Houston's economic diversity Thread .. (Dallas, Austin: designs, title, architecture)

[ParaguaneroSwag]

XTRA Airways is again actively hiring. I'm ready to see their updated launch plans and how they'll function in the post-COVID world.

[As Above So Below...]

Originally Posted by ParaguaneroSwag

XTRA Airways is again actively hiring. I'm ready to see their updated launch plans and how they'll function in the post-COVID world.

I dont hold out any hope. Its a terrible time for the industry and a worse time for industry startups.

[ParaguaneroSwag]

Originally Posted by As Above So Below...

I dont hold out any hope. Its a terrible time for the industry and a worse time for industry startups.

Starting in a down turn is the best time to invest...... if you have enough capital to sustain until things get going again. You’ll be operating at a loss or Atleast very little profit for a while. But the price to buy assets is cheaper and hiring good talent is more available.

[As Above So Below...]

Originally Posted by ParaguaneroSwag

Starting in a down turn is the best time to invest...... if you have enough capital to sustain until things get going again. You’ll be operating at a loss or Atleast very little profit for a while. But the price to buy assets is cheaper and hiring good talent is more available.

That doesnt create demand though. That is going to be severely depressed for a while. Supply will be far outdone by demand for a couple of years. The current airlines have been able to take advantage of the CARES act. A start up wouldnt be able to. That will create a huge economic disadvantage in an environment that is super competitive with stripped demand.

I just dont see it.

[ParaguaneroSwag]

Originally Posted by As Above So Below...

That doesnt create demand though. That is going to be severely depressed for a while. Supply will be far outdone by demand for a couple of years. The current airlines have been able to take advantage of the CARES act. A start up wouldnt be able to. That will create a huge economic disadvantage in an environment that is super competitive with stripped demand.

I just dont see it.

Unless you survive the storm. Is $125 million in fresh capital enough to operate at loss for 2-4 years? That comes down to how much they actually invest and how long it takes for the demand to return. The storm destroys lots in its path, but those not destroyed benefit in the long run by having already invested when it was cheaper and easier.

I’m also of the mindset that this will wither fail or get absorbed but I give it a 20% chance of surviving once demand picks up. If it works out, though, it worked to thwir favor considering they raised capital right when the business cycle was at its peak and began investing right at its lowest.

[As Above So Below...]

Originally Posted by ParaguaneroSwag

Unless you survive the storm. Is $125 million in capital enough to operate at loss for 2-4 years? That comes down to how much they actually invest and how long it takes for the demand to return. The storm destroys lots in its path, but those not destroyed benefit in the long run by having already invested when it was cheaper and easier.

I’m also of the mindset that this will wither fail or get absorbed but I give it a 20% chance or surviving once demand picks up.

Well, this would obviously be a smaller operation but to give you an idea of scale, AA was burning roughly $50 million per day at the beginning of the pandemic but got it down to $25 million a day cash burn. UA and DL are between $15-20 million in the most recent completed quarter. Even an operation that that size would burn around $250,000 per day at the beginning. That doesnt give it much time to break even and the environment is very poor from it.

Maybe they can push through to start up, but keeping it around will be extremely difficult.

[ParaguaneroSwag]

Originally Posted by As Above So Below...

Well, this would obviously be a smaller operation but to give you an idea of scale, AA was burning roughly $50 million per day at the beginning of the pandemic but got it down to $25 million a day cash burn. UA and DL are between $15-20 million in the most recent completed quarter. Even an operation that that size would burn around $250,000 per day at the beginning. That doesnt give it much time to break even and the environment is very poor from it.

Maybe they can push through to start up, but keeping it around will be extremely difficult.

Frontier would be a more appropriate comparison, because that’s how they’ll start Atleast in the beginning. I don’t know their updated plans but a reasonable outcome for thwir start would be a Frontier-Spirit Airlines (somwthing in between) style operation using only 5 737-800s for the first year and potentially expanding from there. One of the executives cited it as the next southwest, but that wouldn’t come around until demand is there.

[As Above So Below...]

Originally Posted by ParaguaneroSwag

Frontier would be a more appropriate comparison, because that’s how they’ll start Atleast in the beginning. I don’t know their updated plans but a reasonable outcome for thwir start would be a Frontier-Spirit Airlines (somwthing in between) style operation using only 5 737-800s for the first year and potentially expanding from there. One of the executives cited it as the next southwest, but that wouldn’t come around until demand is there.

Ill just say I wouldnt want to be starting an airline right now. Had the pandemic not happened and they started in 2016, it would have probably had a great chance at success. Another thing to consider is that CASM (cost per available seat mile) is going upward as airlines have to factor more things post-pandemic.

This isnt a Houston thing, its a nationwide thing. Texas isnt doing that poorly relative to the coasts. The Mountain West and Florida are preforming the best with Denver, Salt Lake City, Las Vegas, Phoenix, Orlando, Miami, Tampa, and Fort Myers all carrying capacity over 66% of 2019. Houston, DFW, and Austin are all around 50-55%. NYC is down near 25%. That is for domestic capacity only. International capacity is still in the crapper all the way around.

[Jack Lance]

Major tech company with an existing Houston footprint is moving it's headquarters to Houston from San Jose increasing Houston's economic diversity.

Hewlett Packard Enterprise is the latest tech company to leave Silicon Valley, and is moving to Houston

Hewlett Packard Enterprise is the latest tech company to shift its focus away from Silicon Valley, announcing Tuesday that it will relocate its headquarters from San Jose, California, to Houston, Texas.

“HPE’s largest U.S. employment hub, Houston is an attractive market to recruit and retain future diverse talent, and is where the company is currently constructing a state-of-the-art new campus,” the company said in its fourth quarter earnings release. It’s unclear how many employees the move will affect, though the company said no layoffs will be with the move.

HPE will keep the San Jose campus, and will consolidate some of its Bay Area sites there, it said.


Antonio Neri, President and CEO of Hewlett Packard Enterprise.
Anjali Sundaram | CNBC
HPE is relocating headquarters to Houston from California (cnbc.com)

[ParaguaneroSwag]

Originally Posted by Jack Lance

Major tech company with an existing Houston footprint is moving it's headquarters to Houston from San Jose increasing Houston's economic diversity.

Hewlett Packard Enterprise is the latest tech company to leave Silicon Valley, and is moving to Houston

Hewlett Packard Enterprise is the latest tech company to shift its focus away from Silicon Valley, announcing Tuesday that it will relocate its headquarters from San Jose, California, to Houston, Texas.

“HPE’s largest U.S. employment hub, Houston is an attractive market to recruit and retain future diverse talent, and is where the company is currently constructing a state-of-the-art new campus,” the company said in its fourth quarter earnings release. It’s unclear how many employees the move will affect, though the company said no layoffs will be with the move.

HPE will keep the San Jose campus, and will consolidate some of its Bay Area sites there, it said.


Antonio Neri, President and CEO of Hewlett Packard Enterprise.
Anjali Sundaram | CNBC
HPE is relocating headquarters to Houston from California (cnbc.com)

Sorry! You beat me to it!