Trudeau Throne Speech.. any comprehensive support for aviation?

Discuss topics relating to airlines.

Moderators: sky's the limit, sepia, Sulako, North Shore

Gino Under
Rank 8
Rank 8
Posts: 833
Joined: Sat Jan 16, 2010 12:06 pm

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by Gino Under »

For airlines, a focus on 'getting back to 2019 ' ignores reality
By Lewis Harper 23 September 2020

There are few more commonly asked questions in the airline industry today than “when will we be back to 2019 levels of demand and revenue?”
As with many coronavirus crisis-related discussions – involving airlines or otherwise – it is tempting to focus on getting back to how things were, even at the cost of considering that some changes might be for the better.
For airlines, estimates of when that return to “normality” will be achieved average around the 2024 mark.
The simplicity of this answer often encourages a rather simplistic take on the industry’s predicament.
“Get through this tricky patch, then it’s back to a growth trajectory from next year onwards.”
But the concept of a return to 2019 levels is really a rather moot one for most operators.
That the industry will be smaller for years to come is already baked into proceedings, as chunks of fleets are retired and tens of thousands of employees let go.
The next few years are not about a journey back to the pre-Covid world; they are about the industry finding a new footing, then establishing a sustainable growth path in a post-pandemic environment.
“Anybody who believes that this is just a temporary crisis and can be resolved through temporary measures is misguided,” said departing IAG chief executive Willie Walsh in early August, while noting that securing enough liquidity is only one part of a viable survival strategy.
There are structural changes under way, which will affect all airlines – and some more than others.
Walsh was perhaps most conscious of a fundamental shift in corporate markets, causing a decline in business travel – an area critical to network carriers with their premium seating-heavy widebody jets.
Other markets – notably the long-haul leisure sector – are also facing a tougher recovery path, raising the prospect that the current generation of passengers becomes more accustomed to shorter-haul trips as different traveller habits are formed.
At the same time, airlines are facing the next few years much more heavily indebted than they could have ever imagined. For that reason, and others, only the most reckless operators are likely to emerge from this crisis without a new-found focus on building liquidity.
For many airlines, a return of governments having a bigger say over strategy is also an inevitable – and arguably regressive – step following various state bailouts across the sector.
All the while, sustainability is starting to become baked into every strategic decision for some carriers – with several bailouts in Europe contingent on environmental targets being met.
Another structural change is the simple fact that airlines are adjusting to being smaller operations.
That said, accelerated industry consolidation is likely to become a consequence of current woes at some point.
A shift in power might also be under way, with those airlines fortunate enough to have a large domestic market to serve likely to emerge from the crisis in a much stronger position than those with a heavy reliance on open international borders.
And eventually, new operators unencumbered by pre-Covid employee contracts, fleet burdens and high debt might spy an unusually attractive opportunity to enter the market.
Customers’ expectations are also likely to change, as they demand more health measures – even once the virus is under control.
Ultimately, these factors and more mean that when the industry does return to those heady days of 2019 demand and revenue, success is likely to be measured on different terms than those imagined just months ago.
And, although the coronavirus crisis has been horrific for the industry, it is important to note that structural changes are not always for the worse.
Rather than “when will we back to 2019 levels?”, a more meaningful question is therefore: “What will the industry look like when we get there?”

The German government gave $10B in aid to Lufthansa in May. Lufthansa is now saying the financial assistance isn't having the desired effect despite layoffs, early retirements, fleet reductions, etc,. and may need more from their government. How will Canada's airlines fare if government assistance eventually shows up and how long will any positive effect last? It may be nothing more than trying to defibrillate a dying patient.
So now we await the pronouncement.

Gino Under
---------- ADS -----------
 
gtappl
Rank 3
Rank 3
Posts: 154
Joined: Wed Mar 04, 2020 8:48 am

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by gtappl »

altiplano wrote: Mon Sep 28, 2020 4:18 am Canada is the only G7 country not offering support to their Airlines.

Why is that? Are we somehow smarter than Germany or Japan or Britain or France? Letting our airlines fail is good policy?

Fact is we have a dolt in the Front Office of this country. Not only is there no support, we have among the most Draconian restrictions to travel even within our own borders.

Enough is enough.
We subsidize nothing in this country, and tax everything. It's fun explaining to Americans our airports have to make a profit while theirs get subsidies.
---------- ADS -----------
 
Gino Under
Rank 8
Rank 8
Posts: 833
Joined: Sat Jan 16, 2010 12:06 pm

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by Gino Under »

Canada can't subsidize everything. Certainly the focus on a very narrow or specific group of subsidy benefactors doesn't meet the fairness metric when it comes to doling out the taxpayer's money.

I'm envious of nothing American. Their introverted, self-centered focus on how they view the world stops within their shores and their borders with Mexico and Canada.
It is a country printing dollars to claim it's wealth and "greatness". Backed up by what? Paying $750 in annual income taxes?
If you think I'm telling you little porky's, have a look at this link.

https://usdebtclock.org/

This is how you visualize their greatness.

Want to see our greatness?
https://www.debtclock.ca/

cheers,
Gino Under :drinkers:
---------- ADS -----------
 
piperdriver
Rank 3
Rank 3
Posts: 172
Joined: Sun May 04, 2014 2:30 pm

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by piperdriver »

Donald Trump tweeted this message late on October 6th:
The House & Senate should IMMEDIATELY Approve 25 Billion Dollars for Airline Payroll Support, & 135 Billion Dollars for Paycheck Protection Program for Small Business. Both of these will be fully paid for with unused funds from the Cares Act. Have this money. I will sign now!
---------- ADS -----------
 
Ratherbe
Rank 3
Rank 3
Posts: 119
Joined: Sun Oct 14, 2018 1:18 pm

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by Ratherbe »

Our government has created a severely uneven playing field for the Canadian airline industry by not supporting it in the manner that all G20 countries have supported their airlines. I fear that the Liberals and Greens are happy to see us fail as this will reduce emissions. The Conservatives have in the past supported open skies and cabotage which would allow such progressive countries like China and the UAE to dominate our skies with their 4-engined A380s. Does the NDP even support our industry?

I wish ALPA and ACPA would demand WJ and AC management cancel all flights into YOW next week after Thanksgiving until this is resolved. The House reconvenes on October 19th.

If ever there was a time for a wildcat strike this is it.
---------- ADS -----------
 
planebored
Rank 3
Rank 3
Posts: 153
Joined: Wed Sep 02, 2020 10:24 am

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by planebored »

Canada is going to have a lot of trouble competing with government backed airlines in the coming recovery. The Canadian government knows this, and I wager they want to see some fail and new upstarts take their place. For some reason they think we have extremely high ticket prices in Canada, when in reality most of that is due to government fees/improvement fees/taxes, but can't see past the end of their own nose.
---------- ADS -----------
 
Ratherbe
Rank 3
Rank 3
Posts: 119
Joined: Sun Oct 14, 2018 1:18 pm

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by Ratherbe »

I agree but who would invest in this industry knowing that Emirates and/or Air China was going to be allowed to dominate the domestic and international market. No one.
Only thing is that AC will likely survive but much smaller and WJ is subject to the patience of Onex. Everyone else is likely toast. Canada has historically struggled to maintain two national carriers. WJ and AC have provided a healthy competition for at least a decade or two but that might not be sustainable. Thinking that we can support more competition is not supported by history.
Big losers are anyone living or doing business anywhere but Toronto, Montreal, or Vancouver.
---------- ADS -----------
 
dhc#
Rank 7
Rank 7
Posts: 592
Joined: Sun May 05, 2013 7:38 am

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by dhc# »

From BNN: Airline support an 'existential, strategic necessity': Ian Lee

https://www.bnnbloomberg.ca/video/airli ... ee~2055191
---------- ADS -----------
 
altiplano
Top Poster
Top Poster
Posts: 5377
Joined: Sat Jan 22, 2005 2:24 pm

Re: Trudeau Throne Speech.. any comprehensive support for aviation?

Post by altiplano »

Robert Kokonis has a real take on it too.

Trudeau Liberals better get over whatever it is, or we are going to lose decades of development in this country.

https://www.bnnbloomberg.ca/video/pande ... nt~2055223
---------- ADS -----------
 
Post Reply

Return to “General Airline Industry Comments”