CFItillIdie

I know it may be too soon to talk about it, but what do the arm chair economists think about recent drop in the markets? How will it impact the recent growth at the regionals? Are we heading back into the land of the furlough sooner than we think? Will this be exactly what management wants to see so it will curb the need to replace the large retiring group?

So many questions, so little time. I have a feeling that we have a little time before any negative impact is felt, but I think that if the market continues to slump we will see some bad things happening this winter. I hate to say it, but things do not look good. The government needs to stop the bleeding soon or else the long term impact will mean that pilots will lose any leverage that we think we have on management.

Thoughts?

Cruz5350

All it takes is one big dive and all these new hires will be on the streets. I support many of the corporate and fractional companies with part's for their Jet's and TProps and across the board we have noticed quite a drastic drop in sales. When I ask the operators whats up they simply say the owners can't or don't want to fly as much due to cost and risk.

STLaviator

I think one of the most important differences we're seeing right now compared to 2008 is that oil prices are still staying down. If the price of crude oil and Jet-A starts going up again, then I'll be a little more concerned. Also, if the White House does finally release the new duty time and rest rules that were supposed to go into effect August 1st, my understanding is that regardless of the economy the airlines will need to continue hiring in order to have staffing levels appropriate to meet the new requirements. But what do I know? There are just too many variables to consider!

pokey9554

I may be completely wrong, but I don't believe the market has much to do with the regionals. Of course some management groups could use scare tactics to convince a group they need to take concessions. If anything, the falling crude prices will encourage the majors to take some of their flying back, however, the volatility of oil should make them cautiosly optimistic. On the other hand, the labor costs of some regionals are so low, the majors may keep them too.

When crude rises, the majors try to offset the rise in price by a drop in overhead (concessions) or an increase in revenue. When a major's pilot group won't take concessions, the whipsaw begins.

In this environment, an airlines success can be determined by the amount of debt it's carrying. With the fear of rising interest rates, borrowing may become more difficult. If you're looking for a place to go, I would consider SkyWest as they have a few bucks in the bank.

Another misconception I feel is completely relevant, is that the goverment doesn't control the stock market. Large financial firms have dramatic effects on stock values.

To answer your question in one sentence, I would say, "Sir or Ma'am, that's above my paygrade".