Flybe nosedives on profits warning

[woolley]

3 hours ago, Derek Flint said:

The three routes plan could apparently be run profitability. It was all the other stuff that dragged Flybe down.

keep it small, realistic, professional and focused. 

 

Right. And we are talking about the government here? An organisation that has no concept of any of your final four words?

Not thinking of standing for Keys in '21 are you, Derek?

[madmanxpilot]

37 minutes ago, Roger Mexico said:

It's that most typical cry of modern economics: "Communism for my bit of the economy; capitalism for everyone else". 

What everyone denouncing Open Skies fails to realise is that we very rarely ever had it.  There was hardly ever competition on any particular route - the only long-lasting one was on Liverpool and that was really only because it was subsidised by the patient transfers (they made up about 30% of Flybe's carryings on the route).  All a formal allocation of routes would have done would have given airlines the freedom to charge what they wanted and up their profits at the expense of the public.  They would no longer have to worry about someone coming onto the route and undercutting them if they got too greedy.

The other delusion that lies behind the opposition to Open Skies is that the air travel market is somehow inelastic - that everyone who travels by air is obliged to travel, obliged to travel by air and obliged to travel to that particular destination.  But a lot of journeys aren't like that and haven't been for many years.  It seems to be based on the fantasy that most air passengers are business travellers for whom money is no object and they have to have particular flights that suit them for which they will pay anything.  But if fares are high they may not travel at all, or go to a cheaper airport or go by boat.  If they are low they may decide to pop over to see relatives or go to a concert or on a short break or even make another business trip.  High fares may even become a factor in whether people move to the Island or stay here once they have or charge more for a contract here or move their business elsewhere.

If the main aim of putting open skies to one side was purely to allow one 'business' to make money, then I'd totally agree with you. It's a bigger picture than than that though. The question is how can we ensure that we always have an air service that is here for us as Island residents when we need it. EasyJet have  often  diverted  back to LGW or LPL because they can't land here (there's another tale to tell about the shit airport landing capability which is for another thread) and when they get to LGW or LPL utilise that airframe to go somewhere other than here. We aren't the most important concern for them. 

For me, the most important thing is to have control of your exposure to disruption .If you want that control yet are prepared to allow competition then you should also be prepared to have someone else take your revenue.

Just a small point - in addition to LPL, it is my recollection that EasyJet competed against Flybe on the LGW route. 

Edited March 9, 2020 by madmanxpilot

[woolley]

1 hour ago, thesultanofsheight said:

You seem very confident in knowing what a company that ceased trading 20 years ago would be charging if was still trading today in a totally different market which has a totally different pricing model. 

They simply couldn't offer the network they did back then with Easy taking the cream off the most popular destinations. It wouldn't be viable. We have traded frequency on small planes for cheap fares on larger planes.

[woolley]

1 hour ago, madmanxpilot said:

Aurigny operate nine aircraft - not two. they have four ATRs, four Dornier 228s and an Embraer 195. Aurigny lose money because they are operating in a competitive market with other airlines sharing the finite passenger revenues available on the GCI routes. If we want  guaranteed continuance of our air services at time when others falter or when their priorities change, then we need the control that having our own airline would bring. If we want that airline not to lose money, then the niceties of having routes competed on will have to be shelved. 

So what? You bar Easyjet? That will go down like a lead balloon.

[Roger Mexico]

12 minutes ago, madmanxpilot said:

For me, the most important thing is to have control of your exposure to disruption .If you want that control yet are prepared to allow competition then you should also be prepared to have someone else take your revenue.

Just a small point - in addition to LPL, it is my recollection that EasyJet competed against Flybe on the LGW route. 

But the only thing that will guarantee control is actually having your own full airline - even leasing planes may leave you vulnerable.  Flybe, for instance, would still have gone under if they had had exclusive rights on all or some Manx routes and we would have been in an even worse position.  Scrapping Open Skies gives you higher fares without any extra security.

I deliberately used 'long-lasting' about the competition on the same routes because there have been others at various times, but not for an extended period.  From memory Flybe inherited those LGW slots and then used them elsewhere or sold them off pretty quickly. 

[madmanxpilot]

27 minutes ago, Roger Mexico said:

But the only thing that will guarantee control is actually having your own full airline - even leasing planes may leave you vulnerable.  Flybe, for instance, would still have gone under if they had had exclusive rights on all or some Manx routes and we would have been in an even worse position.  Scrapping Open Skies gives you higher fares without any extra security.

I deliberately used 'long-lasting' about the competition on the same routes because there have been others at various times, but not for an extended period.  From memory Flybe inherited those LGW slots and then used them elsewhere or sold them off pretty quickly. 

Agree - having an IOM owned airline is the most important thing - engineering it's profitability is a nicety driven by public expectations.

 

Disagree about open skies - if one airline, Govt owned or not, has exclusivity, then fares don't need to be high as they will have all of that's routes revenue. 

Edited March 10, 2020 by madmanxpilot

[Non-Believer]

3 minutes ago, madmanxpilot said:

Disagree about open skies - if one airline, Govt owned or not, has exclusivity, then fares don't need to be high as they will have all of that's routes revenue. 

Wishful thinking? Dependent surely upon desire for revenue, either by private operator or Govt? And we all know what the Govt's position is on revenue?

[asitis]

6 hours ago, woolley said:

Right. And we are talking about the government here? An organisation that has no concept of any of your final four words?

Not thinking of standing for Keys in '21 are you, Derek?

I hope so, Derek has some ink in his pen agree with him or not, and has an iq over 50!

[Andy Onchan]

9 hours ago, dilligaf said:

I am sure you are way smarter than to think it is that simple. Think of how many staff are needed even in a small operation. Economy of scale is key here. Fu@@ me, the baggage handlers alone would cost millions, even before pensions are considered

Baggage handlers are paid for by the ground handling company (Menzies?), who in turn invoice the airline.

[asitis]

6 hours ago, woolley said:

They simply couldn't offer the network they did back then with Easy taking the cream off the most popular destinations. It wouldn't be viable. We have traded frequency on small planes for cheap fares on larger planes.

HOORAY    as predicted in 2006. The sad thing here is peoples low opinion of our Government mean that we judge every "opportunity" as a negative as we realise as soon as they get involved it is doomed to failure! The operating costs of suitable turboprops and the passenger volumes (when not cannibalised by major low cost no commitment airlines) on paper will work, the negativity is down to the sheer lunacy and utter incompetence of our administration.

[Derek Flint]

10 hours ago, NoTailT said:

Delusional to think anyone will fly to Birmingham to get to London.

People already do. There’s one day in the week where it is the best way to do it.

[Derek Flint]

7 hours ago, Roger Mexico said:

But the only thing that will guarantee control is actually having your own full airline - even leasing planes may leave you vulnerable.  Flybe, for instance, would still have gone under if they had had exclusive rights on all or some Manx routes and we would have been in an even worse position.  

Exactly. It was all the other gubbins and nonsense over the last ten years. If they had stuck to UK regional with turboprops they might still be here today. 

Small scale servicing of just a few routes and not Having unnecessary ambition may well work.

[Derek Flint]

8 hours ago, woolley said:

Right. And we are talking about the government here? An organisation that has no concept of any of your final four words?

Not thinking of standing for Keys in '21 are you, Derek?

You aren’t the first to ask! 

I honestly couldn’t be doing with the game playing, lack of focus and reality. I’d be marginalized and life would be made difficult.

I’ve been through all that once. Not sure I want to do it again!

Edited March 10, 2020 by Derek Flint

[madmanxpilot]

2 hours ago, asitis said:

HOORAY    as predicted in 2006. The sad thing here is peoples low opinion of our Government mean that we judge every "opportunity" as a negative as we realise as soon as they get involved it is doomed to failure! The operating costs of suitable turboprops and the passenger volumes (when not cannibalised by major low cost no commitment airlines) on paper will work, the negativity is down to the sheer lunacy and utter incompetence of our administration.

Far to sensible a post to appear here!

[madmanxpilot]

Airport closed due sickness.

It seems that they don't have enough staff to cover illness within ATC - you couldn't make this up. Good job there aren't  many flights to be affected.