Flair Airlines - Planes seized

[schnitzel2k3]

Not sure what this means for them, could be nothing, could be something - but they got in bed with some no bullsheet mf's down in New York. I think their head office might be in Jersey.

I have pondered this one. I will give them the benefit of the doubt that they are organized enough to be aware of payment due dates. I also imagine that the creditor won’t seize 4 airplanes on the day after the payment is late without at least a reminder phone call. That being said, at the very least it suggests that Flair has a cash-flow problem. That’s a matter of concern. While they may be able to improve on that as we head into the summer, the sudden loss of what amounts to 22% of their fleet (4 out of 18 airplanes) will at the least require schedule adjustments, a spiral of cancellations and most damagingly - a loss of consumer confidence. People may be more weary to buy a ticket on an airline which has cash flow problems (airline bankruptcies traditionally have been sudden, spectacular events) and arriving at the airport on the day of travel to be told by the staff that either their flight has been cancelled due to a schedule change, or having no staff there to tell them because the airlines ceased operations earlier that morning.

Don’t confuse this post on what I hope will happen. Flair has some good people working for them and I hope they can get past this situation. But having been around for a while, I have seen movies like this before.

It looks like as more evidence rolls out - it's less Flair and more on the lessor who has other plans for the 4 Max's. It's like the Toronto rental market. Flair had a decent rate, someone's willing to pay more, Flair got the boot.

Hopefully they can secure more aircraft soon.

[cdnavater]

Big question is whether the travelling public will have confidence in Flair going forward. Latest Globe article painted a picture of Flair having a pattern of missing lease payments going back to last September and Two leasing companies were in the process of offering eleven Flair aircraft to other airlines however seven of these aircraft were pulled back because Flair paid up, other four were seized.This caused many unsuspecting travelling customers to loose out. Hard to say where this will all go down the road, however one thing is certain, the aviation superhighway( or runway if you prefer) is littered with plenty bits and pieces of failed airlines.

One thing that is a fact, Flair better be on time for those other seven, precedent set.

“Flair has always paid salaries on time. The CEO was clear that the actions of the lessor were well outside industry standard and lessors don’t act that way. There is more to this than meets the eye. No lessor pulls aircraft without a plan. Airbourne has over 20 aircraft with WJ……….and this week WJ will be announcing significant layoffs. An attempt to deflect the media? Time will tell and Flair will still be around this summer….. and next year….. and the year after.

No other lessors have pulled their aircraft. Fuel companies have not changed their terms. Employees will be paid this week.

The naysayers on here are motivated to disparage Flair as they work for the competition. They’ve been spouting the same for years and yet here Flair is.

Let’s call it what it is - WJ is running scared and can’t compete with Flair on cost and can’t compete with AC on value and revenue. They are stuck in the middle which is a bad place to be. They have pulled out of the East. This week they will begin the cutting (cutting customer service, loyalty, outsourcing safety - as a start). Their CEO has essentially told the pilots to bugger off. There will be more cuts - I’d guess the 787s will be gone by next summer.

Keep trying to convince yourselves that you’re smarter than the money behind flair, that Canada is ‘special’ and can’t sustain a ULCc…………I’d bet on Flair.“

Of course Flairs CEO is going to paint a rosy picture, they have to, it’s in the job description. They certainly won’t tell employees there’s a cash flow problem, duh!

[thepoors]

It is entirely plausible that the leasing company took the opportunity Flair handed them, to reset the lease rate on those fins to todays reality. By the sounds of it the lessor had been shopping those aircraft around since last month. It is possible that this wasn’t a Flair short on cash story. It was maybe a lessor exploiting a slow payee as a way out. This is obviously the way Flair is trying to frame it. Nothing to see here. The lessor is a dick.

How does that make them a dick? They are in it to make money. If Flair had a good covid deal on the leases, all the more reason to make sure the lessor had no outs. They look even dumber for not making those payments on time. Jones calling this "extreme and unusual" also shows that they are in the habit of doing this and getting away with it, till now anyway. I don't see that as being "exploited", the lessor has every right to expect to be paid on time. Flair pushed their luck and got burnt. Hopefully they come out of this alright, but lesson learned.

[JHR]

Flair has definitely not paid it pilots "on time" or it's training providers. There seems to be a history of cash flow issues. Let's hope they can sort it out and survive.

[Fanblade]

It is entirely plausible that the leasing company took the opportunity Flair handed them, to reset the lease rate on those fins to todays reality. By the sounds of it the lessor had been shopping those aircraft around since last month. It is possible that this wasn’t a Flair short on cash story. It was maybe a lessor exploiting a slow payee as a way out. This is obviously the way Flair is trying to frame it. Nothing to see here. The lessor is a dick.

How does that make them a dick? They are in it to make money. If Flair had a good covid deal on the leases, all the more reason to make sure the lessor had no outs. They look even dumber for not making those payments on time. Jones calling this "extreme and unusual" also shows that they are in the habit of doing this and getting away with it, till now anyway. I don't see that as being "exploited", the lessor has every right to expect to be paid on time. Flair pushed their luck and got burnt. Hopefully they come out of this alright, but lesson learned.

I agree.

This is the way Flair is trying to frame it. In bold.

I was simply making a statement about how Flair is attempting to portray the situation.

Based on events and Flair’s blame game explanation, it is plausible that this isn’t a severe liquidity problem as many have assumed. It may have simply been a screw up on Flairs part. Perhaps a history of pushing the envelope caught up to them.

Which ever one it is? We will know within a few weeks

[Fanblade]

.

[braaap Braap]

Flair has always paid salaries on time. The CEO was clear that the actions of the lessor were well outside industry standard and lessors don’t act that way. There is more to this than meets the eye. No lessor pulls aircraft without a plan. Airbourne has over 20 aircraft with WJ……….and this week WJ will be announcing significant layoffs. An attempt to deflect the media? Time will tell and Flair will still be around this summer….. and next year….. and the year after.

No other lessors have pulled their aircraft. Fuel companies have not changed their terms. Employees will be paid this week.

The naysayers on here are motivated to disparage Flair as they work for the competition. They’ve been spouting the same for years and yet here Flair is.

Let’s call it what it is - WJ is running scared and can’t compete with Flair on cost and can’t compete with AC on value and revenue. They are stuck in the middle which is a bad place to be. They have pulled out of the East. This week they will begin the cutting (cutting customer service, loyalty, outsourcing safety - as a start). Their CEO has essentially told the pilots to bugger off. There will be more cuts - I’d guess the 787s will be gone by next summer.

Keep trying to convince yourselves that you’re smarter than the money behind flair, that Canada is ‘special’ and can’t sustain a ULCc…………I’d bet on Flair.

Your bias is showing

Doesn't necessarily mean he's wrong though

For sure. Nobody will know till it happens. But if you're a betting person, who are you going to bet on a) the company who has had planes repossessed (in the latest of a chronicle of sketchy events) or the company that has a record of profitability and while shrinking isn't flashing warning signs like flair. Flair's in his name ffs.

[Invertago]

Let's hope it all works out for the best. Having a hundred extra Flair 737 pilots throwing resumes at WJ does not help the current negotiations situation.

[Bleed Air]

If I was leasing a Ferrari for $100/mo, there is no way I'd be late on a payment EVER!!!!!!
They knew they had a hell of a deal with COVID lease rates, why they would do anything to jeopardize that, even if it is industry standard to look the other way for being a day or so late with payments.
They know what the lease rates are now, and their bottom line was based on those COVID lease rates, now they don't have them anymore, to replace those aircraft they won't be getting the same rates.
Someone should have lost their job over this massive blunder.

[flying4dollars]

Your bias is showing

Doesn't necessarily mean he's wrong though

For sure. Nobody will know till it happens. But if you're a betting person, who are you going to bet on a) the company who has had planes repossessed (in the latest of a chronicle of sketchy events) or the company that has a record of profitability and while shrinking isn't flashing warning signs like flair. Flair's in his name ffs.

Just to be clear, what sketchy events are you referring to? Westjet's biggest competition is Flair. Not AC. WJ has a history of battling with Flair. Yes, WJ has a record of profitability, but I think it took them a number of years to get there. Flair could very well be on its way to doing that. They are kind of following in WJ's shoes which is why they feel so threatened. I am not pointing fingers or claiming to know what's going on, but just because 'Flair' is in his user handle, again, biased or not, doesn't mean he's wrong. You're right though, nobody will know the whole truth and time will tell all. As far as the betting thing, this doesn't have to do with betting on one vs the other. That's not even close to the point of this. Unless I'm misunderstanding your reference of course.

[flying4dollars]

If I was leasing a Ferrari for $100/mo, there is no way I'd be late on a payment EVER!!!!!!
They knew they had a hell of a deal with COVID lease rates, why they would do anything to jeopardize that, even if it is industry standard to look the other way for being a day or so late with payments.
They know what the lease rates are now, and their bottom line was based on those COVID lease rates, now they don't have them anymore, to replace those aircraft they won't be getting the same rates.
Someone should have lost their job over this massive blunder.

I don't think it matters what is being leased or at what cost. A lease payment shouldn't be missed and whoever was responsible should have to be accountable for that, I agree.

[slicktop]

I'm trying to understand how the Flair CEO is blaming everyone but ignoring their own incompetence in paying bills on time?

If you have a sweetheart COVID lease deal on some nice 737s, you should ensure they are paid on time or early. Every month. Regardless whether it's "not industry standard" to repo being a few days behind as he so woefully put in his sad little interview. Perhaps in a different timeline the leasing company would have worked with them to get caught up. But if they are in the legal right to terminate and reposses then that is their right.

And now to throw accusations at WestJet and AC? It's business. If I were a hedge fund leasing group with the ability to legally break the contract and pull in $300,000+ more per month on each aircraft I would do the same. Funds are there to make money for their investors, simple as that.

It's sad to see this happen, even as a pilot at AC I want to see Flair succeed because the more competition there is in this country for pilots the better it is for all of us. And anyone who thinks otherwise is a fool. Especially going into the next 1-2 years of bargaining at a number of the big carriers. A Flair collapse right now flooding the market with typed 737 pilots would be a detriment to WJ ALPA's negotiating as well as ACPA in the next year.

[ziggy]

https://apple.news/A0-YfePtcRECAav-MncNuzA

When your CEO is full of shit.

[ziggy]

https://edmonton.ctvnews.ca/flair-apolo ... -1.6312579

Nothing to see here. It’s the 2 majors that told us to default on payment. Another 777 bailout to add to the current debt. Don’t want to see pilots unemployed, but get out while you can. Your boss is full of shit and willing to take you down with him.

[fish4life]

That makes a lot more sense

[rookiepilot]

https://edmonton.ctvnews.ca/flair-apolo ... -1.6312579

Airborne Capital released a written statement regarding Jones' allegations on Tuesday.
“Airborne Capital strongly rejects the allegations that have been made by Flair Airlines in recent days in relation to four Airborne-managed aircraft," the statement says, adding the leases were terminated after Flair was regularly late on its leasing payments for a five-month period.
"Terminating an aircraft lease is always a last resort, and such a decision is never taken lightly. In this case, following numerous notices to Flair, it again failed to make payments when due and Airborne took steps to terminate the leasing of the aircraft."
Airborne said it has legal obligations to mitigate the losses on the planes, and has taken steps to meet those obligations.
The company said it would not be speaking further on the matter.

[Dias]

I'm not sure what the Flair CEO is doing by still talking about this. Now Airborne Capital is forced to make their own press release to defend themselves. You'd think that Flair would want this out of the news as soon as possible.

[cdnavater]

I'm not sure what the Flair CEO is doing by still talking about this. Now Airborne Capital is forced to make their own press release to defend themselves. You'd think that Flair would want this out of the news as soon as possible.

Jones has no choice to try and minimize it, it would be a snowball effect if not, however he may not have factored the leasing company defending their decision publicly but they have suffered some harm to their reputation from Jones.
Imagine when companies are shopping around for leases, would you be leery about leasing from them, if you thought they would repo them over a five day arrears payment, probably factor into how much you would pay

[rookiepilot]

I'm not sure what the Flair CEO is doing by still talking about this. Now Airborne Capital is forced to make their own press release to defend themselves. You'd think that Flair would want this out of the news as soon as possible.

Jones has no choice to try and minimize it, it would be a snowball effect if not, however he may not have factored the leasing company defending their decision publicly but they have suffered some harm to their reputation from Jones.
Imagine when companies are shopping around for leases, would you be leery about leasing from them, if you thought they would repo them over a five day arrears payment, probably factor into how much you would pay

He’d better be very careful he doesn’t get sued for slandering the reputation of another company. Sure the lawyers are watching.

Can’t smear another business without proof.

You’d be nuts to book flair right now IMO.

[slicktop]

I'm not sure what the Flair CEO is doing by still talking about this. Now Airborne Capital is forced to make their own press release to defend themselves. You'd think that Flair would want this out of the news as soon as possible.

Jones has no choice to try and minimize it, it would be a snowball effect if not, however he may not have factored the leasing company defending their decision publicly but they have suffered some harm to their reputation from Jones.
Imagine when companies are shopping around for leases, would you be leery about leasing from them, if you thought they would repo them over a five day arrears payment, probably factor into how much you would pay

He’d better be very careful he doesn’t get sued for slandering the reputation of another company. Sure the lawyers are watching.

Can’t smear another business without proof.

You’d be nuts to book flair right now IMO.

It's ok Tbaylx will come on shortly and reassure everyone that everything is fine.

[CpnCrunch]

More info here, and accusations of "skulduggery":

https://www.therecord.com/news/waterloo ... ights.html

Sounds like an episode of airplane repo. I miss that show, even though it was a little corny and contrived.

[rookiepilot]

More info here, and accusations of "skulduggery":

https://www.therecord.com/news/waterloo ... ights.html

Sounds like an episode of airplane repo. I miss that show, even though it was a little corny and contrived.

It was just very underhanded and sort of middle-of-the-night skulduggery.”

Jones was not confident that Flair will get the planes back. “If there’s one thing I’ve learned here, it is don’t get between a hedge fund and a dollar. They’re very mercenary in the way that they have approached this,” he said.

This guy is hilarious.



Awesome show, BTW.

[ads-b]

They missed payments for months. Lessor recouped most of their money. Obviously shopped the planes around to airlines that pay their bills. Grabbed their planes before tied up in a bankruptcy.

Time for a new spin.

[JasonE]

When I flew YQT to YYZ in January I chose not to use Flair because I couldn't risk being stuck there for a week! Flew home West Jet for double the price. Not sure the average consumer knows enough about airlines to make that choice.

[ThinMargins]

I have had a lot of conversations with lessors over the past few days.

The news, I am afraid, is very bad. They all think Jones is a pathological liar and want to pull their aircraft out. Jones lying about Airborne seizing aircraft just over a “five day delay” was the final straw because they all talk to each other and know that no one was getting paid since late last year. One lessor said their firm was shocked when Jones stood in front of a microphone and announced route expansions when he had been defaulting on lease payments for almost six months.

They see Flair’s financials every month and know that Flair does not make enough to pay its leases. That is why they were shopping Flair’s aircraft to other carriers.

They were surprised that 777 showed up and started making payments two weeks ago.

Why?

Because that is illegal. The CTA’s June decision last year ordered Flair to contract with lessors without 777’s guarantees or financial support to limit foreign control. These lessors know that the only way they can get paid requires a violation of the law. They do not want any part in that and are looking to find a way to terminate.

And then yesterday, Jones made a mistake. He publicly admitted what was only known to the lessors, that 777 was the party making payments. Now the CTA is starting an investigation. Read the Globe story very carefully. The CTA normally does not respond but has issued a public statement that it is “looking into information made public”. This is going to unravel quickly.

Mr. Jones has said Flair’s U.S. investor 777 Partners paid the amounts owing, adding it to the debt Flair owes.

Miami-based 777 Partners did not respond to e-mailed questions.

The Canadian Transportation Agency in 2022 began an investigation of Flair because 777 Partners appeared to be controlling the company, in violation of Canadian rules. The CTA would eventually declare Flair a Canadian company after the airline agreed to reduce its dependence on 777 Partners for financing and aircraft leases, and add more Canadians to the board of directors.

CTA spokesman Vincent Turgeon said the regulator monitors Flair for anything that might change its Canadian status. This includes its financing “and looking into the information made public over the last few days about Flair’s fleet,” Mr. Turgeon said in an e-mail.