Layoff Numbers

[chipmunk]

I am the source. I work for Sunwing and read the memo.

Heh, I was waiting for you to come back and say that!

While I'm here - Porter is also using the CEWS program.

[GoinVertical]

CEWS is a good start but for someone making living in a major city center and has been making $100k or more a year and has the expenses to match, dropping down to $44k a year is a huge hit.

While I expect most of the older guys to have some cash reserves, I really feel for some junior captains with a young family that probably only just got on their feet over the past few years. House in Toronto, student loans, and everything else...

[Ash Ketchum]

CEWS is a good start but for someone making living in a major city center and has been making $100k or more a year and has the expenses to match, dropping down to $44k a year is a huge hit.

While I expect most of the older guys to have some cash reserves, I really feel for some junior captains with a young family that probably only just got on their feet over the past few years. House in Toronto, student loans, and everything else...

I'm in that exact boat. Sad to say but I was living paycheque to paycheque as junior regional captain trying to raise my family in the Toronto area. Now that I am laid off I will quickly run out of savings unless I can get another decent paying job in the next few months.

[Fanblade]

CEWS is just a way for the government to cook the books and keep the unemployment numbers artificially low. If/when the general public starts to wake up to the real impact of our reaction to this crisis there is bound to be backlash against government/healthcare officials.

Flame away if you must.

As pointed out elsewhere CEWS does not help companies. They could just lay-off and shed the cost.

Since we are in a pandemic a medical metaphor might be appropriate. What the CEWS does is essentially put the economy into an Induced coma. It allows companies to delay reactions until there is better vision on the future. The idea is not that it will stop unemployment. The idea is to give employers enough breathing room to avoid knee jerk reactions or over reactions that aggravate the situation. That trigger knock on consumer retractions and further unemployment.

In the end though every company will right size for the new reality that is awaiting us. Some companies will pick up where they left off. Some won’t. Those numbers will show in the unemployment rate by early fall. Those employment numbers would be significantly worse without CEWS.

Travel is one of the industries that won’t come back fast. The barber, dentist, family doctor, anything people have been putting off due to social distancing will be swamped.

[alkaseltzer]

Any word on whether CEWS will get extended?

[Babar350]

Any word on whether CEWS will get extended?

Only the government can answer this question, I wish someone knew.

[indieadventurer]

It’s being discussed and pushed for by a number of individuals involved with the process to date.

[flying4dollars]

The only operator that I have heard (anecdotally) is topping up to 100% is Flair.Anybody else?

I've heard Flair filed a grievance about the CEWS. I'm not sure of the details though.

No grievance was ever filed about the CEWS. In fact it meant recalling all furloughed pilots and paying them a full salary again.

[mbav8r]

CEWS being extended past June
Emergency wage subsidy being extended beyond June: PM Trudeau
https://www.ctvnews.ca/health/coronavir ... -1.4930655

[rudder]

On the analyst call, Rousseau said that AC was receiving $35-40 million per month from CEWS.

It is a de facto subsidy, albeit paltry compared to daily cash burn rates.

[MrAviator19]

CEWS being extended past June
Emergency wage subsidy being extended beyond June: PM Trudeau
https://www.ctvnews.ca/health/coronavir ... -1.4930655

Is the Government simply trying to buy its way out of an actual bailout of the airline industry as a whole?

MrA

[rudder]

CEWS being extended past June
Emergency wage subsidy being extended beyond June: PM Trudeau
https://www.ctvnews.ca/health/coronavir ... -1.4930655

Is the Government simply trying to buy its way out of an actual bailout of the airline industry as a whole?
MrA

AC is arguing for ‘proportional support’ compared to other global carriers.

The CEWS will add up to $140-160MM if it runs 4 months. $175-200MM if 5 months. $210-240MM if 6 months.

In the US, the big 3 are looking at eligibility for US$10B each in government assistance (that is C$14B). Also government assistance of Euro10B+ for large European carriers. Using annual revenue as the metric, AC is probably looking for C$4-6B. Highly unlikely.

AC looks to be implementing a survival plan that will work with or without meaningful government assistance.

[Gilles Hudicourt]

Delta Mainline 885 aircraft
United mainline: 806 aircraft
American Mainlinte : 1026 aircraft
Even Southwest : 740 aircraft

These numbers, I think, illustrate the reason Air Canada calls for "proportionate support".

Air Canada mainline and Rouge 255 aircraft including the recently parked Aircraft and the 737 Max

We should look at the kind of aid a similar size airline received like KLM who with 122 aircraft is to receive a 2 to 4 Billion Euros in State aid or Air France with 224 aircraft which is getting 7 billion Euros.

https://news.klm.com/klm-grateful-for-2 ... overnment/

https://www.reuters.com/article/us-heal ... SKBN22G0I3

[goldeneagle]

In the US, the big 3 are looking at eligibility for US$10B each in government assistance (that is C$14B).

The US also puts strings on the money, nobody laid off till October, and all destinations continue to get service. It's neatly set up so that no town loses service entirely, and no airline employee goes without a paycheque before they go into the voting booth in November. But after the election, it'll be a no holds barred list of layoffs and reality starts to sink in.

Using the Air Canada example, why should taxpayers of Canada be forking up some billions of dollars to safeguard the investment of an Air Canada share holder ? Our government has already fired up the printing press to print money for the employees. If the company needs more money to stay afloat, let them fire up their own press, print up share certificates and sell them to investors on the open market. That's what the markets are for, sell the risk to folks who take risks. If the company cant survive, that shouldn't be a problem of the taxpayer, not unless it's a crown corporation where taxpayer is the shareholder.

Me thinks all you airline folks want your cake and eat it too. Listen to yourselves, you want to keep the money and funnel it to shareholders when times are good, but stick the bill on the taxpayer when times are bad.. That's just WRONG.

[trey kule]

Agree with you 100%. With share prices in the tank, a debenture or bond with options would maybe be a better vehicle right now. The problem is the uncertainty, and the timeline to recover, if ever.

I would not object to a government loan to tide them over until they can refinance at more favourable terms. ( similar to what the US govt did for the auto and bank industries in 2008). And I dont mean a never going to pay back, Bombardier loan.

But...by act of parliament...Air Canada is headquartered in Quebec....so all bets are off.

The auto industry worldwide is getting decimated...and what they have sold has a high percentage of poor loan quality. Ontario is going to be crying for billions as well

[boeingboy]

The US also puts strings on the money, nobody laid off till October, and all destinations continue to get service. It's neatly set up so that no town loses service entirely, and no airline employee goes without a paycheque before they go into the voting booth in November. But after the election, it'll be a no holds barred list of layoffs and reality starts to sink in.

Using the Air Canada example, why should taxpayers of Canada be forking up some billions of dollars to safeguard the investment of an Air Canada share holder ? Our government has already fired up the printing press to print money for the employees. If the company needs more money to stay afloat, let them fire up their own press, print up share certificates and sell them to investors on the open market. That's what the markets are for, sell the risk to folks who take risks. If the company cant survive, that shouldn't be a problem of the taxpayer, not unless it's a crown corporation where taxpayer is the shareholder.

Me thinks all you airline folks want your cake and eat it too. Listen to yourselves, you want to keep the money and funnel it to shareholders when times are good, but stick the bill on the taxpayer when times are bad.. That's just WRONG.

Sorry - but that's pretty narrowminded.

Everybody needs a bailout. Your assuming everybody is a publicly traded company - which they are not. Maybe those with shares need extra strings or regulations - but they need help none the less. There are hundred's of companies big and small what about them? The government locked down everything - forcing the airlines to sit idle. This was not some random downturn or something of the airlines doing, in which case they should have money to weather the storm, and I would argue most do.

You keep harping that if no-one has money to sit this out for a year - then it's their own fault and they should die....really - give your head a shake. A business in which it's only business is to fly airplanes - they build a plan for that. They don't build a plan for not flying airplanes. Come on.....

While the argument for having enough cash to get you through a few months is a valid one - no-body could plan for being out of business for 6 - 12 months. That is unthinkable - at least before now. During 9/11 the unthinkable happened - but at least it was short term. Even as they started grounding everyone - they knew it would only be a week at most. To be forced into a shutdown for an undetermined amount of time (months or years) with no end in site and be told your on your own. That's just WRONG.

[flying4dollars]

In the US, the big 3 are looking at eligibility for US$10B each in government assistance (that is C$14B).

The US also puts strings on the money, nobody laid off till October, and all destinations continue to get service. It's neatly set up so that no town loses service entirely, and no airline employee goes without a paycheque before they go into the voting booth in November. But after the election, it'll be a no holds barred list of layoffs and reality starts to sink in.

Using the Air Canada example, why should taxpayers of Canada be forking up some billions of dollars to safeguard the investment of an Air Canada share holder ? Our government has already fired up the printing press to print money for the employees. If the company needs more money to stay afloat, let them fire up their own press, print up share certificates and sell them to investors on the open market. That's what the markets are for, sell the risk to folks who take risks. If the company cant survive, that shouldn't be a problem of the taxpayer, not unless it's a crown corporation where taxpayer is the shareholder.

Me thinks all you airline folks want your cake and eat it too. Listen to yourselves, you want to keep the money and funnel it to shareholders when times are good, but stick the bill on the taxpayer when times are bad.. That's just WRONG.

That's a pretty arrogant thing to say. You are aware there are airlines in Canada without shareholders, aren't you? Why wouldn't anyone in the industry want the help? Be it a bailout or loan? Nobody asked for this. The need for help is not due to poor management or financial irresponsibility. It was a result of a government sanctioned lockdown stemmed from allegedly poor viral containment protocols and other factors which you can speculate on.

No, airline folk don't want cake. They just want to continue to put food on their tables and KEEP the roof over their heads. It's just WRONG, to think that's wrong.

[goldeneagle]

That's a pretty arrogant thing to say. You are aware there are airlines in Canada without shareholders, aren't you?

Actually, there are no airlines without shareholders. All corporations have shareholders. You are aware of that aren't you ? The thing is, the vast majority of corporations are not publicly traded, so you dont know anything about the share structure behind the company. But that doesn't mean those corporations cannot access capital markets by selling shares, I've done it myself in the past when we wanted to do a significant round of growth that needed a few million in capital.

Capital markets are available to any company that requires liquidity to stay afloat today. If the capital markets will not provide a company with liquidity, it's likely because the business is not viable going forward. It may or may not be a fault of the company, but that is the reality today. Huge government handouts to prop up companies who produce a product the markets no longer want is just flushing huge amounts of taxpayer money down the drain. Today, and for the forseeable future, airline seats from point A to point B are a product the market doesn't want or need. Airlines need to rapidly shrink to a size the market will support, or go broke. That's the reality today. Flushing a billion dollars of taxpayer money down the airline black hole will not change that, it will just postpone the inevitable.

['97 Tercel]

Airlines need to rapidly shrink to a size the market will support

and that's not happening right now?

[flying4dollars]

That's a pretty arrogant thing to say. You are aware there are airlines in Canada without shareholders, aren't you?

Actually, there are no airlines without shareholders. All corporations have shareholders. You are aware of that aren't you ? The thing is, the vast majority of corporations are not publicly traded, so you dont know anything about the share structure behind the company. But that doesn't mean those corporations cannot access capital markets by selling shares, I've done it myself in the past when we wanted to do a significant round of growth that needed a few million in capital.

Yes, I am aware of that. But your statement of "all you airline folk want to have your cake and eat it too" and how we want to keep our money to funnel it to shareholders, implies that we want to keep our shareholders pockets fat. At some airlines, the employees are also shareholders, so you can see how I made that connection. Perhaps your delivery should not have been so generalized. I am not a shareholder at my airline. Right now, my priority is keeping a job, getting paid for it, and ensuring that continuity. I don't care if we make profit. I just care that we are keeping the bills paid and able to stay afloat until such a time where profits can once again be realized. There are many others out there sharing that very sentiment.

So no, not all of us airline folk are out to have our cake, eat it too and keep money funneling to our, or the company's shareholders.