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Airline Bankruptcy / Merger / Layoffs Pt. 2

General discussions of the systemic, societal and civilisational effects of depletion.

Re: Airlines THE Dead Canary Thread

Unread postby dolanbaker » Sat 26 Jul 2014, 09:28:22

Pops wrote:
Airlines become more "efficient" by cutting flights, packing the seats, eliminating the peanuts and loser routes. This is how the world as you know it ends, not with a bang or a whimper but scratching and clawing every inch.


That is exactly what is happening in the airline business, plus a number of regional airports are also closing as well.

http://en.wikipedia.org/wiki/Galway_Airport
Galway Airport (Irish: Aerphort na Gaillimhe) was located at Carnmore, 4 NM (7.4 km; 4.6 mi) north of Galway City, County Galway, Ireland and is managed by Corrib Airport Limited. It has not serviced any flights since 31 October 2011, when Aer Arann ceased commercial operations at the airport. At 1289 m (4230 ft), the runway is too short to handle most jet airliners and so scheduled services are restricted to turboprop aircraft or small executive jets. In November 2013 it was announced that the airport's aviation licence would cease, closing the airport


You could extend this trend to all energy intensive activities that are not essential to maintaining a reasonable standard of living.
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Planned obsolescence, one of the largest contributors to the man made element of climate change, but the one least discussed: dolanbaker
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Re: Airlines THE Dead Canary Thread

Unread postby Subjectivist » Sat 26 Jul 2014, 10:38:06

dolanbaker wrote:
Pops wrote:
Airlines become more "efficient" by cutting flights, packing the seats, eliminating the peanuts and loser routes. This is how the world as you know it ends, not with a bang or a whimper but scratching and clawing every inch.


That is exactly what is happening in the airline business, plus a number of regional airports are also closing as well.

http://en.wikipedia.org/wiki/Galway_Airport
Galway Airport (Irish: Aerphort na Gaillimhe) was located at Carnmore, 4 NM (7.4 km; 4.6 mi) north of Galway City, County Galway, Ireland and is managed by Corrib Airport Limited. It has not serviced any flights since 31 October 2011, when Aer Arann ceased commercial operations at the airport. At 1289 m (4230 ft), the runway is too short to handle most jet airliners and so scheduled services are restricted to turboprop aircraft or small executive jets. In November 2013 it was announced that the airport's aviation licence would cease, closing the airport


You could extend this trend to all energy intensive activities that are not essential to maintaining a reasonable standard of living.


About three months ago my wife went on a business trip and her company rented her a car to take. All the car rentals around Toledo are clustered at Toledo Express Airport so I took her there.
http://en.m.wikipedia.org/wiki/Toledo_Express_Airport
The place is a ghost town, they have just a couple flights a day despite having decent facilities. They can't attract a big carrier because Detroit and Cleveland are both within a hundred miles and host major airports with multiple carriers.

In the good old days they had frequent connector flights, but for most people around Toledo it is far cheaper to just drive to Detroit or Cleveland to fly directly to your destination. Even Chicago is only about a five hour drive or if you time it right you can even take Amtrakk from Toledo to Chicago for your international flight. Even so the county government won't give up the airport, it is a prestige thing.
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Re: Airlines THE Dead Canary Thread

Unread postby Tanada » Mon 28 Jul 2014, 17:21:19

Image

With the last round of mergers complete and the price of fuel still climbing when will the next round start?
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Re: Airlines THE Dead Canary Thread

Unread postby Tanada » Mon 28 Jul 2014, 17:30:59

Pops wrote:Not to sound too corny but there is a range of mitigation in every area of modern life, not the simplistic either/or "Non-negotiable Lifestyle" and "Total Systemic Collapse" dichotomy that makes for good blog posts.

The one thing Peakers should have learned over the last 10-20 years is a self-organizing system will reorganize when disturbed. This canary won't simply fall off it's perch without warning, it will grow bigger lungs at the expense of its pretty singing voice, shed the colorful plumage and grow scales in it's place, and develop big claws to hang on to that perch at all costs.

Airlines become more "efficient" by cutting flights, packing the seats, eliminating the peanuts and loser routes. This is how the world as you know it ends, not with a bang or a whimper but scratching and clawing every inch.

The canary is more like an alligator.


Funny thing Pops, when I was 19 and thought I had the world by the tail I said that if Death came for me I was planning to go kicking and screaming, not just gently into that Good Night.

The older I get and the more chronic health issues I accumulate the less ability I have to kick and scream whenever the grim reaper shows up. If private airlines are the canary I think they are the investors are going to start abandoning the sinking stock when they figure Peak Oil out. After that we either have all national/nationalized and subsidized airline, or we don't have air travel.

Heck I was only joking when I said I would avoid Malaysian Airlines after they lost two 777 aircraft in four months, but apparently a lot of other people are dead serious about it.

“The harrowing reality for Malaysia Airlines after MH17 is that if the government doesn’t have an immediate game plan, every day that passes will contribute to its self-destruction and eventual demise,” aviation analyst Shukor Yusof told AFP. Losing “one to two million US dollars a day,” the airline has “the bandwidth to stay afloat for about six more months based on my estimates of its cash reserves,” Shukor said.


Read More at inserbia.info/today/2014/07/malaysia-airlines-on-the-verge-of-bankruptcy/ © InSerbia News
http://inserbia.info/today/2014/07/malaysia-airlines-on-the-verge-of-bankruptcy/
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Re: Airlines THE Dead Canary Thread

Unread postby kublikhan » Tue 29 Jul 2014, 00:34:58

Tanada wrote:If private airlines are the canary I think they are the investors are going to start abandoning the sinking stock when they figure Peak Oil out.
Should airlines be the canary? Airlines get better mpg than automobiles.

U.S. major airlines average about 64 mpg, according to calculations using Department of Transportation data for 2009. For each gallon of jet fuel, airlines could, on average, fly one seat 64 miles. That's better than your SUV or hybrid car, unless you pack lots of people into the car.

Boeing says its 777-200ER wide-body jet gets nearly 82 miles to the gallon with 301 seats, all full, on a 3,000-mile trip. Boeing says the champ in its current line-up is the 737-900 with 180 passengers flying 1,000 miles. It gets nearly 99 mpg. The plane with the best average mpg in Airbus's current line-up is the A320 family.
A Prius With Wings vs. a Guzzler in the Clouds

Maybe Hummer should be the dead canary:
DETROIT — General Motors said on Wednesday that it would shut down Hummer, the brand of big sport utility vehicles that became synonymous with the term gas guzzler, after a deal to sell it to a Chinese manufacturer fell apart.

The buyer, Sichuan Tengzhong Heavy Industrial Machines, said in a statement that it had withdrawn its bid because it was unable to receive approval from the Chinese government, which was trying to put a new emphasis on limiting China’s dependence on imported oil and protecting the environment.
G.M. to Close Hummer After Sale Fails

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Re: Airlines THE Dead Canary Thread

Unread postby Newfie » Tue 29 Jul 2014, 07:19:28

Thanks for the air mpg stats, I've often wondered about that but would not have guessed those numbers.
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Re: Airlines THE Dead Canary Thread

Unread postby Pops » Tue 29 Jul 2014, 08:18:43

Ah, but remember T, there is a constant stream of 19 year olds who feel just like you did back then. LOL

My point was that things will change, not simply cease to exist: less hummer more scooter
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Re: Airlines THE Dead Canary Thread

Unread postby Subjectivist » Tue 29 Jul 2014, 10:00:02

kublikhan wrote:
Tanada wrote:If private airlines are the canary I think they are the investors are going to start abandoning the sinking stock when they figure Peak Oil out.
Should airlines be the canary? Airlines get better mpg than automobiles.

U.S. major airlines average about 64 mpg, according to calculations using Department of Transportation data for 2009. For each gallon of jet fuel, airlines could, on average, fly one seat 64 miles. That's better than your SUV or hybrid car, unless you pack lots of people into the car.

Boeing says its 777-200ER wide-body jet gets nearly 82 miles to the gallon with 301 seats, all full, on a 3,000-mile trip. Boeing says the champ in its current line-up is the 737-900 with 180 passengers flying 1,000 miles. It gets nearly 99 mpg. The plane with the best average mpg in Airbus's current line-up is the A320 family.
A Prius With Wings vs. a Guzzler in the Clouds


This in my opinion puts us firmly in the statistics do not lie but liars use statistics discussion. Sure in isolation you can say the new super duper airplane gets great fuel efficiency. However just like a city bus that efficiency is tempered by two things, how full is the device hauling the people? How close to the final destination does the device get the people?

If I get in my Honda Civic with my wife and two or three kids I can go directly from my garage to street parking near Mudhens stadium in Toledo. If I want to take th bus I first have to drive to the edge of the bus network, park, transfer to the bus and walk the last distance into the stadium. It certainly isn't worth the time investment to me or my family when I can just drive an extra 15 minutes to ge in easy walking distance of the stadium.

Say instead I want to go to a Tigers game in Detroit or a Redskins game in Cleveland. Each is about a 60-90 minute drive in my civic, depending on traffic. Again I can park in walking distance of the stadium. If I want to take mass transit my only option is drive to the bus network, park, ride the bus possibly with transfers and a lot of extra time, then reverse the process to go home. The only time I ever did anything remotly like that was years ago going to the Detroit Auto Show I found a parking place on the People Mover monorail. Unfortunately only the inner ring was ever built around the city core, the portions connecting to outer suburbs and other cities was never built. In theory I could go to Detroit or Cleveland by air from Toledo Express airport with a flight time of 30 minutes or so. In reality I would have to go on the one flight of the day to that destination, stay over night, and fly back on the reciprocal flight the next day. Even to do that I would have to drive from my home 30 miles to the airport that is on the other side of Toledo out in the country several miles.

So does the airplane get better milage? In a race from airport to airport, sure. But when you add in the travle out of the way to get to and from the airport on each end, both time and expense, flying is a time and efficiency loser on any journey under several hundred miles. Even going to a Bengals game in Cincinati would take an hour by air and four hours by car. But add in the travel to and from the airports, the wait to get through security, and the fact that on each end the airplane has to taxi, load and taxi and unload the actual time is more like three hours. Plus I have to rent a car or take a cab in Cincinnati to get from the airport to the game and back, and an overnight stay to catch the return flight. How can that possibly be more efficient than just driving my relatively fuel efficient car for four hours?

No, to fly any distance that a reasonable person can drive in 8 hours or less is the real inefficient solution, at least in energy terms and often in time as well.
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Re: Airlines THE Dead Canary Thread

Unread postby kublikhan » Tue 29 Jul 2014, 14:09:29

Subjectivist - I don't think you can really count going through security as a fuel cost. Sure it's a time sink, but not really a fuel cost. Unless you are counting your need to eat an extra sandwich to give yourself the energy to make it through security?

As for speed, you are right that short trips are faster by car. However medium to long trips are not. Also, if you are counting wasted time, you should count that entire trip time for a car as wasted. While driving you cannot(or should not) be sleeping, working, studying, etc. However you can do all of these things while taking a plane or train, or even waiting for your flight. You should factor in this ability to multitask as a time saving factor with mass transit.

An article I recently read broke down the benefits/pitfalls of several different modes of transportation. Not just speed, but also cost, comfort, safety, environmental impact, etc. I'll highlight a few passages:

Fastest: Plane (long trips)
Flying doesn't save you any time when the trip is short. First off, you're supposed to arrive at the airport 60-90 minutes before your flight, and it will probably take you at least 30 minutes each way to drive, taxi, or bus to the airport. That's 2 to 2.5 hours right there, not counting flight time. You could drive from NYC to Philly in less time than that! Flying is only faster when you're taking a decent-sized trip.

Remember that driving time is "wasted time" -- you can't do anything useful while driving. But when you take a plane, train, or bus, you can read, study, work, or sleep.

We'll use three sample trips:
Short: New York to Philadelphia (102 miles)
Medium: New York to Detroit (509-615 miles)
Long: New York to Los Angeles (2467-2791 miles)
The mileage is given as a range because air miles are usually less than driving miles.

Speed of Short Trip (NYC to Philly), One-way
Transportation - To & From the Terminal - Waiting time at terminal - Travel Time - Total Time
Airplane 1:00 1:00 0:30 2:30
Car 0 0 2:30 2:30
Train 1:00 0:20 1:30 2:50
Bus 1:00 0:20 2:00 3:20

Speed of Medium Trip (NYC to Detroit), One-way
Transportation - To & From the Terminal - Waiting time at terminal - Travel Time - Total Time
Airplane 1:00 1:00 2:30 4:30
Car 0 0 9:30 9:30
Bus 1:00 1:20 12:30 14:50
Train 1:00 0:35 15:00 16:35

Speed of Long Trip (NYC to L.A.), One-way
Transportation - To & From the Terminal - Waiting time at terminal- Travel Time - Total Time
Airplane 1:00 1:30 6:00 8:30
Car 0 0 1 day, 19 hours 1 day, 19 hours
Bus 1:00 2:50 2 days, 11 hours 2 days, 15 hours
Train 1:00 5:35 2 days, 11 hours 2 days, 18 hours

Safest: Plane
Flying is much safer than driving.

Fatality rate per billion passenger miles traveled
Car (most dangerous) 7.2
Airplane 2.3
Bus 2.0
Train (safest) 0.5
Is it better to drive, fly, take the train, or take a bus?

As for how full the plane is, they used the averages for the US. Note that if they used the best case scenario for a plane(best plane, full passengers, and ideal fuel/weight ratio), the plane would get nearly 100 miles per gallon. However when you factor in older planes, most flights are not full, most flights are not the ideal length, etc, the average mpg drops down to 64 mpg. This is still better than the average mpg of US car trips. Sure you might car pool, use a fuel efficient Civic, etc to maximize your fuel economy per passenger. But if you are talking about statistics and liars here, you should also be honest about how full the average US car is when making trips, and that they might be driving a SUV or hummer. The 64 mpg plane statistic I quoted was an average so only fair to do the same thing for automobiles.

As for the travel time to and from the airport, that is not much of a factor in the above calculations. A 1 hour round trip by cab to the airport does not do much to change the numbers when you have drive times of several hours and several hundred(or thousand) miles. Once you start getting into several hundred mile trips, a plane really is faster and more fuel efficient than a trip by car.
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Re: Airlines THE Dead Canary Thread

Unread postby kublikhan » Tue 29 Jul 2014, 14:46:23

Just to backup what I was saying in my previous post:

Vehicles and Occupancy
• In 1977, the U.S. averaged a vehicle occupancy of 1.87 persons per vehicle.
• By 2010, average vehicle occupancy had decreased to 1.55 persons per vehicle.

Average Fuel Economy
• Light-duty vehicle fuel economy peaked at 22.0 miles per gallon (mpg) in 1987, declined until the early 2000s, then surpassed 22.0 mpg in 2009.
• Even when accounting for recent legislation, the U.S. has some of the lowest required fuel economy standards of any industrialized nation, well below the European Union, China, and Japan.

Vehicle Size
• From 1987 to 2012, average vehicle weight increased 23% (due to growth in SUV market share)
• The average weight of a passenger car increased 15% from 1987 to 2012, while the average weight of a pickup truck increased by more than 50%. Had vehicle weights remained at 1988 levels, model year 2010 cars could have achieved a 12% higher fuel economy; trucks a 13% increase.
• SUVs and pickups accounted for 31% of new vehicles sold in the U. S. in 2012.

Energy Use
• The transportation sector makes up 28% of total U.S. energy use. From 1973-2011, the percentage of U.S. energy use allocated to the transportation sector increased by 13%.
• Passenger cars and light-duty trucks accounted for 787 million metric tons CO2e and 331 million metric tons CO2e, respectively, together making up 61% of U.S. transportation emissions and 17% of total U.S. emissions.
Personal Transportation

For decades, us automobile fuel economy was stagnate or declining. While aviation fuel economy was increasing.

Jet aircraft efficiencies are improving. There was a 55% overall fuel efficiency gain between 1960 and 2000. Now a days, the aviation industry has developed many operational measures to minimize fuel usage. Airlines have adopted a voluntary fuel efficiency goal. This is to reduce fuel consumption and CO2 emissions by at least 25% by 2020, compared to 2005 levels. New aircraft are 70% more fuel efficient than 40 years ago and 20% better than 10 years ago.
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Re: Airlines THE Dead Canary Thread

Unread postby Subjectivist » Tue 29 Jul 2014, 15:00:15

Granted, but K the great vast majority of the trips that average person takes does not involve air travel and would be very short for an air trip.

What isworse, from where I live east of Toledo I am about half way between Detroit and Cleveland airports, about three hours from the Columbus airport and about four hours from the Cincinnati airport. At that I am lucky for a person in the midwest, if you are in Iowa or the Dakota's you might have to leave the state to get to an international class airport.
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Re: Airlines THE Dead Canary Thread

Unread postby kublikhan » Tue 29 Jul 2014, 17:00:23

Yeah I am not arguing for air travel to be used for short trips, that would be a waste. Personally I hate flying. It's not so much the flying as the hassle of scheduling, traveling to and from the airport, security, waiting, fumes, etc. So I am glad most trips do not involve air travel.

About airport distance, again you have to look at averages. Half the population in the US is within 17 miles of a decent-sized airport. And 90% of the population is within an hour's drive of a decent sized airport. The average(median) distance is 17 miles with the mean distance 26 miles.

Nationwide Results

Most people live a reasonable distance from a decent-sized airport. Half the United States lives within 17 miles of a decent-sized airport, and ninety percent of the country lives within 58 miles (about an hours drive). Twenty-five percent of the population lives pretty darn close: less than 9 miles.

25.72 mi. = mean distance of a person to his or her nearest major airport
Percent of population within a given distance of a major airport:

Percentile Distance (mi.)
10th percentile 5.14
25th percentile 8.78
50th percentile (median) 17.00
75th percentile 34.27
90th percentile 58.50
How Far Are People on Average from Their Nearest Decent-Sized Airport?
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Re: Airlines THE Dead Canary Thread

Unread postby Newfie » Tue 29 Jul 2014, 18:13:38

Interesting conversations. And they show how stats can be tailored to ones point of view.

I live in center city Philly. I NEVER use mass transit, even though it is my personal means of employment.

A bus is something like $2.50 (I don't even know for sure) and you need to have correct change (although that is changing.) We can easily walk anyplace we want to go. If I want to go further the bus easily doubles or triples my travel time, plus it can be a daunting experience especially on a bus full of high school kids! If my Wife and I want to go to a movie then we need to pay for 4 fares, or about $10. A taxi is cheaper because it is based per the trip, not per the passenger. Thus our own car makes much more sense.

As someone who did a LOT of commuting between Philly and either NYC or DC I can tell you, first hand, that working on the train is not what it is cracked up to be. I recently had over 40,000 miles on Amtrak, another old employer ans now client. Yeah, I can work on the train, and did. But I gave it up. When commuting that kind of distance you are putting in a 12 hour day, easy. If you are really working then you are trying to concentrate and that ain't easy on a train. I would come home completely shot, feeling like I had a bad hangover. It just so totally deteriorated my energy it was counter productive, and that made me resentful. By comparison, driving you can listen to music, or make cell call (let's get real, nearly everyone does it nearly all the time), or just think. If you are traveling with a companion then you have company and can chat, maybe about work. This was our preferred way of traveling, for two or three of us to meet at a rest stop and drive in one car.

Flying to Boston used to be ok, before 911. But now it's easier to drive, even though I don't like it. Forget Amtrak, you have to leave the night before and try to sleep on the train and then get there to late for a early meeting. Makes a damn long day. And recently I had to drive 45 miles outside of Boston to get a hotel room that evening (damn the cost, NO rooms available!) I can't do that with a plane or train. Can't imagine what a taxi would have cost.

But you need to be careful on the MPG comparisons. My old Tarus wagon still gets 25 mpg. By the airlines calculations if I have my Wife and my daughter with me we are getting 75 MPG. :lol:
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Re: Airlines THE Dead Canary Thread

Unread postby TrickyDick » Sun 31 Aug 2014, 22:38:19

This link to U.S. Passenger Miles Flown, Driven, etc., shows that air miles appear to have peaked in the same year as driving miles: 2007.

A chart of flown miles would be nice.

http://www.rita.dot.gov/bts/sites/rita.dot.gov.bts/files/publications/national_transportation_statistics/html/table_01_40.html

Here, I've transposed the table to make it friendly for the forum view:

Year Domestic Air Miles
1960 31,099
1965 53,226
1970 108,442
1975 119,591
1980 190,766
1985 275,864
1990 345,873
1991 338,085
1992 354,764
1993 362,227
1994 388,410
1995 403,912
1996 434,652
1997 450,673
1998 462,754
1999 487,940
2000 515,598
2001 486,506
2002 483,525
2003 505,602
2004 558,194
2005 583,771
2006 588,471
2007 607,564
2008 583,292
2009 551,741
2010 564,695
(R) 2011 575,613
2012 580,501
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Re: Airlines THE Dead Canary Thread

Unread postby TrickyDick » Mon 01 Sep 2014, 09:03:28

Here I have crunched the US departures data to show only the peak summer month for each year. Usually, it is July. Sometimes it is August. I left in May of 2013 to compare to May of 2014, since that is as far as the data goes this year. On the website, you can choose whatever data set you want: International, Domestic, Freight, Passenger, Miles, Revenue, etc.

http://apps.bts.gov/xml/air_traffic/src/datadisp.xml

Date Departures
Aug 1996 673,165
Aug 1997 664,026
Jul 1998 687,336
Aug 1999 715,765
Aug 2000 749,508
Aug 2001 766,958
Aug 2002 734,926
Jul 2003 897,255
Aug 2004 953,883
Aug 2005 966,829
Aug 2006 945,269
Aug 2007 951,928
Jul 2008 924,376
Jul 2009 867,673
Jul 2010 860,995
Jul 2011 862,353
Jul 2012 835,340
May 2013 793,536
Jul 2013 830,339
May 2014 757,297

What I selected was US passenger departures, for both Domestic and International flights. August 2005 was the peak. Anyone want to short the airline stocks?
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Re: Airline Bankruptcy / Merger / Layoffs Thread (merged)

Unread postby Tanada » Tue 02 Aug 2016, 12:28:44

In a related development sales of widebody passenger jets like the Airbus A-380, Boeing 767 and 747 are starting to bite the construction end of the business hard. Boeing has stated they are considering ending production of the 747 due to lack of orders and the Airbus A-380 was never able to make the sales goals it was expected to reach. All this bad news for super jumbo jets even though fuel prices are very low for the last 18 months compared to the last 2009-2014 years average.

The Airbus A380 is a true double-decker jet and the world’s largest passenger jet, but airports that use it had to build new facilities to handle the plane. While it sits between 525 and 853 people depending on the class configuration, its bulk means that relatively few airports can handle the plane. Many US carriers prefer to fly multiple times per day between destinations as a way to meet demand for aircraft, rather than flying a smaller number of flights with a higher number of passengers per plane. As of May, only 319 Airbus A380s had been ordered, with 142 of them ordered by Emirates. Virgin Atlantic and Quantas have both booked aircraft, but the manufacturer has acknowledged that these planes may never be built if the market for the A380 doesn’t improve. While Boeing spent much less on their 747-8 extension than Airbus invested in the enormous A380, neither plane may be very profitable. That’s particularly true for Airbus, which is expected to eat the estimated $25 billion it cost to build the A380 in the first place.

The current version of the 747 is known as the 747-8. It’s a 250 ft jet with a redesigned wing, raked wingtips, additional internal fuel capacity, and fly-by-wire capability for lateral controls. According to Boeing, the new international version of the 747, the 747-8I, is 30% quieter, 16% more fuel efficient, and offers 13% lower seat costs per mile. The problem, for Boeing, is that not enough customers are actually ordering the 747-8. The company has therefore warned that “If we are unable to obtain sufficient orders and/or market, production and other risks cannot be mitigated, we could record additional losses that may be material, and it is reasonably possible that we could decide to end production of the 747.”

When Boeing introduced the 747, the four-engine jet quickly became an icon of modern air travel. The 747 was designed at a time when Boeing felt it might be quickly replaced by supersonic aircraft — the distinctive double-decker hump at the front of the plane that now typically offers additional first-class seating was intended to allow for an external cargo door if passengers shifted to faster aircraft. Now, with orders falling, Boeing is considering halting production on one of the most successful and long-lived jet families in history.

Customers have been moving away from four-engine widebody aircraft and towards more efficient twin-engine planes with lower operating costs. Boeing’s 777 and 787 continue to be popular, and it’s not the only widebody company facing a large-scale slowdown. The Airbus A380 may also be headed for an early retirement, thanks to a near-total lack of interest in the world’s largest jet.


http://www.extremetech.com/extreme/2327 ... so-at-risk

Tim Clark, President of Emirates, told Bloomberg that not only had discussions on a new re-engined A380neo version of Airbus’s 525-seat jet “kind of lapsed,” but that his “main concern is that they stop producing the plane.”

This was the first intimation that sudden death is a possibility for the troubled super jumbo. And the numbers highlight this risk.

It has been years since there was any significant commercial demand for the A380, aside from Emirates steadily growing its position to 142 orders. In April, Airbus executives admitted that output in 2017 could be as low as 20 aircraft. This is far below the 30 aircraft needed for annual recurring breakeven (this excludes program nonrecurring costs; there is no way to even begin to recover the $25-30 billion or so invested in the development of this aircraft).

Thus, the question becomes, how long is Airbus willing to lose money, particularly when there’s no doubt about the ultimate outcome? Assuming that next year’s rate of 20 isn’t too ruinous, and assuming that Emirates can keep taking 14 per year (despite declining traffic growth rates and falling load factors), that means Airbus can sustain about three more years of production (14 Emirates planes per year, plus six for other customers). But then again, since Airbus is losing money on all of these planes, Tim Clark is correct to worry that Airbus could simply end the program at any time.

Teal Group has always provided the most pessimistic A380 forecast. But it turns out we may have been much more optimistic than reality.


http://www.forbes.com/sites/richardabou ... 2b27db61b6
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Re: Airline Bankruptcy / Merger / Layoffs Thread (merged)

Unread postby Subjectivist » Tue 02 Aug 2016, 16:43:05

SAN FRANCISCO, July 26, 2016 /PRNewswire/ -- Virgin America Inc. (NASDAQ: VA) today announced that the merger agreement with Alaska Air Group, Inc. (NYSE: ALK), the parent company of Alaska Airlines, Inc., was approved by an affirmative vote of the holders of a majority of the outstanding shares of Virgin America voting common stock. A report reflecting the complete voting results will be available on a Current Report on Form 8-K to be filed later this week by Virgin America.

About Virgin America

Known for its mood-lit cabins, three beautifully designed classes of service and innovative fleetwide amenities — like touch-screen personal entertainment, WiFi and power outlets at every seat, Virgin America has earned a host of awards since launching in 2007 — including being named the "Best Domestic Airline" in Travel + Leisure's World's Best Awards for the past nine consecutive years and "Best U.S. Airline" in Condé Nast Traveler's Readers' Choice Awards for the past eight consecutive years. For information, visit www.virginamerica.com.

About Alaska Airlines

Alaska Airlines, a subsidiary of Alaska Air Group (NYSE: ALK), together with its partner regional airlines, serves more than 100 cities through an expansive network in the United States, Canada, Costa Rica and Mexico. Alaska Airlines ranked "Highest in Customer Satisfaction Among Traditional Carriers in North America" in the J.D. Power North American Airline Satisfaction Study for nine consecutive years from 2008 to 2016. Alaska Airlines' Mileage Plan also ranked "Highest in Customer Satisfaction with Airline Loyalty Rewards Programs" in the J.D. Power Airline Loyalty/Rewards Program Satisfaction Report for the last three consecutive years. For reservations, visit www.alaskaair.com. For more news and information, visit the Alaska Airlines newsroom at www.alaskaair.com/newsroom.


http://www.aviationpros.com/news/122367 ... -group-inc
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Re: Airline Bankruptcy / Merger / Layoffs Thread (merged)

Unread postby Tanada » Wed 03 Jan 2018, 08:22:18

Alaska Airlines/ Virgin America Merger

Mile for mile, one airline burns less jet fuel per passenger than any other.

“Alaska in particular has a very fuel-efficient fleet,” said Daniel Rutherford with the International Council on Clean Transportation in San Francisco.

He said Alaska Airlines has had the best record on fuel economy for the past seven years.

“They use the right aircraft on the right routes, which allows them to burn less fuel.”

The dirtiest airlines include Delta, JetBlue and Virgin America. They burn as much as one-fourth more fuel than Alaska does for every mile they carry a paying passenger.

Alaska might not top the list of fuel efficiency next year: It’s in the middle of a merger with Virgin America, the most polluting of the major carriers. That merger has made Alaska the nation’s fifth-largest airline.

Overall, the airline industry has gotten 3 percent more fuel-efficient in the past two years, but for a reason their customers might not like to hear.

“It was mostly due to the fact that airlines are putting more seats on their planes,” Rutherford said.

So if you feel like a sardine in a can next time you’re at 30,000 feet, comfort yourself with the thought that you’re doing a little less damage to the climate.

Rutherford said efficiency improvements were swamped by the 10 percent growth in air travel over the past two years. Jet fuel consumption, and the carbon dioxide propelled out the back of jet engines, rose by 7 percent.

“Make no bones about it, fuel is a big part of our business,” Alaska Airlines CEO Brad Tilden said in a company sustainability report. “Our fuel consumption represents 99 percent of our carbon footprint. Reducing the amount of fuel we consume is a major focus.”

Even so, the Seattle-based airline’s fuel use and carbon pollution have grown 40 percent in less than a decade as the number of Alaska flights has soared.

As jet fuel prices have fallen in half in the past couple years, flight volumes, airline profits and fuel consumption have all taken off.

The low prices also make investments in fuel efficiency or alternative fuels less attractive economically.

“We do have this current headwind in that jet fuel is very inexpensive right now,” Rutherford said.

The global aviation industry’s carbon emissions are forecast to triple in the next 30 years unless major policy changes reverse that trend.


MERGER LINK
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Re: Airline Bankruptcy / Merger / Layoffs Thread (merged)

Unread postby Tanada » Wed 03 Jan 2018, 08:29:19

Island Air Bankruptcy, regional Hawaiian airline.

In the past three months, Island Air went through a whirlwind of changes, displacing its 423 employees, engaging Hawaii businesses and sending shockwaves through the community.

The case is still ongoing as Hawaiian Airlines (Nasdaq: HA) recently agreed to purchase Island Air’s operating certificate and other assets for $750,000. A hearing on the purchase will be held on Jan. 5.

During a recent court hearing on the bankruptcy, Island Air CEO David Uchiyama said the company’s downturn began when plans to implement new planes were delayed, causing consequent delays to improving the airline’s finances.

This led to Island Air’s inability to pay rent for its aircraft, inciting the beginning of the end for Hawaii’s second largest airline.

On Oct. 12, Island Air’s aircraft lessor, Ireland-based lessor Elix Assets 8 Ltd., served the interisland carrier with notices of termination and demanded the airline to surrender its airplanes while it was in the process of negotiating its aircraft leases.

This resulted in the airline to file for Chapter 11 bankruptcy protection on Oct. 16 in order to continue operations, which caused Wells Fargo Bank Northwest, National Association to file a lawsuit in an attempt to retrieve the airline's three Bombardier Q400 turboprops, the entirety of the airline’s fleet. Wells Fargo also sought to collect the $4.58 million owed by Island Air, which had not paid rent or maintenance reserves since July.

Island Air then revealed it was in discussions with investors for debtor-in-possession and longer-term financing of about $6.5 million, projecting its unrestricted cash to jump from $413,649 in October to $5.7 million in November if it receives the financing. In October, Island Air had $3.4 million in passenger revenue.

The airline was granted continued use of cash collateral, but in an unexpected turn on Nov. 9 Island Air announced its decision to cease all operations by the next day after having exhausted all its legal options to stay in business, and its failure to attract new investors.

"Although lessors’ motion for temporary restraining order was denied by Judge Robert Faris of the District of Hawaii Bankruptcy Court on Friday, Nov. 3, lessors continued to engage in multi-directional legal attacks which Island Air could no longer combat without additional financing," the company said in a statement. "The aircraft lessors were seeking termination of all leases and immediate repossession of all aircraft."

Shortly after the announcement, Hawaiian Airlines issued a statement saying it was working on providing flight relief for Island Air travelers, and increased the number customer service staff across the state's airports.

Hawaii’s largest airline then joined dozens of other local businesses to help provide employment opportunities for Island Air’s 423 employees, including participation from banks, hotels and insurance companies.

On Nov. 15, bankruptcy court Judge Robert Farias converted Island Air’s Chapter 11 emergency bankruptcy protection filing to a Chapter 7 liquidation case after the airline said it was incurring operating costs with “no apparent prospects of satisfying all of its post-petition debts.”

According to a financial statement submitted last month, Island Air had cash and cash equivalents of $737,030 as of Aug. 31, down 62 percent from the $1.9 million it had at the end of 2016. The airline’s total current assets of $2.9 million was down 50 percent, from $5.8 million last year. It reported total assets of $14.3 million and total liabilities of $39.4 million as of Aug. 31.


LINK

In a surprise twist to the Island Air bankruptcy case, the trustee overseeing the liquidation filed a last-minute motion this morning disclosing that Hawaiian Airlines’ parent company has agreed to purchase the operating certificate and other assets of the failed company for $750,000.

Hawaiian Holdings Inc. said it would buy the operating certificate for $450,000 and immediately provide cash advances to pay for Chapter 7 administrative expenses. Hawaiian said it would buy other assets, such as ground-service equipment, furniture and frequent-flier lists, for $300,000.

Bankruptcy Judge Robert Faris said he was prepared to grant the motion to dismiss the case until the trustee came through with the surprise buyer. Faris gave preliminary approval to the sale. A hearing on the sale is set for Jan. 5.

Hawaiian spokesman Alex Da Silva said the decision to buy the operating certificate was a way to bring in-house the company’s turboprop airline, ‘Ohana by Hawaiian, rather than outsource the contract as it is now to Idaho-based Empire Airlines.

Da Silva said the state’s largest carrier formed a new wholly-owned subsidiary, Elliott Street Holdings, to purchase the stock of Island Air and assume ownership of Island Air’s Federal Aviation Administration operating certificate as well as other assets. ‘Ohana by Hawaiian, which launched service in March 2014 and now has three 48-seat ATR-42s, flies between Honolulu and Molokai, Honolulu and Lanai, Kahului and Kona, Kahului and Molokai, Kahului and Hilo and Lanai and Molokai.

“If approved, the sale will allow ‘Ohana by Hawaiian to assume oversight of operations currently provided under contract by Empire Airlines,” Da Silva said. “Those operations would include the hiring of pilots, flights attendants, and customer service and maintenance crews (who now are all Empire employees). We believe that assuming the FAA certificate will greatly benefit our guests by improving the efficiency and reliability of ‘Ohana by Hawaiian.”

If the sale is approved, then the trustee’s attorney, Simon Klevansky, said he would reconvert the case to a Chapter 11 reorganization bankruptcy and Hawaiian would buy new shares of what essentially would be a shell company.

Klevansky said the trustee is still working on trying to enable the more than 400 Island Air employees to gain access to their 401(k) retirement accounts.

Island Air filed for Chapter 11 bankruptcy on Oct. 16 and ceased operations on Nov. 10. It converted the case to Chapter 7 on Nov. 15.


Hawaiian Air Assets Sold
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Re: Airline Bankruptcy / Merger / Layoffs Pt. 2

Unread postby Tanada » Thu 14 Feb 2019, 00:41:06

Can Hawaiian Airlines Survive Southwest's Entry Into The Hawaii Market?

Feb 5, 2019—HONOLULU—Southwest® Boeing 737-800 at Daniel K. Inouye International Airport. The carrier’s first ever touchdown in the Hawaiian Islands comes as part of Southwest’s authorization process with the FAA to offer future scheduled service to Hawaii.Southwest Airlines

It’s coming. Originally set to start late last year, Southwest Airlines flights to Hawaii from the US mainland should begin “soon.”

This week Southwest completed two validation flights to Hawaii, part of the FAA authorization process. Southwest intends to begin flying to Hawaii with Boeing 737-800 aircraft, and later include the 737 MAX-8.

(Full disclosure: I own stock in Southwest Airlines and Jet Blue.)

While United, American, Delta, Alaska, and Hawaiian already fly to the islands, there is high anticipation for Southwest’s entry, due to the “Southwest effect”, the tendency for fares to fall when the airline enters a market. And while other US airlines typically charge $30 per bag for flights to Hawaii, Southwest has said it will continue its policy of not charging for up to two checked bags.

A 2017 study found the “Southwest Effect provides “an additional market fare reduction of 15% and a corresponding traffic increase of 28% to 30%, from the introduction of nonstop service by Southwest…One-way average market fares are $45 lower when Southwest serves a market nonstop than when it does not.”

But Hawaii, a leisure market with a resident population of only 1.4 million, has not proven a pot of gold for every airline. Budget carrier Allegiant Air, whose Hawaiian service once included ten routes from nine mainland cities, stopped flying to Hawaii in October 2017.

While airlines constantly enter and exit the Hawaiian market, there is concern that Southwest’s entry may impact Hawaiian Airlines like the aviation equivalent of a Walmart (“Always Low Prices”) landing at Oahu’s airport.

Nonetheless, Hawaiian Airlines, which has been flying around the islands since 1929, is used to competition. “Hawaiian is used to having people come in and out of their market all the time,” says Helane Becker, Managing Director, Industrials/Consumer-Airlines with Cowen. “They do a good job of responding. They have a strong balance sheet and they’re continuing to grow their operations, build out what they do, replace older aircraft with new, and deliver a really good product to their customers.”

Hawaiian is known for its service, such as providing a meal and drink to passengers heading to the islands. The airline has won numerous awards, including recognition from the U.S. Department of Transportation for #1 On-Time Performance, 2004 – 2017.

Icicles on a Hawaiian Airlines plane as others are de-iced at Seattle-Tacoma International Airport, Jan. 19, 2012, in Seattle. (AP Photo/Ted S. Warren) Photocredit: ASSOCIATED PRESS

The airline has three major market segments: flights from the mainland, interisland flights, and international flights to and from Asia, Oceania and the South Pacific. Hawaiian has been purchasing new aircraft and will have 18 fuel-efficient Airbus A321neos by next year for its West Coast to Hawaii routes. For long-haul and international flights, Hawaiian operates 24 Airbus A330s and has ten Boeing 787 Dreamliners on order.

A significant portion of revenues comes from Asian tourists. The company recently signed a Joint Venture application with Japan Airlines. Domestically, Hawaiian has set codeshare partnerships with Jet Blue from the latter’s Boston and New York gateways.

Southwest has not yet announced its plans for competitive inter-island service, but it may find it difficult to replicate the well-oiled machinery of Hawaiian’s inter-island network. Hawaiian flies 202 flights each day between the six populated islands, including 178 Boeing 717 lights between Honolulu, Maui, Hawai’i and Kaua’i, and 24 departures with ATR-42 aircraft serving Moloka’i, Lana’i, and Kapalua in West Maui.

An Aloha Airlines plane and a Hawaiian Airlines plane taxi for position in Kahalui, Hawaii, March 24, 2005. Aloha ceased operations March 31, 2008. (AP Photo/Lucy Pemoni) Photocredit: ASSOCIATED PRESS

“Southwest’s [inter-island] service appears to be more related to increasing utilization of their aircraft flying between the mainland and Hawaii rather than a dedicated fleet that provides the shuttle service Hawaiian does,” notes Savanthi Syth, Managing Director of the Global Airlines practice at Raymond James. “Southwest’s 737-800 and MAX are too big to serve inter-island with the necessary frequency for commuters.”

Nonetheless, will Southwest’s low prices create a tsunami effect, sweeping established carriers out of the way? Hawaiian is the tenth-largest American carrier, with only 1.6% of US domestic market share, while Southwest is second with 17.9% US market share. Hawaiian currently has about 18% of the Hawaiian market.

“They serve a niche, which is why they are so small,” says Ms. Syth. “However, it helps to be bigger and to have a larger and more diverse network. Over time the industry needs to consolidate more and Hawaiian is likely to be a part of it.” Asked if she thought Alaska Airlines or JetBlue might make a potential merger partner for Hawaiian, Ms. Syth said, “JetBlue seems like a good fit given the Airbus fleet and JetBlue’s smaller West Coast presence. But this is not something I expect in the next few years.”

Despite its relatively small size, Hawaiian flies to the islands from 12 cities on the mainland, more than any other carrier. Southwest says initially it will start with four “initial gateways” in California, including Oakland (OAK), San Diego (SAN), San Jose (SJC), and Sacramento (SMF). Conspicuously absent are LAX, Burbank, John Wayne and other airports serving populous Los Angeles and Orange County.

Southwest’s Hawaiian destinations will include Honolulu (HNL) Kahului Airport on Maui (OGG) Lihue Airport on Kauai (LIH), and Kona (KOA). Pricing, date of ticket sales and the timing for initial flights have not been disclosed yet by Southwest.

Cowen’s Becker notes that while Hawaiian and other competitors offer first or business class seating, Southwest, with its all-coach class seating, “is a different product. We don’t know what the Southwest offering will look like. People expect more than a bag of pretzels on a six-hour flight.”

Southwest, however, “will certainly be aggressive with price,” says Becker. Interestingly, “We think the initial flights will be fairly low revenue flights because Southwest frequent flyers have been saving up their miles.”

On the other hand, Southwest has a very active Southwest Vacations site, and with Hawaii considered the top “bucket list” destination for many Americans, it’s in the airline’s interest to create a travel and destination experience for its customers.

To Ms. Syth, the biggest issue with Southwest’s entry may be potential over-capacity, “further pressuring fares that are already lower due to capacity adds last year.”

Can Hawaiian weather the Southwest threat? “No one knows the Hawaiian market better than them,” says Ms. Becker. “Southwest “will expand the market, but not necessarily damage Hawaiian’s market share.”


Link
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