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slz396
Topic Author
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Sabena's Relaunch Is Almost Assured

Mon Dec 17, 2001 11:29 pm

Hello there,
I know it has been a while since I have last posted on this forum, but things have been rather bussy for me over the last 2 weeks (...the upcoming introduction of the Euro and of course the EU summit in Laken...)


Anyway, this afternoon I have found some time to inform you on the latest developments in the dat+ story. As you maybe know I am generally the first one to bring you real new facts, contrary to many others which keep on posting ‘new’ stories from (reliable?) foreign sources which are most of the time outdated when they make it to this forum…


Seems that after the technical problems Davignon ran into on December 13th with SIC (which managed to buy some extra time only thanks to a clever technical intervention of its lawyers and the presiding judge), this belgian nobleman and head of the Air Holding NV/SA has not sat still; in fact it seems he has even made a big step forward yesterday evening!
After very difficult negociations with the SIC creditors over the weekend, Lippens and Davignon have finally managed to secure a dubble majority (i.e. half of the SIC creditors representing half of the credits) as required under Belgian law for a recovery plan for SIC!
This updated plan does no longer call for a real cash investment of 100 million euro from SIC in dat+ (on request of the creditors) but rather clears dat of a similar amount of depts towards SIC.
In both cases the result is the same for dat and the SIC creditors (which will loose 100 million euro), but for the SIC creditors it means they can now book this 100 million euro as money lost (i.e. deductable from their taxes in their countries of origin).
With the new recovery plan accepted by the required dubble majority of creditors, it is highly unlikely that SIC will not be granted a permanent (18 month) protection from other creditors on December 18th by Mrs. Spiritus. As you know, the survival of SIC is a cornerstone in the plans of Davignon-Lippens to permit the expansion of dat into dat+.


Also, I can assure you (ex officio) that over the past week the Flemish government has been put under very high pressure to reconsider its decission not to invest in dat+. Naturally, because they do not want to give the impression they have made a U-turn after their initial refusal based on an (questionable) advice of the Flemish auditor of finances, they have now engaged an 'independent' auditor to give them a new (more positive) advice with which they will justify their investment.


Finally, the full Lippens-Davignon plan has unoffically been presented to the EU commission during the summit in Laken last weekend and I can confirm that it has been verbally discussed with and aproved by a senior EU advisor to Mrs. De Palacio! I must say that he didn’t like the idea too much of BIAC and Belgocontrol (2 state controlled holdings) being part of the private investors, but he said he would not oppose to it as the overall public presence will not exceed 50%.
He also verbally agreed to a new long term state loan to pay back the short term bridging loan, because the bridging loan clearly only permitted to start a new company and the new loan is a purely economical issue, although the fact that the EU commission (alarmed by the very negative public opinion in several EU member states including Belgium after the way in which they helped old Sabena going under) does not want to be seen as guilty of the premature dead of the new Belgian national carrier and the subsequent unemployment of yet another additional 3,000 to 6,000 people.


Finally, some more semi-offical news:
Seems the Newco (temporarily called dat+)will be built around 2 separate entities:
One for European operations, based on the current dat, and one for intercontinental operations. The advantage of this is that EU competition rules will not apply so stricly to intercontinental flights as the free common market philosophy is less introduced there, so limited and indirect government support could be tolerated in the future too. (cfr. Air France and Air Lib and the French overseas territories.)
The new name of dat would be:
Sabena Europe,
whereas the name of the intercontinental part of the Newco is going to be:
New Sabena
Logo and livery would most certainly be preserved too.



 
TCA256
Posts: 695
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RE: Sabena's Relaunch Is Almost Assured

Mon Dec 17, 2001 11:37 pm

Slz393,

In which field do you work ? foreign affairs or EU ?

Thanks for the report...
 
go canada!
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RE: Sabena's Relaunch Is Almost Assured

Mon Dec 17, 2001 11:43 pm

Doesnt the name sabena spell the deathknell for this airline?
It is amazing what can be accomplised when nobody takes the credit
 
SN-A330
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RE: Sabena's Relaunch Is Almost Assured

Mon Dec 17, 2001 11:51 pm

Thanks for this clear info Slz396 !

regards, SN-A330
I would rather be flying...
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Mon Dec 17, 2001 11:52 pm

I see you're confirming what I've said all along - that it's only due to arm twisting, threats, promises and even breaches of EU rules - that the Belgian government has been able to ensure that the finance has been (or is being) raised.

Don't you think that the EU (and especially the Transport Commissioner) is well aware of all the Machiavellian machinations that have been going on with respect to the award of lucrative contracts, government guarantees and tax offsets?

At the end of the day, all this does is just reinforce the negative opinions about corrupt practices the rest of Europe has about Belgium.

 
go canada!
Posts: 2886
Joined: Wed Jun 06, 2001 1:33 am

RE: Sabena's Relaunch Is Almost Assured

Mon Dec 17, 2001 11:57 pm

and no doubt so screaming belguims will attack you any minute....

im just waiting for our friend pat from albania.......
It is amazing what can be accomplised when nobody takes the credit
 
User avatar
keesje
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:00 am

Questions are :

- who wants to invest his prinvat savings into Sabena Europe / New Sabena ?
- who is willing to book his next May holiday with Sabena, given more secure alternatives ?

In the end it is efficiency and customer trust that have to do the job. Not clever bureaucracy, verbal agreements and extended government protections ...

Who will pay for the again "unexpected & unacceptable" losses in say March 2002 ...

I'm waiting for a GOOD Belgium solution ..

BTW, I sympathize with all Sabena employees involved ...

"Never mistake motion for action." Ernest Hemingway
 
Banco
Posts: 14343
Joined: Mon Oct 29, 2001 11:56 pm

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:06 am

Hmmm, even if the finance raised is shown to come from dubious (in competition terms) sources, do you really have such faith in the EC that it will block it?

Am I sceptical? Sure, but I would be willing to be convinced.
She's as nervous as a very small nun at a penguin shoot.
 
Guest

This Smells...

Tue Dec 18, 2001 12:07 am

I have a strange feeling about this. It seems that the DAT-vicounts have turned their asses into the fireplace.... Let's wait and see.
 
TCA256
Posts: 695
Joined: Sat Dec 04, 1999 3:59 am

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:08 am

Oooh Ceilidh, once again....If you knew at least a single
element that hasn't been bargained in Laeken among the
different EU delegations, you would definitely make up
your mind about political and economical influences! It's
a common practice for Members States to threat or
bargain the EU political decision in the aim of their own
domestic problems...Look just at Jacques Chirac from
France and Valéry Giscard d'Estaing (Presidential race)
or Berlusconi and the EU mandate for crimes...I wish
you would think only once about a general practice before posting again your bad hidden resentments against Belgium...  Innocent

Uhmmm, now talking about Ms Loyola De Palacio, your
says are just hypothesis and if the Davignon-Lippens
are enough clever to pass through the EU regulations,
well, lucky they found out the best way to act without
breaking the law...That's not called
"Machiavellian machinations" but intelligence !!!!

cheers,
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:17 am

My point is, that at the end of the day the losers (yet again) are the poor Belgian taxpayers. The big corporate 'investors' will have their financial positions secured - at the expense of the taxpayers; and if SN 2 is a re-run of SN 1 (and I have no reason to suppose that it will not be if it is being politically, rather than commercially, guided) then it too is likely to have a future made solely of losses ... paid for by the taxpayer.

Just think, that money could have gone into something useful - schools, hospitals, roads, housing ... and it goes into this: an ego exercise because the Belgian government believes that they must have a national airline!

Sorry, but this is a national disgrace.
 
SN-A330
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:24 am

Wow Ceilidh, are you getting emotional about the poor Belgian taxpayers now ?

Regards, SN-A330
I would rather be flying...
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:27 am

SN-A330 - go back to my earliest posts on SN and you'd see that this was my primary gripe about them ... I'm a typical Libran, always standing up for the underdog!  Big grin
 
Banco
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 12:52 am

Although those who have argued with me over Europe will know that I am quite virulently anti-EU; in the interests of fairness to those in other European countries I feel I should point out that the Daily Telegraph is the most Eurosceptic of all British newspapers.

Doesn't mean I think it is wrong though! Big grin Big grin
She's as nervous as a very small nun at a penguin shoot.
 
Guest

What's Up Ceilidh?

Tue Dec 18, 2001 12:52 am

My hair turned into grey when I read the news paper this morning. Does France want to play Napoleon again? And Italy the laughing Mussolini and Germany the tighted Hitler? What a unity is this EU? I think they have to cut the balls of those impotent mascoline powersick politicans. What a childish behaviour? It seems those guys do not have anything betters to do... they should go back to school learning a profession.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 1:06 am

Air Orange - I couldn't agree with you more! Frankly, I think we should get rid of all politicians - who after all are in it largely for their own benefit - but then the problem is what do we replace them with?

Banco - very true. Indeed, when I was at Uni, I was a member of FCS - now, living in Scotland, I'm a strong SNP supporter. In geometrical terms, I suspect that's around a 100 degree turn!  Big grin

From a business and personal viewpoint, I think that the Euro is a great idea. I worked out that over the course of this year, I have lost over £4,000 by changing currencies - around 10% overall. Of that, if the Euro had already been in place, I could have saved at least £2,500. As we all know, banks are absolute ripoffs - not only do they have their 'buy' and 'sell' rates but the b*stards generally charge commission - on top of their 10+% margins!  Pissed  Pissed  Pissed

Then there's the three day cheque clearance period in the UK - strange that, as when I give someone a cheque the funds are taken from my account the same day it's deposited!

Politicians and bankers ... biggest scumbags on earth.
 
Banco
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 1:13 am

Ceilidh - I know this slightly off topic but just as an aside: Don't you think that the (relative) decline in SNP popularity recently is due to people in all parts of the UK suddenly panicking and thinking that the whole of the UK could lose its independence and therefore Scotland/England issues are put on the backburner for a while?  Big grin
She's as nervous as a very small nun at a penguin shoot.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 1:19 am

Not really - I think it stems more from the faction fighting within the party and of course all of the shenannigans with the new Parliament building etc putting people off politics generally. The recent 'Officegate' scandals have hit the Scottish Labour Party very hard - especially as it was Gordon Brown's clique that has been removed from power.

Don't forget that historically Scotland has been much closer to Europe than England has - you have the 'Auld Alliance' (though that's really more of a religious thing) and of course the Celtic heritage with Brittany.

I think that a very large number of Scots are keen to press ahead with full devolution resulting in an independent Scotland within a federal Europe which would nevertheless be part of the British Isles (like the Channel Islands, the Isle of Man and even Gibraltar).

Oh yes, and we'd like the money the Sassenachs took for our oil back as well, please!  Big grin Big grin  Big grin
 
Banco
Posts: 14343
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 1:21 am

As long as you give us back the annual subsidy! Big grin
She's as nervous as a very small nun at a penguin shoot.
 
Banco
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 1:28 am

OK, back to the topic. Do we have any idea when there will be further movement on Sabena/DAT etc?
She's as nervous as a very small nun at a penguin shoot.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 1:34 am

It should be tomorrow, the 18th - when the Commercial Court is due to sit again. If a viable business plan and proof of financing is in place, then DAT will be allowed to continue. If not, then SIC (which includes all the SN Group companies) will be liquidated.

I heard that two banks - including HSBC - had rejected the proposals ... Slz396 what do you know about that?
 
KENNY
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 3:02 am

Cleidith: I've noting heard about the rejection of proposals  Smile

As I can read for the main topic: New Sabena & Sabena Europe, will it be the names used?
 
LJ
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 3:25 am

How long will it take before LH, KL and AF file a suit against DAT+? I guess the same day.

Regards
Laurens
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 3:35 am

And don't forget Ryanair!!
 
LJ
Posts: 5463
Joined: Wed Nov 17, 1999 8:28 pm

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 4:09 am

HSBC is going down for EUR 146mio if I'm not mistaken. Compared to this all the Belgian banks had very small cash in the old Sabena. However, Airbus will be one of the biggest creditors and thus their behavior is probably determined.

BTW slz396, unlike what maybe be appropiate in Belgium (because this is probably the only way in which some companies make investments like DAT+), it's not common to deduct bad loans of you tax bill. Don't think HSBC can do this.

Finally,as I said before. All DAT+ competitors will start legal action against DAT+ and at the EU court mrs. Palacio's views arent always followed.

BTW and VEX, VG Airlines (or Freddy van Gaever himself) will join the I'll sue you list.

Regards
Laurens
 
manni
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 4:52 am

The subsidising Ryanair recieved for starting operations out of Charleroi is currently being looked at by the EU. Ryanair recieved up to 1.5 million pounds from the Belgian tax payer to do so, yet it is trying to sue one of Belgiums biggest employer whenever possible. People working for Sabena payed taxes that are used to subsidise Ryanair. Now that is hypocrite!
 
LJ
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 5:27 am

Thanks Manni, this give me the opportunity lists all what FR received or will receive from the Wallon state (source The Observer)

http://www.observer.co.uk/business/story/0,6903,619293,00.html

However, Manni read the last line. It clearly says that FR doesn't get any preferential treatement at Charleroi (something you can't say about DAT+). DAT would get the same amounts (maybe an idea).

Regards
Laurens
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 5:31 am

I've told you (Manni) and the other people that have persisted in trying to attack FR over Charleroi this many times! Indeed, as I have previously said, I have correspondence with the airport management confirming that they will provide rebates and other incentives on a sliding scale, depending on the number of flights and passengers.
 
airDD
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 5:32 am

Also FR flies from "Brussels South Airport"

which is not the main Brussels Airport.

It is in the middle of nowhere Big grin
 
flysab
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 5:38 am

EBCI/CRL is located north of Charleroi, about 60 kilometers from the center of Brussels.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 5:53 am

So? If I was getting a much better deal from one airport than another 'main' one, I'd be inclined to use it. Indeed, this is the reason why Go have pulled off the Scotland - Dublin routes: they are unable to compete with FR's prices ex PIK when they fly from GLA - paying [b]nine[/b] times as much per passenger for their landing, handling, navigation and terminal fees!

Just compare the loadfactors of FR ex CRL with DAT ex BRU. Now, guess which of the two operators is making money?  Insane  Insane

I suspect I know why so many ex Sabeniens are opposd to FR - it's because they do not wish to be infected by BeCA and have therefore not employed any Belgian pilots at CRL. Even more annoying, of course, is that at the last count there were four Dutch guys based there flying for FR! Big grin Big grin
 
manni
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 6:28 am

Lj, Ceilidh

Ryanair might not get more than any other airlines who want to start operating out of CRL but they also dont get less. They do get subsidies, payed by US. I, note that you are not, as a Belgian taxpayer do not mind that this money is being used to give subsidies to SN or any other company that generate a fair amount of economic activitie and creates jobs. Both things wich can't be said about Ryanair. In the contrary, subsidies are supposed to create Morejobs but Ryanair only create a few jobs at the costs of thousands of other. Now give me one good point for the Belgian economie, that Ryanair is present at CRL , wich does not has a bad influence elsewhere and that justifies subsidies of ME. A little hint to the marketing departement of Ryanair for their next campaign? Add "with thanks to the Belgian taxpayer" on your adds. That seems to be the only way to offer these ridiculously low fares. Now, Ryanair might opt for CRL because it is cheaper altough it is 60KM out of Brussels. I certainly will never chose for CRL because of Ryanair cheaper fares. I do have my standards and they are definitely worth more than a couple of Euros. Smokin cool
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 6:39 am

Which is better for the Belgian economy; an airline that saves people money - or one that costs them hundreds of millions of Euros?

As to not employing Belgians - I understand that over 100 cabin crew members have been taken or are being taken on; and in addition to that there's all the ground staff and reservations staff at CRL.

Don't forget that until FR came along, CRL was nothing - it just had the odd freighter flight every now and then; and even those preferred to fly into OST!

If DAT or the 'new Sabena' was to operate out of CRL, they would get the same deal - if they have at least the same number of flights and passengers going through there. So what's the problem?
 
airDD
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 7:00 am


You can't blame FR for trying to get the lowest possible deal. Maybe FR is getting subsidized by the Walloons BUT SN was always subsidized by the government and was expensive with mediocore service, providing unfair competition to VEX & CTB… at least FR is cheap.


DAT should consider relocating to CRL and get the same deal, maybe then the new SN will make a profit.

airDD
 
manni
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 7:20 am

Ceilidh,

Read my post again. I did not saythat it did not create jobs at all. No catering, no cargo, no special assistance, cleaning is done by cabincrew. It does create jobs at the cost of many more jobs, read Sabena employees etc. CRL was nothing before and is nothing now! No, the region has no advantages with Ryanair in CRL. A big part of the laid off Sabena employees are from that region, the same people who contributed (unwilling) money to FR. Now you try to explain me how on earth it is in the interest of that region, taking into consideration the job losses elsewhere.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 7:57 am

Well, if we look at the overall cost of the benefits provided to FR, we have the following:

· €160,000 (£99,000) for each of the first 12 routes Ryanair opens from Charleroi. Since the contract took effect last April, it has already launched flights to six new cities.

· €768,000 (£476,000) to subsidise recruitment and training of pilots and cabin crew.

· Cheap landing tax of €1 (62p) per passenger, rising to only €1.13 (70p) in 2006 and €1.30 (80p) in 2010.

· Free offices.

· Up to €250,000 (£155,000) towards Ryanair's hotel and subsistence costs while it set up its Charleroi office.

For arguments sake, lets call this €3 million on an overall basis.

Now, let's assume that 1.5m people travel out of CRL, each saving an average of €100 which they can then spend on other things. That gives the economy a net benefit of 1.5m x €100 - €3m = €147m.

Let's contrast that with SN and DAT which have cost the taxpayer hundreds of millions of Euros in subsidies - and have cost passengers more money, therefore taking it out of the economy.

Sure, with the SN scenario, you have people employed and paying taxes. SN employed what, 6,000 people? It needed over €500 million last year in various subsidies and capital injections - so that means that each of the employees cost the taxpayers €83,333 - many, many times more than they would have had back in taxes!

Now, how can you say that an operation that costs so much is better than one which contributes so much!
 
airDD
Posts: 367
Joined: Tue Oct 16, 2001 3:06 am

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 7:57 am

Manni,

Maybe FR has some benefits for the people living in the area to get cheap fares.

Eternally subsidized SN was too expensive for most of the Belgians and the numerious SN strikes showed how much the SN employees cared about the pax.

The main purpose of an airline is to fly people around not to employ people.
 
Stratofish
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 8:17 am

"The main purpose of an airline is to fly people around not to employ people."

I´d say the main purpose and (main) justification for the existence of ANY company is to employ people.

Well, yes every company is being started to generate money, I know, but that is no real justification nor the only or main one.

As in the case here the calculation that should be made is not how much the employees did cost the tax-payers but how much they WOULD cost them if they had no jobs.

Stratofish
The Metro might be the Sub(optimal)way
 
Guest

Ceilidh

Tue Dec 18, 2001 8:25 am

Agree... and hurray for the EURO from me too.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 6:01 pm

Stratofish - what planet are you living on? Perhaps in the Soviet Union the primary purpose of a company is to employ people, but here in the real world, the primary purpose of a company is to make money for its investors - its shareholders!  Insane

As a student of 'international business affairs' you should be well aware of that.

AirDD is absolutely correct. The strikes showed just how grateful those employees were for their jobs!
 
Banco
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RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 6:25 pm

Ceilidh - Correct, no company (as opposed to a co-operative for example goes into business for any other reason than to try to make money. However, I would be interested to know if others also believe the same as Stratofish.

On the subject of the so-called subsidy to Ryanair, if there is opposition to it on the grounds that it "damages" the competition,then surely you have the opportunity to register that protest at the next set of regional elections. Is there any move to oppose that?
She's as nervous as a very small nun at a penguin shoot.
 
DragonRapide
Posts: 133
Joined: Thu Sep 27, 2001 6:59 pm

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 9:36 pm

Seems Stratofish needs some support here.
Yes I agree that one of the main objectives of a company is to employ people.
To Ceilidh this may sound as a return to the Sovietunion, but what he believes (companies should make money) is capatalistic and thus as bad because also extreme. As always the truth is in the middle.
Go back to my first sntence in this post, it says: "Yes I agree that ONE of the main objectives of a company is to employ people." Logically it is not possible to employ people if you don't make any profit. But doing everything possible (without thinking about your employees), just to have even more growth and proffit, year after year, is just plain stupid. Unlike pure mathematics, the profit and growth capacity of a company does not know something like "assymptotically going to infinite +". The reason why many companies do work like this is because they are shortsighted. Why are they that? Because shareholders want ever bigger returns and because the President, or CEO or whatever you call him is often rewarded based on the growth / profit. Lets be serious, lately a company is in trouble and shares go down if the growth is less tahn previous year. What are they thinking???????
It is my firm believe that much more companies would not go bust and would not have to downscale, if they would have followed a strategy different from trying to push for the impossible.
Now relate this to aviation. If airlines would not have tried to grow bigger and bigger, maybe they wouldn't have been in the problems they are right now. Cause who seems to be suffering the most? The really big and old ones. Not the smaller companies.
 
James768
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Joined: Thu Dec 21, 2000 11:26 am

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 10:45 pm

If the deal at Charleroi is so outrageously unfair to Ryanair....why doesn't somene else take it up too? Belgian, British, whoever. So long as it's open to everyone...that's competition folks.
 
vikingivest
Posts: 12
Joined: Tue Nov 20, 2001 10:32 pm

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 10:59 pm

The purpose of starting a company might be to make money. However money is usually a result of producing products that others want's to buy. Products that gives us all a better, and sometimes cheaper, life.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 11:08 pm

DragonRapide - not at all. The best employers - by definition - look after their people well. In fact, if you look at Southwest Airlines, you'd see that their employees come first, then the customers, then the shareholders.

Why? It's really rather logical.

Happy employees = satisfied customers.
Satisfied customers = lots of business.
Lots of business = happy shareholders.

As you rightly say, the companies that are suffering are "the really big and old ones. Not the smaller companies" - therefore those that are overstaffed, and especially those which are overpaying their personnel (and therefore adding to their overheads) are the ones in trouble.

Those which are 'lean and mean' are the ones that will survive.

Personally, I believe very strongly that all employees should be shareholders in the company. Everyone should be on a reasonable base salary, but that should be topped up with a significant share of the profits. This means that in the good years, everyone does well; and in the lean years, well, everyone has their base pay and just has to tighten their belts.

It's a win-win situation for all.
 
DragonRapide
Posts: 133
Joined: Thu Sep 27, 2001 6:59 pm

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 11:14 pm

It's not a win-win situation for all since the average employee has no control over the company's strategy and future. When mistakes are made at top level, there is not a single thing employees can do. And very often it is bad management that brings companies into trouble and leaves employees without jubs as we have learned yet again in the recent past.
You will also see that a company is having a rough time because of factors outside its control, employees will not go on strike that fast. It's just when they are being sacked because managament screwed up then they become angry and go on strike. Shares would not prevent that.
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Tue Dec 18, 2001 11:22 pm

Shareholders have the ability to remove the board. Therefore if the employees felt that X was doing a poor job, they could raise that at the AGM and vote the individual off the board.

In addition, it legally entitles the employees access to the company's accounts, so they can see the financial position the company is in.

It would also make them considerably more cost conscious - as part of every Euro or dollar wasted is coming out of their pockets.
 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Sabena's Relaunch Is Almost Assured

Wed Dec 19, 2001 12:13 am

Ceilidh,
I'll ask it with you words. What have you been smoking? 1.5 million people travelling out of CRL each year? That is +4100 on any day of the year. That is 22 737-800 with a loadfactor of 100%, if they are that popular they would not give away seats for free or next to nothing (well what you pay is what you get here). Weight your words before you put them buddy.

Indeed ir does cost the Belgian taxpayer much more to have an extra 6000 people unemployed (plus indirect unemployement at other aviation related companys) than the subsidies we pay to SN. Also the income of SN is taxed, so Sabena also generates money for Belgium. And with your example, SN flies a lot more people into Belgium than FR, people who spent money in Belgium for food, accomodation, ...

CONCLUSION: The SN subsidie iw worth every EURO, it would ofcourse been better if SN could do without subsidie. We could then give the money that is left to the EC to help to develop some rural areas in Ireland.
 
TCA256
Posts: 695
Joined: Sat Dec 04, 1999 3:59 am

RE: Sabena's Relaunch Is Almost Assured

Wed Dec 19, 2001 12:31 am

To date, I can't retrieve it but there's an interesting
analysis made by the University of Liège about what
SN generated indirectly despite it's huge subsidies in
the past...I mean about jobs in various sectors such
as catering, industrial firms, clothing industries,....If
I'm not wrong, SN generated more money and advantages for the economic sector than what has been spent to keep the airline in the sky. Well, that
doesn't mean the situation had not to be changed but
we should be cautious while talking about figures, there
are just figures...Regard to the aim of airline considering
the employees, I think DragonRapide got the point..there's not better deal than a position between
two extremes, employees and high profits! Ceilidh got
one also writing a good scheme would be this position
where employees are shareholders and can express
their opinion against a bad management, or even remove
it...but real life is not so easy; employees can definitely be short-minded,and it's more usual for small companies than "big players" to have such employed shareholders !
 
Guest

RE: Sabena's Relaunch Is Almost Assured

Wed Dec 19, 2001 12:45 am

Manni - I've used the same figures as PIK is getting. FR serve five routes from PIK - how many are served from CRL? Look at the subsidy information I provided again: you'll see that it's for 12 routes. If they aren't operating 12 youres, you can therefore reduce the subsidy being provided by €160,000 per route.

They operate from PIK, STN etc at pretty close to 100% and yes, they do give away tickets for free (plus airport charges and taxes etc) as Michael O'Leary says that they can afford to fly the pax for free with the income coming from onboard sales and commissions for hotel and car rental bookings.

You seem to be assuming that none of the 6,000 people will find work elsewhere - does that not indicate that they should never have been employed in the first place, if true? If not true, then surely their cost to the Belgian exchequer will be small?

I'm most amused by your statement: . Also the income of SN is taxed, so Sabena also generates money for Belgium. You have obviously overlooked the fact that it's profit that's taxed; not income - and as SN managed to make a profit twice in its 78 year history, I suspect that it was a mere drop in the ocean of debt!  Insane Big grin  Insane

Finally, you say that SN flew more people into Belgium than FR. That may well be true, except for two facts: (1) if you look at it proportionately - ie the average number of people coming (and staying) in Belgium on each flight then FR is going to be very much higher than SN; and (2) SN mainly carried connecting pax that would spend little if no money in Belgium.

The SN subsidies are therefore wholly indefensible and a drain on the economy.

CONCLUSION: The regional financial assistance to FR is probably one of the best deals ever done by a Belgian regional government.

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