I'm all for respectful disagreement.


What you have described is all true for "mainline" or "legacy" type operators.

By definition, Atlas is an outsource provider. When the going gets tough, mainliners and legacies outsource. We've seen it all before. And the military, well, the military does not run on tax receipts.

All of that could be said about most ACMI carriers....especially the ones that the parent company has multiple revenue streams besides flying freight.

Good points by you and Zero. Not really a binary condition, though.

I'd say we're recession resilient, but not proof. Look at other ACMI carriers that were bought and used to cross-subsidize other businesses that were failing. Our business model is resilient, but we can be subsumed by greater financial maneuvers. For example if we were owned by something with "Capital" or "Fund" in its name. Every time there's a financial crisis that puts investment banks in a bind, we are vulnerable.

Agreed!
But the scope of the question was limited to Atlas. ACMI in general is the cockroach of the cargo industry. It will survive a nuclear economic event, but often perishes by executive malfeasance.

Have to disagree... Atlas is by definition a "Scheduled Carrier" with a minority of its fleet dedicated to sub-Service/ACMI/CMI

Atlas already leads FedEx in Available Ton Miles (ATM's) and nearly double that of UPS dating all the way back in 2019 and has grown substantially since then.

DOT Form 41 Data:
Atlas (Polar & Southern) : 24.5 BILLION Ton Miles
FedEx (Express): 22.3 Billion Ton Miles
UPS (Airlines): 13.8 Billion Ton Miles

Productivity per pilot of Atlas far exceeds that of any other carrier
Atlas 12,048,000 Average Ton Miles flown for the year 2019
FedEx 4,916,000 Average Ton Miles
UPS 4,865,000 Average Ton Miles

For 2020 (Atlas Investor Slides (SEC Data))
Atlas/Polar/Southern flew a combined 344,800 Block hours

Annual Revenue growth 2020 (SEC Filings)
Atlas/Polar/Southern: 17.8%
UPS: 14.2%
FedEx 9.2%

Pre-Tax Profit (SEC Filings)
Atlas/Polar/Southern: 14.2%
UPS 11.1%
FedEx 6.3%

Fuel remains a reimbursed cost through Fuel Surcharges accessed for each kg flown in slot controlled airports, so fuel will continue to be of little concern as prices fluctuate.

More than 65% of Atlas/Polar/Southern flying is on company owned slot/route authority. DHL under a block space agreement has access to that capacity but DOES NOT OWN IT or have operational control of any slot/route authority.

More than 85% of Actual Ton Miles are flown on the 747/777 aircraft where margins are the greatest with a direct return to Atlas on Revenues and Profits.

Atlas/Polar have additional slot capacity coming which is the reason for the recent acquisition of the 747-8/777 aircraft from Boeing.

Opinion:
The 737 remains a loss leader fleet, no Atlas/Polar/Southern freight is moved on those fleets and they remain solely ACMI/CMI lift.

The 767 Fleet has a large component dedicated to Amazon, again relatively low margin flying much like the 737.

However the balance of the 767 fleet is in fact flying scheduled service, and that list of aircraft are growing to accommodate new Scheduled service to South America, Europe, and possibly intra-Asia.

The 777, 747-8/400F are all primarily scheduled service with a few exceptions for CMI airframes. There are a few aircraft used for ACMI/Charter works however that lift has almost entirely been re-dedicated to supporting the IATA Exempt route airports to boost capacity where slots previously restricted access.

Much of the Kalitta flying will begin to wind down as the IATA Covid exemptions begin to subside later in 2022. Ghost flights and non-scheduled service will once again require strict adherence to route authority holders assigned slots/schedules. Atlas/Polar/Southern are positioned to maximize this capacity growth on these restricted segments with their existing route structures and future expansion slots.

https://www.iata.org/en/policy/slots/covid-19-slots/

That's all very interesting and I don't dispute any of it. I truly believe that Atlas crews are the most productive, valuable (and under appreciated) freight crews in the industry. Maybe I'm biased. But all of that honestly distracts from the original question:

Let's restate the question to really get to the point: "Should a prospective new hire at Atlas in 2022 be concerned about a furlough later this year or in 2023 due to economic recession or crisis."

My answer remains, no. Why? The so-called logistics (or supply chain) crunch that we're experiencing now is forecasted to continue until 2024/25. If the Legacies are VERY short on crews now, we are EXTREMELY short on crews. During an economic recession the demand for crews will be less at the Legacies. Demand may actually drop to zero temporarily. But in our segment of the industry, we'll simply be able to hire more crews then and may actually be properly staffed for the first time since 2016.

Again, Atlas has never furloughed for economic reasons. They furloughed as an intimidation tactic during negotiations.

Interesting observations here. We see different scenarios since we see different scopes of risk.

What about AAWH? Holdings is principly an investment company. So while our airline's business may be robust we share risk to a great degree with holdings.

What are people's perspectives on risk to us from difficulties that can potentially impact AAWH as demand for aircraft change, finance terms change and so on?

This is my point. The business model is strong, even considering the other subsidiaries. Any risk to crews has always come from inside the organization, not outside.

In point of fact, Atlas actually declared bankruptcy once, due to financial shenanigans by the second CEO Rick Shuyler who took over after the original founder/CEO Michael Chowdry died. Shuyler cooked the books, so the SEC canceled the original stock. Bankruptcy was declared in order to wipe the slate clean, so to speak.

https://www.joc.com/air-cargo/atlas-..._20040201.html

https://www.sec.gov/litigation/admin/2007/34-55556.pdf

Former TWA CEO Jeff Erickson took over at that point. He apparently had a reputation as a "cleaner" or "reorganizer" and the company emerged from bankruptcy in July 2004 with $7 million in cash. AAWH has been profitable ever since.

I say again: the business model is solid. Executive ethics are a bigger threat to crews than the economy.