Airline Industry in Turmoil with over $100/barrel Oil

[seabhcan]

Why hasn't France got any significant Low Fares airline? French courts have conspired to keep them out and allow Air France to dominate.

That, and the trains...

[Spanner Island]

That, and the trains...

Germany has a number of significant low fares airlines. As has Spain...

Both have good rail networks too...

Plus low fares airlines tend to spread their wings beyond the home market anyway... so while a good train system might have a slight affect on domestic flights (and even some short international flights)... I don't really think trains have much to do with the lack of a major French low fares airline...

[Buck Rogers]

Why hasn't France got any significant Low Fares airline?

Because the French have decided that if you are based in France, you must pay French social security contributions, be you airline crew or anybody else. Ryanair etc decline to pay social security costs hence they don't have (m)any French bases. Other countries are more amenable to airlines not paying social costs, allowing other industries to subsidize Ryanair. Works well for ryanair, perhaps less so for society at large if every company took the same view.

[hammer]

Holy shamoley

Staycations will boom

[gijoe]

Another one bites the dust.

Embattled Cimber Sterling collapses as investor halts funds

A Regional Danish operator with 19 aircraft, mainly ATR's and Bombardier CRJ200's. No Irish routes.

Cimber Sterling - Wikipedia, the free encyclopedia

I expect a number of the smaller and package operators to hit the wall come this autumn and winter. None of these will have hedged against $120 oil.

Lufthansa have also announced they are laying off 3500 literally with days of lauching the new boeing 747-8I.

[gijoe]

BMI Baby is to close down with the cost of 800 jobs. BA took it over as part of the BMI purchase and are closing it down. They fly to Cork and Knock IIRC.

EDIT: They are ceasing operations from June 11th.

[Tommythesash]

That, and the trains...

Yawwwwwn.

[MarkD]

BMI Baby was stuck with leases on thirstier 2nd gen 737s and what appears to have been some poor gameplanning on the part of management. Looks like Jet2, Flybe, Easy etc will just take the routes over to soak up spare capacity in their own operations and hire ex Baby staff under new Ts and Cs rather than make a play for the company. Lufthansa (owners of BMI) basically had to take a financial hit if Baby wasn't sold before IAG closed the deal so suitors were likely hanging back to see if IAG would do it for cheaper, perhaps even give Baby away with a dowry attached to save the termination costs. Unfortunately for the staff and crews liquidation is more likely now.

BMI Regional (Aberdeen head office) is in a similar pickle, with uneconomic small Embraer RJs which are being killed in this fuel environment by Q400s and ATRs just like Cimber with its CRJ200s. It looks like the endgame there may involve becoming a franchise airline for Flybe but that will be interesting since Loganair already has that role in Scotland.

[cimon9999]

There is an alternative. They can make fuel from cheap shale gas.

Forgive them father, they know not what they talk about.

In a truly absurd turn of events, an airline in America has acquired an oil refinery to gain "control" over its fuel costs:

One challenge for Delta may be showing that it can operate the Trainer refinery more profitably than its previous owner did.

“You do have to question a little bit Delta management’s thought that they can run it better than ConocoPhillips,” said Kyle Cooper, director of research at Houston-based consultant IAF Advisors. “They’ve hopefully done their work and their analysis that says that this hedging cost is going to be lower than their current hedging cost.”

Cory Garcia, an analyst at Raymond James & Associates Inc. in Houston, said letting the Trainer plant close might have been a better outcome for the oil industry, which is adding refining capacity outside the U.S.

[john123]

I symatise with the good airlines who dont take advantage of passengers so that that ryanair ye shower of scumbags