As the price of Jet-A continues to climb, the airline Chiefs are left with little recourse but to start chopping jobs and thus attempt to shrink to profitability.
Large pilot groups from three major carriers are circumventing their elected union officers and making back room deals with management in the face of looming furloughs. These are truly historic times in the airline industry. Never has the axiom of united we stand, divided we fall been more appropriate than now.
Another sign of the times is the use of outside legal firms by an individual pilot or a small group of like minded pilots against the company, union, or other pilots. This practice is spreading like a prairie fire in a strong wind. It is almost as common as a cell phone stuck in someone's ear. In fact, at least once a week one of my fellow pilots will hand me a business card from some three name legal firm and say something like, "This is who I'm with. You should consider these guys. They're good." Just when I think I've seen it all....
In Ecclesiastes 1: 9, it says (paraphrasing) There is nothing new under the sun.
Large pilot groups from three major carriers are circumventing their elected union officers and making back room deals with management in the face of looming furloughs. These are truly historic times in the airline industry. Never has the axiom of united we stand, divided we fall been more appropriate than now.
Another sign of the times is the use of outside legal firms by an individual pilot or a small group of like minded pilots against the company, union, or other pilots. This practice is spreading like a prairie fire in a strong wind. It is almost as common as a cell phone stuck in someone's ear. In fact, at least once a week one of my fellow pilots will hand me a business card from some three name legal firm and say something like, "This is who I'm with. You should consider these guys. They're good." Just when I think I've seen it all....
In Ecclesiastes 1: 9, it says (paraphrasing) There is nothing new under the sun.
Does that mean Caesar's chariot drivers sued each other when the price of horse feed went through the roof?
Life on the Line continues...
Life on the Line continues...
19 comments:
Yup, that's what Montie used as his reasoning to announce 2000 jobs will be cut as Air Canada reduces its capacity this coming fall.
Now I find myself faced with the question of 'do I stay, or do I bail?'
This has not been a good day.
I am in yyz a lot. We need to get together and compare notes...
My heart goes out to all in the airline industry in these high price of oil times.
It is, I believe, the direct result of over population of this small planet of ours.
I hate to think of 100 years hence, fortunately, I will not be here!
Thanks and regards to all pilots
Bill au
So, do you think ALPA is helping or hurting? Personally, I suspect there will be fewer furloughs at JetBlue than United.
A barrel of oil should be no more than $70 - it is the speculators (who are not regulated by any US investment laws)who are driving the price to the $140 range. Sadly, a small group of investment companies are having a negative impact on the airlines and economies of the world while making millions in profits and no one is doing anything about it. Perhaps if they were taxed 100% on their profits that would drive them out of the oil markets.
RD
oil prices are getting higher and the low budget (LCC such as deccan, indigo airlines)are ready to apply fuel surcharge
That'd be nice, Dave. I'm off until the 29th, so if you're in town anytime between now and then, let me know.
Hi, Dave! I'm chuckling at your analogy of Caesar's chariot drivers and the price of horse feed! I'm glad you can still keep your wonderful sense of humour in all the craziness!
BTW, in Australia petrol (gas) today reached a top price of $1.72/litre (US$1.62/litre) or approx. US$6.13/gallon.
How lucky you are in Australia. School holidays start on Friday in the state in Germany that I live in.
Petrol=Gas € 1.56/l
That equates to (US)$9,20/gal.!
So where does that us leave us....?
Driving very small cars:)
I live in Edmonton, Alberta, Canada, where the oil is under our feet.
C$1.35/ liter or C$1.45/l for premiun fuel. Of that about 22% is government taxes.
Any advance on Regular Unleaded at "average" UK£ 1.20 per litre - approx US$ 2.25. That's well over US$ 10.00 per US "short gallon"!
One filling station nr Exeter, Devonshire was selling at UK£ 1.99 per litre on Monday; last day of our recent gas delivery driver strike!
ISH
Hi Dave, Craig here in MCO again, this is a horrifying age we live in which is forceing many to leave not only the airline indusrty but the US.. Even though this is a world wide problem, we all no that fuel is cheaper in many part of the world such as south America where the local joe can fill up for 35 cents a gallon, or the EK where they produce the oil and its sold, Im told for as low as 35 cents a gal..
I worry that the worlds dependance on oil will become a biblical trigger for the end times and the wars that have yet to be faught, or worse a war called fighting terrorizm....
All this could obviously lead to historical and drastic events that will change we live in big ways, the collapse industries like ours, worse countries..
As to the ALPA issue, when all is said and done, I can blame anyone for seeking legal representation when they are are in fear for the families future.. I for one have left the airlines here for good, and jumped over to teaching international pilots and dispatcher students, the money is good, and we dont see an end to the flow of students comming here for quality US training and a Great currency exchange rate they get to come here..
Good luck Buddy, I am a big fan of yours..
If it wasn't oil it would be something else. The airlines have been on a 7 year bankruptcy cycle for as long as I can remember. They are their own worst enemy.
I think, and I sure hope that I am right, that the administration change in the US (it does not matter who wins) will spark the economy and some of the economic turmoil we see will ease off. Much of oil volatility right now seems to be the product of speculative investing (as much or more than actual availability of oil). Other factors are fairly tricky trade deals (NAFTA, for example) that require Canada and the US to sell oil to each other at certain market prices, even though it might make sense for our two nations to keep the oil for domestic use. There are surely many other factors, but I think we will see a softening of the market in a few months.
The airlines, it seems, are now in a cycle of change and that may take some time to settle. Hopefully, not too many pilots and employees will suffer as a result.
All of this is a little depressing, seeing as I am/was? planning to become a pilot.
I have doubts now and wonder if I should abandon my dreams and seek other career paths.
Are things really this bad? or are things being dramatized a little bit too much?
If you were in my position Dave, would you continue to pursue a career as a pilot (In any shape or form) or forget it, and seek another career?
Thanks
jesse- the airline business is cyclical, like a sine wave. About every seven years it goes up and down. I've lived through a bunch of those cycles and am still here. I would not let a down turn stop you from being a pilot; it is a great job. Having said that, you must be mentally and financially ready for furloughs. It is a fact of life for a pilot. I have been furloughed twice. This high oil price will most likely forever change the face of the business into something I would not recognize in the future. But they will still need pilots.
Today's tea leaves say $250/bbl oil by next year.
Most mature transport industries operate on a 1:10 ratio of fuel costs to revenue. I.E. the cost charged by a carrier to move X from A to B is ten times the cost of fuel to move X from A to B. Anything less than this tends to be unsustainable and results in carriers going bankrupt. I have no idea why the 1:10 rule works but it's pretty much an observed fact in trucking, rail, river freight, ocean freight, buses, and--until recently--air travel.
Over the past few years, airline fuel bills have gone from 1/10th of revenue (in line with the 1:10 rule) to 30%. To completely stabilize the air travel industry will mean jacking up fares to bring the 1:10 rule back into force.
Yeah, you read that right. To stabilize the industry on today's oil prices would mean tripling fares. If oil hits $250 next year, then we're looking at increasing fares by a factor of five over what they were a few years ago.
How many people are going to be flying when the cheapest transcon fare is over $1500? How many airlines will be left standing? How many aircrew will still be employed as aircrew? The answer to all three is 'not many.'
You'd be fscking nuts to get into the industry now.
Caesar's chariot drivers probably waited till fellow chariot driver was in dark ally and stabbed him/her in back. Not that I am suggesting anything you might try.
"As the price of Jet-A continues to climb, the airline Chiefs are left with little recourse but to start chopping jobs and thus attempt to shrink to profitability."
Haha. It's funny that raising prices is never even mentioned by industry peeps. I don't get it. When costs go up, you raise your prices. Cut the jobs AFTER people stop flying (due to higher prices), not before.
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