:58 pm

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:23 pm

Midwestindy wrote:
panamair wrote:
Scotron12 wrote:
Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??


It's not just Boeing or the airlines...it's CORPORATE AMERICA. You guys have an issue with CAPITALISM in America. It's so easy to blame shareholders but under the Capitalist system, shareholders are key; who do you think provides the CAPITAL in capitalism? And lest we forget, many employees are shareholders as well. Share buybacks benefit all shareholders, be they employees, grandmas, management or institutional investors...


However, all of Corporate America is not asking for a bail out, at least not yet


Just wait. How many industries can survive shutting down massive parts of the economy for a couple of months?
 
picarus
Posts: 332
Joined: Fri Dec 29, 2000 6:51 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:23 pm

panamair wrote:
Scotron12 wrote:
Water under the bridge, but don't you think the airlines were taking their cue from Boeings playbook? Massive stock buybacks to generate huge paydays for management and Wall Street?

Now they are all hat in hand. Jeez...$43Billion in buybacks and $17Billion in dividends Boeing spent in a 6yr period 2013-2019! Bet they wish they had kept a big chunk ha??


It's not just Boeing or the airlines...it's CORPORATE AMERICA. You guys have an issue with CAPITALISM in America. It's so easy to blame shareholders but under the Capitalist system, shareholders are key; who do you think provides the CAPITAL in capitalism? And lest we forget, many employees are shareholders as well. Share buybacks benefit all shareholders, be they employees, grandmas, management or institutional investors...


I’m afraid not. Consumers are the key. Wipe out demand and no amount of CAPITAL will protect share holders.

As much as you’d like to believe it, the truth is we don’t operate in an an absolute free market society. There are rules and consequences.
 
phxa340
Posts: 1134
Joined: Thu Mar 29, 2012 4:07 am

Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:25 pm

Airlines need to reap what they sow, to an extent. The argument that the economy will stop without them is not without merit, however if this is an unconditional hand out , as a tax payer that would upset me. How can you bailout the airlines but not the hotels, bars and restaurants ?? There’s a lot of sense of entitlement within the airline industry IMO and as someone watching my friends lives destroyed because of hotel and bar abandonment etc. , the superiority argument that somehow airline employees are more important than everyone else is a little head scratching and frustrating. I think airline employees need help but not that expense of everyone else who is hurting. You are just like us now.
 
panamair
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Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:31 pm

picarus wrote:

I’m afraid not. Consumers are the key. Wipe out demand and no amount of CAPITAL will protect share holders.


How do consumers consume anything when there is no company or product? How does a company get started?

OK, I probably shouldn't have said that shareholders are key, however, it's naive to think that shareholders don't matter. At the end of the day, the key stakeholders in any enterprise are the employees, the shareholders, and the customers. All three are equally important and management's objective is to satisfy all three groups of stakeholders. What many on here are advocating is to ignore/punish one of the three groups, and that is not the way to manage a successful business.
 
AAPramugari14
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Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:54 pm

I’m Flight Crew... without this bailout expect the US3 to fail and possibly disappear. On top of that expect millions to be out on the street without jobs. Airlines aren’t the only ones effected. There’s so many contract workers who are tied to the survival of the US3 that if we did all go belly up it would be a disaster for the world economy. Let’s not even forget the immediate impact on Boeing and Airbus. Some of you need to think about the repercussions...
 
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kjeld0d
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Re: Corona virus Bailout Bill

Tue Mar 17, 2020 11:58 pm

Big american corporation 101 --- Privatize profits and socialize losses. Employees are liabilities. Work quickly to establish that you are "too big to fail" and dire consequences will result. Round up your troops--marketing, PR and lobbyists--to spread Fear, Uncertainty and Doubt.
 
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PA110
Posts: 1986
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Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:00 am

There's a lot of hyperbole driven by nervous insecurity. Bottom line, the airlines need to take a number and wait in line with everyone else affected by this unprecedented event. Why should airline employees be prioritized ahead of small retail shopkeepers, restaurant workers or minimum wage laborers?
Look, it's been swell, but the swelling's gone down.
 
leyland1989
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Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:07 am

Many flag carriers are going to get nationalist again, perhaps some forced mergers are going to happen too.
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Nick123
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Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:10 am

Executives making over $200 mill should take a 33% pay cut??? How about a 100% pay cut?? If you have been making $200 mill a year, you should be fine.
 
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EA CO AS
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Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:22 am

32andBelow wrote:
Squeezix wrote:
Atlwarrior wrote:

I absolutely agree. All those years of airline profits, something should have been set aside for a high-risk event.


And how many hundreds of thousands of jobs will be lost because of this attitude?

They can work at the airlines that fill the gap. Air travel won’t just end on these routes.


Air travel just won't end, but the economy as we know it will. Airlines don't just rise from the ground overnight; you'd be talking about months of ramp-up for a new entrant to start scheduled operations, and even then, just limited ones. Now imagine trying to replace all the current lift out there, while everything tourism-based - hotels, theme parks, car rentals, cruise lines - go under. What starts with about 700K people unemployed now balloons into 2 million or more. And from that point, we're not in a recession, but a global depression.

Sorry, but no amount of cash set aside from earnings would have insulated against an event of this magnitude.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
Miamiairport
Posts: 748
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Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:22 am

I feel like a broken record but this business model of not making any money on the core product and trying to make it up on fees, shoving a butt into every seat available, cutting costs by cutting customer service and treating paxs like human cattle is not sustainable when some kind of adverse economic impact hits. The industry again has built massive capacity flying people half way across the country for $139 round trip but treating them like garbage, giving them a substandard product and finding other means to gouge them. Until the airline industry has a sane profit making business model the bailouts will be constant as well as the constant complaining.
 
LOT767301ER
Posts: 127
Joined: Mon Aug 29, 2016 2:14 am

Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:24 am

I feel like a broken record but this business model of not making any money on the core product and trying to make it up on fees, shoving a butt into every seat available, cutting costs by cutting customer service and treating paxs like human cattle is not sustainable when some kind of adverse economic impact hits. The industry again has built massive capacity flying people half way across the country for $139 round trip but treating them like garbage, giving them a substandard product and finding other means to gouge them. Until the airline industry has a sane profit making business model the bailouts will be constant as well as the constant complaining.


So you want $600 airfares for everyone on MIA-DEN? Cool.

This board's understanding of how commercial aviation economics works is equivalent to that of a yahoo article comments section. Hard to say if one should laugh or cry.
 
MohawkWeekend
Posts: 283
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Re: Corona virus Bailout Bill

Wed Mar 18, 2020 12:50 am

This does beg the ethical question - should there be a cap on all all employee compensation while an industry is receiving aid? Not just the company CEO and President. Should taxpayers fund employee's earning say $150,000 to $300,000 a year when the average American makes about $60,000.

A single person who isn't in one of these industries will get about $400 a week in unemployment.
    300 319 320 321 707 717 720 727 72S 737 73S 734 735 73G 738 739 747 757 762 ARJ B11 C212 CRJ CR2 CR7 CR9 CV5 D8S DC9 D9S D94 D95 D10 DH8 DTO EMB EM2 E135 E145 E190 FH7 F28 F100 FTRIMTR HRN L10 L15 M80 M90 SF3 SWM YS11
     
    zippy
    Posts: 161
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    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 12:55 am

    planecane wrote:
    Are you suggesting the government should pay all airline employees their salary to do nothing?


    Yes.

    It is too late to stop the spread of SARS-CoV-2 but not too late to slow it down. Removing the financial incentive to go to work will absolutely help things from getting worse. Even Dear Leader has signed on to this idea as he is now promoting paying everyone $1,000.
     
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    Midwestindy
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    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:02 am

    EA CO AS wrote:
    Sorry, but no amount of cash set aside from earnings would have insulated against an event of this magnitude.


    AA has spent $12.5B on buybacks in the past ten years, obviously there would have been taxes on that money, but the argument that "no amount of cash" could have saved them sets a dangerous precedent.

    Keep in mind that I agree that airlines should be "bailed out" in some form, but there should be stipulations put on any deal.
    Status for 2019/2020: AAdvantage Platinum, Delta Gold, Southwest A-List
     
    MSPNWA
    Posts: 3698
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    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:15 am

    They can ask for relief once they've exhausted all private market solutions and it's a last resort before bankruptcy. Not a minute before. And even then I wouldn't promise help. The public doesn't need to immediately bailout an industry that has had an unprecedented run of success carried by the backs of the public.
     
    VS11
    Posts: 1673
    Joined: Mon Jul 02, 2001 6:34 am

    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:31 am

    Can I just remind everyone that during TARP in 2008, the Government/taxpayers made money? The Government can always take an ownership stake in each airline and when things improve sell them. This isn’t some deeply conflicting moral case. It is a temporary situation and the goal is to minimize the disruptiveness. The Government is not giving free money away.
     
    Mightyflyer86
    Posts: 26
    Joined: Sat Dec 28, 2019 3:50 pm

    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:35 am

    AAPramugari14 wrote:
    I’m Flight Crew... without this bailout expect the US3 to fail and possibly disappear. On top of that expect millions to be out on the street without jobs. Airlines aren’t the only ones effected. There’s so many contract workers who are tied to the survival of the US3 that if we did all go belly up it would be a disaster for the world economy. Let’s not even forget the immediate impact on Boeing and Airbus. Some of you need to think about the repercussions...


    Some Americans are just too funny. They defend and believe in their perfect capitalist system, they criticize “subsidized” airlines and are quick to point out that socialism does not work until their perfect system threatens to come down and all of a sudden they want bailouts, government interventions and a little bit of corporate socialism because “jobs are at stake”. Meanwhile while Wall Street was hitting all time highs and companies spent billions in stock buybacks and everybody was enjoying fat profit sharing checks, nobody was worried about how to survive a crisis like this one.

    Boeing’s troubles are their fault, the US taxpayer should not foot the bill but hey what do I know?
     
    Mightyflyer86
    Posts: 26
    Joined: Sat Dec 28, 2019 3:50 pm

    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:38 am

    VS11 wrote:
    Can I just remind everyone that during TARP in 2008, the Government/taxpayers made money? The Government can always take an ownership stake in each airline and when things improve sell them. This isn’t some deeply conflicting moral case. It is a temporary situation and the goal is to minimize the disruptiveness. The Government is not giving free money away.


    Can you substantiate your claim?
     
    VS11
    Posts: 1673
    Joined: Mon Jul 02, 2001 6:34 am

    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:46 am

    Mightyflyer86 wrote:
    VS11 wrote:
    Can I just remind everyone that during TARP in 2008, the Government/taxpayers made money? The Government can always take an ownership stake in each airline and when things improve sell them. This isn’t some deeply conflicting moral case. It is a temporary situation and the goal is to minimize the disruptiveness. The Government is not giving free money away.


    Can you substantiate your claim?


    U.S. ends TARP with $15.3 billion profit

    https://money.cnn.com/2014/12/19/news/c ... louts-end/
     
    32andBelow
    Posts: 5037
    Joined: Mon Sep 03, 2012 2:54 am

    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:50 am

    EA CO AS wrote:
    32andBelow wrote:
    Squeezix wrote:

    And how many hundreds of thousands of jobs will be lost because of this attitude?

    They can work at the airlines that fill the gap. Air travel won’t just end on these routes.


    Air travel just won't end, but the economy as we know it will. Airlines don't just rise from the ground overnight; you'd be talking about months of ramp-up for a new entrant to start scheduled operations, and even then, just limited ones. Now imagine trying to replace all the current lift out there, while everything tourism-based - hotels, theme parks, car rentals, cruise lines - go under. What starts with about 700K people unemployed now balloons into 2 million or more. And from that point, we're not in a recession, but a global depression.

    Sorry, but no amount of cash set aside from earnings would have insulated against an event of this magnitude.

    Delta nor American nor united nor your previous Alaska are going to shut if they don’t get bailed out. They are going to cut capacity and go I to debt. Then it’ll come back and they can pay their debt off. In 6 months if this is still going we can talk. Alaska has only cut capacity 10%. It’s like they are in denial.
     
    Mightyflyer86
    Posts: 26
    Joined: Sat Dec 28, 2019 3:50 pm

    Re: Corona virus Bailout Bill

    Wed Mar 18, 2020 1:55 am

    VS11 wrote:
    Mightyflyer86 wrote:
    VS11 wrote:
    Can I just remind everyone that during TARP in 2008, the Government/taxpayers made money? The Government can always take an ownership stake in each airline and when things improve sell them. This isn’t some deeply conflicting moral case. It is a temporary situation and the goal is to minimize the disruptiveness. The Government is not giving free money away.


    Can you substantiate your claim?


    U.S. ends TARP with $15.3 billion profit

    https://money.cnn.com/2014/12/19/news/c ... louts-end/



    Let’s see how much the US government can recover on this one since stock valuations are a lot higher now compared to 2008-2015.

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