Airlines in a Crisis

Some airlines, like Ryanair, demand all online check in while others, like Emirates, demand desk check in. Some want more checked in baggage and less carry on while others demand more carry on and less checked in. It seems that full service airlines want more control and less obstacles demanding check ins where they can hand out kits of sanitizing measures and less passenger handling by hand of anything in the cabin. Low Fares airlines go for more of what the passenger can do and less of what they have to do. A policy they have pushed for years. So no real change there then, even in a communicable disease crisis.

Not issuing refunds means airlines have been living on unearned revenue and were for all sense and purpose trading while technically bust even before this crisis. The longer they are allowed to go without paying back what they haven't earned, the longer they are in reality now trading on their passengers money as well as their other creditors. All this money should technically have been in a similar to escrow account until either the airline earned it or they refunded it. These airlines have been paying out dividends and share buybacks with money that wasn't theirs. I know large amount of cash sitting in bank accounts are very tempting but when one do a lot of advanced sales is it part of being an honest business. This goes also for they who don't normally issue refunds. The unexpected will always arrive. Hoping it won't arrive during your time at the helm is not an example of good leadership. Prudent is not a negative word in finances.

Take the analogy of going for a walk and you meet people that don't care about social distancing. You just know that if they are careless when you meet them they will be just as careless in other aspects of dealing with the spread.  Always choose a route where you are the one that controls the distance. Always choose an airline that has taken more precautions than the absolute minimum that won't cost them much. Smart travellers will make up their mind about what amount of precautions is necessary and will choose an airline that supplys them. However I'm not saying an airline, even a low fares one, couldn't cater for both. Instead of a class divider curtain they could have a CoVid19 precaution divider curtain. In front you get free middle seats, cleaning of toilets between each customer and cleaning of cabin between each flight. Behind, for a bit less money, you get nightly cleaning and shared armrests.

If your airline continues an albeit limited trolley service in CoVid19 times, it is important that your staff don't become super spreaders. They should of course wear masks and gloves. But the gloves  should also be cleanable so they can be treated with hand sanitizer between each customer. This hinders immediate transfers of viruses from the card/cash of one customer to the items of the next. Remember that virus stays alive for minutes on skin, hours on clothes but days on hard surfaces. In general, if you are doing to much with your hands to clean them constantly, just wear gloves and clean them. The same goes for they who are allergic to cleaning stuff or get sores from washing their hands to often.

Some airlines see their strict adherence to social distancing as a marketing opportunity. Promising doubting passengers that they won't be seated within touching distance of somebody they don't know will attract people nervous about being infected in an environment they have little control over. https://simpleflying.com/jetblue-july-social-distancing/ This is the way to get more people up in the air. Not coming with unconfirmed swada about that nobody gets infected on an airplane just because it yet haven't been proven to the full extent of the law. If airline executivess really think their Hepa filtered airconditioning systems are so excellent in stopping all contamination would they approve if pubs and all other indoor crowded spaces also just demanded masks and turned their airconditioning up. They also suffer economically if they can't stuff people in to the degree they did before.

Some airlines are singing the poor man tune to their staff at the same time as they are announcing postivity about the future to the stock markets. Can their eagerness to plead the crisis to get support and cheap loans from governments combine with the need to keep their share prices high to please owners and secure the share price their own bonuses and share options depends on. The Ryanair unions are certainly copping on to that not every thing is like it seems and telling the airlines management they can't have it both ways. Themselves agreeing only to a 1 year cut in their own salaries while saying to their staff that they must take a 5 year cut. https://uk.reuters.com/article/uk-health-conornavirus-ryanair/unions-say-ryanair-exaggerating-covid-threat-to-undermine-conditions-idUKKBN22W1YZ This reminds me of how healthy a bonus the SAS CEO got out of negotiating down his staff terms and conditions while that airline was in a crisis a few years back. Even in a crisis the have

Did Schram forget that the world has changed when he today presented his new'ish senior managment for Norwegian. The plan from last winter should have been put out to pasture and a new one created more suited to corona and a return. Getting in old sales colleagues to sell more inflight stiff to passengers no longer existing is a bit to late. Will these new brooms first start in April next year when the company plans to have more than 7 planes in the air. The won't sell much aboard a plane where everyone wears a mask. And the experience is more about not getting infected rather than anything else. The position, in addition to Karlsen's, that is most of importance is Chief of Operations. And they haven't filled that. No wonder they have problemes handling even 7 planes. The CEO must have been in a hurry to present his plan before the new owners get control of their shares, get organized and come up with their own plan. Or person/team that will form that plan. Will th

What is the plan for the lenders new shareholdings in Norwegian. Why did they not just take the planes back and finished with it. A loss is a loss and better be over and done with it and move on. Are they just leaving the Dreamliners there hoping the Norwegian government through unsecured loans to Norwegian will pay for maintenance and parking for them until the market returns. Then take them back only at such a time when existing or new airlines make signals to move on the Transcontintal markets Norwegian left behind. Unless Norwegian's management in the near future quickly turns around and show they have a plan for all those aircrafts one would assume the planes real owners will take them back. In the meantime they can always make some extra cash by selling the billions of new Norwegian shares to upset norwegians. On the other hand would they not be better off getting in a new management with a vision for the company. A vision for how planes could be utilized whatever it take

Financing your airline by selling your planes on delivery at price+ to a leasing company against paying extra high rents for a contracted amount of years, is proving to be a bit of a trap in times when you can't make an icome from said planes. A company like Norwegian have proven that to all when they saw the necessity of handing over control to their lenders by converting some of the debt to shares and making the before 100% shareowners into mere 5% owners. This type of financing is more like the old fashioned cropholder, but on a company level. A practiche that ultimately lead to you becoming a pure tenant of your own holding, and possibly to eviction from it, the first time the harvest failed.

If you are ok on a plane because of the excange rate and filtlering capacity of its air circulation system, should pubs be ok to stuff them in at full capacity as long as they install Hepa filters in their aircondition and turn it up to the same rate as on a plane. What about supermarkets, shops and hairdressers. Would the corona world be able to go back to normal . Well they could according to IATA. The argument from there and pushed by many airline chiefs is that due to the advanced airconditioning and the filtering capacity of the Hepa filters airlines hould be excempt from the physical distancing required on al other business premises. That and for economical reasons off course that they can't make as much profit if their capacity is reduced due to having middle seats blocked off. But the economical argument against social distancing is no different for any other type of business on the planet.

Let's take som quick math to Ryanair's O'Leary's claims that middle seat free is unsustainable. According to the Ryanair results presentation their average fare is 37 euro. Add 50% and it becomes 55.5 Still below Easyjet's current of 59 according to the same presentation. Will an extra 18 euro 50 cents really stop people from flying if it means they could be safer from viruses. It seems more of a pshycological problem for top brass rather than for any real economic reason, that airlines think they should be excempt from the physical distancing that every other business have to put up with. Some will always persist on squezing the last of capacity out of both materiel and staff, even at the cost of suffering, for others. The only thing a temporry 50% rise in ticket prices put an end to is O'Leary's plans about releasing a rush of Low Fares to get further market share from competitors, as long as they don't do just the same with borrowed money. I am su

Problem exists because airlines in their wisdom decided that in cattle class every seat should not have its own 2 armrests. There is little help in cleaning the bathroom frequently if the person in the seat beside you leave the virus on the armrest you both share. This could have been prevented if a 3+3 aircraft was 25cm/10inches wider so one could fit 4 more independent armrests. This would give space for extra 5cm/2inch wide armrests and a small gap between the armrests of adjacent seats. A gap that these days could be used for sample a dividing curtain, or a small shield to 100% ensure you don't touch your neighbour, or anything he/she touched, with the hand that soon will inadvertently be touching your face.

Is Easyjet well served by getting on the wrong side of a 30% shareholder in difficult times. Is the continued concentration on growth for the benefit of the shareholders that take all the risk, or for increasing managements incentive packages. There are enough samples of corporate greed where top management walks away with millions even though the results tanks and staff ends up getting laid off. Easyjet management says an outside independent have looked at its dealings with Airbus and found nothing untoward. An independent company is only as independent as the one that pays their bill want them to be. Self-hiring an "independent" is a well known way of getting in ahead of an investigation instigated by somebody else.I am not saying anything will be hung on the current management of Easyjet, but smaybe something will stick on Airbus that could be used for negating the contract without penalties. Even more likely since they have already settled something similar. Easyjet ma

Norwegian worked up a good brand in Low Fares transatlantic and to parts of Asia. Now when they are retracting to the Norway and Scandinavia market, plus probably something to bring those customers to some sun like Spain, Italy, France and similar, it leaves a market, new fleet and crews ready for easy prickings for the right operator. London Gatwick could be losing some of its main operators on the transatlantic market with Virgin shrinking and BA retrenching to Heathrow. So there is an opportunity for a partial ready made market to be exploited when traffic returns. And chances of a head start for they willing to dip a toe in the water, with the potential of real returns. Many have tried and failed in Europe-US low fares. Few had such a chance that now exists to make it also a true Low Cost. Utilizing the worked up brand of Norwegian could give an instant ready supply of potential passengers. Combine that with a great opportunity for exceptional deals on leases, low price on fuel

Airlines should the minute the lockdowns started have realised that all bookings made was on a diferent basis for a world no longer existing. They should then have cancelled all previous bookings, reset their systems and treated it as beginning of time and asked all previous and potential new customers to book again when a new schedule where made available. Only if refunds are made can new customers be convinced that the money they pay for new bookings will not disappear in the same voucher hole as their previous now cancelled bookings. Specially if some of the carefull reopenings are reversed and more flights are again cancelled. Problem is many airlines have been treating funds received for future bookings as a part of their cash reserves. Good accounting practices says they are unearned revenue and should be booked as such, only coming into the earned and profit accounts when travel happens. However many airlines have been tempted to see these amounts that can build up in their bi

Many remember the old class separating curtains used in planes. This could be moved from row to row depending on how many business class customers there was. A similar curtain on every row of seats would be a very good physcial barrier to stop droplets expelled with sneezes, or during conversations, traveling over several rows. An extension could be added down to the armrest between each seat in a row for complete cocooning and removing the need for leaving seats free. When you have taken your seat you sanitize your hands and your are safe even if you touch your face now ad then because your hands will then not touch anything touched by anyone else. Social distancing by walls works in first class so why not. And row separating curtains have been allowed for a long time as a movable class separation. A company has already made a sample: https://simpleflying.com/middle-seat-privacy-screens/ However they could be larger and on the armrest instead of taking a whole seat, to allow full oc

Social distancing must be practiced everywhere els ein corona times, why not on airlines. No business think physical distancing is good for profit but most have to accept it asa necessity in a hopefully temporary new reality. Airline management though seem to find the whole concept difficult. Some of them are so used just for profit to stuff their customers in to the absolute legal limit and without comforts that they don't. Safety is just because accidents are bad for business. In a differnt time they would be landlords sending their tenants on coffinships to America so they could utilize the vacated land better. Problem with that way of thinking arise when low-low prices are no longer the be all and end all for if people want to fly or not. In dangerous times people become price unelastic and will pay what it costs if they absolutely have to fly. And if not necessary they won't no matter how cheap it is. This concept seeems to escape many of todays airline chiefs. Even thoug

The airline have showed impressive adaptability converting some of its currently little needed passenger aircrafts to cargo during the current crisism taking opportunity to make cash out of opportunity. What we expect from a island nation where road freight is not an alternative for international transport. And from a company that is used to take geographical advantage of that one without extra freedoms can legally fly passengers between 2 other countries if one stops over in own country. https://simpleflying.com/icelandair-767-freighter-photos/

The company have been busy reorganizing it's finance side with converting parts of loans and leases to shares to save the company, selling out the existing shareholders in the process. What have been missing is some operational management and ideas. One would think that with only 7 out of 160 planes in the air they would be on top of things, but no. Daily we read new articles about why they can't keep to in Norway mandated social distancing with middle seat free, and ecuses why. Do not say much for either management nor their IT systems or their control on the aircrafts. Since the newish CEO came in we have been waiting for when his operational plan for how Norwegian should be run would be announced. One certainly can't say he hit the ground running in that department. So far everything new is financial and under the former tempe CEO's remit Norwegian could doo so much more out of this crisis. They have 787's that can take air-containerized freight, but have sho

It is not only ppe. I have som packages with tracking on the way from China to Ireland. Anything non medical related just get trurned back by security at the airport in China, goes back to the bus station, gets sent to the airport and same again and again. With a 10 day waiting at each step. 3 times now in 3 months, and not going anywhere. 4 other small packages all medical related just goes missing either in China or on destination airports in Europe. Probably stolen because its something covid related you could use at home and people in the system see what it is due to the declaration description. Or sits at airports in Europe for days and weeks awaiting further handling. Earlier packages often went from China to Europe via Russia. This seems to have stopped completely. And it is not only Cina. A postcard took nearly 2 months from Ireland to Norway, My easter greeting arrived yesterday. There is obviously no effective alternative organized for post even within Europe when planes ha

No matter if they have their planes on pay by the hour, should Norwegian circulate both planes and pilots to keep them in certification and at peek performance. Neither Norway nor Europe is a desert where you can just park you planes and think they are in the same condition after a few months. And pilots need a certain amount of take offs and landings to keep their certificates current. Rotate at least regularly all instructors on both types of aircraft. It isn't a coincidence that Ryanair is starting up again before 4 months has passed, and that they have been doing regular touch and go's at their bases.

Have Ryanair's O'Leary lost the ability to ajust. He is complaining left right and center about why not everything is like before. Why should they have to practise distancing, why is there quarantines and why do the airline have to do any changes instead of somebody else like the airports taking care of all the bothersome stuff. Did he completely forget his schoolyear teachings about price unelastic demand. We see every day reports about people who would be willing to pay a bit more if there just was flights. They who want to and/or are desperate to travel will pay what it costs. But many will not travel for any price because they are scared. Either scared because they don't trust airlines to adapt to the new distancing safety standards or hardline practice the masks thing. Or scared they will be on a plane full of ignoramas who not only will not practice it there but do the same everywhere else and therefor be pestilence carriers. Better sit back and wait for better time