Friday, April 17, 2015

Emirates increases Dhaka to triple daily


Emirates has officially announced that it will be increasing its presence in the Dhaka market segment by increasing frequencies effective immediately. Current double daily nonstop services are being raised to triple daily nonstop using a two class 430 seater B777-300ER exclusively. 

The airline has the highest market share out of Bangladesh to USA and Europe as well as a cult like following with Bangladeshi freight forwarders.

Flights depart DXB at 0200/1030/1315 and arrive back at 0025/1305/2210 local time respectively. 

Thursday, April 16, 2015

Air New Zealand announces Houston-Auckland nonstop




Air New Zealand has officially announced that it will be launching new 5 weekly nonstop flights to IAH-Houston, USA effective Dec 2015. All flights will be operated using a B777-200ER in code share with its fellow Star Alliance partner i.e. United 



Wednesday, April 15, 2015

Qatar Airways increases Athens and Larnaca flights


Qatar Airways has officially announced that it will be significantly increasing capacity on its Larnaca and Athens bound routes effective 01JUN onwards as the carrier looks to take advantage of the peak summer travel season. The main highlights are as follows:

LCA - frequencies increased from 4 weekly to daily using an A320

ATH - frequencies increased from double to triple daily nonstop using an A333 + A321 + A320 each on a daily basis respectively. The new ATH service is scheduled in the below mentioned manner

QR 207 Dep DOH 1930 Arr ATH 0010+1
QR 208 Dep ATH 0110 Arr DOH 0540

Above schedule of QR 207 only connects GCC destinations along with NBO, DAR, EBL and KTM.

Monday, April 13, 2015

13APR news edition




Sri Lankan Airlines has revealed significant capacity expansion plans across its medium haul Asian network from 15JUN onwards of which the main highlights are as follows:

LHE – frequencies increased from 3 to 5 weekly nonstop flights using an A320

DAC – frequencies increased from 6 weekly to daily nonstop flights using an A320

CCU – new 3 weekly nonstop flights to be launched

SHJ - frequencies increased from 4 to 5 weekly nonstop flights using an A320

  
China Eastern Airlines based out of Shanghai has revealed expansion plans for its North America bound services for the IATA W15 season of which the main highlights are as follows:

LAX – frequencies increased from daily to 10 weekly nonstop flights using a B77W exclusively

YYZ – frequencies increased from 3 to 4 weekly nonstop flights using a B77W

YVR - frequencies increased from daily to 10 weekly nonstop flights using an A332 exclusively


Oman Air’s CEO has revealed the configurations of their upcoming B788s and B789s which are due to be delivered to the airline in 2015-16. A total of 2 B788s + 6 B789s were originally ordered by WY and their outlined configuration is as follows:
  • Two B788s will have 267 seats in a dual class layout i.e. 18J + 249Y
  • Out of the six B789s, three will have a three class layout seating 242 pax i.e. 8F + 30J + 204Y where as the remaining 3 will have 288 seats in a dual class configuration i.e. 30J + 258Y.
  • The 3 class B789s will be used on LHR-MCT which is going to be increased to double daily by W15 season.
  • It has ordered 20 new B737s out of which the breakdown is for 10 B737NGs + 10 B737MAXs. However the breakdown of whether its for the -700/800/900MAX version has not yet been revealed!
  • Fleet strength to be increased to 70 units by 2020 i.e. 25 wide bodies + 45 narrow bodies with all E75s + ATRs to be phased out by 2017 as the airline sees no value having regional aircraft in its fleet.
It was also revealed that their next new long haul route is going to be a city in China (most likely Beijing) which is expected to come online in 2016 and to be operated with a B788. 

Analysis:

There is no commercial justification for WY to have a first class cabin and three different cabin configurations for its B787 fleet which only causes further confusion internally for their scheduling and operations personnel. WY has built an excellent reputation offering a high end premium product in all of its cabin classes but in the past due to its low density configuration of its A330 fleet, it has in turn resulted in major revenue loss. All of their B787s should have a standardized two class layout because if an airline with a much higher premium client base such as Qatar Airways can afford + see the commercial sense of not having a first class cabin on board its B787 and B777 fleet, Oman Air should accordingly take notice!

With regards to its future wide body fleet, WY's CEO has officially announced that the airline is looking at the A330NEO family as well as ordering more B787s as by 2020, it aims to operate at least 25 wide body aircraft alongside 45 B737NGs/MAXs. The current wide body fleet numbers 4 A332s + 6 A333s + 2 B788s + 6 B789s totaling 18 aircraft. This means that WY aims to grow its WB fleet by adding a further 7 units.

From a commercial business stand point across all board, it is advisable that WY standardize their wide body fleet around the B787 family and not a combination of both as the former overall would be cheaper to maintain + operate + can fly any route nonstop even up to JFK if need be which the A330NEO cannot do. Its 10 A330s are in very good shape hence would fetch a decent resale value in the used aircraft market place by the end of the decade. Since the requirement is to fly 25 wide body aircraft, the split should be 15 B789s + 10 B788s configured in the below mentioned manner:

B788 - maintain existing dual class configuration of 18J + 249Y

B789 - two options to be considered here

Option 1 - standardize all B789s to 30J + 258Y

Option 2 - have two dual class configurations i.e. for its normal long/medium haul routes with the already stated configuration i.e. 30J + 258Y alongside a high density configuration that is required for many leisure/labor market routes. The high density B789 should be configured to seat 18J (same number of J class seats that the B788 has) + 294Y totaling 312 seats. Such a configuration is ideal from a flight economics point of view to operate on high density labor/leisure routes such as Jakarta, Manila, Kuala Lumpur, Dhaka, Colombo, Jeddah, Lahore and Kochi. 

As far as its narrow body fleet is concerned, it currently numbers 2 B737s + 26 B738s + 5 B739ERs + 4 E75s totaling 37 units. This is stated to be increased to 45 by 2020 as part of the recent order for 20 B737s is to replace by 2022 its oldest B737-700s + B737-800s. For the Indian subcontinent routes + Cairo + selected flights to Saudi Arabia, the B739ER/MAX is the best aircraft for WY from an economic performance point of view as it offers 20% more seating capacity than the B738 operating with only 7% higher costs hence a no brainer. The B739MAX has the capability to also fly up to Thailand nonstop from MCT should the need arise in the future.  


Thai Airways has officially announced that in order to rapidly accelerate cost saving measures as part of its 3 year turn around plan, it shall speed up the process by phasing out 22 wide bodied aircraft in 2015 alone which are as follows:

8 B744s + 2 B744Fs + 6 A346s + 6 of its oldest A333s

As a result of the 2 B744 freighters (744Fs) being retired, it will mark the end of Thai Cargo operating as a seperate entity as the airline looks to use the belly space of its B777, A330 and B787 for the uplift of commercial cargo.

FYI in 2013, TG lost $392 million versus $482 million in 2014 operating with 102 aircraft (82 of which were wide bodies)!

Analysis:

A well thought out move by TG's management concerning the fleet in addition to suspending JNB, DME and MAD flights this year as well. However, there are few additional items that need to be considered and implemented:

LAX flights need to be suspended in 2015 too as they utilize 1.5 aircraft for only a 4 weekly service hence an inefficient way of utilizing an asset. In addition, this route is a major loss maker i.e. even bigger than MAD/DME hence just like its fellow rival Malaysia Airlines also swallowed its pride and suspended LAX, Thai too needs to bite the bullet by following suit. 

TG needs to also to maintain its brand and image reputation by continuing to operate as a legacy carrier and not confuse itself + its passengers with a dual brand strategy with its Thai Smile LCC. It just needs to look at other major legacy carriers who have experimented with the same strategy and failed i.e. UA, DL, 9W, AC and JAL to name a few.

The 20 A320s of Thai Smile should all be leased out to interested airlines in Asia or TG should instead dry lease in 10 A321-200s with one ACT. These A321s can fly easily up to 6 hours nonstop from BKK airport and help reduce operational costs significantly on ASEAN + Indian subcontinent routes where mutiple daily frequencies using a B777/A330 is not always required + some routes that are operated on a daily basis using a wide body would do better with an A321. 

The A321 to begin with should be configured to seat 12J + 168Y in a dual class (180 seats total) layout easily. Its total cost of operations is $5000 less per hour on average (50% less) than an A333/B772 and can also in its belly carry 3.5 tons of cargo. It would be more commercially viable for TG using this aircraft type on routes such as CMB, HYD, ISB, CCU, BLR and secondary cities in China rather than the wide body aircraft. In addition, this aircraft is also ideal in fine tuning capacity, for example its current BKK-SIN service is flown 5 times daily but at least 3 of these flights can be easily operated at full S/F using an A321 rather than a 50-60% A333/B772! A route such as DPS + MNL which is only operated once daily, can be instead flown twice daily comfortably with an A321 thus in turn providing more schedule flexibility for P2P pax + better network feed especially for EU/DXB bound flights. SGN + HAN currently flown double daily with a wide body, can easily support a triple daily flights on their own using an A321 due to the massive O&D demand to Thailand and East Asia itself + EU! On the domestic front, in order to increase market share and operate in a more efficient manner on the popular BKK-HKT sector in particular where it currently flies 8 times daily with B777/A330s, it can do so 10-12 times daily using an A321 with peak time flights operating as a shuttle service for both business + leisure pax.      


Emirates has officially announced major capacity increases across its long haul route network from 01OCT15 onwards as the carrier looks to aggressively cement its market share position in key high yielding segments that are seen to have long term growth potential. The main highlights are as follows:

BOS – frequencies increased from daily to double daily nonstop using a B77W

ZRH - capacity increase to double daily A380s effective 01OCT due to strong demand especially for its premium cabin classes on this sector.

CPH - capacity increased from daily B77W to daily A380. The A380 to be used for CPH will be in the new two class configuration seating 615 pax i.e. 58J + 557Y !

Comments:

EK will be receiving 4 dual class A380s this winter and CPH has been the first destination announced for the whale jet. This configuration makes it the largest passenger airplane in service today (seats wise) beating the 560 pax B747-400 previously in service with JAL/ANA. The other destinations that one would expect EK sending the dual class A380 on are Mauritius, Manila, Kuala Lumpur, Bangkok and Jakarta.  


Copa Airlines based out of Panama in South America has officially announced that it has placed its largest ever order for aircraft with Boeing worth $6.6 billion. The aircraft ordered is for a combination of both B738MAX and B739MAX with the breakdown per aircraft type not mentioned though! Currently, CM's fleet consists of 17 B737-700s + 26 E90s + 56 B738s. The B737s are being replaced with B738s in a phased manner from this summer onwards. The B739MAXs ordered will be used to replace the B738s on the most popular medium haul routes such as those to JFK, MIA, EZE, GRU and GIG.


China Southern Airlines based out of Guangzhou, China has officially announced that it will be significantly increasing its presence in the LAX market place effective 19JUN onwards. Frequencies will be raised from daily to 11 weekly nonstop flights operated by an A380 daily + 4 weekly B77W. The carrier looks to tap into the ever increasing CAN/HKG/Shenzen corridor traffic segment as well as further aggressively poach away traffic from other airlines that is bound to SIN, MNL, PEK, PVG, BKK, DEL and KUL.


Turkish Airlines has officially announced to the Istanbul Stock Exchange, that it has secured on a long term dry lease 5 additional A330s of which the main highlights are as follows:
  • Three A330-200s (22J+228Y config) will be leased from Wells Fargo Bank which will bring the total A332 fleet to number 20 units.
  • Two brand new A330-300s (ex Afriqiyah Airways of Libya) will be leased for 8 years. These will be configured in TK's standard 28J+261Y configuration and will result in the A333 fleet number to rise to 21 units currently!
With regards to its route network, TK too revealed significant capacity upgrades which are as follows:

NRT – capacity increased to double daily nonstop flights using an A333 exclusively

ADD – capacity increased from daily B739 to daily A332

FIH/LBV – frequencies increased from 3 to 5 weekly flights using an A332

Comments:

With the lifting of Iran sanctions imminent, one should not be surprised to see TK rapidly ramping up its flights to the various destinations it serves there as well as possibly launch new 3-4 weekly nonstop flights to DTW-Detroit, USA to cater for the large number of Lebanese, Iranian, Iraqi, Jordanian, Egyptians residing in Michigan state.  


Qatar Airways has officially announced that they will be significantly increasing its services to Indonesia from July 2015 onwards in the below mentioned manner:

CGK - frequencies increased to triple daily nonstop flights using an A332 double daily + B77W daily

DPS - frequencies increased from daily to double daily nonstop flights using a B788 for all flights

Comments:

The increase of services to DPS-Bali will definitely help increase S/F on its European bound services as that is the main target market along with Dubai and Jeddah. In addition, it also gives a competitive edge to QR by operating double daily to the island city as Emirates has announced that they are launching new DPS-DXB services on a daily basis using a B77W from June too. With regards to the Indonesia country itself, if QR is given more bilateral access, it should seriously look at serving SUB-Surbaya airport nonstop from DOH at least four times per week using an A332 initially as it is nice little niche market having the second largest urban population (9 million) along with high labor demand to GCC/KSA in particular.  


Sunday, April 12, 2015

Thai Airways to retire 22 aircraft in 2015


Thai Airways has officially announced that in order to rapidly accelerate cost saving measures as part of its 3 year turn around plan, it shall speed up the process by phasing out 22 wide bodied aircraft in 2015 alone which are as follows:

8 B744s + 2 B744Fs + 6 A346s + 6 of its oldest A333s

As a result of the 2 B744 freighters (744Fs) being retired, it will mark the end of Thai Cargo operating as a seperate entity as the airline looks to use the belly space of its B777, A330 and B787 for the uplift of commercial cargo.

FYI in 2013, TG lost $392 million versus $482 million in 2014 operating with 102 aircraft (82 of which were wide bodies)!

Comments:
  1. A well thought out move by TG's management concerning the fleet in addition to suspending JNB, DME and MAD flights this year as well. However, there are few additional items that need to be considered and implemented:
  2. LAX flights need to be suspended in 2015 too as they utilize 1.5 aircraft for only a 4 weekly service hence an inefficient way of utilizing an asset. In addition, this route is a major loss maker i.e. even bigger than MAD/DME hence just like its fellow rival Malaysia Airlines also swallowed its pride and suspended LAX, Thai too needs to bite the bullet by following suit. 
  3. TG needs to also to maintain its brand and image reputation by continuing to operate as a legacy carrier and not confuse itself + its passengers with a dual brand strategy with its Thai Smile LCC. It just needs to look at other major legacy carriers who have experimented with the same strategy and failed i.e. UA, DL, 9W, AC and JAL to name a few.
  4. The 20 A320s of Thai Smile should all be leased out to interested airlines in Asia or TG should instead dry lease in 10 A321-200s with one ACT. These A321s can fly easily up to 6 hours nonstop from BKK airport and help reduce operational costs significantly on ASEAN + Indian subcontinent routes where mutiple daily frequencies using a B777/A330 is not always required + some routes that are operated on a daily basis using a wide body would do better with an A321. 
  5. The A321 to begin with should be configured to seat 12J + 168Y in a dual class (180 seats total) layout easily. Its total cost of operations is $5000 less per hour on average (50% less) than an A333/B772 and can also in its belly carry 3.5 tons of cargo. It would be more commercially viable for TG using this aircraft type on routes such as CMB, HYD, ISB, CCU, BLR and secondary cities in China rather than the wide body aircraft. In addition, this aircraft is also ideal in fine tuning capacity, for example its current BKK-SIN service is flown 5 times daily but at least 3 of these flights can be easily operated at full S/F using an A321 rather than a 50-60% A333/B772! A route such as DPS + MNL which is only operated once daily, can be instead flown twice daily comfortably with an A321 thus in turn providing more schedule flexibility for P2P pax + better network feed especially for EU/DXB bound flights. SGN + HAN currently flown double daily with a wide body, can easily support a triple daily flights on their own using an A321 due to the massive O&D demand to Thailand and East Asia itself + EU! On the domestic front, in order to increase market share and operate in a more efficient manner on the popular BKK-HKT sector in particular where it currently flies 8 times daily with B777/A330s, it can do so 10-12 times daily using an A321 with peak time flights operating as a shuttle service for both business + leisure pax.      

Emirates increases Boston to double daily


Emirates has officially announced via the GDS system that it shall be launching an additional daily flight to Boston, USA effective 01OCT15. Both daily flights will be flown using a B77W exclusively and beyond feed from BOS shall be provided by EK's biggest U.S. partner i.e. B6-Jetblue which has a size able hub base at that airport. 

The schedule of the 2nd daily service is as follows:

EK 239 Dep DXB 0320 Arr BOS 0855

EK 240 Dep BOS 1115 Arr DXB 0815+1

Saturday, April 11, 2015

COPA orders 61 B737MAXs



Copa Airlines based out of Panama in South America has officially announced that it has placed its largest ever order for aircraft with Boeing worth $6.6 billion. The aircraft ordered is for a combination of both B738MAX and B739MAX with the breakdown per aircraft type not mentioned though!

Currently, CM's fleet consists of 17 B737-700s + 26 E90s + 56 B738s. The B737s are being replaced with B738s in a phased manner from this summer onwards. The B739MAXs ordered will be used to replace the B738s on the most popular medium haul routes such as those to JFK, MIA, EZE, GRU and GIG.

Friday, April 10, 2015

Cathay Pacific considering Barcelona flights




Media reports emanating out of Hong Kong have suggested that Cathay Pacific is looking to add two additional long haul destinations in 2015 as it looks to take advantage of niche markets that provide good O&D + onward feed potential. The two routes identified are Barcelona and Mexico City effective November 2015. No indication has been provided regarding frequencies per week nor which aircraft type would be used to operate.

CX also officially disclosed that it will be reducing its services to ORD-Chicago from the on set of the IATA S15 season from the current 10 weekly to daily nonstop using a B77W.

Comments:

Launching BCN is a well thought out move, as demand to Asia from this city
over the past three years has rapidly grown in particular to China, Seoul and Japan so CX is well positioned to take advantage of that + there is good amount of O&D traffic to the HKG hub. In addition, BCN is a mini hub for its fellow One World partner i.e. Iberia so CX can code share via BCN to Latin America + Europe to gain additional feeder traffic. Comparing demand between BCN and MAD to SE Asia in 2014 is as follows:

HKG - 59K vs 35K
NRT - 130K vs 90K
HND - 26K vs 16K
PVG - 79K vs 85K
PEK - 51K vs 55K
ICN - 90K vs 101K
MNL - 23K vs 29K
SYD - 22K vs 16K
MEL - 19K vs 17K
BKK - 40K vs 70K
SIN - 45K vs 12K
KUL - 10K vs 11K
SGN - 4K vs 5K
CAN - 11K vs 14K
HAN - 3K vs 5K

Total is 612,000 versus 561,000 in favor of BCN + more importantly HKG O&D traffic (the highest form of yield) is far greater for BCN along with the fact that cargo demand to/from BCN is higher than MAD to/from Asia. Therefore seeing how they launched MAN-HKG with 4 weekly flights initially, one can for see the same being adopted for HKG-BCN initially. But in all fairness, both BCN and MAD can easily be sustained by CX four to five times per week using a B77W or A359 in the future.

China Southern increases Los Angeles capacity


China Southern Airlines based out of Guangzhou, China has officially announced that it will be significantly increasing its presence in the LAX market place effective 19JUN onwards. 

Frequencies will be raised from daily to 11 weekly nonstop flights operated by an A380 daily + 4 weekly B77W. The carrier looks to tap into the ever increasing CAN/HKG/Shenzen corridor traffic segment as well as further aggressively poach away traffic from other airlines that is bound to SIN, MNL, PEK, PVG, BKK, DEL and KUL.

Thursday, April 9, 2015

Emirates increases Copenhagen and Zurich


Emirates has officially announced that it will be significantly increasing capacity on two of its European routes from this winter season in the below mentioned manner:

Zurich - capacity increase to double daily A380s effective 01OCT due to strong demand especially for its premium cabin classes on this sector.

Copenhagen - capacity increased from daily B77W to daily A380. The A380 to be used for CPH will be in the new two class configuration seating 615 pax i.e. 58J + 557Y !

Comments:

EK will be receiving 4 dual class A380s this winter and CPH has been the first destination announced for the whale jet. This configuration makes it the largest passenger airplane in service today (seats wise) beating the 560 pax B747-400 previously in service with JAL/ANA.

The other destinations that one would expect EK sending the dual class A380 on are Mauritius, Manila, Kuala Lumpur, Bangkok and Jakarta.  

Wednesday, April 8, 2015

Turkish increases its A330 fleet size



Turkish Airlines has officially announced to the Istanbul Stock Exchange, that it has secured on a long term dry lease 5 additional A330s of which the main highlights are as follows:

  • Three A330-200s (22J+228Y config) will be leased from Wells Fargo Bank which will bring the total A332 fleet to number 20 units.
  • Two brand new A330-300s (ex Afriqiyah Airways of Libya) will be leased for 8 years. These will be configured in TK's standard 28J+261Y configuration and will result in the A333 fleet number to rise to 21 units currently!
Comments:

With the lifting of Iran sanctions imminent, one should not be surprised to see TK rapidly ramping up its flights to the various destinations it serves there as well as possibly launch new 3-4 weekly nonstop flights to DTW-Detroit, USA to cater for the large number of Lebanese, Iranian, Iraqi, Jordanian, Egyptians residing in Michigan state.  

Qatar Airways increases Indonesia flights


Qatar Airways has officially announced that they will be significantly increasing its services to Indonesia from July 2015 onwards in the below mentioned manner:

Jakarta - frequencies increased to triple daily nonstop flights using an A332 double daily + B77W daily

Bali - frequencies increased from daily to double daily nonstop flights using a B788 for all flights

Comments:

The increase of services to DPS-Bali will definitely help increase S/F on its European bound services as that is the main target market along with Dubai and Jeddah. In addition, it also gives a competitive edge to QR by operating double daily to the island city as Emirates has announced that they are launching new DPS-DXB services on a daily basis using a B77W from June too.

With regards to the Indonesia country itself, if QR is given more bilateral access, it should seriously look at serving SUB-Surbaya airport nonstop from DOH at least four times per week using an A332 initially as it is nice little niche market having the second largest urban population (9 million) along with high labor demand to GCC/KSA in particular.  


Wednesday, April 1, 2015

Oman Air Boeing 787 details







WY's CEO has revealed the configurations of their upcoming B788s and B789s which are outlined below:


  • Two B788s will have 267 seats in a dual class layout i.e. 18J + 249Y
  • Out of the six B789s, three will have a three class layout seating 242 pax i.e. 8F + 30J + 204Y where as the remaining 3 will have 288 seats in a dual class configuration i.e. 30J + 258Y.
  • The 3 class B789s will be used on LHR-MCT which is going to be increased to double daily by W15 season.
  • It has ordered 20 new B737s out of which the breakdown is for 10 B737NGs + 10 B737MAXs. However the breakdown of whether its for the -700/800/900MAX version has not yet been revealed!
  • Fleet strength to be increased to 70 units by 2020 i.e. 25 wide bodies + 45 narrow bodies with all E75s + ATRs to be phased out by 2017 as the airline sees no value having regional aircraft in its fleet.

It was also revealed that their next new long haul route is going to be a city in China (most likely Beijing) which is expected to come online in 2016 and to be operated with a B788. 

Analysis:

There is no commercial justification for WY to have a first class cabin and three different cabin configurations for its B787 fleet which only causes further confusion internally for their scheduling and operations personnel. 

WY has built an excellent reputation offering a high end premium product in all of its cabin classes but in the past due to its low density configuration of its A330 fleet, it has in turn resulted in major revenue loss. All of their B787s should have a standardized two class layout because if an airline with a much higher premium client base such as Qatar Airways can afford + see the commercial sense of not having a first class cabin on board its B787 and B777 fleet, Oman Air should accordingly take notice!

With regards to its future wide body fleet, WY's CEO has officially announced that the airline is looking at the A330NEO family as well as ordering more B787s as by 2020, it aims to operate at least 25 wide body aircraft along side 45 B737NGs/MAXs. The current wide body fleet numbers 4 A332s + 6 A333s + 2 B788s + 6 B789s totaling 18 aircraft. This means that WY aims to grow its WB fleet by adding a further 7 units.

From a commercial business stand point across all board, it is advisable that WY standardize their wide body fleet around the B787 family and not a combination of both as the former overall would be cheaper to maintain + operate + can fly any route nonstop even up to JFK if need be which the A330NEO cannot do. Its 10 A330s are in very good shape hence would fetch a decent resale value in the used aircraft market place by the end of the decade. Since the requirement is to fly 25 wide body aircraft, the split should be 15 B789s + 10 B788s configured in the below mentioned manner:

B788 - maintain existing dual class configuration of 18J + 249Y

B789 - two options to be considered here

Option 1 - standardize all B789s to 30J + 258Y

Option 2 - have two dual class configurations i.e. for its normal long/medium haul routes with the already stated configuration i.e. 30J + 258Y along side a high density configuration that is required for many leisure/labor market routes. The high density B789 should be configured to seat 18J (same number of J class seats that the B788 has) + 294Y totaling 312 seats. Such a configuration is ideal from a flight economics point of view to operate on high density labor/leisure routes such as Jakarta, Manila, Kuala Lumpur, Dhaka, Colombo, Jeddah, Lahore and Kochi. 

As far as its narrow body fleet is concerned, it currently numbers 2 B737s + 26 B738s + 5 B739ERs + 4 E75s totaling 37 units. This is stated to be increased to 45 by 2020 as part of the recent order for 20 B737s is to replace by 2022 its oldest B737-700s + B737-800s. For the Indian subcontinent routes + Cairo + selected flights to Saudi Arabia, the B739ER/MAX is the best aircraft for WY from an economic performance point of view as it offers 20% more seating capacity than the B738 operating with only 7% higher costs hence a no brainer. The B739MAX has the capability to also fly up to Thailand nonstop from MCT should the need arise in the future.  
   

Thursday, March 26, 2015

27MAR edition





Emirates has announced major expansion plans for its long haul network for the upcoming IATA S15 season of which the main highlights are as follows:

MCO – new daily nonstop flights effective 01SEP using a B77L

NBO – capacity increased from daily A332 + daily B77W to double daily B77W

DPS – new daily nonstop flights effective 01JUN using a B77W

SEA – frequencies increased from daily to double daily using a B777 effective July

DUS – capacity increased to daily A380 + daily B77W effective 01JUL

MAD – capacity increased to daily A380 + daily B77W effective 01AUG

ORD – capacity increased from daily B77L to daily B77W effective May

CCJ – frequencies increased from 11 to 12 weekly nonstop flights using a B777

PER – frequencies reduced from triple daily to double daily i.e. daily A380 + daily B77W

JFK – capacity increased to four daily A380s with MXP-JFK too being upgraded to a daily A380

Comments:

A big surprise pulled by EK by announcing new daily services to Orlando (MCO) as one cannot see any commercial rationale justifying a daily service on a year round nonstop basis using a 260 seater B777-200LR. It would have been better if EK flew to MCO via an EU airport that has high year round demand to the city such as LGW/MAN/AMS/CDG/Germany as then it would also attract additional source of revenue via 5th freedom pax + cargo.


Hainan Airlines based out of Beijing, China has disclosed that it will be purchasing 30 additional Boeing 787s as the carrier has been highly impressed with the aircraft performance on its trans-pacific services to USA. Currently, it has 13 B788s in its fleet seating 213 pax (36J + 177Y) however the new order is for the larger B787-900 version only which is expected to seat 270 passengers in two classes. It is expected that this order will be a catalyst to replace the airline’s 17 strong A330 fleet (8 A332s + 9 A333s).


Ethiopian Airlines CEO has disclosed that the airline is in talks with Boeing to purchase 6 of the “overweight terrible teens” Boeing 787-800s at a steep discounted price as the carrier has been very impressed with how this aircraft type has performed on its long/medium haul routes to Asia in particular. If this purchase gets confirmed, it will result in ET owning a total of 19 B787-800s! In addition, ET confirmed that it will be realigning its strategy in Sao Paulo in the following manner effective 27APR:

·         Flights will be flown nonstop using a B788 rather than one stop via LFW
·         Frequencies increased from two to three times per week
·         Flight reschedule retimed to attract 6th freedom transfer traffic originating from Southeast Asia, India, DXB, Kenya and Saudi Arabia

Days: 1/3/6

ET 506 Dep ADD 0845 Arr GRU 1445
ET 507 Dep GRU 0230 Arr ADD 2030

Lastly, ET has confirmed that it has been granted additional access bilaterally into India hence will be in turn launching an additional second daily nonstop service from ADD to BOM effective April 2015. 

The schedule is as follows:

ET 640 Dep ADD 1540 Arr BOM 2315
ET 641 Dep BOM 0350 Arr ADD 0530

Comments:

The new second daily ET BOM flight is most likely going to be a failure due to the below mentioned reasons:

1. You do not launch a new daily long haul flight by giving the market 2 months notice only and that too in low season. Airlines such as EK/QR can do so because they have many more market segments that can adequately feed a new flight across various continents something which ET does not enjoy the luxury of !

2. You do not launch a new daily long haul flight when as a network carrier, you don’t even have 5 destinations that would connect to this new service in both directions via your main hub. From what I have seen, only KRT + NBO connect. Not even DAR/EBB connect in both directions !!! There is no way this new flight can be sustained on a daily basis using a B787.

3. Small O&D market size between ADD-BOM (20,000 pax in 2014) is one third the size of NBO-BOM (60,000 pax) hence this is totally un-warranted.


Eva Air of Taiwan has announced a major fleet purchase order that will fuel its expansion into the next decade. The main highlights are as follows:

·         10 B787-1000Xs to replace its A330 fleet
·         5 B777Fs to replace its entire B744F fleet (8 units)
·         5 A321NEOs


Qatar Airways has officially announced major capacity expansion plans for the upcoming IATA S15 season of which the main highlights are as follows:

BLR – capacity increased from daily B787 to daily B77W effective 01AUG

SIN – frequencies increased from double to triple daily effective JUN using an A359

CMB – capacity increased to double daily B77W + daily A321 effective 01APR

MIA – capacity increased to 5 weekly B77Ws effective 02MAY

DPS – capacity increased to daily B77W effective 01APR

CPT – frequencies increased from 5 weekly to daily nonstop flights using a B787 effective OCT

ZNZ – new 5 weekly flights to be launched via JRO using an A320 effective 01JUL

CGK – frequencies increased from 18 weekly to triple daily using a B77W daily + double daily A330


Austrian Airlines has revealed that it will be launching new nonstop flights to Miami as the carrier looks to take advantage of rapidly growing demand from Europe to South Florida. OS will be operating 5 weekly nonstop flights using a B772ER with the below mentioned schedule:

OS 097 Dep VIE 0955 Arr MIA 1520
OS 098 Dep MIA 1710 Arr VIE 0850+1


Sri Lankan Airlines has officially filed for its return to Australia after a gap of 14 years as the carrier looks to tap into the mass Sri Lankan + South Indian diaspora that lives down under. UL has applied to serve Melbourne nonstop from Colombo four times per week using its brand new A330-300 effective 01NOV15 with the below schedule:

UL 601 Dep CMB 0100 Arr MEL 1600
UL 602 Dep MEL 1800 Arr CMB 2300

In Australia, a majority of the Sinhalese/Tamil diaspora (totaling 150,000+) reside in Victoria state of which Melbourne is the biggest city.


Etihad Airways has disclosed many capacity changes to its network for S15 season of which the main highlights are as follows:

ISB – capacity increased to double daily A321s

MAD – frequencies reduced from daily to 4 weekly A332s

NBO - capacity increased to from daily A320 to daily A321

MAA – capacity increased to double daily A321s

HYD – capacity increased to daily A346 + daily A320

IKA – frequencies increased from 3 weekly to daily using an A320

JFK – new daily A380 flight announced for EY 103/101 rotation (early morning arrival into JFK)

COK - capacity increased to double daily A321s

TRV – capacity increased from daily A320 to daily A321


Cathay Pacific has disclosed it will be launching a new long haul route in 2015 as the carrier looks to tap into high yielding niche markets with minimal direct access to Asia. The new route revealed by CX is Dusseldorf in Germany that will be flown 4 times per week using a B777-300ER effective 01SEP15. In addition, other capacity changes revealed by CX were as follows:

DME – all 3 weekly flights suspended effective June

SFO – frequencies increased from double daily to 17 weekly nonstop flights using a B77W exclusively effective 11JUN

YYZ – frequencies increased from 10 to 13 weekly nonstop flights using a B77W effective 27JUL


Kuwait Airways has officially revealed a major expansion plan of its medium haul route network from IATA Summer 2015 onwards as the carrier looks to increase aircraft utilization as well as expand with additional deliveries of new A320s in particular. The main highlights are as follows:

MUC - new 3 weekly nonstop flights effective 16JUL using an A343 with below schedule

Days 2/4/6

KU 173 Dep KWI 0745 Arr MUC 1255
KU 174 Dep MUC 1425 Arr KWI 2100
COK – frequencies increased from daily to double daily using an A320 for both flights with below schedule
KU 351 Dep KWI 2045 Arr COK 0430+1
KU 352 Dep COK 0550 Arr KWI 0815

KU 349 Dep KWI 2230 Arr COK 0615+1
KU 350 Dep COK 0715 Arr KWI 0940

IST - new daily nonstop flights effective 13JUL using an A320 with below schedule

KU 153 Dep KWI 2250 Arr IST 0310+1
KU 154 Dep IST 0415 Arr KWI 0800

BLR - new 3 weekly nonstop flights effective 01SEP using an A320

Days 2/4/7

KU 353 Dep KWI 2100 Arr BLR 0430+1
KU 354 Dep BLR 0530 Arr KWI 0755

AMD -  new 3 weekly nonstop flights effective 01SEP using an A320

Days 2/3/6

KU 345 Dep KWI 2245 Arr AMD 0505+1
KU 346 Dep AMD 0605 Arr KWI 0730

VIE - new 3 weekly nonstop flights effective 21JUL using an A320

Days 2/4/7

KU 177 Dep KWI 0120 Arr VIE 0605
KU 178 Dep VIE 1040 Arr KWI 1700

Analysis:

It is very pleasing to see KU once again growing its medium haul route network which has remained stagnant in terms of growth for over a decade now. However there are many concerns regarding the above expansion plan:

1. Munich has an O&D of 34,000 pax per annum with a majority flying in the summer. However like its competitors i.e. QR/EY/EK, KU too is a network carrier relying on more transit traffic out of Europe rather than O&D. Taking this into account, the schedule of KU 173/174 is guaranteed to fail because it only connects BKK + MNL in both directions via KWI and those flights are already full year round hence getting access to seats on BKK-MNL will be very tough. Operating a gas guzzling A343 too on a new route with such a schedule is also an extremely risky proposition due to the high operational costs involved.

2. The same applies to VIE which has an O&D demand of 16,000 pax per annum to/from KWI + sees summer seasonal demand primarily. The schedule for VIE too does not offer convenient connections via KWI in both directions to ANY destination on KU's network. Instead, KWI-VIE-KWI should be re-timed to be as below

KU 177 Dep KWI 0900 Arr VIE 1345
KU 178 Dep VIE 1440 Arr KWI 2100 

The above proposed schedule at least allows in both directions India, Pakistan and BKK/MNL/KUL/CGK to be connected in both directions via KWI thus capable of supplying additional feeder traffic.

3. KWI-IST though has a large O&D traffic demand year round i.e. 130,000 pax in 2014 but so does DXB/DOH/AUH/BAH in greater or equal numbers. None of these carriers including TK are dependent on O&D traffic mainly on this route and rely a lot on connecting traffic bound to Asia. KU's schedule for IST only connects DXB, BAH and JED in both directions via KWI in addition the timings proposed are very un-attractive for O&D traffic as with a 0300am arrival into IST it means an extra night's hotel needs to be paid for ! The main direct competition is TK four daily + daily Jazeera (SAW). Once again to ensure good year round S/F, the best schedule for KU at IST would have been below

KU 153 Dep KWI 0950 Arr IST 1410
KU 154 Dep IST 1510 Arr KWI 1855

If slots at IST for these timings cannot be secured then slots at SAW should be obtained. The above proposed schedule allows all of KU's Asia routes to be connected in both directions via KWI to Istanbul !

4. With regards to its India bound expansion to AMD and BLR, it has and does not have merit. To begin with, KU needs to first consolidate its India bound services especially on routes that it does not fly daily i.e. MAA + COK + TRV as these three routes see massive year round O&D demand to KWI + GCC

KWI-MAA - 240,000 pax
KWI-COK - 185,000 pax
KWI-TRV - 80,000 pax

KWI-MAA is flown by KU only four times per week nonstop using an A300-600R (AB6) which is a shock because it has higher O&D demand to KWI versus BOM + DEL ! The first thing that needs to be done is make MAA-KWI daily nonstop followed by COK and then consider expanding other services. BLR is a poor choice of a new Indian route as demand to GCC is not as high as CCJ nor HYD which should have been given higher preference! 

5. Frequency increase of KWI-COK flights from daily to double daily from April 2015 using an A320 though a good move, from a scheduling, sales and aircraft utilization perspective, it looks very weird as explained below:
KU 351 Dep KWI 2045 Arr COK 0430+1
KU 352 Dep COK 0550 Arr KWI 0815
KU 349 Dep KWI 2230 Arr COK 0615+1
KU 350 Dep COK 0715 Arr KWI 0940
You cannot have two KWI-COK-COK flights departing within 1:45 hours of each other as it is not a business route unlike KWI-DXB for example. This is purely a VFR/labor market segment route and in order to better utilize the A320, the schedule I would suggest is nicely spread out and more convenient for both O&D + transit traffic:

KU 351 Dep KWI 2045 Arr COK 0430+1
KU 352 Dep COK 0515 Arr KWI 0750
KU 349 Dep KWI 0845 Arr COK 1630
KU 350 Dep COK 1715 Arr KWI 1940
With my above proposed schedule, you can use one dedicated A320 to operate both KWI-COK-KWI on a daily basis each respectively. You have a nice spread of morning + evening departure timings as with the 0845 KWI departure it will allow KU in the future to create a new Indian subcontinent departure hub wave bank between 0830-1000. In addition, if KU has a spare A320 at night, it should instead look at either increasing KWI-MAA from 4 weekly to daily or launching new 4 weekly KWI-HYD nonstop flights as last year 60,000 passengers alone flew KWI-HYD-KWI + increase KWI-LHE-KWI from 3 to 5 weekly A320s.