Airlines

The teenager and her big sister

The Guardian has published a conversation between the 16yo climate activist, Greta Thunberg, who recently told a group of adults they’re just “uninformed” and Congresswoman Alexandria Ocasio-Cortez, who thinks we should go out of our way to make air travel unnecessary.

For as much as The Guardian hypes this Skype call as the intellectual version of the Jamaican men’s 4x100m Olympic sprint team, CM think it is more like Eric the Eel and Eddie the Eagle.

Despite AOC’s Green New Deal being dismissed by her own party as a “green dream” and it losing 57-0 in the Senate, The Guardian paints her as a doctorate in her field. Sadly, her younger sidekick will soon receive an honorary degree from the University of Mons in Belgium.

Anyway, the manifesto of the left is all in this conversation – the politics of envy, the evil oil lobby, the importance of tokenism and of course a 16yo telling us that she knows best.

One of the telling lines from Thunberg runs,

I saw very recent numbers, I think it was yesterday, that suggested about 2% of Sweden’s population don’t believe in the climate crisis. Here it’s not as acceptable to not believe in it. Everyone accepts that it’s a fact. But still we aren’t talking about it, and it’s not a priority. We are just treating it like any other issue.”

Two points.

First, Thunberg explains the totalitarian propaganda shaming of it “not [being] as acceptable not to believe in it

Second, any politician staring at only 2% skepticism faces next to no risks to pushing a climate agenda. Take Ireland. It too has stated a climate emergency with a glossy Climate Action Plan 2019 yet the budget papers tell the complete opposite to crisis – 0.6% of total budget spend on the environment with a cap out to 2022. Hardly the actions of an emergency mandate…

In any event Thunberg plans to travel to the UN summit in NY on September 23rd. Given she doesn’t fly she is still committed to go there. She’ll need to sail because catching an ocean liner is far more polluting than an aircraft. Having said that, her wafer thin size catching a commercial flight won’t add any net emissions to those already in the air. SH can also take solace that the Virgin Group CEO has at least muttered we should consider not to fly to save the planet instead of shutting the airline down.

The good thing is that AOC has extended every courtesy to Thunberg when she arrives. To be honest she should be thrust onto the stage at the Democrat primaries to add to the hard left tack it has already taken. He’ll, she can even claim illegal status and vote for AOC in New York, which has just joined the other 650 group thinking councils around the world to declare a “climate emergency.”

Boeing raises 20yr forecast

Boeing reports airlines will need around 44,000 new commercial aircraft worth $6.8 trillion by 2038, vs. 43,000 planes worth $6.49 trillion estimated in 2018. The biggest demand will remain for single-aisle jets. 32,420 narrow-body planes are likely to be built.

So much for the fear of global warming induced by air travel. In total, planes are 2% of human induced CO2. Or 0.00024% of the CO2 in the atmosphere.

Although the International Air Transport Association (IATA) wilted to the gun held to its head by the UN. The IATA has got behind the movement to do its bit for climate change. In a two page flyer, it covered the idea that we reckless passengers must consider our carbon footprint but at the same time help the U.N. raise $40bn in taxes, sorry ‘climate finance,’ between 2021 and 2035.

The reality is if Greta Thunberg receives an invite by the Queensland government to lecture on climate change she can rest easy that the footprint in the air will be so tiny because there isn’t a diesel electric train to get here.

IATA caves to the climate change cabal to fill the UN coffers

The International Air Transport Association (IATA) has got behind the movement to do its bit for climate change. In a two page flyer, it covered the idea that we reckless passengers must consider our carbon footprint but at the same time help the U.N. raise $40bn in taxes, sorry ‘climate finance,’ between 2021 and 2035.

The Carbon Offsetting & Reduction Scheme for International Aviation (CORSIA) is the vehicle which the UN’s International Civil Aviation Organization (ICAO) intends to liberate us from our sins and help fund the waste so endemic in the NY based cabal. Wherever the UN is involved expect a sinister agenda behind the virtue.

All airlines have been required to monitor, report and verify their emissions on international flights since Jan 1, 2019. Operators will be required to buy “emissions units” from the UN. If one asked the UN would it prefer emissions to be cut or taxes to be raised, it would select the latter every time.

But why? Passengers don’t seem to demand airlines flight shame them before they board. On the contrary, many carbon offset schemes exist among airlines but hardly any passengers elect to pay them. Note the world’s largest offset program below.

In its 2017 Annual Report, Qantas boasted,

We have the world’s largest airline offset program and have now been carbon offsetting for over 10 years. In 2016/17, we reached three million tonnes offset.”

Carbon calculators tend to work on the assumption of 0.158kg CO2/passenger kilometre.

In the last 10 years, Qantas has flown around 1 trillion revenue passenger kilometres. While the literature in the annual report denotes one passenger offsets every 53 seconds, the mathematical reality is simple – 2% of miles are carbon offset. So that means that 98% of people couldn’t care less.

Perhaps more embarrassing is that The Guardian noted in Jan 2018 that,

Qantas [was the] worst airline operating across Pacific for CO2 emissions

Kind of a massive load of hot air when you do the maths!

Which begs the question, why does the IATA feel compelled to intervene in ramping up the costs of travel when passengers aren’t calling for it? IATA’s job is to keep airlines flying and support the growth where it forecasts a doubling of air travel by 2030. Airlines have been ordering Boeing 737 MAX & Airbus A320neo short-haul jets as well as long-range B787 & A350 in huge numbers to take advantage of fuel efficiency that helps lower operating costs.

By IATA’s own admission, global air travel in totality is only 2% of man-made CO2 emissions. That is to say that all air travel is responsible for 0.00003% of CO2 in the atmosphere. Big deal! What is the point of taxing an industry where the footprint is so minuscule?

Take Josh Bayliss, CEO of Virgin Group. He said,

“It’s definitely true that right now every one of us should think hard about whether or not we need to take a flight.”

Why doesn’t he close down the airlines in the portfolio? Instead of waiting for his customers to grow a conscience via flight shaming and do the right thing why not force their choice? The obvious answer is that it’s hypocritical in the extreme.

Airlines operate on about 70% capacity load factor break even so if Virgin flights end up being half full thanks to flight shaming he’ll only end up having his fleet of jets spewing more or less the same CO2 per flight which will ultimately put the airline out of business.

It is all too stupid. IATA joins the growing list of bodies petrified to talk in hard numbers about true impacts. When the 22,000 pilgrims that fly each year to UN COP summits around the world to kneel at the altar of the IPCC practice what they preach, CM may start to feel concerned Until then, CM will keep calling the climate hoax out. Deeds, not words, IATA!

Go woke, go broke

Yet another example of why CM has cancelled his FT subscription. Where is the critical reporting? This article by Pilita Clark doesn’t critique the ridiculous movement by corporates to virtue signal but falls in line with the stupidity.

Maybe the best metaphor for the woke corporation is parsley. It often looks nice as a garnish but 99.9% of us push it to the side of the plate and leave it to be thrown away.

Corporate hypocrisy is everywhere.

Take Josh Bayliss, CEO of Virgin Group. He says,

“It’s definitely true that right now every one of us should think hard about whether or not we need to take a flight.”

Why doesn’t he close down the airlines in the portfolio? Instead of waiting for his customers to grow a conscience and do the right thing why not force their choice? The obvious answer is that it’s hypocritical.

Airlines operate on about 70% capacity load factor break even so if Virgin flights end up being half full he’ll only end up spewing more or less the same CO2 per flight and go out of business. British Airways, EasyJet and Ryanair will welcome Virgin’s virtue signaling. Go woke, go broke.

Qantas has the world’s largest carbon offset program yet only 2% of passengers elect to pay. That’s the extent of the belief in global warming.

Blackrock’s chief Larry Fink said his asset manager needs to do more than just make money yet it only backed 10% of the climate related shareholder proposals. Why? Supposedly because they would crush profits. All talk, little walk.

BP surprisingly helped prevent a carbon tax it openly launched support for. A fossil fuel company trying to undermine a carbon tax? Wow. Who’d a thunk?

UK shadow chancellor John McDonnell has said Labour would seek to delist companies from the London Stock Exchange that didn’t meet their climate change commitments. In order to meet that, will that mean a child daycare company will be burnt at the stake for not brainwashing kindergarten kids? Will there be a minimum pot plant to child ratio?

How would regulations impact the myriad of different businesses that would trigger being dumped from the LSE? What standard would be applied? CM is betting corporates jus need to “file” a governance statement on climate change which no one will read. As long as 100% of companies file, nothing will happen.

Pretty easy to avoid too. Companies could list on Nasdaq or the Singapore exchange to avoid the regulations and still raise capital. Did you think of that Mr McDonnell? No because it is all about being woke and there are plenty of alternatives to dodge stupid policy. Capital is global.

Pilita Clark closes her article by saying,

“Yet the climate debate is shifting and I am willing to bet that companies failing to match their green claims with solid action face far greater risks than they ever have before.”

Like much of the climate religion, few hard facts are ever presented except the date we are all supposed to die. Even then that is an ever-shifting goal post. We can be assured that when 2028 arrives all of a sudden we’ll have another 12 years to do something. A bit like the joke where a patient asks his doctor how long he has to live and is given an extension so he can pay his bill.

The ever-growing tide of the “woke” corporation is going to thwart ingenuity and entrepreneurship. It is corporate suicide to pander to this nonsense. It is not for companies to bang on about their wonderful commitments. Customers and shareholders can decide for themselves. Maybe if companies listened to both groups they would find profits go up. People are growing sick and tired of being told what to do. How to think.

The world is littered with corporate wokeness backfiring. The irony is much of it is self-inflicted. By trying to create false images of virtue, the results have been disastrous.

P&G had to write off billions from its Gillette brand for the toxic masculinity campaign. Before the campaign Gillette was ranked 7th out of 45 health and grooming brands. After, rock bottom.

There is almost a wave of corporate fear twisted by a minority of social activists like Sleeping Giants which create false narratives about public perceptions of evil companies. There is a flip side.

Chick-fil-A was established by Southern Baptists. They don’t ram their Christian beliefs at all in the restaurants. Activists tried to boycott the fast food outlet because one of the directors personally didn’t support same-sex marriage. Guess what, store numbers have doubled and revenues tripled over the last decade.

Chick-fil-A states it’s mission is, “To glorify God by being a faithful steward of all that is entrusted to us. To have a positive influence on all who come in contact with Chick-fil-A.”

Chick-fil-A is notable by its closure on Sundays, Thanksgiving and Christmas. So people are well aware ofthis corporate backing its religious beliefs.

There is a difference between founding a company on certain beliefs and concocting them to ride a wave of hijacking social movements. Customers are aware of the difference.

Virgin Group can wax lyrical about its concerns in trying to save the planet but the only woke thing would be to shut down. Pushing the guilt back on its customers shows how hypocritical the airline is.

To be honest it gets tiring waiting in corporate lobbies watching flat panel TVs advertising all of the wonderful community things they do. 99% of the transaction with any corporate will be driven by the ability to deliver goods and services, not supporting tree planting. It is not to diminish charity or good intentions, rather to cut back on acting as though they’re angels to avoid being put on an imaginary naughty step that doesn’t exist.

Perhaps CM should recommend a portfolio of non-compliant ESG companies. When the market sells off, all the passive money in ESG compliant names should well underperform those that don’t. Perhaps an asset manager should establish an ETF with a basket of companies that just provide product or service rather than garnish it with lashings of corporate virtue. Here is betting it would be a contrarian winner.

What happens if Yellowstone erupts?

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In 2012, CM, in a former guise, wrote a piece on what might happen if Mt Fuji erupted. Over the past couple of years, scientists have been postulating whether Yellowstone might blow her top. In 2019 the stories are front page news again. The last time she blew was 631,000 years ago. So the consensus is not if, but when. The last time she blew, 240 cubic miles of volcanic ash spewed into the atmosphere. When Mt St Helens erupted as a VEI5 (paroxysmal), 0.29 cubic miles of ash and volcanic rock was sent into the atmosphere. The 2010 Icelandic Eyjafjnallajokull volcano was a VEI4 (cataclysmic).

The doomsayers suggest if the Wyoming based volcano goes off, 87,000 will be killed immediately and 2/3rds of the US will become inhabitable. The ash would block out sunlight leading to cooling by up to 5 degrees. The sulphur aerosol spewed out of volcanoes reflects sunlight meaning the world could be thrown into a nuclear winter. A volcano erupting has zero to do with global warming but it would change climactic conditions.

The damage caused in each zone can be seen here. FEMA believe a $3 trillion minimum economic impact would occur. That seems light if the Mega-colossal (VEI8) event occurs. St. Helens was around $3 billion in damages.

Zone 1

A major problem faced after an eruption is the electricity grid. Dry volcanic ash in and of itself is not conductive enough to cause insulator flashovers but it is highly soluble and if it is mainly composed of aerosols it can cause the grid to be shutdown. The insulators require de-ionised water to clean at low pressure to prevent damage to the surfaces of the conductors. Trying to rectify the problem by using backup diesel generators would be met by ultra fine volcanic ash particles gumming up injectors and the engine filters. So power shortages would be long lasting. Solar would also require cleaning and wind power gears would also become fouled up by the ash. So if you own a Tesla you’ll be in trouble. Gasoline powered cars would eventually stop working if filters weren’t replaced frequently.

Water reservoirs would also end up making it unsuitable for drinking in the short term. Depending on the level of turbidity of the water supply, several weeks may be required to restore it to normal.

Airlines would be grounded. Volcanic ash is terminal for jet engines. In 2010, the Icelandic volcano cost airlines over $1.5 billion in revenue over the 6 weeks or so of disruption. The Eurostar was not impacted by the volcano and saw a large uptick in business. Ferries also experienced a 4x boost in traffic.

If the eruption was as huge as forecast, filter companies would stand to benefit greatly. High Efficiency Particulate Air (HEPA) filters would see high replacement demand. Japanese company Daikin (6367) has a subsidiary Nippon Muki which makes HEPA filters. Japan Vilene (3514) is also a maker for automotive related filters. Dow Chemical has HEPA filters although a tiny part of the total business.

Shipping companies would benefit, especially transport substitution of air cargo players where fleets would not be able to be deployed.

Insurance companies would likely escape a lot of financial damage as their policies are unlikely to cover ‘acts of god’ such as volcanic eruptions.

EPCO losses would be immense. The amount of repair work to entire grids and a halt to power supplies would hit revenue and ramp cost.

While it is still only hypothetical, the tragedy of a mega colossal eruption would be catastrophic in terms of loss of life and economic impact. The US is 25% of world GDP. Such a VEI8 eruption would have severe global economic implications. So if it comes, batten down the hatches.

The Plane Truth

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The plain (plane?) truth is that commercuial airlines face a growing risk of cyber attacks. It is a frightening prospect. Airline safety has never been better from an aeronautics perspective. Yet more pilots are switching to iPads to access airport information including runway approaches. No more need for heavy paper flight maps. Cockpits are digital. Air to ground links open up vulnerabilities which could allow nefarious actors to place an aircraft at the wrong height, even if the display tells otherwise.

Think of how politicians or high value targets could be assassinated this way. Hackers could dump the fuel, while sending normal consumption data to the pilots. The black box would record all the conflicting data. Who needs to take a bomb onboard? It could be made to look like an accident. The cockpit voice recorder could be switched off by remote leaving the investigators precious little to go on. The Israeli National Cyber Directive views this as a growing risk.

After a week of visiting Israel’s best cyber companies, many staffed with former members and leaders of the elite military cyber unit 8200, solutions will be found but the game is growing riskier by the day. The lack of adequate protection is evident. The live hacks (from low level amateurs to state sponsored) we were witness to show just how naked so many businesses and government agencies are. The access points to hack are also exposed by the fact less than 1% of people have security on the hand held devices they make so many decisions from.

Qantas gets a taste of its own medicine

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Qantas CEO Alan Joyce has had a taste of his own medicine. Forever a boss ramming social activism at shareholders’ expense down the throats of passengers and staff, China is demanding that the airline remove “Taiwan” off its maps and the airline is likely to comply. True colours. While happy to pontificate to others, Joyce falls into line when real dictators bark orders. So much for the social justice of Taiwanese clientele. Sold down the river without a fight.

Why didn’t Qantas engage the Dept of Foreign Affairs to officially complain about such a ridiculous request? Even if it is odds on that Foreign Minister Julie Bishop would chicken out of such an opportunity, it is a precursor at how China is happy to bully its neighbors around even on trivial things such as in-flight magazines. Then again why wouldn’t the Chinese do this if they know how quickly and easy they can get compliance?

Tyrannies don’t do diplomacy. And too many democracies don’t defend it.