Volcano Grounds 'Planes

[andyoxon]

Airlines are starting to declare that the skies are safe for flying...  They've sent up empty planes and declared that they came back "without a scratch".    The Germans and the Dutch are spearheading this little campaign and putting pressure on their various air safety agencies.  

The Met Office sent up a plane - and it hit a dense patch of ash.  Significant damage - and unable to say where these will be.

Fine, if the Germans and the Dutch want to fly, let them - but not in our airspace.

With the eruption still continuing heterogenous ash concentrations, is going to be one of the main issues.

This is an interesting graphic - animated boundary layer (at end of page)
Met Office: Icelandic volcano - latest updates

[Frenchie]

So they are all going to go bust then 

Beyond a few days (4-5) many will be in trouble (getting there); past a week or two some may well be starting to do just that, yes. This was reported in the news.

[Jaded]

So not all then.

Possibly the ones with weaker business, possibly the ones benefitting most from the relative unsustainability of current flying? Like I said up thread?

[andygates]

I'm pretty sure a robust business ought to handle a week of outage.  Unless its contingency pot had been strip-mined for profits...

[Mr Larrington]

Apparently, John Cleese paid 30,000 kroner (about £3.3k) for a Noggy taxi to take him from Oslo to Brussels where he had a Eurostar seat home booked.  I have visions of him reprising the role of headmaster Mr Stimpson from Clockwise...

Dr. Larrington was also travelling from Oslo to Brussels.  I wonder if she persuaded Mr. Cleese to give her a lift

[Chris S]

I think this post on pprune sums up for me the dilemma of the business:

So, we decide to fly again with volcanic ash in the atmosphere across our route- how is this going to work?

1. The Met Office/VAAC will continue to publish their best assessment of path and area affected by volvanic ash, as is their duty; it will be depicted on SIGWX charts, NOTAMS and in other pre-flight planning information.

2. Our Ops Manuals and Airplane & Engine OEM's advise that we must avoid flight into 'known' areas of volcanic ash. Commander's then have the dilema of deciding how to operate their flights in the face of a known hazard to flight. Will there be a derogation issued by our airlines and respective NAA's that pilot's can fly into 'known' areas of volcanic ash?

3. As a sound precautionary principle, after we do start flying en-mass, we will, at least for a period of time, require a check of each aircraft & engines inaccordance with the engine manufacturers procedures. This will be disruptive enough, as a previous engineering posts highlighted its not that straight forward. I don' think the few test flights that have been conducted are sufficient to say this isn't required.

What about engine/airframe warranty issues?

4. How will the leasing companies react to companies flying their aircraft into areas of known volcanic ash, and what agreements will be required to defer risk from the lessor to the lessee? Return conditions are the airlines responsibility I know, but I would think consultation is required.

5. Insurance? some agreement will presumably be required with our insurers on the above. If the airlines do accept the risk do they have sufficient capital in their business to do that for a large fleet of airplanes?

6. NATS/Eurocontrol?, a derogation will be required to permit IFR clearances to be issued into areas of know Volcanic ash.

7. And as EU operators how is this going to coordinated across Europe and a common approach established?

And I am sure there are many other issues I can't think of right now that are going to conspire against us in the coming days. Is there anyone out there that can tell us what's happening in the airlines, insurance, leasing companies and regulatory bodies regard to the above.


We don't know enough about this do we? But we didn't know enough about it before it was an issue - and it didn't bother us then, it's only a problem that we don't know enough about it now that we need to know all about it. IYSWIM.

[Morrisette]

What this crisis is missing is a picture of a plucky Icelander slogging through piles of volcanic ash on a bicycle. Anyone got one?

[TimC]

So not all then.

Possibly the ones with weaker business, possibly the ones benefitting most from the relative unsustainability of current flying? Like I said up thread?

There are businesses at the weaker end of the scale in any sector of commerce, from corner shops to banks. Many go bust in the normal run of events, most don't. Imposing regulatory closure on a legitimate business' activities will harm any business, and businesses that are otherwise healthy will be driven closer and closer to the edge. Airlines are particularly (though not uniquely) cash-flow dependent, and always have been. Even with large sums 'in the bank', continued existence requires commitment of funds well in advance of resources being required. That commitment needs the explicit support of the company's banks, unless the company is a government-sponsored one. There are none of those in UK. No bank will give open-ended support to a business that has no revenue, no matter how well-managed it has been in the past. Therefore all non-nationalised airlines are vulnerable, just some more than others. Whether any or all go bust is simply a question of how long this lasts. Most will survive a week or 10 days. Some will fold very shortly after that. But even the strongest will struggle if this goes significantly beyond a couple of weeks.

Edit: there are a great many other industries that rely on aviation too, which will also suffer significant harm if this goes on for long. Don't give me any guff about us all having to live without high-speed airfreight, or longhaul holidays. They will all be available after this is over, and at much the same price they are now. They will simply be provided by companies based in territories not affected by this crisis. To all intents and purposes, that means US companies.

[Jacomus]

I'm pretty sure a robust business ought to handle a week of outage.  Unless its contingency pot had been strip-mined for profits...

We recently have done an analysis of our model.

If all money stops today, in our current situation we can survive for 3 months with no revenue before we go to the wall.

Back in the Bad Old Days we were running about 1 week from failure and we only survived because my boss propped the company up using his personal savings to pay our wages and keep the lights on. Fortunately he only had to do that once, because he couldn't do it twice.

[pcolbeck]

I suspect the arm of our business that installs video conferencing solutions will see an upturn as a result of this.

[Mr Larrington]

Teh ironeez, they hurtz mi brane.

[clarion]

Just heard traffic reports.  Eurostar and Eurotunnel running extra trains.  Ferries running to time with some spaces available.  Continent not quite so cut off, after all.

[TimC]

I'm pretty sure a robust business ought to handle a week of outage.  Unless its contingency pot had been strip-mined for profits...

We recently have done an analysis of our model.

If all money stops today, in our current situation we can survive for 3 months with no revenue before we go to the wall.

Back in the Bad Old Days we were running about 1 week from failure and we only survived because my boss propped the company up using his personal savings to pay our wages and keep the lights on. Fortunately he only had to do that once, because he couldn't do it twice.

For a company the size of BA to last three months without revenue, it would probably require something in the region of £5 billion in liquidity. There is no way its accountants would sanction that amount of static capital. Like most airlines, it will have few saleable assets - all its aeroplanes and properties will be leased. Those leases will be paid monthly - around $500k to $1.2m a month per aeroplane (BA has approximately 230 aeroplanes), say £150m a month. Its 45,000 staff will cost about £140m a month in pay. Direct operating costs of its aircraft will reduce, but won't be eliminated. Payments on its fuel contracts, hotels, insurance, buildings and a host of other things will continue. And on the last day of the crisis, they will still need to show their financiers that they can service a $10bn-a-year fuel habit, so they can't plan to run down to their last few quid. Layoffs will start within a couple of weeks. Just a few at first, but in thousands before long. Reduction of expensive facilities like engineering and pilot training will happen quite quickly if there's any hint of this being an extended hiatus - and will cost money to reactivate.

Airlines eat money more voraciously than they eat fuel. None can survive for long without income.

[border-rider]

For a company the size of BA to last three months without revenue, it would probably require something in the region of £5 billion in liquidity. There is no way its accountants would sanction that amount of static capital. Like most airlines, it will have few saleable assets - all its aeroplanes and properties will be leased.

There's the problem.

Companies run with sufficient reserves (just) for the good times.  No Plan B.  I suppose it's a calculated risk - and this time they may be on the wrong end of the odds.

In the old days of state carriers, the backstop would have been the Treasury, I suppose.  With great profit comes greater risk...

[Jaded]

With finite fuel supplies comes risk. Make the money now before we are all grounded in 50-100 years time. 

[Frenchie]

With finite fuel supplies comes risk. Make the money now before we are all grounded in 50-100 years time.

I'm sure this is already loooked at (synthetic fuels). But this is beyond the point here...

[TimC]

MV, actually there are several Plans B (and on...), but no-one anticipated the current convergence of inadequate regulation, inadequate research and excess risk-aversion! We assess, quantify and train for risk in so many areas of aviation, but for some bizarre reason we have never properly assessed and quantified the effects and risks of volcanic debris. As the industry and its regulators are left with their trousers down, it's (disastrously) up to non-expert politicians, their PR advisors and other flunkies to decide what is and what is not safe. Unsurprisingly, none will declare that anything except total abstention from aviation is safe.

[Jaded]

for some bizarre reason we have never properly assessed and quantified the effects and risks of volcanic debris.

Tim, it is interesting that that hasn't been done - given the BA 747 that nearly crashed 18 years ago, several other incidents and the air industry's exceptional approach to safety.

Any theories as to why that might be?

[Tom B]

Virgin, I believe, also run a train company. Presumably this is making more money than it was a week ago. Was there anything stopping other airlines from diversifying?

[border-rider]

MV, actually there are several Plans B (and on...), but no-one anticipated the current convergence of inadequate regulation, inadequate research and excess risk-aversion!

Of course.  Otherwise it would have been factored in.  No matter what you plan for as realistic risk, something will bite you.  If you have a business model that falls over with 10 days of inactivity, then in the long run you're dead.  If you don't, then in the short term you're likely also dead of course

[TimC]

for some bizarre reason we have never properly assessed and quantified the effects and risks of volcanic debris.

Tim, it is interesting that that hasn't been done - given the BA 747 that nearly crashed 18 years ago, several other incidents and the air industry's exceptional approach to safety.

Any theories as to why that might be?

Yes - as I explained earlier, the reaction to that incident, and KLM's similar one in Alaska (IIRC), was to define avoidance areas based on visible volcanic plumes. The engine manufacturers at the time examined the engines and determined what damage volcanic ash can do and by what mechanisms. Their statements back then were, basically, don't go into this stuff. Of course, what they meant was the stuff that could be seen with the equipment available back then. As that didn't really inconvenience anyone too much, no-one saw the need to assess just how much exposure to what concentrations of which types of volcanic emissions would be ok, and what engineering and engine management mitigations would increase the safety margins. That is now coming back to bite us firmly on the arse.

[Polar Bear]

Let's get a measure of realism about this rather than it turning into a blame game.

Firstly, we know what the ash can do to a jet engine:  We also know that it might be possible to restart the engines in certain circumstances, but, there is no guaranteed formula to allow this.

Secondly, we know that the effect of nature, an ongoing volcanic eruption and weather conditions causing the distribution of said ash suspended in the atmosphere at a level where commercial airliners normally fly.

Thirdly, we don't know exactly where and when the ash might exist because it is invisible to the naked eye, and to the equipment carried on commercial airliners, making it impossible for a crew to spot and avoid.

Forget the business model.   Who has the hubris of a banker to send planes full of people up?   It seems to me that the risk assessment, something that the airline industry normally claims that they are incredibly strong on, has been well made.   I certainly wouldn't want to send up hundreds of aircraft full of people if I couldn't be sure of their safety.   Businessmen are worried about money.   I'm far more concerned about the value of life.

[Greenbank]

Up until Thursday it would have been "Yes, we should really do that investigation on volcanic ash we've been talking about for the last 18 years since Flight 9, but it's really expensive and we haven't needed it in that time so we'll think about it again next year."

Friday: "Bollocks."

Hindsight is 20:20.

[Asterix, the former Gaul.]

Let's get a measure of realism about this rather than it turning into a blame game.

IATA are blaming the 'governments'.

Forget the business model.   Who has the hubris of a banker to send planes full of people up?

The answer is obvious: we send plane loads of bankers up to see what happens.

[TimC]

MV, actually there are several Plans B (and on...), but no-one anticipated the current convergence of inadequate regulation, inadequate research and excess risk-aversion!

Of course.  Otherwise it would have been factored in.  No matter what you plan for as realistic risk, something will bite you.  If you have a business model that falls over with 10 days of inactivity, then in the long run you're dead.  If you don't, then in the short term you're likely also dead of course

Well, yes - sort of! Actually, I doubt there are many businesses of any kind which plan for extended (in the terms of their revenue cycle) periods of inactivity. I used to run a narrowboat hire business which was, inevitably, inactive throughout much of the winter. We could and did plan for that, and our major outgoings were planned to accommodate the annual variations in revenue. However, we could not easily manage to absorb an extended period of inactivity imposed on us from outside, as we discovered when the canals were clsoed in May 2001 due to Foot and Mouth disease (which was another example of government crisis mismanagement). We survived that, just, but were dealt another blow when 9/11 happened and all our US and Canadian customers cancelled! We survived that too, as Brits cancelled their overseas holidays and came to us, but it all got very close to the edge.

Right now, this is an expensive but survivable crisis for UK aviation. There are unlikely to be silver linings to this cloud of the sort that rescued my business. The inadequacies of research and regulation I referred to earlier mean that there is no defined method of determining when it is 'safe' to fly, and thus the decision making process is crippled and will take a long time to develop. It may be too late for UK aviation by then.