Industry Predictions
03-21-2020, 06:42 PM
#1
Gets Weekends Off
Thread Starter
Joined APC: Oct 2019
Posts: 150
Industry Predictions
In less than 10 days, this industry went from record highs + a pilot hiring forecast that would indicate the best entry point for an airline career in aviation history to unprecedented capacity cuts, plummeting passenger load factors, travel bans, and all-out survival mode.
The economic damage done will likely permanently change the industry as we knew it pre-COVID-19. Airline furloughs are not a matter of if, it’s a matter of when — no bailout is going to compensate for the likely lower passenger demand in the months and years ahead. Airlines will shrink and need to practice capacity discipline.
What do you all think the future holds?
Will the inevitable bailouts reverse the trajectory of U.S. airlines? How much will airlines shrink? Can any airline financially weather this storm without intervention? Will the mass retirements from age 65 result in uptick in hiring in the future or will shrinking fleets mostly cover labor demands? How do you think the industry may change in the future?
The economic damage done will likely permanently change the industry as we knew it pre-COVID-19. Airline furloughs are not a matter of if, it’s a matter of when — no bailout is going to compensate for the likely lower passenger demand in the months and years ahead. Airlines will shrink and need to practice capacity discipline.
What do you all think the future holds?
Will the inevitable bailouts reverse the trajectory of U.S. airlines? How much will airlines shrink? Can any airline financially weather this storm without intervention? Will the mass retirements from age 65 result in uptick in hiring in the future or will shrinking fleets mostly cover labor demands? How do you think the industry may change in the future?
03-21-2020, 06:50 PM
#2
Gets Weekends Off
Joined APC: May 2013
Posts: 2,594
Originally Posted by 6ix9ineYearFlow
In less than 10 days, this industry went from record highs + a pilot hiring forecast that would indicate the best entry point for an airline career in aviation history to unprecedented capacity cuts, plummeting passenger load factors, travel bans, and all-out survival mode.
The economic damage done will likely permanently change the industry as we knew it pre-COVID-19. Airline furloughs are not a matter of if, it’s a matter of when — no bailout is going to compensate for the likely lower passenger demand in the months and years ahead. Airlines will shrink and need to practice capacity discipline.
What do you all think the future holds?
Will the inevitable bailouts reverse the trajectory of U.S. airlines? How much will airlines shrink? Can any airline financially weather this storm without intervention? Will the mass retirements from age 65 result in uptick in hiring in the future or will shrinking fleets mostly cover labor demands? How do you think the industry may change in the future?
The economic damage done will likely permanently change the industry as we knew it pre-COVID-19. Airline furloughs are not a matter of if, it’s a matter of when — no bailout is going to compensate for the likely lower passenger demand in the months and years ahead. Airlines will shrink and need to practice capacity discipline.
What do you all think the future holds?
Will the inevitable bailouts reverse the trajectory of U.S. airlines? How much will airlines shrink? Can any airline financially weather this storm without intervention? Will the mass retirements from age 65 result in uptick in hiring in the future or will shrinking fleets mostly cover labor demands? How do you think the industry may change in the future?
The reaction to this flu is far worse than the flu itself. You CANNOT allow the medical community with their "worst case scenarios" call the shots.
At what point is the financial cost higher than what will probably be less than 5000 deaths? We are still below 300. Does anyone actually think that Cuomo or Newsome et al will turn on the lights in 2 or 3 weeks? No, they want it shut down for 45 days. Death to the career for 3-5 years. Hope Im wrong.
03-21-2020, 06:57 PM
#3
Gets Weekends Off
Joined APC: Apr 2013
Posts: 1,180
Originally Posted by 6ix9ineYearFlow
In less than 10 days, this industry went from record highs + a pilot hiring forecast that would indicate the best entry point for an airline career in aviation history to unprecedented capacity cuts, plummeting passenger load factors, travel bans, and all-out survival mode.
The economic damage done will likely permanently change the industry as we knew it pre-COVID-19. Airline furloughs are not a matter of if, it’s a matter of when — no bailout is going to compensate for the likely lower passenger demand in the months and years ahead. Airlines will shrink and need to practice capacity discipline.
What do you all think the future holds?
Will the inevitable bailouts reverse the trajectory of U.S. airlines? How much will airlines shrink? Can any airline financially weather this storm without intervention? Will the mass retirements from age 65 result in uptick in hiring in the future or will shrinking fleets mostly cover labor demands? How do you think the industry may change in the future?
The economic damage done will likely permanently change the industry as we knew it pre-COVID-19. Airline furloughs are not a matter of if, it’s a matter of when — no bailout is going to compensate for the likely lower passenger demand in the months and years ahead. Airlines will shrink and need to practice capacity discipline.
What do you all think the future holds?
Will the inevitable bailouts reverse the trajectory of U.S. airlines? How much will airlines shrink? Can any airline financially weather this storm without intervention? Will the mass retirements from age 65 result in uptick in hiring in the future or will shrinking fleets mostly cover labor demands? How do you think the industry may change in the future?
They aren't going to start taking Amtrak across the country and spend 3-4 days traveling.
People said after 9/11 and 08 travel was done for and tons weren’t coming back. Funny.
Who knows when this will happen, but when all the BS settles people will fly again. I would almost bet there will be pent up demand after weeks or a month (or more) of social distancing and canceled vacations and precious travel plans.
03-21-2020, 07:00 PM
#4
Gets Weekends Off
Joined APC: May 2013
Posts: 2,594
Originally Posted by CAirBear
All I know is this. People aren’t going to start driving 18 hours in their cars to go visit grandma/friends and family.
They aren't going to start taking Amtrak across the country and spend 3-4 days traveling.
People said after 9/11 and 08 travel was done for and tons weren’t coming back. Funny.
Who knows when this will happen, but when all the BS settles people will fly again. I would almost bet there will be pent up demand after weeks or a month (or more) of social distancing and canceled vacations and precious travel plans.
They aren't going to start taking Amtrak across the country and spend 3-4 days traveling.
People said after 9/11 and 08 travel was done for and tons weren’t coming back. Funny.
Who knows when this will happen, but when all the BS settles people will fly again. I would almost bet there will be pent up demand after weeks or a month (or more) of social distancing and canceled vacations and precious travel plans.
I love the optimism, but the media loves people trapped inside depending on them to spoon-feed the propaganda.
The career is toast for 18 months or more. Hope Im wrong
03-21-2020, 07:09 PM
#6
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Joined APC: May 2013
Posts: 2,594
Originally Posted by bluesky24
I know a lot of people are already planning trips for when things get back to normal. Once business travelers are allowed to fly again there will be full flights in no time.
All sectors are bleeding their cash reserves now. They wont have the cash to throw around- Think about the average joe, who make up most of the loads. They will have zero reserves for travel until next year at the earliest. This is why shutting down an economy completely is so misguided. It take years to get the locomotive going again. If you slow it, it can come back quickly, but not if it grinds to a halt.
Look at the market- Yes, a lot of us have cash and will chuck it in to the market IF we are not out of a job or have to take pay cuts for 2 years.
The reaction is the disaster of this corona takeover.
03-21-2020, 07:14 PM
#7
On Reserve
Joined APC: Jan 2014
Posts: 16
I predict FedEx/UPS will again be the ultimate goal for most pilots.
Passenger airlines collapse every decade:
-9/11
-Great Recession
-COVID19
To your original question, I believe it will take 3-5 years before we see pre-corona demand for pax airlines. Hopefully with all the upcoming retirements, furloughs won't go deep. Just realize rapid progression and short upgrades to Captain are probably a thing of the past.
Passenger airlines collapse every decade:
-9/11
-Great Recession
-COVID19
To your original question, I believe it will take 3-5 years before we see pre-corona demand for pax airlines. Hopefully with all the upcoming retirements, furloughs won't go deep. Just realize rapid progression and short upgrades to Captain are probably a thing of the past.
03-21-2020, 07:20 PM
#8
"Yinzer an'at"
Joined APC: Jun 2012
Position: Sittin at the puter
Posts: 186
This morning, March 21, @5:am an article was published in the online version of The Atlantic. The Atlantic is a "left leaning" publication. However it has been around since 1857, and has some very good authors and contributors, and while it has a progressive tilt, it is considered accurate and trustworthy. This story, recounts recent conversations and emails between the author of the article and prominent economists. The economists are not at all left wing, they are from Goldman Sachs and JP Morgan and Mark Zandi, the Chief Economist at Moody's.
An excerpt from this article.
Economic number-crunchers are struggling to keep up with the speed of the slide. On Sunday evening, Goldman Sachs projected that economic growth would be zero in the first quarter of the year, which ends March 31, and that economic activity would fall by 5 percent in the second quarter. Just three days later, J.P. Morgan put out a new forecast: The gross domestic product would fall by 4 percent this quarter and then plummet a staggering 14 percent in the next three months.
“We’re talking really big numbers,” Heidi Shierholz, who served as chief economist for the Department of Labor during the Obama administration and is now a senior fellow at the Economic Policy Institute, a progressive think tank, told me on Thursday morning.
By Friday, Goldman Sachs had revised its figures: The investment bank was now expecting a 24 percent drop in the second quarter. “Holy hell,” Shierholz said in an email flagging the update for me.
To put the data in perspective: These second-quarter forecasts would mean the deepest, fastest drop in economic activity since the government began calculating the nation’s GDP on a quarterly basis in 1947. Before now, the worst three-month plunge was 10 percent in early 1958, which happened to coincide with a flu pandemic that began the year before.
Shierholz and her colleagues have been working to translate the Goldman Sachs and J.P. Morgan projections into the statistics that people care most about—namely, jobs. A nosedive along the lines of what J.P. Morgan is predicting, she told me, would mean that 8.5 million jobs would be lost by the summer, spiking the unemployment rate from its current 3.5 percent all the way up to roughly 8.7 percent. Under the Goldman Sachs estimate, the jobs gone would total 14 million. By comparison, a rough total of about 8.7 million jobs disappeared in the Great Recession a decade ago, but those losses were spread out over years. This would occur in a single springtime.
The full text of the article is here: https://www.theatlantic.com/politics...nesses/608461/
[While the president and Larry Cudlow are predicting a steep "V-shaped" dive and recovery for the economy, the folks at Moody,s JP Morgan and Goldman Sachs are not so sure. They predict a much more dire outlook. For my own $.02, I believe that the current wave of "shut-downs" in the economy will increase and the duration will lengthen. We don't have the testing data necessary to determine if we are winning, losing or slowing the infection rates. That will likely required a longer Social Distancing and closed business scenario. That can only make the numbers worse.]
This last paragraph, in brackets, simply my opinion, however I would invite you to read the article. The article does have a "ray of sunshine" at the end but it requires the government to perform flawlessly on the economic front. Even if the US Govt. does everything right economically other countries, ie. China and the EU may not. There is a lot of debt in the system and it is unstable.
An excerpt from this article.
Economic number-crunchers are struggling to keep up with the speed of the slide. On Sunday evening, Goldman Sachs projected that economic growth would be zero in the first quarter of the year, which ends March 31, and that economic activity would fall by 5 percent in the second quarter. Just three days later, J.P. Morgan put out a new forecast: The gross domestic product would fall by 4 percent this quarter and then plummet a staggering 14 percent in the next three months.
“We’re talking really big numbers,” Heidi Shierholz, who served as chief economist for the Department of Labor during the Obama administration and is now a senior fellow at the Economic Policy Institute, a progressive think tank, told me on Thursday morning.
By Friday, Goldman Sachs had revised its figures: The investment bank was now expecting a 24 percent drop in the second quarter. “Holy hell,” Shierholz said in an email flagging the update for me.
To put the data in perspective: These second-quarter forecasts would mean the deepest, fastest drop in economic activity since the government began calculating the nation’s GDP on a quarterly basis in 1947. Before now, the worst three-month plunge was 10 percent in early 1958, which happened to coincide with a flu pandemic that began the year before.
Shierholz and her colleagues have been working to translate the Goldman Sachs and J.P. Morgan projections into the statistics that people care most about—namely, jobs. A nosedive along the lines of what J.P. Morgan is predicting, she told me, would mean that 8.5 million jobs would be lost by the summer, spiking the unemployment rate from its current 3.5 percent all the way up to roughly 8.7 percent. Under the Goldman Sachs estimate, the jobs gone would total 14 million. By comparison, a rough total of about 8.7 million jobs disappeared in the Great Recession a decade ago, but those losses were spread out over years. This would occur in a single springtime.
The full text of the article is here: https://www.theatlantic.com/politics...nesses/608461/
[While the president and Larry Cudlow are predicting a steep "V-shaped" dive and recovery for the economy, the folks at Moody,s JP Morgan and Goldman Sachs are not so sure. They predict a much more dire outlook. For my own $.02, I believe that the current wave of "shut-downs" in the economy will increase and the duration will lengthen. We don't have the testing data necessary to determine if we are winning, losing or slowing the infection rates. That will likely required a longer Social Distancing and closed business scenario. That can only make the numbers worse.]
This last paragraph, in brackets, simply my opinion, however I would invite you to read the article. The article does have a "ray of sunshine" at the end but it requires the government to perform flawlessly on the economic front. Even if the US Govt. does everything right economically other countries, ie. China and the EU may not. There is a lot of debt in the system and it is unstable.
03-21-2020, 07:23 PM
#9
Line Holder
Joined APC: May 2017
Posts: 90
Originally Posted by Bozo the pilot
Not until 2021- maybe.
All sectors are bleeding their cash reserves now. They wont have the cash to throw around- Think about the average joe, who make up most of the loads. They will have zero reserves for travel until next year at the earliest. This is why shutting down an economy completely is so misguided. It take years to get the locomotive going again. If you slow it, it can come back quickly, but not if it grinds to a halt.
Look at the market- Yes, a lot of us have cash and will chuck it in to the market IF we are not out of a job or have to take pay cuts for 2 years.
The reaction is the disaster of this corona takeover.
All sectors are bleeding their cash reserves now. They wont have the cash to throw around- Think about the average joe, who make up most of the loads. They will have zero reserves for travel until next year at the earliest. This is why shutting down an economy completely is so misguided. It take years to get the locomotive going again. If you slow it, it can come back quickly, but not if it grinds to a halt.
Look at the market- Yes, a lot of us have cash and will chuck it in to the market IF we are not out of a job or have to take pay cuts for 2 years.
The reaction is the disaster of this corona takeover.
03-21-2020, 09:19 PM
#10
Gets Weekends Off
Joined APC: Dec 2017
Position: Retired NJA & AA
Posts: 1,916
Business travelers are the airlines bread and butter. A YouTube poster I follow named Louis Rossmann runs a computer repair business in NYC. His rent is $12,500/month. All non-essential business are supposed to be shut down but since he supports some Gov agencies he can stay open. But he has no customers to speak of. Yet his building management company has already sent him a rent due notice even thou it's not due until April 5th. And they're doing the same for the other buildings they manage. There may be loans from the SBA, but that has to be paid back. Many of these businesses won't be able to pay their rent with no business, then the building owners won't be able to pay the mortgage, then the mortgage holder gets screwed. Domino effect bigtime. If this pandemic last too long the economy will tank like none of us have ever seen.
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