Brussels Airlines in 2020

Join this forum to discuss the latest news that happened in the world of commercial aviation.

Moderator: Latest news team

Post Reply
Passenger
Posts: 6898
Joined: 06 Dec 2010, 20:54

Re: Brussels Airlines in 2020

Post by Passenger »

Passenger wrote: 23 Jul 2020, 10:26 ...

Anyway - perhaps we'll get some real answers later today, in the Belgian Parliament. Agenda Thursday 23th July 2020, at 15h00 in the Commissie voor Financiën en Begroting / Commission des Finances et du Budget: "Reddingsplan Brussels Airlines. Gedachtewisseling met de vice-eersteminister en minister van Financiën. Plan de sauvetage Brussels Airlines. Echange de vues avec le vice-premier ministre et ministre des Finances.
Livestream starts at 15h00:
http://www.dekamer.be/media/index.html? ... id=55U0869
(possibility for language change FR/NL)

sean1982
Posts: 3273
Joined: 18 Mar 2003, 00:00
Contact:

Re: Brussels Airlines in 2020

Post by sean1982 »

Passenger wrote: 23 Jul 2020, 10:26 I still don't know why it took so long for the Belgian government to finalize the agreement with Lufthansa. What is on paper now, is what Lufthansa agreed long time ago: "an agreement in line with the agreements in Germany, Switzerland and Austria. An agreement that is good for both parties".

De Croo says - once again in De Ochtend, VRT, this morning, that he has managed to get a lot of concessions from Lufthansa. What is there so special about "Brussels must remain a hub for Brussels Airlines"? There are no plans to move operations to Eindhoven or Luxembourg. What is there so special to have two seats at the Brussels Airlines Board (with or without voting right, minister???). They can't block decisions, and once the loan is repaid, their term ends. What is there so special to have the Brussels Airlines shares as bond, in case Lufthansa doen's repay the loan? "This is crucial", De Croo said. If LH doesn't want to refund, you go to court. If they can't refund, the value of the SN shares will be zero. What is a promise that Brussels Airlines will invest in new aircraft, "if they make a profit and if the economy allows it"? If they can, they will do so anyway: to avoid Green Deal taxes and fines. And if aviation recovers slowly: no new aircraft.

Minister De Croo demanded a seat at the Lufthansa Board - he didn't got it. He demanded 25% shares from Brussels Airlines - he didn't got it. And his power play / poker game finally resulted in a deal that could have been concluded one or two months ago, like in Switzerland and Austria.

Anyway - perhaps we'll get some real answers later today, in the Belgian Parliament. Agenda Thursday 23th July 2020, at 15h00 in the Commissie voor Financiën en Begroting / Commission des Finances et du Budget: "Reddingsplan Brussels Airlines. Gedachtewisseling met de vice-eersteminister en minister van Financiën. Plan de sauvetage Brussels Airlines. Echange de vues avec le vice-premier ministre et ministre des Finances.
For someone claiming not to work for SN you know a lot if inside news. Where you part of the negotiation team? or what is your source?

Passenger
Posts: 6898
Joined: 06 Dec 2010, 20:54

Re: Brussels Airlines in 2020

Post by Passenger »

Inquirer wrote: 22 Jul 2020, 11:58 ...
Noteworthy to me is the additional commitment of €100M by Lufthansa, which is IMHO a meaningful sign they indeed do not intend to let go of Brussels Airlines any time soon.
...
...(depending the interest rate, of which I haven't seen anything BTW)...
De Croo said a lot of interesting things in Parliament this afternoon. To answer your question(s):

The loan is €290M, which will be provided by the Belgian Federal Holding and Investment Company (SFPI-FPIM).
Intrest rate is the minimal EU regulated; it starts at 50bps, raising to 200bps for the last 3 years.
Lufthansa will also invest € 100M as extra capital (kapitaalverhoging/ augmentation de capital).
Lufthansa will also settle the Brussels Airlines restruction costs (budgetted at € 70M).

User avatar
Atlantis
Posts: 4483
Joined: 12 Apr 2005, 00:00

Re: Brussels Airlines in 2020

Post by Atlantis »

Passenger wrote: 23 Jul 2020, 21:45
Inquirer wrote: 22 Jul 2020, 11:58 ...
Noteworthy to me is the additional commitment of €100M by Lufthansa, which is IMHO a meaningful sign they indeed do not intend to let go of Brussels Airlines any time soon.
...
...(depending the interest rate, of which I haven't seen anything BTW)...
De Croo said a lot of interesting things in Parliament this afternoon. To answer your question(s):

The loan is €290M, which will be provided by the Belgian Federal Holding and Investment Company (SFPI-FPIM).
Intrest rate is the minimal EU regulated; it starts at 50bps, raising to 200bps for the last 3 years.
Lufthansa will also invest € 100M as extra capital (kapitaalverhoging/ augmentation de capital).
Lufthansa will also settle the Brussels Airlines restruction costs (budgetted at € 70M).
What he also mentioned was that by 2026 SN will receive 2 new or more long haul planes. Those ones will be already greener and less noisy.

It will be also a new type. A smaller plane that still can do the long haul. He didn't mentioned the type but it can be the A321.

He also mentioned that it will be an advantage also for BRU bcs that type can reach the States from BRU what not will be possible from FRA or MUC.

sean1982
Posts: 3273
Joined: 18 Mar 2003, 00:00
Contact:

Re: Brussels Airlines in 2020

Post by sean1982 »

Passenger wrote: 23 Jul 2020, 21:45
Inquirer wrote: 22 Jul 2020, 11:58 ...
Noteworthy to me is the additional commitment of €100M by Lufthansa, which is IMHO a meaningful sign they indeed do not intend to let go of Brussels Airlines any time soon.
...
...(depending the interest rate, of which I haven't seen anything BTW)...
De Croo said a lot of interesting things in Parliament this afternoon. To answer your question(s):

The loan is €290M, which will be provided by the Belgian Federal Holding and Investment Company (SFPI-FPIM).
Intrest rate is the minimal EU regulated; it starts at 50bps, raising to 200bps for the last 3 years.
Lufthansa will also invest € 100M as extra capital (kapitaalverhoging/ augmentation de capital).
Lufthansa will also settle the Brussels Airlines restruction costs (budgetted at € 70M).
The point is .. you already knew before the parliamentary hearing, so again, for someone claiming he doesn’t work for SN .. where did you get this info from?

User avatar
Atlantis
Posts: 4483
Joined: 12 Apr 2005, 00:00

Re: Brussels Airlines in 2020

Post by Atlantis »

sean1982 wrote: 24 Jul 2020, 09:09
Passenger wrote: 23 Jul 2020, 21:45
Inquirer wrote: 22 Jul 2020, 11:58 ...
Noteworthy to me is the additional commitment of €100M by Lufthansa, which is IMHO a meaningful sign they indeed do not intend to let go of Brussels Airlines any time soon.
...
...(depending the interest rate, of which I haven't seen anything BTW)...
De Croo said a lot of interesting things in Parliament this afternoon. To answer your question(s):

The loan is €290M, which will be provided by the Belgian Federal Holding and Investment Company (SFPI-FPIM).
Intrest rate is the minimal EU regulated; it starts at 50bps, raising to 200bps for the last 3 years.
Lufthansa will also invest € 100M as extra capital (kapitaalverhoging/ augmentation de capital).
Lufthansa will also settle the Brussels Airlines restruction costs (budgetted at € 70M).
The point is .. you already knew before the parliamentary hearing, so again, for someone claiming he doesn’t work for SN .. where did you get this info from?
Sean, the info Passenger gave here, we knew all already before, so there is nothing new.

Stop this chasing for issues which are not

oldblueeyes
Posts: 91
Joined: 13 Apr 2020, 12:44

Re: Brussels Airlines in 2020

Post by oldblueeyes »

Atlantis wrote: 23 Jul 2020, 22:43
Passenger wrote: 23 Jul 2020, 21:45
Inquirer wrote: 22 Jul 2020, 11:58 ...
Noteworthy to me is the additional commitment of €100M by Lufthansa, which is IMHO a meaningful sign they indeed do not intend to let go of Brussels Airlines any time soon.
...
...(depending the interest rate, of which I haven't seen anything BTW)...
De Croo said a lot of interesting things in Parliament this afternoon. To answer your question(s):

The loan is €290M, which will be provided by the Belgian Federal Holding and Investment Company (SFPI-FPIM).
Intrest rate is the minimal EU regulated; it starts at 50bps, raising to 200bps for the last 3 years.
Lufthansa will also invest € 100M as extra capital (kapitaalverhoging/ augmentation de capital).
Lufthansa will also settle the Brussels Airlines restruction costs (budgetted at € 70M).
What he also mentioned was that by 2026 SN will receive 2 new or more long haul planes. Those ones will be already greener and less noisy.

It will be also a new type. A smaller plane that still can do the long haul. He didn't mentioned the type but it can be the A321.

He also mentioned that it will be an advantage also for BRU bcs that type can reach the States from BRU what not will be possible from FRA or MUC.
So what is the advantage of a A321LR if the A321XLR can fly from New York to Rome?

This seems to be something like a political compromise - politics can claim new planes and whatever routes to the US East coast as big concession, LH organize a lease of something not really touching their strategy without bringing a significant overall impact. If they would have said - we want the 321XLR in a consistent subfleet size to maximize the potential in BRU in niche markets, that would have been a different thing.

Passenger
Posts: 6898
Joined: 06 Dec 2010, 20:54

Re: Brussels Airlines in 2020

Post by Passenger »

CEO Dieter Vranckx announces a smoother refund process:

.

sean1982
Posts: 3273
Joined: 18 Mar 2003, 00:00
Contact:

Re: Brussels Airlines in 2020

Post by sean1982 »

Passenger wrote: 24 Jul 2020, 15:50 CEO Dieter Vranckx announces a smoother refund process:

.
A refund with tax money is quite ironic seeing that we've all collectively paid for it :roll:

Poiu
Posts: 848
Joined: 14 Nov 2015, 09:38

Re: Brussels Airlines in 2020

Post by Poiu »

sean1982 wrote: 24 Jul 2020, 21:04
A refund with tax money is quite ironic seeing that we've all collectively paid for it :roll:
Mr Decroo was quite clear in parliament: SN was in negative equity, in other words: virtually bankrupt. It’s the refusal to refund bookings which kept them alive till today and as such it’s only normal that, now that there’s money again, refunds will be processed in the near future.

sean1982
Posts: 3273
Joined: 18 Mar 2003, 00:00
Contact:

Re: Brussels Airlines in 2020

Post by sean1982 »

Poiu wrote: 25 Jul 2020, 08:34
sean1982 wrote: 24 Jul 2020, 21:04
A refund with tax money is quite ironic seeing that we've all collectively paid for it :roll:
Mr Decroo was quite clear in parliament: SN was in negative equity, in other words: virtually bankrupt. It’s the refusal to refund bookings which kept them alive till today and as such it’s only normal that, now that there’s money again, refunds will be processed in the near future.
Still quite skeptical about a repayment of 295 million (without interest) over 6 years. That would be around 50 million euros a year, starting this year. 50 millions is 5 times more than the highest profit SN has ever had in its history ... that aint gonna happen.

Pocahontas
Posts: 184
Joined: 27 Oct 2012, 15:26

Re: Brussels Airlines in 2020

Post by Pocahontas »

You are 100% right. U happy now?

sean1982
Posts: 3273
Joined: 18 Mar 2003, 00:00
Contact:

Re: Brussels Airlines in 2020

Post by sean1982 »

Pocahontas wrote: 25 Jul 2020, 11:38 You are 100% right. U happy now?
Nice attitude

rwandan-flyer
Posts: 481
Joined: 19 Dec 2010, 12:30

Re: Brussels Airlines in 2020

Post by rwandan-flyer »

sean1982 wrote: 25 Jul 2020, 10:13
Poiu wrote: 25 Jul 2020, 08:34
sean1982 wrote: 24 Jul 2020, 21:04
A refund with tax money is quite ironic seeing that we've all collectively paid for it :roll:
Mr Decroo was quite clear in parliament: SN was in negative equity, in other words: virtually bankrupt. It’s the refusal to refund bookings which kept them alive till today and as such it’s only normal that, now that there’s money again, refunds will be processed in the near future.
Still quite skeptical about a repayment of 295 million (without interest) over 6 years. That would be around 50 million euros a year, starting this year. 50 millions is 5 times more than the highest profit SN has ever had in its history ... that aint gonna happen.
In France, more and more people are saying, that AF won't prpbably be able to pay its loan. Probably Frecnh Gov, should have buy more stake, to help Air France. Some people are takling about a nationalization, in the worst scenario.

We are a little bit worry about the long haul market. It was the only market, where Air France was profitable, while they were in the red, on their European and Domestic markets. September and October of this year will be probably decisive for Air France. If they can operate most of their long haul flights, with "correct" loads thanks to Biz pax, it's will be ok. If it's not the case (few flights and empty loads), things could be worst. And in France, we are facing off to the worst recession , since the 39-45 war


Air France burns 15 million euros per day ... will it be able to avoid nationalization?

At this rate, state loans will not suffice ...

https://translate.google.fr/translate?h ... OsQyVBjR6c

I know some people will tell me that SN and AF situations are probably not the same, but in my opinion, the hardest is about to come, for SN, which for example, doens't have a huge UE Newtork. SN doesn't have a domestic market. Few flights = few money.

Trafic at CDG is low, EasyJet has just cut some routes in France,such as Nantes Toulouse, Best Lyon or Lille Toulouse for September 2020 (literally no flights for these routes, for the moment). What will be the trafic from mid October to mid December which are the very low period, in term of the demand (except for the All Saints holidays)
Last edited by rwandan-flyer on 25 Jul 2020, 12:35, edited 1 time in total.

Pocahontas
Posts: 184
Joined: 27 Oct 2012, 15:26

Re: Brussels Airlines in 2020

Post by Pocahontas »

sean1982 wrote: 25 Jul 2020, 11:54
Pocahontas wrote: 25 Jul 2020, 11:38 You are 100% right. U happy now?
Nice attitude
Just saying that what you say is correct.

Passenger
Posts: 6898
Joined: 06 Dec 2010, 20:54

Re: Brussels Airlines in 2020

Post by Passenger »

Passenger wrote: 23 Jul 2020, 21:45 The loan is €290M, which will be provided by the Belgian Federal Holding and Investment Company (SFPI-FPIM).
Intrest rate is the minimal EU regulated; it starts at 50bps, raising to 200bps for the last 3 years.
...
Basic intrest rate (Euribor) is: -0,29% (minus)
1st year: 0,5% to be added
2nd and 3th year: 1% to be added
4th, 5th and 6th year: 2% to be added

Source:
Trends 24/07/2020 (paywall)
https://trends.knack.be/economie/bedrij ... 22957.html

rwandan-flyer
Posts: 481
Joined: 19 Dec 2010, 12:30

Re: Brussels Airlines in 2020

Post by rwandan-flyer »

sean1982 wrote: 25 Jul 2020, 10:13
Poiu wrote: 25 Jul 2020, 08:34
sean1982 wrote: 24 Jul 2020, 21:04
A refund with tax money is quite ironic seeing that we've all collectively paid for it :roll:
Mr Decroo was quite clear in parliament: SN was in negative equity, in other words: virtually bankrupt. It’s the refusal to refund bookings which kept them alive till today and as such it’s only normal that, now that there’s money again, refunds will be processed in the near future.
Still quite skeptical about a repayment of 295 million (without interest) over 6 years. That would be around 50 million euros a year, starting this year. 50 millions is 5 times more than the highest profit SN has ever had in its history ... that aint gonna happen.
Brussels Airlines: Have the lessons of the past been learned?


[...]

Now retired, Waldo Cerdan observes the situation with certain hindsight. But, as was already the case twenty years ago, he is not afraid to express an opinion that is not necessarily consensual. In his eyes, the 290 million euros released by Belgium do not constitute a loan: "No, it is not a loan for the good and simple reason that Brussels Airlines is totally incapable of repaying these 290 million euros. by 2026, nor later for that matter. To be convinced of this, it suffices to read the balance sheets published by the National Bank and / or to follow in the footsteps of the loan of 125 million euros which had been granted to the DAT in 2001 (DAT was a subsidiary of Sabena and it was she who succeeded Sabena before becoming SN Brussels Airlines then Brussels Airlines, note). "This loan was initially granted for a period of three months, miraculously extended to five years and whose repayment will finally be postponed to 2017, continues Waldo Cerdan. Afterwards, no one, in any case, not me, knows. So to lend money to someone who we know will be unable to repay, is either to make a donation which, for political reasons, cannot bear his name, or to create over-indebtedness, and he does not You don't have to have a doctorate in economics to know the likely outcome. ”Clearly, that would be inevitable bankruptcy.

https://translate.google.fr/translate?h ... 3D10549681

Airline debt threatens recovery

An IATA analysis revealed that the airline industry’s global debt could rise by almost $120 billion to $550 billion by year-end.

https://airlines.iata.org/news/airline- ... s-recovery

oldblueeyes
Posts: 91
Joined: 13 Apr 2020, 12:44

Re: Brussels Airlines in 2020

Post by oldblueeyes »

sean1982 wrote: 25 Jul 2020, 10:13
Poiu wrote: 25 Jul 2020, 08:34
sean1982 wrote: 24 Jul 2020, 21:04
A refund with tax money is quite ironic seeing that we've all collectively paid for it :roll:
Mr Decroo was quite clear in parliament: SN was in negative equity, in other words: virtually bankrupt. It’s the refusal to refund bookings which kept them alive till today and as such it’s only normal that, now that there’s money again, refunds will be processed in the near future.
Still quite skeptical about a repayment of 295 million (without interest) over 6 years. That would be around 50 million euros a year, starting this year. 50 millions is 5 times more than the highest profit SN has ever had in its history ... that aint gonna happen.
You should start to think economically.

The loan is a bridge until the company is able to refinance its debt on the free market.

If you ask about 5o Mio EUR Profits to be accumulated every year over the next years, than you might have little towards zero understand of economics.

Or do you believe that the public debt is paid back although the bonds are paid back on time? No, there is a new bodn issued and the collected money pays the old ones. The same mechanism applies for all the deals closed with the German, Swiss and Austrian givernments, too.

A crisi is always good to cut off also routes, expenses dreams etc without a solid financial contribution, but having internal supporters, legacy related internal lobby etc.

So let's see first how the company will look like after Reboot plus the Corona adjustments.

Inquirer
Posts: 2088
Joined: 14 Feb 2012, 14:30

Re: Brussels Airlines in 2020

Post by Inquirer »

Don't forget that the owner of a company can always decide to pay back a loan taken up by his company on their behalf should the company not have sufficient means to pay it back...

It has been reported in the press that Lufthansa's CEO is planning to raise money on the financial markets as soon as the aviation sector is sufficiently stabilized with the aim to buy out all of the governments and get full control over the group again by 2023.

https://www.aerotelegraph.com/en/luftha ... ul-flights

A quote preceeding the agreement between our country and Lufthana:
By 2023, Lufthansa wants to have repaid all state aid – probably also because of the associated conditions that come along with it. However, this will not make the company debt-free, said Spohr. «We want to take out loans on the free market in order to repay the taxpayers’ money in Switzerland, Germany and Austria. We would rather be indebted to the capital market than to the taxpayer.»

At present capital markets are locked for airlines, so public funds are the only funds available to them; if the corona pandemic gets wiped out, that will not be the case in 2 or 3 years.

Poiu
Posts: 848
Joined: 14 Nov 2015, 09:38

Re: Brussels Airlines in 2020

Post by Poiu »

Inquirer wrote: 26 Jul 2020, 19:44 At present capital markets are locked for airlines, so public funds are the only funds available to them; if the corona pandemic gets wiped out, that will not be the case in 2 or 3 years.
The capital markets have been locked for SN for many years, did you forget how Luftie had to provide a 100 million loan to avoid bankruptcy a couple of years ago?
The 290 million will hardly be sufficient to finally pay back the tickets from cancelled flights, SN was short on cash long before Covid, Waldo is correct, they will never be able to pay back the loan. #Alitalia2.0

Post Reply