24 ms·
The Airline Industry's Meltdown
- Thalarg 6y agoVery good article, did not expect.
- Animats 6y agoIs this trip really necessary? It's a good read, but mostly states the obvious. One real question - which plane makers will survive? Unless air travel rises to higher levels than before the epidemic, there are enough spare aircraft around for a few years of no new purchases. COMAC will be supplying the China market soon, along with their client states. Airbus is subsidized. Boeing might not make it.
- kalleboo 6y ago> there are enough spare aircraft around for a few years of no new purchases Unless airlines decide they need to downsize their aircraft and demand shifts to smaller/regional jets
- KiranRao0 6y agoGiven the precedence set by the auto makers, I don't see how the US government will allow Boeing to go bankrupt. Edit - spelling
- sumedh 6y agoDidnt GM go bankrupt? Existing shareholders are left holding the bag when new shares are issued.
- 88840-8855 6y agoI disagree. COMAC will do China. Airbus will do Europe Boeing will do USA + is super strong on its military branch Airbus + Boeing will share the rest of the world
- PuddleOfSausage 6y agoRegions like Africa may see some COMAC activity too.
- paganel 6y agoAs a European I don't see Airbus being allowed to fall, after all it's mostly a military company which has also been busy building commercial aircraft in times of peace. The same discussion goes for Boeing, at most the US Government will nationalise it for a time.
- Cthulhu_ 6y agoYeah I think this is the answer - it depends on which ones get bailed out by the government. Same with airlines.
- baq 6y agothey also build spacecraft and launch systems, so yeah. https://www.airbus.com/space/launchers-deterrence/ariane-6.html https://www.airbus.com/space/launchers-deterrence/ariane-6.h...
- benhurmarcel 6y agoThe military activities of Airbus are much smaller than their civil revenues. You got it reversed. See their financial statements [1], defense and space is 15~20% of the revenue in normal years (and not all of it is military). On the other hand, Boeing does make a lot more revenue than Airbus on military contracts [2]. It seems to be around 34%, and double the amount at ~$26bn for Boeing vs ~$12bn for Airbus. [1] https://www.airbus.com/investors/financial-results-and-annual-reports.html https://www.airbus.com/investors/financial-results-and-annua... [2] https://investors.boeing.com/investors/financial-reports/default.aspx https://investors.boeing.com/investors/financial-reports/def...
- paganel 6y agoI don't think those revenue percentages are representative of the true character of both Airbus and Boeing, which I personally see as military companies first, and if they happen to also be dominant in the civilian industry (hence extending their owners' economic power without the use of actual weapons) then it's all for the best, otherwise it will do. I'd say that Airbus is even more military-complex-based than Boeing, as its CEO is selected by the French and German governments combined, private shareholders be damned. There's also yesterday's speech by French president Macron, saying that Europe needs "to end military dependence on US" [1]. There's no other company in Europe than can better achieve that goal other than Airbus (especially today, when air superiority is paramount in almost any conflict, see the present war between Armenia and Azerbaijan) [1] https://www.nationalreview.com/news/macron-calls-on-europe-to-end-military-dependence-on-u-s/ https://www.nationalreview.com/news/macron-calls-on-europe-t...
- kenneth 6y agoIt'll be a long time before China can produce planes domestically. COMAC doesn't even yet have a 737-class plane ready, nevermind anything more advanced.
- DocTomoe 6y agoActually, COMAC has the C919, which will have it's first delivery as soon as 2021.
- Animats 6y agoRight. There are problems with the C919, but making airliners is a national priority for China. It's one of the areas in the China 2025 Plan. So money will be spent until it succeeds. COMAC is still learning. Probably the airliner after this one will be good. It took Airbus 21 years to get a good airliner out the door.
- prower 6y agoOne way to understand these trends, Aboulafia told me, is through the industry’s most beloved metric: the seat mile. If a plane with 300 available seats flies 1,000 miles, that flight clocks up 300,000 seat miles. Airlines are constantly comparing revenue per available seat mile, or Rasm, with cost per available seat mile, or Casm. Aboulafia, pronouncing these terms as “razzum” and “cazzum”, said: “As long as razzum is a nose above cazzum, you’re happy.” If you're an Italian speaker, this can be very funny and ironic.
- tda 6y agoplease enlighten us non-Italians
- prower 6y ago"Ad cazzum" is a sort of fake latinism, to say (in a sort of fake-courtly language) that something has been done/said/thought in a totally random way with no planning at all. Doing something "ad cazzum" means, generally, that you've just done it without even the slightest hint of thinking before acting.
- eecc 6y agoYou should also add that “cazzo” is Italian for “dick” and “alla cazzo di cane” is vulgar for something done in a hurry, bumbling along as you go... (and if you close your eyes for a moment and imagine a dog happily strolling along you get the picture)
- YeGoblynQueenne 6y agoAlso note that English speakers would pronounce the double-zed in "razzum" and "cazzum" as "z", whereas in Italian it's pronounced more as "ts" (i.e. "catso", not "cazo"). Additionally, the "u" in "cazzum" should be silent in an Englsh accent, but clearly spoken in Italian: "caz'm" as opposed to "cah-zoom". (Speaking as a non-native speaker of both languages and having spent a lot more time in an English-speaking country than in Italy).
- hannob 6y agoObservation: Often articles about the airline industry and new aviation tech manage to completely miss the giant elephant in the room - which is the incompatibility of this industry in its current form with a world in a climate crisis. This article is a noteworthy exception that it even talks about it.
- cipher_system 6y agoThe global aviation industry is only around 2% of the global CO2 emissions so i'd say it's more of a mini elephant.
- abyssin 6y agoGiven that it provides mostly luxury services, it's quite easy to get rid of these 2%. Nobody is going to suffer from not being able to take the plane to go on a vacation.
- logicchains 6y agoWho are you to know how much other people suffer from not being able to go on vacation?
- luckylion 6y agoMaybe qualifying it helps: Nobody is going to reasonably suffer from not being able to take the plane to go on a vacation.
- rini17 6y agoI already know some who did suffer (perhaps unreasonably but that's in the end irrelevant).
- luckylion 6y agoPerhaps "suffer" isn't great here, because it's used coloquially as "being affected" and to literally suffer because of something. People will be affected, absolutely. And some people might also suffer from not being able to have an international vacation. But probably not reasonably so, i.e. a reasonable person would not suffer in that situation. You can suffer unreasonably, and you're right, it's irrelevant to the question of "does suffering exist", but it's very relevant to the question of "should we do something about it as society". If it's reasonable, probably. Otherwise that's between an individual and their therapist.
- cm2187 6y agoFinding a flight is also a frustrating experience for users right now. Airlines are selling tickets for destinations, which if you look at historical data, they haven't flown to for 6 months. If you buy a ticket, your flight gets cancelled and you end up spending the next weeks jumping hoops and waiting for your money to be refunded (and assuming you bought it in a jurisdiction that mandates refunds). Advice: if the airline isn't flying to this destination this week, if you can't see the flight on the airport's online arrival boards or on flight tracking websites, don't buy the ticket, the flight is likely fictitious.
- lm28469 6y ago> if you can't see the flight on the airport's online arrival boards or on flight tracking websites, don't buy the ticket, the flight is likely fictitious. Afaik the flight gets "confirmed" if enough people buy the tickets. At least that's how I've seen it happen in germany. The alternative is that they offer the regular schedules, let's say 3 flights per day, let people book, each flight end up being 2/3rd empty. Then they notify the passengers the schedule changed, but in fact they only keep one flight and redirect all passengers to the same plane.
- cm2187 6y agoI would be OK with them only advertising one flight or less, I expect that in the current climate there will be reduced flights. I have issues with them deliberately selling tickets on flights that they know will never happen. I think that approach is pretty much a scam.
- deleted 6y ago[deleted]
- personlurking 6y agoI've been going through this these past two weeks in Europe. I just need to do two short flights, one of them between two major cities. So far, it has cost me hundreds of dollars - ie, I've lost that much - and two dozen hours of lost time in phone calls, emails, and non-functioning websites and apps (of major airlines and subsidiaries). I currently have several hundred dollars in many cancelled flights apparently being refunded to me. Almost every flight time gets either changed or the flight gets cancelled, and Airbnbs get cancelled left and right as well. All of this post-confirmation. Secondary effects of these cancellations are having to rearrange schedules of connecting flights or accomodations, and thereby losing money. It's been a (first-world problem) nightmare. As of now, my first flight looks like it might actually happen, and I've given up on pre-purchasing my second flight, choosing instead to attempt to buy the connecting flight from the airport.
- _Microft 6y ago"In 2017, when United Airlines reduced the weight of its paper in its inflight magazine, it saved nearly 770,000 litres of fuel a year – or $290,000 in costs." This hit home. 770000 litres of jet kerosene translate to 2100 tons of CO_2 emissions[0]. That's the emissions of more than 200 average Germans or 50% of the emissions of over 400 people. Cutting one's emissions by half is most likely not easy at all, so maybe even more people would be required for an equivalent reduction in emissions. Now: if someone at an airline thinks that the inflight magazine feels cheap now and that it should be printed on better paper again, it would wipe out any emission savings that hundreds of people could ever hope to achieve personally. Makes one feels a bit helpless, doesn't it? [0] https://de.wikipedia.org/wiki/Kerosin https://de.wikipedia.org/wiki/Kerosin (Look for "Kohlendioxidemissionen bei Verbrennung"). Edit: the point I wanted to make is that a willy-nilly decision of someone with sufficient influence can have way more effect that intentional decisions of average people could ever have.
- draugadrotten 6y agoSorry to be blunt, but imagine the CO2 savings if every passenger went to the bathroom before the flight.
- awiesenhofer 6y agosounds like something ryanair would love to implement in an instant
- bbarnett 6y agoPlus, it would make full body cavity searches easier to mandate! A win for all! (coming soon to your local district)
- benhurmarcel 6y agoActually Ryanair did suggest to make the toilet paying in flight at some point.
- taneq 6y ago
- pm90 6y agoWe keep trying to make airlines work with a ton of taxpayer bailout money. I wonder if its time to just face the obvious problem that airlines may not be a profitable way to transport people over long distances, and perhaps consider alternatives? Would high speed rail be more profitable once the initial investments are made? Are there alternatives?
- Erlich_Bachman 6y agoThe tourist industry in general struggles in many countries now, similar to flight industry, due to COVID19 measures. Do you then also draw a hasty conclusion that the tourist industry is in fact "not a profitable business" in general?
- fxtentacle 6y agoGrowing tourism is impractical. For example, look at how hard Venice is trying to keep day visitors out.
- newforms 6y agoThe article mentions how profitable the airline industry has been - "in the black for 11 straight years" https://www.iata.org/en/pressroom/pr/2019-12-11-01/ https://www.iata.org/en/pressroom/pr/2019-12-11-01/ I suspect any mass transport is going to take a hit with the current situation, trains included.
- choeger 6y agoShort answer, no. In the current political climate (pun intended), air travel is seen as an obscene luxury. But putting these moralities aside, it is easy to see, how efficient it is. 1. Air travel is point-to-point (for reasonably large points) practically for free. Open three airports, you have six connections. Open a fourth, you now have up to 12 connections. This kind of combinatorial growth cannot be done with road or rail (but partially with ports). 2. Air travel is quick. Flying between the US and Europe is the matter of a day. No need for intermediate accomodations, etc. On short distances, trains can compete here. 3. Air travel is relatively cheap. Not so much because of the energy used or the construction, but because of the utilization of aircraft. A modern aircraft can make multiple connections a day. This can be replicated by some fast trains, but not to that degree. It cannot be replicated by ship, except for the shortest of routes. Conclusively, I would say that carbon-neutral or even just carbon-efficient air travel is here to stay, or traveling will become much more expensive.
- Uberphallus 6y agoNo mention of the meltdown within GDS companies. GDSs, for those not aware, offer airlines anything from booking/pricing/interoperation services to full IT outsourcing. These companies basically take a small fee out of every operation done by either Online Travel Agencies (OTA) or the airline itself. Even before the pandemic airlines were already pissed at these monsters (Travelport and Amadeus being the biggest contenders) that arguably they created, but now with the razor thin margins of airline travel, GDSs are either gonna take a big cut on their already reduced revenue, or the boot. For Amadeus, virtually all contractors (at least 1000 in one site, multiple thousands worldwide) have been dismissed overnight, and most hired staff are working reduced hours. I can only assume it's been the same for Travelport.
- fogihujy 6y agoI never even expected Amadeus to have that many employees at one single site. Well, if the GDS providers start failing then there's going to be an interesting mess to get out of.
- Uberphallus 6y ago> Amadeus is today the biggest company in Sophia Antipolis with 5000 employees from and consultants from around the world, working in R&D, as well as marketing and support. http://www.investincotedazur.com/en/tca-directory/155765/amadeus/ http://www.investincotedazur.com/en/tca-directory/155765/ama... That paragraph didn't age well. Roughly 30-40% of the workforce were consultants, so you can make the numbers. It's the wrong time if you wanted to look for a job in the area, estimates show there are about 1500 engineers without a mission or job, aggregated from all companies in Sophia. The fact that Air France has a site there too helped drive up the numbers, a senior manager I know is working 1 day per week till the end of the year, so you can imagine what happened below him.
- speedgoose 6y agoI have quite a few friends who used to work for AirFrance as contractors. They simply stopped working for AirFrance.
- vijucat 6y agoSuggestion: make a theme park from grounded / unused planes. A Disney World, but flight-themed, and with REAL planes (and real ex-pilots). I can tell you that a ton of boys would be excited as hell to learn how to take off and land from a real pilot. In stormy weather! I'd definitely give it a visit :-)
- danpalmer 6y agoFriendly tip, but this could reinforce stereotypes of which genders can do which jobs. Probably not too much of an issue talking about kids wanting to be pilots on HN, but in general it's best not to gender things like this. "...a ton of kids would be excited as hell..." works just as well, and wouldn't be in danger of making anyone feel excluded. This is minor, no one instance will change things, but the cumulative effect is a society where women are vastly under-represented in areas like tech/STEM, or men are under-represented in child care.
- 88840-8855 6y ago>Friendly tip, but this could reinforce stereotypes of which genders can do which jobs. I hope you are kidding... >"...a ton of kids would be excited as hell..." works just as well, and wouldn't be in danger of making anyone feel excluded. I am a grown man. You say "kids" - I feel excluded now.
- danpalmer 6y ago> You say "kids" - I feel excluded now. You're right, I apologise, when you grow up you can be a pilot too.
- jhamilton 6y agoDon't feel that way, judging by your response it's clear you never progressed past childhood.
- dang 6y agoPersonal attacks will get you banned here, so please don't. If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html and sticking to the rules when posting, we'd be grateful.
- 11235813213455 6y agoPlanes are basically pollution machines, so it's quite good news if people can refrain from travelling in the air (most of time unnecessarily)
- metalliqaz 6y agoAre they any machines that aren't?
- kirubakaran 6y agoBicycles, sailboats, windmills ...
- metalliqaz 6y agoWhen modern people discuss machines, that's not what we are talking about. None of those are practical for modern travel. We're talking trains, planes, and automobiles.
- 11235813213455 6y agoalthough I love sailboats (compared to motor boats), they still pollute indirectly (most cruise boats have engines, they need maintenance which pollute, ..) Bicycles too need maintenance, but it's so ridiculously insignificant compared to cars (at least my bike) that we can round to 0!
- Rury 6y agoOf course. Operating a foot-treadle floor loom doesn't pollute. Stirling engines don't necessarily pollute (unless you consider kinetic energy to be pollution). Actually machines don't inherently pollute. Ones which do, only pollute because they're operating off of or on something which pollutes (e.g. the burning of fossil fuels).
- lotsofpulp 6y agoIt depends on the definition of pollute. Pollute can mean anything that increases entropy. Pollution can mean anything that alters the environment, and that certainly includes any human activity. Pollution can mean anything that increases the probability that the parameters of the environment that allow human life will change. This can include human activity in sufficient amounts that cause environmental damage. Simples example is too many people existing, and their waste causing issues with water sources and then having to build sewage facilities and dealing with the side effects of that. The point is that everything affects everything, and there is no “pure” solution. Causing pollution of one type might help mitigate pollution of another type, and the trade offs are impossible to completely analyze. Obviously some pollution (emissions from fossil fuels) are easy to figure out and blame. But the benefits of those are also incalculable, such as increased life expectancy due to ability to travel, plastics to reduce disease transfer, etc. But at its root, human activity, namely living longer and increasing number of human lives is itself the biggest polluting factor.
- ehnto 6y agoI have been wondering about the long term impact of all this on airplane maintenance. Just like the military industrial complex needs ongoing work to maintain it's domain knowledge and tooling, will the maintenance teams responsible for these aircraft end up losing key people, infrastructure and key knowledge during the shutdown?
- tpurves 6y agoThe maintenance is still happening and it's killing the airlines on costs too. There's one (of several?) small regional airport 2.5hrs north of Toronto where Aircanada parks a dozen large planes from canceled routes. A few times a week a whole crew of maintenance workers and trucks drives all the way up from Toronto, inspects the planes, runs up each engine, then shuts them down, does any maintenance work then drives all the way back to Toronto. Been doing that for 6 months.
- blantonl 6y agoAnother unintended consequence of having so many aircraft parked for so long not operating is bringing them back to life and flying them. It's never been done on such a large scale, and there have been numerous documented instances of emergencies involving fuel pumps on 737s causing in-flight shutdowns of engines due to the aircraft sitting for so long and getting in an unstable state. Boeing even had to send out a directive to all airlines to double and triple check certain components on aircraft that have sat for so long. Aircraft, just like cars, are designed to be continuously flown and running, not sitting around.
- deleted 6y ago[deleted]
- woeirua 6y agoGood article, but I think it really misses some key stats. Here's a summary of the daily passenger statistics from the TSA [1]. We're still running around 25% of normal. The airline industry is getting absolutely annihilated this year. If Congress does not pass a new bailout, like this week, the airlines will be forced to layoff tens of thousands of flight attendants, pilots, mechanics, etc. For the most part, those are not jobs that easily transfer to other industries. The economic devastation of coronavirus is just getting started for airlines. The lack of demand for jet fuel is going to have serious cascading effects throughout the oil and gas industry. [1] https://www.tsa.gov/coronavirus/passenger-throughput https://www.tsa.gov/coronavirus/passenger-throughput
- jamroom 6y agoI'm not much of an economic expert nor do I really know how the airline industry operates, so I could be completely wrong. My concern with an "airlines bailout" is that it is just going to prop up the industry for another quarter or two, when I don't believe that demand for air travel will return to pre-pandemic levels any time soon. So what if instead, we just allow the airlines to lay off tens of thousands of people and the money we would have spent bailing out the business side + workers just goes to the workers instead? It could even include job training or something else to help those that want to change industries. Then as demand returns many of these laid off workers can be rehired. I don't know if this would work, but I feel like if we talking about propping up all the airlines then it's something we will be doing for several years.
- notatoad 6y agoyou don't need to be an expert to know that you're exactly correct, all you need to do is look at how the airlines behaved when they got bailed out last time.
- woeirua 6y agoYou're absolutely right, that would be the better approach, but it is unlikely to succeed with the current Congress. A rational Congress would have recognized months ago that the economic effects of the pandemic are likely to persist for years, and that bailing out businesses is not going to solve this problem at all... But the Republicans are not willing to admit yet that this is going to be a problem past next summer.
- nradov 6y agoIf you have frequent flyer miles then consider cashing them out now. I used all of mine to buy Home Depot gift cards. I expect that many airlines will end up bankrupt again so miles may end up worthless.
- csteubs 6y agoAnecdotally, one of the silver linings is the barrier for startups operating in the airline industry has never been lower. Prior to Covid it was exceedingly difficult to get a sit-down with business development personnel at major airlines, but the situation is now largely reversed if you approach with a product/service that could even marginally increase revenue per seat mile.