bayareas

I read from other thread .

Originally Posted by 1010101 View Post
I hear there was some communication sent out late last week that has wound all the pilots right up, lots of rumours of strikes being called over the Christmas period. Anyone any further insight?
That was mentioned in one of the threads on PPRuNe, where a number of the pilots have been venting in at least 5 separate threads.

http://www.pprune.org/fragrant-harbour-19/

christep

They've vented on many threads every year for the last 15+ years. Really - deep down they know that the deal they have is far better than they could get anywhere else. Their problem is that CX is squeezing them a bit to take their package a little closer to the rest of the world and they are upset they will no longer be able to live like kings, but just like the bus drivers that they really are.

They won't strike. You're fine.

24left

Your formatting of quotes is incorrect

This was my post which included the comment from poster 1010101

https://www.flyertalk.com/forum/28936771-post65.html

.

KrazyTrain18

Your shockingly out of touch if you believe that last line, pilots are arguably the most important part of the company and work very hard to keep the airline's wheels turning. Do they make a very healthy wage ? Yes, no denying it but do they also carry a lot of responsibility ? I think you know the answer.

percysmith

Yes but CX is training its own crews. Not like the expat captains with housing benefits are the only ones who know how to drive an A350. Opportunity for cost cutting there to CX's accountants.

brunos

It is more than "Opportunity for cost cutting there to CX's accountants". CX is truly in bad financial state with a bleak future. It has little to do with accountants, savings are required for airline survival. There is a limit to imposing cost-cutting on pax alone. Employees have to contribute too, especially those with outlandish packages well above current industry standards.
If I were one of those, I would also complain, rant, threaten and use all kinds of arguments to keep my current situation. But those should (and probably do) understand that everyone needs to share efforts in a bleeding company (and that include top management) and that they have nowhere else to go with similar work conditions. There is a lot of jealousy among other CX staff (including junior pilots) so they won't get much internal support. Once a company has started laying off staff, as CX has recently done and might continue in the future, there is little incentive to go on a crippling and unpopular (externally and internally) strike.

My guess if that there is very very strong probability that there will not be an actual strike.

percysmith

Frankly being an accountant it's more like what the business side wants to do. If they want to keep the slot hog then I'll have to keep the expat captains and implement cost control. If I don't keep the slot hog then I'm free to early retire and/or retrench them.

1010101

CX is actually operating at a decent profit once you strip out those stupid fuel bets. When those expire the airline will be back to profitability, pilot salaries and everything. Management is only aggressively cutting costs because of the mistakes they made.

CX needs to be very careful laying off experienced pilots. It's a big reason for their brand loyalty.

percysmith

I thought it's more their slots and hogging. If they marketed "teams of excellence" of CX and even QF-seconded pilots that took off at 5am in the morning, would the "loyalists" fly them?

brunos

I respectfully disagree on both points.

CX is not operating at a good profit once you strip off the fuel hedging decisions. And the future is bleak as abundantly discussed elsewhere.

Maybe I am an exception, but I never felt that pilots age was a big (not even small) reason for brand loyalty. Certainly CX has not used it in marketing and I am not sure that this is an argument often mentioned by pax. US airlines have no retirement age (no age-discrimination law), and I don't feel safer with a 69 pilot than with a 39 pilot.
There has been a lot of concern voiced about Chinese airlines. But their safety record is excellent. And I never heard discussion about CX being a better brand than LH, BA, E or QR based on pilot age.

kaka

Buwaha? Cx not operating at a good profit bar fuel penalties??

as for slot hogging- works for every other airline. Jl nh ba ca sq all have good slots on 1 end and none on the other. Without the other slot u cant do much.

andersonCooper

So what's good profit?

If we are looking at 2017 1H, Rev at 43.9, Opex 47.0, but hedge loss was 14.7. Excluding hedge loss we are at 11.6 OP income, a 26.4% OP margin under HK IFRS.

For comparison, AA's same ratio under US GAAP was 10.3%; BA, under EU IFRS, was 10.8%. HU did not publish HX results so no direct comparison to HX available. (AA has no hedge exposure; IAG did not disclose hedge gain/loss in interim.)

Source: CX 2017 interim, AA Q2 10-Q, IAG Q2 17 Presentation.

I agree with the portion about pilot though, at least for me.

1010101

It's not really a case of agree or disagree on the financial statements. They are what they are. Take away the hedging losses and CX operates at a healthy profit - $11.6b according to @andersonCooper

I don't mean pilot age, i mean pilot experience. Due to the hiring policy changes CX is no longer bringing in experienced military/airline pilots, they are bringing in 0 hours grads. In any world experience is a good thing. It's not just whether or not the airline has had any crashes, its simple things like the ability to adhere to speed restrictions and so on. Many people fly CX because they trust them.

drivingflyingwalking

Whilst partially true it's not accurate to say they are only bringing in 0 Hour cadet Second Officers. CX continues to hire experienced pilots many from other airlines and armed service backgrounds. Also for the first time in almost 10 years Cathay is hiring experienced First Officers to join the company directly as First Officers, bypassing the Second Officer process to help bring experience levels up!

brunos

I believe your figure is incorrect.
As given on page 20 of the Interim report that you reference, the fuel hedging loss for H1 2017 is 3.2 not 14.7. Actually 14.9 is the total fuel cost with 11.7 of gross fuel cost (actual fuel expense).
As you can see on page 19, the airline loss before taxation is 2.9. Hence, with no hedging loss, CX would have made a small profit before tax of 0.3 and paid a small profit tax on it (rather than receiving a carry over tax refund). This is a minuscule ratio to total revenues of approximately 0.3/45.9 = 0.65%.

Two additional negative comments:
1. H1 2016 (last year) CX profits excluding hedging loss was much larger in the order of 3.8 (loss was small and hedging losses huge) compared to 0.3 in H12017
2. Yield has fallen by 5.2% for passengers in H1 2017. This is a dramatic fall and a very bad news.