Rumors
03-04-2024 | 01:54 PM
#41
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Joined: Mar 2023
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They can’t, the only way spirit makes it is by raising ticket prices which is not possible or restructure to lower costs. Even then, offer premium services like the legacies or just be content as a niche ULCC. It would be tough but that’s the only way.
03-04-2024 | 03:46 PM
#42
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Joined: Mar 2020
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a sudden; spirits doing poorly. Do I think spirit is in perfect shape? No! But let’s give credit where it’s due.
03-04-2024 | 04:34 PM
#43
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Joined: Jan 2018
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they did - in second quarter last year. But no one wants to remember that. Yes spirit showed a profit Q2 last year, but by Q3, spirit was going into a merger where making money wasn’t going to help get the merger passed. Then all of
a sudden; spirits doing poorly. Do I think spirit is in perfect shape? No! But let’s give credit where it’s due.
a sudden; spirits doing poorly. Do I think spirit is in perfect shape? No! But let’s give credit where it’s due.
They had a 15m net profit in Q3 2021, but significant losses in every other quarter since covid. The last two quarters were -156m and -183m. Losing about 500m per year, with a huge junk bond maturing in 2025.
03-04-2024 | 06:30 PM
#44
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Joined: Feb 2024
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The thing is, it is hard to figure out...
Yes, we have a clearly defined number of crews per plane. And you can calculate some of the cost of that by adding all the pilot slaries together. But there is a lot of other cost, like support staff, training staff, office building, Simulator time, that does not decrease if you furlough crews. And we would not furlough crews, we would furlough junior FOs, so very little cost savings. One of the biggest reasons there weren't more furloughs during the pandemic (outside of gov cheeze) was that the cost to retrain everyone was higher than to offer over 50% pay for people to sit home.
Napkin math:
Furlough 25%, so 1000 on 1st&2nd year pay, downgrade 500 on 5th year pay would save about $180M/yr or $45M/Q. And it would mean 30 aircraft not staffed, but they have no engines anyway...
Sounds great. But NK net loss last Q was over $180M, so you would have to furlough the other 75% of the pilots as well to save enough........ (yes, I know, furloughing the senior would save more)
(What I do find interesting is that the whole strategy of NK was always been based on continued growth. And anytime the growth would slow down the analytst would be worried, and pushed for growth. And now all the analytsts are saying that the ULCC market is only so big, and we can't be profitable at our size. And they have known about basic economy from the legacies forever, and/or should have known the effects of that.)
Yes, we have a clearly defined number of crews per plane. And you can calculate some of the cost of that by adding all the pilot slaries together. But there is a lot of other cost, like support staff, training staff, office building, Simulator time, that does not decrease if you furlough crews. And we would not furlough crews, we would furlough junior FOs, so very little cost savings. One of the biggest reasons there weren't more furloughs during the pandemic (outside of gov cheeze) was that the cost to retrain everyone was higher than to offer over 50% pay for people to sit home.
Napkin math:
Furlough 25%, so 1000 on 1st&2nd year pay, downgrade 500 on 5th year pay would save about $180M/yr or $45M/Q. And it would mean 30 aircraft not staffed, but they have no engines anyway...
Sounds great. But NK net loss last Q was over $180M, so you would have to furlough the other 75% of the pilots as well to save enough........ (yes, I know, furloughing the senior would save more)
(What I do find interesting is that the whole strategy of NK was always been based on continued growth. And anytime the growth would slow down the analytst would be worried, and pushed for growth. And now all the analytsts are saying that the ULCC market is only so big, and we can't be profitable at our size. And they have known about basic economy from the legacies forever, and/or should have known the effects of that.)
So I think the numbers we're looking at is between 400-500 FOs to be furloughed and 170 CAs to be downgraded if this post renders true.
03-04-2024 | 06:48 PM
#45
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He can allude to whatever he wants but he’s not talking big changes. He’s just talking about “some” bundling of the product. There will be no substantial changes. They don’t have the vision and can’t get the money even if they did.
03-04-2024 | 08:58 PM
#46
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Joined: Oct 2022
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Hate to give thread any validity, but I believe the math you did was factored wrong. The original post said 25% of FOs will be furloughed, not 25% of the company. There are about 1,833 FOs, 25% of that would be 458. If you furlough 1000 FOs, you're losing more than half of the FOs on property lol. And then even with a 10% downgrade of CAs, there will be a significant imbalance of CAs to FOs where CAs largely outnumber the FOs.
So I think the numbers we're looking at is between 400-500 FOs to be furloughed and 170 CAs to be downgraded if this post renders true.
So I think the numbers we're looking at is between 400-500 FOs to be furloughed and 170 CAs to be downgraded if this post renders true.
100 second year 72x142x100 = 1.022M
100 four year captains 72x109x100= .785M
70 five year captains 72x109x70= .550M
5.150M of straight hourly rate cost savings per month. No idea what they’d save on taxes, benefits, and the individual cost to re qual furloughed pilots later down the road to weigh against.
03-05-2024 | 12:57 AM
#47
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Joined: May 2015
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400 or so first year is 72x97x400 = 2.793M
100 second year 72x142x100 = 1.022M
100 four year captains 72x109x100= .785M
70 five year captains 72x109x70= .550M
5.150M of straight hourly rate cost savings per month. No idea what they’d save on taxes, benefits, and the individual cost to re qual furloughed pilots later down the road to weigh against.
100 second year 72x142x100 = 1.022M
100 four year captains 72x109x100= .785M
70 five year captains 72x109x70= .550M
5.150M of straight hourly rate cost savings per month. No idea what they’d save on taxes, benefits, and the individual cost to re qual furloughed pilots later down the road to weigh against.
My basic bath shows them saving ballpark 70 million a year with 400 less FO seats and 125 less CA seats . A not insignificant number and one the company I’m sure is considering. hope it never comes to that. Contract I think stipulates they have to ask for voluntary furloughs before involuntary. So if we get an email asking guys to leave early , or who may wanna take
some time off unpaid (nobody) then we know what the next move is gonna be. Let’s hope that Email doesn’t come.
03-05-2024 | 03:22 AM
#48
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Joined: Oct 2022
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why did you count 4 and 5 year captains at 109?
My basic bath shows them saving ballpark 70 million a year with 400 less FO seats and 125 less CA seats . A not insignificant number and one the company I’m sure is considering. hope it never comes to that. Contract I think stipulates they have to ask for voluntary furloughs before involuntary. So if we get an email asking guys to leave early , or who may wanna take
some time off unpaid (nobody) then we know what the next move is gonna be. Let’s hope that Email doesn’t come.
My basic bath shows them saving ballpark 70 million a year with 400 less FO seats and 125 less CA seats . A not insignificant number and one the company I’m sure is considering. hope it never comes to that. Contract I think stipulates they have to ask for voluntary furloughs before involuntary. So if we get an email asking guys to leave early , or who may wanna take
some time off unpaid (nobody) then we know what the next move is gonna be. Let’s hope that Email doesn’t come.
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