2020 Oklahoma City Aviation Thread

[gopokes88]

This isn't a failure of the airline model, this is a failure of the government to protect the economy. The airlines aren't looking for free money. They are looking for low interest loans and protection to ride out the storm. Just as every other industry.

Airline bad. Charged me for a bag.. Airline bad.

Airline is more than welcome to charge any fees they want. That’s not really what I’m getting at.

And you’re right the Feds bear some responsibility for shutting the economy down.

But the airlines operated with little cash on hand in a cash intensive business. That’s on them.

[catch22]

Airline is more than welcome to charge any fees they want. That’s not really what I’m getting at.

And you’re right the Feds bear some responsibility for shutting the economy down.

But the airlines operated with little cash on hand in a cash intensive business. That’s on them.

From a business perspective is it even wise to have a ton of money in the bank? If your share price suddenly crashes it could make you a prime hostile takeover target. If every company hoarded their cash how much would that impact GDP by having money removed from the entire economy? If every fortune 500 company hoarded away 10 billion in cash, that would remove 5 trillion out of the working economy to sit in a bank waiting on a disaster that is literally once in a century.

[gopokes88]

From a business perspective is it even wise to have a ton of money in the bank? If your share price suddenly crashes it could make you a prime hostile takeover target. If every company hoarded their cash how much would that impact GDP by having money removed from the entire economy? If every fortune 500 company hoarded away 10 billion in cash, that would remove 5 trillion out of the working economy to sit in a bank waiting on a disaster that is literally once in a century.

I mean given the events of this week, probably good to have big piles of cash. I mean is Apple a takeover target?

And if your share price crashes then it’s something the individual’s price and you might be a takeover, but if everyone’s crashes nah no takeover there.

[gopokes88]

Something has to change, we can’t have huge govt bailouts every single time there’s a recession.

[d-usa]

Tie government aid to taxes paid?

[HangryHippo]

Tie government aid to taxes paid?

Great starting point.

[catch22]

Something has to change, we can’t have huge govt bailouts every single time there’s a recession.

I don't disagree with that, but this isn't a recession caused by any mismanagement of any of the industries that are effected. I believe this is the first time airlines have ever needed bailing out? This quite literally is the entire economy needing to be propped up the best they can.

Anyone that knows me knows that I lurrrrvvvv to harp on major corporations and wall street greed. This one is for once not their fault. I'd say do whatever it takes to keep this ship afloat.

[catch22]

I was wrong there was a bailout in 2001 after 9/11, again completely out of the control of the airlines.

It's not like the airlines are always begging for bailouts.

[TheTravellers]

Interesting read:

https://slate.com/business/2020/03/a...ronavirus.html

[gopokes88]

I don't disagree with that, but this isn't a recession caused by any mismanagement of any of the industries that are effected. I believe this is the first time airlines have ever needed bailing out? This quite literally is the entire economy needing to be propped up the best they can.

Anyone that knows me knows that I lurrrrvvvv to harp on major corporations and wall street greed. This one is for once not their fault. I'd say do whatever it takes to keep this ship afloat.

I’m with you

But it’s fair to say what behaviors leading up to this can change?

I think a lot will change naturally.

[catch22]

I’m with you

But it’s fair to say what behaviors leading up to this can change?

I think a lot will change naturally.

I think so. Whoever survives this will likely have a better cash plan in place, but nothing of what could cover the costs of this. That's my point. No one even knows what this will cost and no one foresaw this.

United had $50 billion in assets. However all of those assets are only useful to other airlines. The normal hedge is that one company in trouble can liquidate those assets; there's no contingency for the entire industry being cut off at the knees. Those assets are worthless. No one needs airplanes all of a sudden. No one needs extra slots at LHR, no one needs extra ground equipment or prime gates.

Heck at the rate things are going no one even needs the coke cans you could make out of the airplanes. It really just is an unfortunate turn of events for every sector.

[mugofbeer]

Very well put. No business such as this - and many others - can possibly be expected to survive a 100 to near 0 drop in business for much of any period of time. Airlines have an enormous investment in fixed assets and operate on a very thin profit margin. Any interruption in the revenue stream will very quickly eat up reasonable cash assets.

[Jeepnokc]

Just flew back in tonight. Plane empty even though DL had cancelled quite a few flights. The parking garage was eerily empty with less than ten cars on average on each floor I was on.

[PaddyShack]

This is sad... All of the empty seats... I just sit here thinking it would be fun to buy a bunch of segments and airport hop for a few days.

[catch22]

Not that it even matters anymore...

UA departing load factors (as a whole for each respective city) tomorrow, just random cities:

PDX: 29%
DEN: 25%
IAH: 24%
SFO: 24%
EWR: 22%
LAS: 21%
IAD: 20%
ORD: 19%
SEA: 17%
OKC: 15%
BOS: 15%
BNA: 12%
LGA: 11%
OMA: 11%
TUL: 11%

[BG918]

Honest question, why not just shut the airports down?

[catch22]

^ Surprised no one has, yet.

[PhiAlpha]

This is where I get mad when people say let the airlines fail. Yes the optics of stock buybacks look bad. Heck, I don't agree with them in all instances either. But this is a capital intensive, low margin business. The airlines never had nor never will have the internal cash flow to fund large capital expenses. People want to fly on the newest airplanes for the cheapest price. The only way to do that is to get investors on board. We can't offer dividends, the only thing we can offer to the investment community is an appreciation of their assets (stocks). It is essential to return cash and value to shareholders in this business because there is really no other way to order hundreds of billions of dollars of aircraft, equipment, and technology without the investment community.

People think airlines are unfair, and sure in many ways it feels that way. But it is a dizzying thought to think of how much it costs to run one. We are damned if we do and damned if we don't.

Welcome to the world of being involved in an industry that everyone loves to hate...at least it will stop for yours when things get back to normal

[gopokes88]

Welcome to the world of being involved in an industry that everyone loves to hate...at least it will stop for yours when things get back to normal

They at least have some friends.


We have no friends. Which isn't politics, we actually have no friends. Dems obvs hate O&G, Trump tweeted like a week ago he loves cheap gasoline prices. Lol

[Rover]

They at least have some friends.


We have no friends. Which isn't politics, we actually have no friends. Dems obvs hate O&G, Trump tweeted like a week ago he loves cheap gasoline prices. Lol

O&G loves to play the woe is me card. Dems don't hate O&G. They had O&G PEOPLE who like to act like there is nothing to climate change, who do what they can to block responsible green energy development, who deny there is a future in alternative energy, who take undue gambles with investor money, who operate expense their royalty owners unduly, etc. My family has been fed by O&G for decades, yet I have been legally cheated out of receiving fair value for royalty ownership, etc. If O&G has a target on their back, it's because they put it there.

[gopokes88]

O&G loves to play the woe is me card. Dems don't hate O&G. They had O&G PEOPLE who like to act like there is nothing to climate change, who do what they can to block responsible green energy development, who deny there is a future in alternative energy, who take undue gambles with investor money, who operate expense their royalty owners unduly, etc. My family has been fed by O&G for decades, yet I have been legally cheated out of receiving fair value for royalty ownership, etc. If O&G has a target on their back, it's because they put it there.

Don't disagree with that either

[catch22]

United has canceled 2,181 flights today. These do not include flights that were removed from the schedule due to trimming. These were flights intended to operate. Systemwide load factor: 19.7%.

[no1cub17]

Bailout money for stock buybacks? Why, so Dougie can in a few years sell $90 million in AA stock again? (Assuming AA is still around). The suits and shareholders will be just fine. There are folks looking at months and months of ZERO income and because this is America, no health care and no social safety net either. Having said that, let's see what actually happens with this current bailout, and if it actually gets money to those who need it most, not the big wig corporate types who I have zero sympathy for. I love aviation and flying around the world as much as anyone. If bailout money goes to the rampers and agents and FAs so they can feed their families - great! Otherwise, no thanks.

[catch22]

So far from what I know the intent of the stimulus bill is to keep the lights on and keep employees from being furloughed until the other side of the demand trench.

In fact I believe the bill forbids and common stock purchases until the loans are repaid and for a year beyond that.

[Jeepnokc]

My wife has to fly this weekend and it appears to only have about ten people on the plane at this point