WestJet Group Hiring Freeze

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Namttej
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Re: WestJet Group Hiring Freeze

Post by Namttej »

chromeuser wrote: Thu Mar 12, 2020 8:15 am I've been at Encore less than 6 months.

I am expecting a notice soon and planning for it.
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cloak
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Re: WestJet Group Hiring Freeze

Post by cloak »

There is no point really in sensationalizing the facts, yet for various reasons some wittingly or unwittingly do it! It is a self fulfilling prophecy that makes our worst fears become reality. In comparison with past outbreaks and pandemics this is not that bad; fear makes it way worse. This is an opportunity to educate ourselves and research some of those events, like H1N1, SARS, MERS, AIDS, and gain perspective.

Unfortunately the media has made the situation worse by focusing on the negative that creates more fear and people's behavior changes as a result. Where internet can be such a great medium to spread real news and instructions on containing the situation so people can go about their lives more safely, it creates an atmosphere of absolute fear that spreads like wildfire. Simple fact is that we have to stop doing that, one and all. So that we go about our normal lives and others do the same and life will go on normally. It's not the virus but our own fear that defeats us!

In this case, I think it is prudent to perhaps put future hiring on hold, but it would be unwise to furlough as that creates more fear and the impression of doom and gloom. That will discourage people from normal life including travelling and makes the situation worse. Pragmatically, it also creates negative impression with skilled workers who will be less likely to come back if they find other opportunities.
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ayseven
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Re: WestJet Group Hiring Freeze

Post by ayseven »

Again, you are right. I will hammer this home as much as I can. Do not let this get you down. Move forward as best you can.
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47north
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Re: WestJet Group Hiring Freeze

Post by 47north »

Looks like more than a hiring freeze. CUPE expecting 50% layoffs

https://www.theglobeandmail.com/busines ... -covid-19/
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Splash
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Re: WestJet Group Hiring Freeze

Post by Splash »

I just read the CBC News article about the flight attendants expecting massive lay-offs. That's not all, read the part about the YVR - LAX flight today.

https://www.cbc.ca/news/canada/calgary/ ... -1.5497037
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Airbrake
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Re: WestJet Group Hiring Freeze

Post by Airbrake »

Splash wrote: Fri Mar 13, 2020 12:48 pm I just read the CBC News article about the flight attendants expecting massive lay-offs. That's not all, read the part about the YVR - LAX flight today.

https://www.cbc.ca/news/canada/calgary/ ... -1.5497037
Yesterday I did an MCO flight and our load 2 days before going there was north of 120 on an 800, when we did it we took less than 35. Cancellations are a huge impact currently.
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Realitychex
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Re: WestJet Group Hiring Freeze

Post by Realitychex »

Anyone who thinks an imminent furlough program at WS is part of some sort of Onex master plan is delusional.

WJ's daily expenses are somewhere in the order of $12.5mm, and at last report, they had roughly $1.5b in cash available, or 120 days, (better than AC's$48mm avg daily run rate and 104 day cash supply).

Not only are new bookings non-existent, (at both airlines), but cancellations are the order of the day. Because of their fare mix, a far higher % of WJ's cancellations will go into "travel bank" funds, vs refunds at AC. AC would expect to bring in about $53mm a day in new bookings at this time of year, WS about $14mm a day. Not happening. I'll bet not even 20% of that.

In other words, there's very little new cash coming in, lots of cancellations and refunds - $ - going out, and then the daily cost of running an airline, ($12m for WJ, about $48m for AC, perhaps a little less for both at this time of year).

Not a pretty picture, folks.

Sure, WJ has the cash to withstand things for a longer period of time than AC, but let's be clear. Neither airline can afford to drain their cash reserves to even half of their current position.

AC, by its own admission, is far more exposed to TATL, TPAC, Australia and South America flying. Same on transborder. They also are dependent on last minute, high yield flying that generates their higher rasm to cover off their higher casm, (which, adjusted for stage length, remains 25% higher than WJ's). No one is booking last minute business flights these days that have traditionally padded AC's coffers. Same at Porter. And don't get me started on Flair. They are probably at Home Depot buying rope as I write.

AC is chronically known for pumping sunshine and never being immune to anything that impacts other airlines, both in Canada and the rest of the world. "Saul Goodman......"

Nonsense.

You can be absolutely assured that AC, WJ and all the others are, at this very moment, working 24/7 to figure out how to slash 40 - 60% of their schedule starting as early as mid next week. Significant furloughs are inevitable for all.

And as is the case with the stock market, the elevator down moves a lot faster than the elevator going up. It'll take time to spool things up back to normal. Fortunately, there's a still a decent amount of time to recover for 3Q. That being said, recall how the defacto pilot strike at WJ in May 2018 impacted advance bookings into June, July and to a degree, August. If this thing progresses into mid May, look out.

Few would describe me as an optimist, but in this case, I think the worst will be over within 45 days.

It goes without saying that the faster the hysteria subsides, the better it'll be for all. WJ tends to be less seasonal than AC. AC losing its 3Q, which generates the majority of its annual profit, would be an unmitigated disaster.

The question many of us are watching is what part of the fleet AC will park? Rouge, with its "free airplanes, cheap crews, lower costs and highly profitable model", or mainline, which, by it's own admission, has costs 15% or more than Rouge. It would seem obvious that you keep the lowest cost part of the operation and scale back the high cost, cash draining part of the business, But then again, didn't AC pilots agree to Rouge with provision it wouldn't cost them jobs?

The devil is in the detail.

As many of us longtimers know, "this all shall pass". But in the interim, it will be most unpleasant.

:cry:
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palebird
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Re: WestJet Group Hiring Freeze

Post by palebird »

No delusion here buddy. You Westjet cheerleaders keep your heads in the sand. The mother of all financial crisis is knocking at the door. Onex is a big player and they will liquidate Westjet faster than you can wrap your head around that fact. Have fun. Once this virus pandemic has run it's course we will find ourselves mired in one ugly recession. With a completely inept government. Canadian dollar is sinking like a stone. Euro banking system has had negative rates for quite some time and we are almost there.How do you stimulate an economy such as ours when you no longer can drop rates? Love to hear that answer. The credit markets are seizing up and liquidity is king. Onex understands this. You do not.
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TheRealPapaK
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Re: WestJet Group Hiring Freeze

Post by TheRealPapaK »

Realitychex wrote: Sat Mar 14, 2020 9:27 am
WJ's daily expenses are somewhere in the order of $12.5mm, and at last report, they had roughly $1.5b in cash available, or 120 days, (better than AC's$48mm avg daily run rate and 104 day cash supply).

Last report Westjet had $1.36B liquidity and AC had $7.38B. If Air Canada was at $48m a day that would be 154 days.

Plus 35 of the mainline 319/320 are already sold and leased back because of the Max crisis as well as 14 EMB and could be dropped quickly They could also get rid of their mainline 767's 1 year early.
Air Canada has Boeing paying for 10% of their pilots. And they have ~200 retirements a year that they could offer early retirement packages to and probably off load 10-15% of their most expensive pilots without laying off from the bottom of the list.

I'm not trying to poo poo on WestJet or fear monger. I'm just trying to point out that AC has a stronger position then you are letting on.
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tsgas
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Re: WestJet Group Hiring Freeze

Post by tsgas »

cloak wrote: Fri Mar 13, 2020 8:56 am There is no point really in sensationalizing the facts, yet for various reasons some wittingly or unwittingly do it! It is a self fulfilling prophecy that makes our worst fears become reality. In comparison with past outbreaks and pandemics this is not that bad; fear makes it way worse. This is an opportunity to educate ourselves and research some of those events, like H1N1, SARS, MERS, AIDS, and gain perspective.

Unfortunately the media has made the situation worse by focusing on the negative that creates more fear and people's behavior changes as a result. Where internet can be such a great medium to spread real news and instructions on containing the situation so people can go about their lives more safely, it creates an atmosphere of absolute fear that spreads like wildfire. Simple fact is that we have to stop doing that, one and all. So that we go about our normal lives and others do the same and life will go on normally. It's not the virus but our own fear that defeats us!

In this case, I think it is prudent to perhaps put future hiring on hold, but it would be unwise to furlough as that creates more fear and the impression of doom and gloom. That will discourage people from normal life including travelling and makes the situation worse. Pragmatically, it also creates negative impression with skilled workers who will be less likely to come back if they find other opportunities.
The only possible alternative to massive layoffs is job sharing combined with pay cuts. This is not a drill.
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Last edited by tsgas on Sat Mar 14, 2020 12:04 pm, edited 1 time in total.
kiaszceski
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Re: WestJet Group Hiring Freeze

Post by kiaszceski »

tsgas wrote: Sat Mar 14, 2020 11:52 am The only possible alternative to massive layoffs is job sharing combined with pay cuts. This is no a drill.
AKA temporary part time job.
I guess more people could get through this situation with a part time schedule than being laid off.
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sarg
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Re: WestJet Group Hiring Freeze

Post by sarg »

Airbrake wrote: Sat Mar 14, 2020 6:35 am
Splash wrote: Fri Mar 13, 2020 12:48 pm I just read the CBC News article about the flight attendants expecting massive lay-offs. That's not all, read the part about the YVR - LAX flight today.

https://www.cbc.ca/news/canada/calgary/ ... -1.5497037
Yesterday I did an MCO flight and our load 2 days before going there was north of 120 on an 800, when we did it we took less than 35. Cancellations are a huge impact currently.
With Disney and most of the other theme parks closed it doesn't make sense to go to MCO on a family holiday. FLL and MIA will suffer as well no cruises.
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jjj
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Re: WestJet Group Hiring Freeze

Post by jjj »

I have considered the prospect of a job share or pay cut.

That would be cool as long as it came with fences.

If you give up 10% at a place like WestJet then you need assurances that you will get it back.

Guys on furlough also need to come back to the same job they left - not something worse than when they left.

I put my faith in the union on this one.
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Realitychex
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Re: WestJet Group Hiring Freeze

Post by Realitychex »

AC had $5.889b in cash, cash equivalents and short term investments at Dec 31 2019.

At an average run rate of $47.893m a day, that's 123 days of cash available.

WS had an average run rate of $13m a day with cash of about $1.6b, or coincidentally, 123 days of cash available.

Both may have credit facilities available. WS has a better credit rating so its credit will be cheaper than AC's. WJ typically is profitable in 1Q on an operating basis, AC rarely is, so WJ's cash position was likely holding its own until this blew up, AC's was likely down a little.

Neither operation will be willing to drain their cash reserves to even 50% of where they are currently at playing silly bugger market share games, even moreso the higher cost operator of the two.

The bottom line is that its delusional thinking to assume that any airline, and especially one with 105 wide body aircraft and 70% of its revenue coming from international travel that has completely collapsed, can keep going on a "what me worry?" basis.

There are going to be draconian cuts in the next week in Montreal and Calgary.

:shock:
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kiaszceski
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Re: WestJet Group Hiring Freeze

Post by kiaszceski »

Realitychex wrote: Sat Mar 14, 2020 2:04 pm AC had $5.889b in cash, cash equivalents and short term investments at Dec 31 2019.

At an average run rate of $47.893m a day, that's 123 days of cash available.

WS had an average run rate of $13m a day with cash of about $1.6b, or coincidentally, 123 days of cash available.

Both may have credit facilities available. WS has a better credit rating so its credit will be cheaper than AC's. WJ typically is profitable in 1Q on an operating basis, AC rarely is, so WJ's cash position was likely holding its own until this blew up, AC's was likely down a little.

Neither operation will be willing to drain their cash reserves to even 50% of where they are currently at playing silly bugger market share games, even moreso the higher cost operator of the two.

The bottom line is that its delusional thinking to assume that any airline, and especially one with 105 wide body aircraft and 70% of its revenue coming from international travel that has completely collapsed, can keep going on a "what me worry?" basis.

There are going to be draconian cuts in the next week in Montreal and Calgary.

:shock:
Those numbers are quite interesting. When you talk about WJ cash, are you talking about what’s in WJ bank account? I’m curious to read more. Do you have the source?
Wouldn’t Onex be trying to mitigate cuts by adding money?
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tsgas
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Re: WestJet Group Hiring Freeze

Post by tsgas »

jjj wrote: Sat Mar 14, 2020 1:46 pm I have considered the prospect of a job share or pay cut.

That would be cool as long as it came with fences.

If you give up 10% at a place like WestJet then you need assurances that you will get it back.

Guys on furlough also need to come back to the same job they left - not something worse than when they left.

I put my faith in the union on this one.
FYI the union doesn't issue you your pay check. If the bean counters determine that you are a greater liability than an asset , during a Global recession , then you will join the long line of the unemployed.
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tsgas
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Re: WestJet Group Hiring Freeze

Post by tsgas »

kiaszceski wrote: Sat Mar 14, 2020 2:13 pm
Realitychex wrote: Sat Mar 14, 2020 2:04 pm AC had $5.889b in cash, cash equivalents and short term investments at Dec 31 2019.

At an average run rate of $47.893m a day, that's 123 days of cash available.

WS had an average run rate of $13m a day with cash of about $1.6b, or coincidentally, 123 days of cash available.

Both may have credit facilities available. WS has a better credit rating so its credit will be cheaper than AC's. WJ typically is profitable in 1Q on an operating basis, AC rarely is, so WJ's cash position was likely holding its own until this blew up, AC's was likely down a little.

Neither operation will be willing to drain their cash reserves to even 50% of where they are currently at playing silly bugger market share games, even moreso the higher cost operator of the two.

The bottom line is that its delusional thinking to assume that any airline, and especially one with 105 wide body aircraft and 70% of its revenue coming from international travel that has completely collapsed, can keep going on a "what me worry?" basis.

There are going to be draconian cuts in the next week in Montreal and Calgary.

:shock:
Those numbers are quite interesting. When you talk about WJ cash, are you talking about what’s in WJ bank account? I’m curious to read more. Do you have the source?
Wouldn’t Onex be trying to mitigate cuts by adding money?
Onex has an opportunity to buy up companies , outside of aviation , at major discounts. Why would they spend good money after bad on an industry that will be in the red for the foreseeable future ?
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jjj
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Re: WestJet Group Hiring Freeze

Post by jjj »

tsgas wrote: Sat Mar 14, 2020 2:26 pm
jjj wrote: Sat Mar 14, 2020 1:46 pm I have considered the prospect of a job share or pay cut.

That would be cool as long as it came with fences.

If you give up 10% at a place like WestJet then you need assurances that you will get it back.

Guys on furlough also need to come back to the same job they left - not something worse than when they left.

I put my faith in the union on this one.
FYI the union doesn't issue you your pay check. If the bean counters determine that you are a greater liability than an asset , during a Global recession , then you will join the long line of the unemployed.
Correct however we have a Company that is used to just doing whatever they want and now we have a Union to take them to task on how to manage things such as a pilot list and seniority. With the Union in place it will be harder to slash the ranks of the pilots compared to the FAs. Slashing FA jobs without formal measures in place doesn't trigger training events etc. They can move me to another seat if required but they also have to train me.

JJJ
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kiaszceski
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Re: WestJet Group Hiring Freeze

Post by kiaszceski »

They can cut pretty much 10-15% of bottom of the list with no immediate training required because the majority are FO.

And since they will probably be cutting routes and lower the number of flights for let say the yyz-yul turn and probably others « business routes » nobody will see any difference.

Onex bought Westjet for twice the market price, that’s probably not to let it sink but cuts are inevitable.
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Realitychex
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Re: WestJet Group Hiring Freeze

Post by Realitychex »

If you talk to the powers at be at Onex, they'll tell you they bought WJ at a $4-$7 per share discount to its true value. Onex doesn't over pay for anything.

They bought WJ when it was just coming out of a mud puddle and they know it.

They'll be furloughs at AC, WJ, AA, Delta, UAL, Alaska, jetBlue, Southwest.......everyone. No one is immune.

Everyone should be back at work within about 90 days.

Use your time off wisely. It's a rare opportunity for airlines to reset and for employees to get an extended break.

If you think Onex bought WJ in order to shrink it, you're delusional.
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