Bye Bye Zoom

[mattedfred]

"Sorry man, but to compare Zoom to Jetsgo is over the line, The Zoom folks didn't have to mortgage a house to have a job."

off the topic of this thread but jetsgo employees didn't have to mortgage their house to have a job they CHOSE to.

i understand the reasons why many of us CHOSE to fly for an operator that had training bonds etc when we were starting out but do AGREE to do so at the jetsgo level is SAD.

IMHO

[boeingboy]

HMY was one example of the 'smart money' leaving aviation.

That couldn't be farther from the truth.

There was nothing smart about HMY's money.......................just lots of it!

[imarai]

Remember WorldWays, Canada 3000, Roots Air, Greyhound (operated by Kelowna Flightcraft), Harmony, and JetsGo? Sorry to see them go. Perhaps Zoom Air can reorganize. If the past is prologue, low-cost air fares will always be in demand, but considering high fuel costs, the massess will be flown by mass marketed airlines, and there is room for only a few of those companies. The spectre of monopollies loom large during recessionary economies, even though Canada is thought not to be in one..,but there are signs of a slow down in economic growth. The next few months may prove unsettling to some of the legacy carriers in the U.S. as well. Hang on. We may be in for a bumpy ride.



"Inflatable vest? Sorry, we sold out of those on our Winnipeg to Edmonton flight."

[cjet]

THAT IS WHY, I would never,ever book anything with the ZOOMs, CanJets, Skylinks and Transats for a holiday out of the country. It is Air Canada - bar none and depending on the destination WestJet. I keep telling my many acquaintances that if you are gonna spend big bucks on a MED. cruise or something similar down south, STAY THE @#$! AWAY from the above outfits. IT's your hard earned money that is going down the toilet!!!!!!!!!!

Old Fella,

What you may not realize is when you travel with Charter Airlines like Skyservice or Canjet is that they have contracts with huge international tour companies that have huge buying power at resorts around the world. Who is going to get a better rate for hotels in the Caribbean Air Canada who buys a 1000 rooms a winter or Thomas Cook at 10000? These tour companies also buy every seat on the airplanes they charter. So for Canadian charter airlines that means less risk because the flight is paid for even if it is empty. So for your money and your friends the best bang for your vacation buck is at a charter airline.

CJET

[Kelowna Pilot]

Perhaps Zoom Air can reorganize.

They're gone.

No one their right mind would buy a Zoom ticket now. Way too risky.

If I had to put everything that's happening now in historical context, I'd say the industry is right were it was a couple months before 9-11.

The fall slowdown will be the 9-11 event, and by next summer you're going to be looking at a very different industry in Canada and the US.

Much, much smaller I'm afraid.

[randallg]

Long term oil prices have nothing to do with a hurricane or the Canadian government, and everything to do with Iran and Russia.

[EastCoaster]

Wow... I mean.. I guess we all know how this industry can have it's ups and downs (have been there for the last C6 experience) but it's really tough to have people on here bashing the charter carriers. It's guys like Old Fella, spreading absolute crap, that influence the travelling public.

Wishing all the best to all of the folks at Zoom and hoping to hear some kind of positive news in the coming days.

To the people musing over how not to shut down an airline (HMY, C6, etc) ... The safest way (if it's a planned shutdown rather than aircraft being reclaimed by leasing companies) is exactly the way that it is always done in Canada and the rest of the world. The simple facts are that if everyone knows that the company is going to fold in two months time, and anything happens, then it will be blamed on shoddy work or skimping on materials or burned out staff... the truth of the matter is that there's unfortunately only one way to shut down an airline and it's no fun for anyone and leaves us all out in the dark but it's the safest way.

[. .]

Old Fella,

What you may not realize is when you travel with Charter Airlines like Skyservice or Canjet is that they have contracts with huge international tour companies that have huge buying power at resorts around the world. Who is going to get a better rate for hotels in the Caribbean Air Canada who buys a 1000 rooms a winter or Thomas Cook at 10000? These tour companies also buy every seat on the airplanes they charter. So for Canadian charter airlines that means less risk because the flight is paid for even if it is empty. So for your money and your friends the best bang for your vacation buck is at a charter airline.

CJET

His point was that charter airlines have a nasty habit of going tits up while you're still on vacation. You can always find a cheaper fare, but it's not necessarily the best option for everyone. Once bitten twice shy right?

[Old fella]

"It's guys like Old Fella, spreading absolute crap, that influence the travelling public."

Well.......... tell that to the individual(CBC Interview in CYHZ) with his 4 kids who just got dumped of in Halifax enroute to Calgary or whereever & the other 213 sitting it out on their own as well. Talk about influencing the travelling public with "absolute crap". My arse!!

The industry needs a shakedown............

[.......]

Old Fella: Zoom, Sunwings, Canjet & Air Transat, apples X 3 and oranges... three private, one public...

I never could figure out how Zoom could operate 767-300s on the same routes as we did and offer such low prices!

I guess we have the answer now.

Too bad for our colleagues though!

[Flyboy757]

I read somewhere a many years ago that the most dramatic happenings in ones life include divorce, death of family member and loss of job.
I flew C3`s last A320 flt YVR to YYZ. Called the times in at 1 am to be told I no longer had a job. An unbelieveable feeling. If you haven`t been there then you have no idea. All, if not most of Zoom`s pilots are ex C3 drivers... they`ve been through this before but it doesn`t make it any less devestating.
Head office and the paper pushers make the decision to keep going or shut down, not the crews. If you are pissed because passengers are stranded and "up the creek", fine but don`t take it out on the aircrews. They have enough on their plates to deal with.

[xsbank]

Another cut in the competition - "low-cost" airlines are a thing of the past in Canada. Anybody try and book a ticket at Xmas? YUL-YVR, $2500 for 2! And, that's on Westjet.

[Rowdy]

In response to xsbanks comments..

It's about time the travelling public had to pay the actual operational costs of air travel. Its a priviledge not a right to fly across the country.

Best of luck to those that lost jobs in finding employment.

[Kelowna Pilot]

It's about time the travelling public had to pay the actual operational costs of air travel. Its a priviledge not a right to fly across the country.

True, but it boils down to a rock and a hard place situation...

Raise fares and a lot of people will simply stay home and not fly...

What to do?

[imarai]

deleted

[Rockie]

"How about some remorse to those poor folks who are stuck somewhere(maybe with kids) or even OLDER THAN ME who are now in a bind, no place to go. Probably nobody gives a fiddlers @#$! about their status. Now they have to shell MORE MONEY so they can get themselves home or whatever. Vacation plans in tatters/ruined............

Who will speak for them!!!!! Nobody here!!!"

As always happens in cases like this the newspapers, magazines, radio, and TV news are filled with stories of travellers plans being disrupted. CBC's Brian Stewart could barely keep the smile off his face last night as he opened the story with a comment about how many puns could be made of the airline's name. Then of course the story was all about the family in Halifax who had to wait 7 hours in the airport with two small children. Another story was of some woman who wouldn't make it to her niece's wedding or something like that. It's always all about the plight of the passenger and never a word about the people whose lives have been turned upside down. Nobody needs to speak for the passengers here because everybody else in the world is.

This is an aviation forum. We are for the most part employed in the business and in many, many cases have been in the same position as the people who used to work for Zoom. In fact in many, many cases we personally know the people who used to work at Zoom. Many of our colleagues at Zoom are members of this forum. I don't feel as if we need to direct any of our sympathy toward the customers. I think it is only right that we reserve that for our friends and colleagues.

[niss]

Can you believe the shit hemmorage that would have occured here if she was tased?

[CAL]

is it me or does it seem that alot of Canadian carriers go out like this?
I mean not telling a soul and leaving people all over the place...I mean having your airplane seized?
How can the boss even show his face after allowing that to play out?.....surely he had warnings...just shut it down and try and go out with some respect.

[bornagain1340]

I have a hard time imagining being told that I no longer had a job (without warning). Then having to go home and explain this to your family (although they probably already knew from watching the news).
I wish the best for you guys/gals and I hope something better can be found without having to move your life across the ocean.

[goldeneagle]

is it me or does it seem that alot of Canadian carriers go out like this?
I mean not telling a soul and leaving people all over the place...I mean having your airplane seized?

This is what happens when you get folks running a business, that dont really understand the 'big picture'. They sold charters, probably most of the sales were for deliveries a year out, based on pricing at the time. They didn't take appropriate measures to control costs over that year, and in the end, when the fat lady sang, the press release says they had a 50 million dollar shortfall due to fuel price increases.

As much as all the folks from the operations end of the business on here like to criticize the 'suits in head office that know nothing about flying', this is a case of the folks in head office not correctly managing thier risks to market exposure. With a little more financial acuity, probably at the expense of 'aircraft operating knowledge' at head office, an analyst would have identified the unmanaged risk, the risk of fuel prices rising dramatically. A quick trip over to the finanacial markets, and, for a modest fee, it would have been easy to purchase futures on fuel, a method of locking in the fuel price deliveries for the next year, and closing that exposure to market conditions off.

It would have taken a little bit of capital, ie, there would be some cost involved, but, hedging a year supply of fuel for the zoom fleet would not have been that expensive compared to other costs in thier business. That hedge would have added a little to the overall cost equation for the operation, but, if it had been correctly implemented, probably would have cost each zoom passenger an extra dollar or so on the ticket, and, they would still be flying today. With the meteoric rise in fuel prices over the last year, probably would be some financial analyst that sits in head office, collecting a significant bonus as well, and we would have heard a lot of grumbling from the ranks about 'suits stealing all the money from the pie'. Then again, a small task by the suits a year ago would have prevented this whole escapade.

It's the pilots job to manage operational risk. It's the job of the suits to manage business risk. For an airline to succeed, both have to be done, and they are completely different beasts. This is a case of an unmanaged business risk ringing the bell to cue up the fat lady singing.

Next time you got to complain about execs running an airline, that know nothing about flying, ask yourself, how well do you know how to manage the risk exposure to financial markets, and minimize the impact of fuel prices, for purchases running in the hundreds of millions of dollars out the next two years. If you know exactly what financial vehicles to work with, where to purchase, and how to amortize them correctly, then maybe you do belong in head office. If not, maybe you should stick to flying airplanes, and let the financial analyst worry about how much it's going to cost to fuel up that 7?7 14 months down the road.

In recent market conditions, airlines live and die by the fuel hedging program. Sounds to me like Zoom didn't have one, and, that's the reason they fell by the wayside. They aren't the first, and they wont be the last. 50 million shortfall in fuel, sounds to me like spending a hundred grand to put an 'expert' in the front office would have been cheap.

Any time you see a 'fuel surcharge', it's an indication of an airline not fully hedging fuel requirements. In the current volatile oil market, that's going to be the financial death knell for a few more.

[goldeneagle]

Right on Goldeneagle, I just had to explaine to pasengers who should know better why I was tankering fuel, also pre paying {hedging} this on a very small scale, but it helps, I wonder how many have locked in thier heating costs for this winter? not many I bet.

I'd go a step further clunk. Wanna tell the difference between an airline that's going to succeed, and one that's going to fail. That's easy. Those with a sharp commodities trader working out of head office, will succeed. Those not participating in the fuel futures market will fail. It's really that simple.

Take an airline of any significant size, fuel runs in the range of 30% of the overall cost, higher if you are using older less capital intensive airplanes that burn more fuel. Margins are signficantly lower. If the fuel hedging program does not manage fuel cost risk into a number less than the margin, the airline will fail, it's only a matter of when. If the fuel heding program brings the variable portion of fuel cost down below the operating margins, the airline will succeed.

The financial markets have vehicles to mitigate, and even eliminate fuel cost risk, and they can be purchased in quantities small enough to deal with the volumes of a one or two airplane fleet. If the trip goes onto the schedule, with a fare posted for that trip, and the fuel for that trip (irrelavent of how far out) is not risk managed, it's a business model that's going to fail eventually, only a matter of time.

The zoom pr says they had a 50 million shortfall on fuel. That was an unmanaged market risk, worth more than the entire value of the company. Taking those kind of risks in business tend to work out well in good economic times, but, leaving that kind of market exposure untended in the downturns, it's financial suicide. It takes hundreds of properly trained and experienced pilots to operate an airline. It only takes one properly trained and experienced analyst / trader to eliminate fuel cost risk for an airline of any size.

An airline with a 'smart' head office wont need fuel surcharges, the cost of fuel is factored, and managed into the risk equations BEFORE the trip goes on the public schedule. It's NOT an afterthought at the end of the month when the bills arrive.

[Stoptheworld]

Just flicking through the tube over the lunch hour when I passed the dear CBC news-channel where the headline was "Zoom and Gloom". The intrepid reporter was interviewing an analyst (whose name I missed). The part that got me was the reporters statement to the effect :"So what you're saying is that people shouldn't book these small carriers"

The analyst was a little more circumspect when he replied that what he thought people should do was do a little homework and realize that it costs quite a bit of money to run a plane and extremely low prices (like $1.00 YOW-YYZ for example) should really indicate something.

Thank you to yet another dumb-ass reporter who can barely dress themselves. What a wonderful statement. Let us make absolutely sure that no start-up can ever make it.

It kills me that she reccommended AC and WJ but wasn't it just 10 years ago or so that WJ was a small start-up charging ridiculously low fares, flying aircraft that well...lets not go there.

Sometimes shooting the messenger would solve a lot of problems.

[bcflyer]

Another cut in the competition - "low-cost" airlines are a thing of the past in Canada. Anybody try and book a ticket at Xmas? YUL-YVR, $2500 for 2! And, that's on Westjet.

Not sure why you added the "thats on Westjet" at the end of your post. Air Canada is pretty much matching Westjet prices on every route these days. I'm assuming that you were talking about a return ticket? YUL-YVR at Christmas time works out to just over $2400 return on A/C.

Back on topic now... Good luck to all the Zoom guys and gals out of work.

[whiteguy]

69 people? WTF? On a discount carrier?

Did Zoom suck, or is this an indication of ridiculous over-capacity (in the market overall, not by this carrier) on the route flown?[/quote]

The 69 people were departing from YYC to GLA. The flight was YVR-YYC-GLA-LGW. I'm sure there lots of people that boarded in YVR.

Funny how we still believe everything the media prints!

[robbreid]

http://www.avcanada.ca/forums2/viewtopi ... =7&t=45738

Congratulations your hired, now we have good news, and bad news!!!