Charlotte-Douglas Airport (CLT) Expansion

[navigator319]

1 hour ago, Tyrone Wiggum said:

A few observations from around the Intrawebs:

1) The recession is a foregone conclusion;

2) Most of the airlines will be in Chapter 11 Reorganization by early summer at the latest;

3) Airline travel may be permanently reduced (I guess nothing in business is "permanent," but for the foreseeable future) as the result of global growth no longer responding to monetary policy AND the potential for infection.

My question is: what does it mean for CLT?  Let's say we see a 10% reduction in air travel, annualized, for the next five years; what do?

I don't believe you will see bankruptcies.  Govt will step in , they have already said as much.

[15895]

31 minutes ago, navigator319 said:

I don't believe you will see bankruptcies.  Govt will step in , they have already said as much.

I think you’ll see both. Bankruptcy and Government stepping in after-the-fact to make sure the airlines don’t fail. 

Edited March 16, 2020 by AirNostrumMAD

[navigator319]

3 minutes ago, AirNostrumMAD said:

I think you’ll see both. Bankruptcy and Government stepping in after-the-fact to make sure the airlines don’t fail. 

Really?  I don't think they will force them through the bankruptcy process as part of stepping in.  

I really think they will just end up  cutting checks to them all .... American , United, Delta, Southwest, JetBlue, Alaskan, Hawaiian, Frontier, Spirit 

If they go through the bankruptcy process lots of other folks get hurt besides just the direct companies and I don't think they will want those types to get hurt also 

We will see though.  All of this will be studied and debated for the rest of our lifetimes that is for sure.

[likewyatt]

The big boys will be saved and the smaller players that put downward pressure on prices will be left for dead. Just the like some banks were saved and others left to die (Wachovia). Gov't picks the winners and losers based on which companies have congress in the back pocket. Call me cynical, but everyone knows this is how the system works. 

[TCLT]

15 minutes ago, AirNostrumMAD said:

I think you’ll see both. Bankruptcy and Government stepping in after-the-fact to make sure the airlines don’t fail. 

 

6 minutes ago, navigator319 said:

Really?  I don't think they will force them through the bankruptcy process as part of stepping in.  

I think AirNostrumMAD might be right. But I don't think the government will let them go bankrupt first. I think chapter 11 will happen in spite of government intervention. Demand, and revenues, are seeing such a sharp (and most likely sustained) drop that airlines are going to have to shed aircraft and employees just to survive. Unfortunately, contracts (especially labor contracts) will make this difficult. So it is reasonable to expect chapter 11 filings just to get out of commitments so the airlines can cut expenses enough to continue to exist. Some airlines might avoid this if they can convince debtors and unions to accept enormous concessions, but this is well and truly unprecedented. 

As I'm typing this news is breaking that a government rescue package is in the works. Hopefully this is just the start of much bigger intervention, but it still might not be enough.

[urbanlover568]

2 minutes ago, likewyatt said:

The big boys will be saved and the smaller players that put downward pressure on prices will be left for dead. Just the like some banks were saved and others left to die (Wachovia). Gov't picks the winners and losers based on which companies have congress in the back pocket. Call me cynical, but everyone knows this is how the system works. 

Won't work this time. Debt is sky high already and will only increase inflation. Sorry to say, the buck has to stop somewhere. The amount of companies that can go bankrupt will be far more than 2008. Nothing can stop what's coming. We are already forcing our children to work much longer than we are in a life of debt. Sorry for being pessimistic, but what we are doing financially is irresponsible and has consequences.

[TCLT]

Here is a look from CAPA at the unfolding situation and potential fallout on the aviation industry. Obviously the major takeaway from the article will be the headline, that most of the world's airlines will be bankrupt by the end of may if not sooner. They echo the belief that massive and coordinated government intervention will be required to save the industry. And they predict that post crisis the survivors will primarily be the major, international network airline groups.

And for perspective on how bad this is for the industry, this post on another forum shows a comparison of capacity destruction to past crises and potential models of the recovery. I believe the -50% estimate will prove to be too conservative.

 

[CLT2014]

I'd guess the Concourse A expansion gets killed... American and the other tenants just aren't going to have an appetite for higher landing fees and gate lease agreements to pay for capital projects for a while. I know we'd like the airlines to have a long term view, but the reality is decisions will be made with short term views when fighting for survival. I'd like to be proven wrong.

[Tyrone Wiggum]

4 minutes ago, CLT2014 said:

I'd guess the Concourse A expansion gets killed... American and the other tenants just aren't going to have an appetite for higher landing fees and gate lease agreements to pay for capital projects for a while. I know we'd like the airlines to have a long term view, but the reality is decisions will be made with short term views when fighting for survival. I'd like to be proven wrong.

American could have used all those profits it's generated over the years to do many things to keep itself viable in this situation; instead, it wasted most of its cash on share buybacks.  Airlines, like several other industries, are run by some of the most myopic people you'll ever meet, in that the ONLY thing that matters is this quarter's share price.

A pox on the airline industry;  I hope to hell we don't bail them out with a blank check, because they are the poster children for privatizing gains and socializing losses.

Edited March 16, 2020 by Tyrone Wiggum

[urbanlover568]

Canada just closed its borders to everyone but Americans and Canadians. Guess that includes air travel also. 

Sudan has closed all of its airports now also.

[elrodvt]

Obviously everyone is in touch with an airline and economic seer - other than me that is. 

I have read a few articles that say after all the airline contractions they're in the best shape to weather a downturn in a long time. 

Not that this helps the little guys who I doubt our current government is inclined to do much for. Never know though...

[TCLT]

1 minute ago, elrodvt said:

Obviously everyone is in touch with an airline and economic seer - other than me that is. 

I have read a few articles that say after all the airline contractions they're in the best shape to weather a downturn in a long time. 

This isn't a "downturn". This is a complete collapse of the industry. No company on the planet can weather a situation where demand for their product and revenue drops 75-100%. That's where the airlines are right now.

[joenc]

This isn't a downturn, this is zero demand for months. All of the profitable business travel is cancelled for the foreseeable future.

[urbanlover568]

Non-essential pennsylvania business ordered closed by order of the governor.

[urbanlover568]

Russia is closing it's borders to foreign visitors also now. 

 

Edit: Egypt suspending air travel also.

Edited March 16, 2020 by urbanlover568

[TCLT]

To give an idea of serious a situation the airlines find themselves in and how deep the fall in demand has been in response to the spread of the virus and snowballing travel restrictions, here's a summary of what some major US and European airlines have done regarding capacity and employment. Realize that most Asian airlines already took such drastic actions a couple months ago and most of the South American airlines are now doing these things as well. This is by no means exhaustive, but it's a snapshot of where we're at today. Again, this is already well beyond a simple downturn and it is still getting worse. This is every airline everywhere on the planet.

Airline	Capacity Reduction	Announced Layoffs
Norwegian	85%	90%
KLM	90%	30%
Air France	90%	?
BA	75%	?
Iberia	~100%	?
American	30%	?
Delta	40%	?
United	50%	?
El Al	~100%	80%
SAS	100%	90%
Austrian	100%	?
Lufthansa	80%	?
Ryanair	~100%	?

[Tyrone Wiggum]

3 minutes ago, TCLT said:

Airline	Capacity Reduction	Announced Layoffs
Ryanair	~100%	?

How will I ever fly city to city in Europe strapped to the wing of the plane?

Seriously, motherfudge Ryanair

[KJHburg]

a friend of mine flew from Newark nonstop to Charlotte for $37 and some change today.  One way.  she was leaving NYC to work at her parents home in LKN.   She said the flight was maybe 1/2 full but plenty of room to spread out. 

[InSouthPark]

22 minutes ago, Tyrone Wiggum said:

How will I ever fly city to city in Europe strapped to the wing of the plane?

Seriously, motherfudge Ryanair

I could care less how cramped their plans are.  I flew roundtrip from Hamburg to Dublin for 40 euro.  I can't get to CLT airport roundtrip in an Uber for that price. 

[elrodvt]

moved wrong thread

Edited March 17, 2020 by elrodvt
wrong thread

[KJHburg]

American asks its pilots to take voluntary leave and 1500 plus are based in Charlotte.  Couple different options explained.

https://www.bizjournals.com/charlotte/news/2020/03/16/american-airlines-giving-pilots-options-for-leaves.html

Post above belongs either in the Coronavirus thread or political comments thread.  

[elrodvt]

I agree I was in the wrong thread by accident. How do you move it?

Edited March 17, 2020 by elrodvt

[KJHburg]

25 minutes ago, elrodvt said:

I agree I was in the wrong thread by accident. How do you move it?

that is above my pay grade maybe just copy it and then reposted it another thread.  I have done that before.  

[elrodvt]

^ Thanks

[JHart]

20 hours ago, Tyrone Wiggum said:

American could have used all those profits it's generated over the years to do many things to keep itself viable in this situation; instead, it wasted most of its cash on share buybacks.  Airlines, like several other industries, are run by some of the most myopic people you'll ever meet, in that the ONLY thing that matters is this quarter's share price.

Unfortunately with a decade of court rulings and interpretation of legal doctrine, that is a feature not a bug of our economic system.. Almost every major company used tax cuts to buy back shares instead of adopting long term, sustainable growth plans; not just airlines