Moderators: jsumali2, richierich, ua900, PanAm_DC10, hOMSaR

 
winginit
Posts: 2849
Joined: Sat Feb 23, 2013 9:23 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Wed Apr 01, 2020 7:14 pm

Vladex wrote:
winginit wrote:
airbazar wrote:
It's called fuel hedging. You buy fuel for future use at an agreed upon present price.
https://simpleflying.com/what-is-fuel-h ... nes-do-it/
The trick is to find that agreed upon price that works for both parties.


Ah yes, fuel hedging... because that's worked out so very well recently for airlines who have engaged in the practice. Has oil bottomed? Again, you're dancing around the notion that there will be a quick recovery here without stating a claim - when will, in your opinion, the industry be back to where it was at the beginning of this year measured by revenue or whatever metric you choose?

At the end of the day you're implying that cheap oil here might prolong the lives of four holers - the exact opposite is happening in practice.


I think airlines that didn't buy A380 will go down by a lot including something like Cathay while EK and SQ will go up by a lot when this is done.


'Go down by a lot'? What does that mean? Be specific. Also, SQ has already been bailed out by their government and EK will be to a degree that's even larger than the US3, so those maybe aren't the best examples. It is undeniable that the decision to buy A380s isn't helping any carrier at present or in the near future.
 
ACA772LR
Posts: 74
Joined: Thu Nov 05, 2015 4:55 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Wed Apr 01, 2020 7:22 pm

I know this is anyone’s best guess but would the A340s survive this coronavirus? I know that Swiss just recently finished the refurbishment but I don’t think that really matters if this virus wreaks havoc for another 6 months to a year or however long this plays out for
 
Vladex
Posts: 468
Joined: Sat Oct 26, 2013 2:44 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Wed Apr 01, 2020 8:53 pm

winginit wrote:
Vladex wrote:
winginit wrote:

Ah yes, fuel hedging... because that's worked out so very well recently for airlines who have engaged in the practice. Has oil bottomed? Again, you're dancing around the notion that there will be a quick recovery here without stating a claim - when will, in your opinion, the industry be back to where it was at the beginning of this year measured by revenue or whatever metric you choose?

At the end of the day you're implying that cheap oil here might prolong the lives of four holers - the exact opposite is happening in practice.


I think airlines that didn't buy A380 will go down by a lot including something like Cathay while EK and SQ will go up by a lot when this is done.


'Go down by a lot'? What does that mean? Be specific. Also, SQ has already been bailed out by their government and EK will be to a degree that's even larger than the US3, so those maybe aren't the best examples. It is undeniable that the decision to buy A380s isn't helping any carrier at present or in the near future.


I mean they will not recover in terms of flights for months and years let alone profits . Cathay has been losing so much money in the last 8 months that even Etihad and Qatar are raising their eyebrows. But at least they didn't get A380 so they must be smart according to you. I think you are suffering from A380 derangement syndrome otherwise.

SQ and EK haven't been losing money like those 3 and they will pick right where they left off in weeks when they restart and they will have more people flying them because of reliability and brand and being outside EU, US and China. Because they are small city states, government must treat people more humanely and more honestly than in those big conglomerations.
 
winginit
Posts: 2849
Joined: Sat Feb 23, 2013 9:23 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Wed Apr 01, 2020 8:58 pm

Vladex wrote:
SQ and EK haven't been losing money like those 3 and they will pick right where they left off in weeks when they restart and they will have more people flying them because of reliability and brand and being outside EU, US and China. Because they are small city states, government must treat people more humanely and more honestly than in those big conglomerations.


Let's not downplay the fact that SQ just got $13 BILLION in liquidity from the Singaporean Government (that's nearly 3x what the Big 3 in the US are getting individually even though SQ is a much smaller carrier). That, more so than anything else, will allow SQ to snap back moreso than other airlines. EK will inevitably get comparable assistance.

We are reaching a point, if we're not there already, where the only driver behind whether airlines live or die will be the degree of government assistance they receive. Full stop.
 
11C
Posts: 152
Joined: Mon Jun 17, 2019 2:25 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 2:36 am

9Patch wrote:
11C wrote:
Opus99 wrote:
Low oil prices are mixture of things at the moment. Is due to Saudi and Russian tension. But also because there’s low demand at the moment so it’s forcing the price even lower. There’s a huge dip across ALL forms transport at the moment.

Webster’s Dictionary entry under ”obviality.”

No such word in Webster's Dictionary, did you mean obliviality?


No, but I do like to make up words, apparently. Obviousness is what I meant. An English chap in my old unit used “obviality” interchangeably with obviousness. I liked it. He also was fond of “shat”, which isn’t used as much in the U.S., but has a nice ring to it.
 
9Patch
Posts: 541
Joined: Wed Mar 13, 2019 10:38 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 5:00 am

11C wrote:
9Patch wrote:
11C wrote:
Webster’s Dictionary entry under ”obviality.”

No such word in Webster's Dictionary, did you mean obliviality?


No, but I do like to make up words, apparently. Obviousness is what I meant. An English chap in my old unit used “obviality” interchangeably with obviousness. I liked it. He also was fond of “shat”, which isn’t used as much in the U.S., but has a nice ring to it.

You said ”obviality” is a Webster’s Dictionary entry.
It's not.
 
User avatar
seahawk
Posts: 9627
Joined: Fri May 27, 2005 1:29 am

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 5:04 am

What good is cheap fuel, if you have no passengers willing to fly? And people will avoid to fly until there is a working vaccine and then it will take some time for the fear factor to reduce.
 
FluidFlow
Posts: 673
Joined: Wed Apr 10, 2019 6:39 am

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 5:20 am

ACA772LR wrote:
I know this is anyone’s best guess but would the A340s survive this coronavirus? I know that Swiss just recently finished the refurbishment but I don’t think that really matters if this virus wreaks havoc for another 6 months to a year or however long this plays out for


I would say, they keep it. Yes they are a bit more expensive than a 330 to operate but on the other hand they have low capital costs. As long as the LH group does not place a massive 330neo order (or 787) to replace many older 330/340 in the complete LH group fleet I do not think that Swiss will ged rid of WB aircraft. Maybe if cheap 777 get available but there are routes where the 777 cant get filled while the relatively low density 340s can be filled.
 
User avatar
Mortyman
Posts: 5832
Joined: Sat Aug 12, 2006 8:26 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 5:57 am

I don't get the people who say that when this is over, passengers won't fly ... Things will be back to normal and People will fly. No reason to make an even bigger drama of this than it already is.
 
FluidFlow
Posts: 673
Joined: Wed Apr 10, 2019 6:39 am

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 6:09 am

Mortyman wrote:
I don't get the people who say that when this is over, passengers won't fly ... Things will be back to normal and People will fly. No reason to make an even bigger drama of this than it already is.


People will fly, but it will be less.

The more businesses adapt to Video conferences and getting things done without meeting, why spending money on flights, especially when you have to pay back government bailouts/loans etc.
The longer this drags on, the less likely are private citicens to spend their money on flights/vacations instead of first saving a bit for the next crisis.
The more people lose their jobs, the less money is there to spend on flights/vacations, even if they get paid right now by the government. This will end at one point and then there is something else to worry than flying away.

As sad as it already is, but this will take 2-3 years to go back to 2019 levels at least. To much is affected. It is like 9/11 + financial crisis on an all out global scale, hitting every business. It is not only the US or the banks. This is hitting from the small hair dresser at the corner up to Apple. Everyone will have a really bad year and another not so good year 2021. On top of that, government will have to start paying back the dept at one point, which will also reduce government demands for flying.

This will not go back to normal quickly at all.
 
Toinou
Posts: 261
Joined: Sun Apr 14, 2019 8:21 am

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 6:39 am

I can't predict how quick demand will increase again. But I tend to think that those predicting an immediate recovery are overly optimistic. As others said here, there will be a huge hit to corporate's finances so they will have to cut expenses, if they don't fall completely. Also, after many years of wondering why there is still so many business trips when audio or video calls are available, I am pretty sure that this situation will be eye-opening to many: they will be able to spare money, time and improve their ecological record (which will still be an important PR point in the coming years).
To me, the most worrying aspect is the debt question. Many companies and people, are living on credit. It is what fuelled a good part of last years growth. This is true in most part of the developed world, especially in the US, and in many developing nations too. If this crisis causes a debt crunch, it may add to an already terrible economical crisis and lead to something of biblical proportions.

Vladex wrote:
SQ and EK haven't been losing money like those 3 and they will pick right where they left off in weeks when they restart and they will have more people flying them because of reliability and brand and being outside EU, US and China. Because they are small city states, government must treat people more humanely and more honestly than in those big conglomerations.

I don't get your last sentence. Do you really think that governments in Singapore or Dubai are acting "more humanely and more honestly"? You may want to have a little look at their human rights records or simply at their laws...
 
User avatar
DarkSnowyNight
Posts: 2639
Joined: Sun Jan 01, 2012 7:59 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 8:47 am

FluidFlow wrote:
ACA772LR wrote:
I know this is anyone’s best guess but would the A340s survive this coronavirus? I know that Swiss just recently finished the refurbishment but I don’t think that really matters if this virus wreaks havoc for another 6 months to a year or however long this plays out for


I would say, they keep it. Yes they are a bit more expensive than a 330 to operate but on the other hand they have low capital costs. As long as the LH group does not place a massive 330neo order (or 787) to replace many older 330/340 in the complete LH group fleet I do not think that Swiss will ged rid of WB aircraft. Maybe if cheap 777 get available but there are routes where the 777 cant get filled while the relatively low density 340s can be filled.


343s tend towards very similar densities to a 772. Same again WRT the 346 v 773/W.

Having that been said, it is true that the trip costs & long term MX costs of the 343 aren't significantly different to the 77E. In fact, you would need a 772 to see any real difference, but those are hard to come by just now and you'd be sacrificing a good deal of range capability.

There are advantages to a 772/E over the 343, but those hinge on already having them in the fleet. If not, procuring 'new' ones is certainly more trouble than it is worth.

I agree. The 343s stay, I think.



Mortyman wrote:
I don't get the people who say that when this is over, passengers won't fly ... Things will be back to normal and People will fly. No reason to make an even bigger drama of this than it already is.


Not drama. Opportunity. It is very simple. No discretionary money. And work-arounds found to 'business' travel that was never necessary in the first place. Put yourself in the position of a company that has just spent six months figuring out there is an entire cost block you can elimenate. And could have years ago, if we are being honest.

Firing low/no-value travel departments and marketing teams, and getting rid of the associated beyond salary costs is an opportunity that simply cannot be ignored. Especially if everyone else is doing it.

Road warriors will not disappear completely. There will always be things that require personal supervision. But for most training, meetings, speaking engagements etc, for the past decade or so have been largely an unnecessary favor for the employees/executives doing this. The amount of fat about to be trimmed away is undeniable. If nothing else, it will be the silver lining to all this mess.

And that is not getting even started on what the government will see as an opportunity to levy environmental restrictions as well.

I do agree that some flying will return, but it is not wise to assume* that it will be what it was.


11C wrote:
9Patch wrote:
11C wrote:
Webster’s Dictionary entry under ”obviality.”

No such word in Webster's Dictionary, did you mean obliviality?


No, but I do like to make up words, apparently. Obviousness is what I meant. An English chap in my old unit used “obviality” interchangeably with obviousness. I liked it. He also was fond of “shat”, which isn’t used as much in the U.S., but has a nice ring to it.


I too enjoy doing this. The best is when you spread use to other people that would not otherwise have come up with something.

I had a good moment the other week when a kid of mine complained that there were several Roazards along the freeway on her trip here. She got that from her mother, who, in turn, got that from me twenty years ago.


* - assume as in enough to invest anything in.
"Nous ne sommes pas infectés. Il n'y a pas d'infection ici..."
 
airbazar
Topic Author
Posts: 10119
Joined: Wed Sep 10, 2003 11:12 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 12:55 pm

winginit wrote:
airbazar wrote:
It's called fuel hedging. You buy fuel for future use at an agreed upon present price.
https://simpleflying.com/what-is-fuel-h ... nes-do-it/
The trick is to find that agreed upon price that works for both parties.


Ah yes, fuel hedging... because that's worked out so very well recently for airlines who have engaged in the practice. Has oil bottomed? Again, you're dancing around the notion that there will be a quick recovery here without stating a claim - when will, in your opinion, the industry be back to where it was at the beginning of this year measured by revenue or whatever metric you choose?


Fuel hedging is a bet. Sometimes it works and sometimes it doesn't. IIRC, the last time around it worked really well while right now airlines that are hedged against much higher prices are unable to take advantage of the current low prices. No one, not even the experts can predict the future of oil prices however you will not find many people, anyone really who is predicting oil will go even lower than $20/bbl which means that hedging now is as good a bet as it ever was.

As for the recovery, it's all relative. I think it will be a lot faster than the 2008 recovery because the financial institutions that are needed to support a recovery are in much better shape than they were in 2008. I also think that some areas will rebound faster than others. In the U.S. and Asia for example, faster than in Europe. Europe I predict it will have a much slower recovery in part because nothing ever happens fast there anyway.

As for the aircraft implications, my theory is that low fuel prices and an uncertain economic future may lead airlines like EK, SQ, LH, BA to defer deliveries of new aircraft (specifically the 779), and extend the life of the existing VLA fleet.

And yes there will be a contraction in passenger numbers for a few years to come but there will also be airlines that don't survive and airlines that shrink so the supply will be reduced too. The contraction won't happen on the demand side only.
 
blockski
Posts: 687
Joined: Wed Jun 15, 2016 8:30 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 1:42 pm

airbazar wrote:

As for the aircraft implications, my theory is that low fuel prices and an uncertain economic future may lead airlines like EK, SQ, LH, BA to defer deliveries of new aircraft (specifically the 779), and extend the life of the existing VLA fleet.

And yes there will be a contraction in passenger numbers for a few years to come but there will also be airlines that don't survive and airlines that shrink so the supply will be reduced too. The contraction won't happen on the demand side only.


The problem with the theory is obvious - it's hard to imagine enough economic uncertainty for airlines to defer new aircraft, but not so much uncertainty and demand disruption that they're still flying (and filling) VLAs.

EK is a unique case given their reliance on the A380. But if the others defer their 777-9 deliveries, the far more likely scenario is they park their VLAs entirely and use the smaller widebodies they already have. With depressed demand, they should have plenty of slack in their fleets.
 
WayexTDI
Posts: 1706
Joined: Fri Sep 21, 2018 4:38 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 2:45 pm

FluidFlow wrote:
Mortyman wrote:
I don't get the people who say that when this is over, passengers won't fly ... Things will be back to normal and People will fly. No reason to make an even bigger drama of this than it already is.


People will fly, but it will be less.

The more businesses adapt to Video conferences and getting things done without meeting, why spending money on flights, especially when you have to pay back government bailouts/loans etc.
The longer this drags on, the less likely are private citicens to spend their money on flights/vacations instead of first saving a bit for the next crisis.
The more people lose their jobs, the less money is there to spend on flights/vacations, even if they get paid right now by the government. This will end at one point and then there is something else to worry than flying away.

As sad as it already is, but this will take 2-3 years to go back to 2019 levels at least. To much is affected. It is like 9/11 + financial crisis on an all out global scale, hitting every business. It is not only the US or the banks. This is hitting from the small hair dresser at the corner up to Apple. Everyone will have a really bad year and another not so good year 2021. On top of that, government will have to start paying back the dept at one point, which will also reduce government demands for flying.

This will not go back to normal quickly at all.

People have said video conferences would be the norm years ago; yet, they weren't until "imposed" upon us by this virus. No reason for them to remain the norm.
Studies have shown that, in general, workers from home tend to be less productive and that creativity is hampered by the lack of easy interaction; and companies still functioning are currently seeing this.

Also, I believe people will want to get out, see other people or the family they couldn't see during the confinement. We might see travel pick back up rapidly.

I am agreeing on one point though: if this drags on, then we are in deep trouble. Most people and companies can survive or make it work for a month, maybe 2; but not 6 months of more. So, the shorter the crisis is (even if it's very deep crisis), the better it is and the sharper it'll rebound.
 
winginit
Posts: 2849
Joined: Sat Feb 23, 2013 9:23 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 4:02 pm

airbazar wrote:
winginit wrote:
airbazar wrote:
It's called fuel hedging. You buy fuel for future use at an agreed upon present price.
https://simpleflying.com/what-is-fuel-h ... nes-do-it/
The trick is to find that agreed upon price that works for both parties.


Ah yes, fuel hedging... because that's worked out so very well recently for airlines who have engaged in the practice. Has oil bottomed? Again, you're dancing around the notion that there will be a quick recovery here without stating a claim - when will, in your opinion, the industry be back to where it was at the beginning of this year measured by revenue or whatever metric you choose?


Fuel hedging is a bet. Sometimes it works and sometimes it doesn't. IIRC, the last time around it worked really well while right now airlines that are hedged against much higher prices are unable to take advantage of the current low prices. No one, not even the experts can predict the future of oil prices however you will not find many people, anyone really who is predicting oil will go even lower than $20/bbl which means that hedging now is as good a bet as it ever was.

As for the recovery, it's all relative. I think it will be a lot faster than the 2008 recovery because the financial institutions that are needed to support a recovery are in much better shape than they were in 2008. I also think that some areas will rebound faster than others. In the U.S. and Asia for example, faster than in Europe. Europe I predict it will have a much slower recovery in part because nothing ever happens fast there anyway.

As for the aircraft implications, my theory is that low fuel prices and an uncertain economic future may lead airlines like EK, SQ, LH, BA to defer deliveries of new aircraft (specifically the 779), and extend the life of the existing VLA fleet.

And yes there will be a contraction in passenger numbers for a few years to come but there will also be airlines that don't survive and airlines that shrink so the supply will be reduced too. The contraction won't happen on the demand side only.


You have, yet again, not answered the question - so I'll ask it again:

When will, in your opinion, the industry be back to where it was at the beginning of this year measured by revenue or whatever metric you choose? Be specific.

I'll state my claim: 2027 is when we will see US carriers reach the revenue levels that we say for full year 2019. Seven years, on account of, among other things, a very slow demand recovery paired with curbed capital spending that's sidetracked by the realization that much larger cash balances are needed on the books to whether events like this one.
 
konrad
Posts: 584
Joined: Fri Mar 15, 2002 3:54 am

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 4:20 pm

Oil at $20/bbl! Given the present loads, perhaps it is viable to reinstate stored ERJ-145 and CRJ-200 instead of the A380/B747 ?
 
11C
Posts: 152
Joined: Mon Jun 17, 2019 2:25 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Thu Apr 02, 2020 5:24 pm

DarkSnowyNight wrote:
FluidFlow wrote:
ACA772LR wrote:
I know this is anyone’s best guess but would the A340s survive this coronavirus? I know that Swiss just recently finished the refurbishment but I don’t think that really matters if this virus wreaks havoc for another 6 months to a year or however long this plays out for


I would say, they keep it. Yes they are a bit more expensive than a 330 to operate but on the other hand they have low capital costs. As long as the LH group does not place a massive 330neo order (or 787) to replace many older 330/340 in the complete LH group fleet I do not think that Swiss will ged rid of WB aircraft. Maybe if cheap 777 get available but there are routes where the 777 cant get filled while the relatively low density 340s can be filled.


343s tend towards very similar densities to a 772. Same again WRT the 346 v 773/W.

Having that been said, it is true that the trip costs & long term MX costs of the 343 aren't significantly different to the 77E. In fact, you would need a 772 to see any real difference, but those are hard to come by just now and you'd be sacrificing a good deal of range capability.

There are advantages to a 772/E over the 343, but those hinge on already having them in the fleet. If not, procuring 'new' ones is certainly more trouble than it is worth.

I agree. The 343s stay, I think.



Mortyman wrote:
I don't get the people who say that when this is over, passengers won't fly ... Things will be back to normal and People will fly. No reason to make an even bigger drama of this than it already is.


Not drama. Opportunity. It is very simple. No discretionary money. And work-arounds found to 'business' travel that was never necessary in the first place. Put yourself in the position of a company that has just spent six months figuring out there is an entire cost block you can elimenate. And could have years ago, if we are being honest.

Firing low/no-value travel departments and marketing teams, and getting rid of the associated beyond salary costs is an opportunity that simply cannot be ignored. Especially if everyone else is doing it.

Road warriors will not disappear completely. There will always be things that require personal supervision. But for most training, meetings, speaking engagements etc, for the past decade or so have been largely an unnecessary favor for the employees/executives doing this. The amount of fat about to be trimmed away is undeniable. If nothing else, it will be the silver lining to all this mess.

And that is not getting even started on what the government will see as an opportunity to levy environmental restrictions as well.

I do agree that some flying will return, but it is not wise to assume* that it will be what it was.


11C wrote:
9Patch wrote:
No such word in Webster's Dictionary, did you mean obliviality?


No, but I do like to make up words, apparently. Obviousness is what I meant. An English chap in my old unit used “obviality” interchangeably with obviousness. I liked it. He also was fond of “shat”, which isn’t used as much in the U.S., but has a nice ring to it.


I too enjoy doing this. The best is when you spread use to other people that would not otherwise have come up with something.

I had a good moment the other week when a kid of mine complained that there were several Roazards along the freeway on her trip here. She got that from her mother, who, in turn, got that from me twenty years ago.


* - assume as in enough to invest anything in.


I agree. My error was attributing the word to Webster’s. It is a little too advanced for anything like a dictionary. I like “roazards,” as well. It is an efficient use of the language.
 
winginit
Posts: 2849
Joined: Sat Feb 23, 2013 9:23 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Tue Apr 07, 2020 5:39 pm

Lufthansa announced today that they'll be retiring:

- 6 of their 14 A380s
- 7 out of 17 346s
- 5 of 15 744s
- 11 A320s
- 3 of 3 343s

I think this alludes to an answer to the question posed in this thread.
 
Miamiairport
Posts: 589
Joined: Tue Apr 10, 2018 8:14 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Tue Apr 07, 2020 6:13 pm

winginit wrote:
LCDFlight wrote:
This situation DOES favor the operation of old aircraft. Here's how:

1. Old aircraft have cheaper ownership costs. You can park them. You can wait out a crisis like this more successfully than the operator of new aircraft.
2. Fuel is cheap. This significantly improves unit costs of old aircraft. It makes it closer to the operating cost of brand new aircraft.

For these two reasons, new aircraft are extremely painful to park and wait out the crisis. Old aircraft are simply better right now.


I don't disagree with the fundamentals there under normal demand circumstances, but that's not where we are, and what you're seeing as a result of this demand drop off and likelihood of a slow recovery is the big three most notably doing the exact opposite of what you're saying. They're accelerating retirements of old aircraft across the board.

As others have mentioned, given the demand situation I think this cheap oil will do nothing to extend the lives of four holers. This is only accelerating their retirement.

airbazar wrote:
The drop in passenger traffic is only temporary and not due to some underlying economic disaster. Unlike the global recession of 2008 which took a few years to recover from and it was rooted on some really high risk behavior on the part of financial institutions, I expect the recovery this time around to be very fast because the underlying indicators were strong going into this Pandemic.


Virtually every single airline CEO disagrees with you. Shutting down the global economy for at least a month is an economic disaster by virtually every metric. Goldman Sachs said just this morning that the US GDP will drop by 34% in the second quarter. THIRTY-FOUR PERCENT. Unemployment will reach, at a minimum, 15% and could see for the first time in modern history - 30%.


Agreed by the end of April the economy will be in such bad shape my sense is that they will be forced to life the ban (you already see the rumblings now). However by then the damage done will take more than months, possibly up to a decade to correct. Much of this is untested and unknown. Flying around 747s and 380s with 10% load factors wouldn't be profitable if oil fell to pre 1974 levels.
 
AEROFAN
Posts: 1849
Joined: Wed Aug 04, 2004 9:47 am

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Tue Apr 07, 2020 6:25 pm

A better question would be are we going to see the fuel surcharge removed.
“You are not entitled to your opinion. You are entitled to your informed opinion. No one is entitled to be ignorant.” ~Harlan Ellison~
 
winginit
Posts: 2849
Joined: Sat Feb 23, 2013 9:23 pm

Re: Oil at $20/bbl. What does it mean for the 747 and A380?

Tue Apr 07, 2020 7:13 pm

AEROFAN wrote:
A better question would be are we going to see the fuel surcharge removed.


I genuinely didn't even know that there were carriers who still had fuel surcharges? Who? I know these were eliminated virtually across the board in the TPAC entity years ago.

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos