24NOV edition

The 2013 Dubai Air Show kicked off amidst much fan fare as the 3 big Middle East carriers tried to outdo one another with major orders announced on opening day. Apart from this, the show lacked any further significant orders from any airline. The main highlights from the show in terms of orders being placed were as follows:

a)      Emirates – placed an order for 115 B779Xs + 35 B778Xs + 50 options for both variants

b)      Qatar Airways – placed an order for 50 B779Xs + 13 A330-200 freighters

c)      Etihad Airways – placed an order for 8 B778Xs + 17 B779Xs + 30 B787-1000s + 1 B777-200LR freighter + 26 A321NEOs + 10 A320NEOs + 40 A359s + 1 A330-200 freighter + 10 A351s

d)      Fly Dubai – placed an order for 100 B738MAXs + 11 normal B738NGs

e)      Ethiopian Airlines – placed an order for 8 Bombardier Q400s

f)       Iraqi Airways – placed an order for 16 Bombardier C Series 300 (5 firm + 11 options)

Comments:

The EY order for 26 A321NEOs is a smart move as the carrier can use this aircraft as well to operate instead of a wide body to selected European routes where there is lack of premium demand + cargo plus it can standardize many of its ISC bound services to an A321. One can assume that the 8 B778Xs would be part of an exchange deal with Boeing buying back 5 of the B772LRs that EY will soon obtain from Air India. Some of these aircraft are also part of a ‘group order’ deal as the 10 A320NEOs are slated to go to Air Serbia and one shall not be surprised to see few B779Xs go to Jet Airways and Virgin Australia from 2021 onwards to replace their B773ERs.  

The order placed by Emirates is not one for expansion but rather more so to entirely replace its existing B777-300/-300ER fleet in particular. The B779X though has the capability to operate nonstop from DXB to SFO/LAX/GRU/SYD without any payload issues in either direction.  

Emirates has officially announced many capacity increases especially with regards to its A380 deployment for the upcoming IATA Summer 2014 season of which the main highlights are as follows:

MUC – capacity increased to double daily A380s

CDG – capacity increased with all 20 weekly flights operated with the A380

CPT – capacity increased to double daily B773ERs

HKG – capacity increased to triple daily A380 + daily B773ER (EK 386/87 only)

BKK – capacity increased to triple daily A380 + triple daily B773ER

AMS – capacity increased to daily A380 + daily B773ER

ATH – capacity increased from daily A345 to daily B773ER

Austrian Airlines has officially announced that it will be increasing its flights to Delhi, India effective 14APR14 as the carrier looks to feed its additional USA services to IAD, ORD and EWR next summer with support from India. DEL-VIE flights will be operated on a daily basis from the previously mentioned effective date using a Boeing 767-300ER.

Etihad Airways has officially announced many route network updates for 2014 of which the main highlights are as follows:

ZRH – new daily nonstop services to be launched effective 01JUN14 using a 3 class A333

MED – new daily nonstop flight to be launched using an A320

MUC – frequencies increased from daily to double daily effective 01FEB14 using an A333

Gulf Air has officially announced that it will be reinstating two previously terminated destinations as the carrier looks to gradually grow its route network within a 5 hour flying radius of Bahrain. Services to Mashad in Iran and Trivandrum in India shall be re-launched effective 15DEC13 operated in the following manner:

MHD – 4 weekly nonstop flights using an A320

TRV – 5 weekly nonstop flights using an A320

Air France has revealed many capacity changes to its long haul Summer 2014 schedule of which the main highlights are as follows:

KUL – frequencies increased from 3 to 4 weekly nonstop flights using a B772ER

GIG – frequencies reduced from double daily to 11 weekly i.e. daily B773ER + 4 weekly A332

JKT – new daily services to be launched via SIN using a B773ER

SFO – frequencies reduced from double daily to 12 weekly i.e. daily A380 + 5 weekly B772ER

ABJ – capacity reduced to 10 weekly nonstop flights using a B772ER exclusively

PNR – frequencies increased from 5 to 6 weekly nonstop flights using an A332

KLM has officially announced many capacity changes to its long haul route network schedule of which the main highlights are as follows:

LOS – capacity reduced from daily A333 to daily A332

CPT – frequencies increased from 4 to 5 times per week using a B772ER

IAH – frequencies increased from daily to 9 weekly nonstop

FUK – frequencies increased from 3 to 4 weekly nonstop flights using a B772ER

JRO/DAR – capacity increased from daily A332 to daily A333

JFK – frequencies increased from double daily to triple daily

Jetblue has officially announced that it has placed a follow up order with Airbus for 35 additional A321s as the carrier is extremely buoyed with the prospects that this aircraft can bring to the airline’s bottom line in terms of revenue growth and yield on high density medium haul routes. The breakdown calls for 20 A321NEOs and 15 A321s with Sharklets. In addition, the airline also firmed up options it previously held on 18 A320s to 18 A321s thus bringing its total A321 order book to 80 units i.e. 50 current versions + 30 A321NEOs.

Qatar Airways has officially announced that it shall be launching new services to EDI-Edinburgh, Scotland effective 02MAY14. Five weekly nonstop flights will be operated by QR using a B787-800 with the below mentioned schedule:

Days: 1/3/5/6/7

QR 27 Dep DOH 0800 Arr EDI 1315
QR 28 Dep EDI 1445 Arr DOH 2340

Above mentioned schedule allows excellent connections in both directions via DOH to GCC, DEL, China, BKK, MNL, ICN, SIN, CGK, KUL, MEL, KHI, JNB, BEY and COK.  

South African Airways officially announced for the financial year ended 2012, it posted a net loss of US$ 143 million and in order to engage in cost cuts, it has opted to suspend flying to EZE-Buenos Aires (effective March 2014) and has requested the South African Government to consider its request to also consider suspending Mumbai and Beijing of which the latter is its biggest loss maker at US$ 30 million per year. However, due to the government’s desire to maintain online flying links with the BRICS (Brazil Russia India China) member states, its request was denied to suspend PEK. Currently, SAA operates a daily A332 to BOM and a 3 weekly nonstop A346 to PEK. It has also attributed its large losses to operating the A343s and A346s on their EU/USA/Australia long haul flights versus a more efficient twin engine aircraft.

Turkish Airlines has officially announced that it will be launching new services to YUL-Montreal, Canada effective 03JUN14 as part of a new bilateral signed between Canada and Turkey to further liberalize access. The new bilateral permits TK to operate to Canada 9 times per week and it will do in the following manner:

YUL – new 3 weekly nonstop flights to be launched effective 03JUN14 using an A332

YYZ – frequencies increased from 5 to 6 times per week using a B773ER effective 29MAR14

Air New Zealand has revealed the configuration of its soon to be delivered Boeing 787-900s which will feature a 3 class cabin i.e. business, premium economy and economy. In total, 302 seats will be on board i.e. 18 business class (flat beds), 21 premium economy and 263 economy class. The first routes to be operated by this aircraft type are nonstop from its main Auckland hub to Shanghai and Tokyo.

05NOV edition

Turkish Airlines has officially announced that it has been bilaterally awarded seven additional frequencies to Pakistan from November 2013 onwards and as a result shall be taking full advantage in the following manner:

LHE – new 3 weekly nonstop flights to be launched effective 27NOV using a B738

KHI – frequencies increased from 4 weekly to daily effective 23DEC using a B738

ISB – frequencies increased from 3 to 4 weekly effective 25NOV using a B738

In addition to the above, TK too confirmed that its services to IAH-Houston shall be increased to daily nonstop effective 30MAR14 using a B773ER.

Egypt Air’s management has officially announced that the carrier will be placing a major order with Boeing and Airbus next year for a total of 60 new aircraft i.e. 17 to replace current fleet and 43 to be used for growth. Management has informed the media that it is considering the Airbus A380/A350 alongside the B77X/787 for the wide bodied fleet mix. The carrier wants to take full advantage of the geographical location of its Cairo hub and be a key player in the EU-Asia, EU-Africa and North America-Asia/Africa market segments. To begin its expansion plans, all the new aircraft that would be ordered shall be leased rather than purchased outright for financial ease, two new long haul routes were officially announced for 2014 which were Hong Kong and Jakarta (to be operated via KUL).

Source: http://www.bloomberg.com/news/2013-10-10/egypt-air-identifies-60-plane-requirement-to-revamp-aging-fleet.html

Analysis:

The aircraft that MS are looking to replace include 7 A332s + 4 B772As + 3 A342s + 3 AB6Fs. Its flagship long haul product is available currently only on board its new A333s and B773ERs. MS doesn’t need anything bigger than a B77W in the future. The A380 too has no business being in the MS fleet even for service to JED because it is operated 4-5 times daily by the airline from CAI hence better suited for this aircraft type.

As far as MS’s medium/long haul fleet is concerned, the fleet should be like this:

B77W – should remain for long haul and high density medium haul routes. In order to best utilize this asset to its fullest potential, it should be configured in 2 layouts i.e. one for long haul which is the current 49J + 298Y and one for high density routes requiring less premium seats. Over here, the configuration proposed is 21J + 379Y giving it 400 seats i.e. 17% more capacity at the same operational cost. The high density configuration is ideally suited for MS’s services to KWI, JED, RUH, DXB, BKK as well Hajj/Umrah flights to Saudi Arabia. There is no need what so ever for MS to drain its finances by investing in the more expensive B779X when the B77W (B773ER) is perfectly suited for its route network.   

B 789 - for medium density long/medium haul routes (A359 one feels is too big in a 2 class configuration for this market segment for MS)...280 seats in a 2 class config i.e. 24J + 256Y

A321-200NEO - for high density short haul routes in the MENA region and Africa (within 6.5 hours flying distance)...170 seats in a 2 class config i.e. 12J + 158Y

CS300 - for high frequency regional/domestic routes plus low density short/medium haul routes within a 6 hour flying radius of CAI. Configuration proposed is 12J + 115Y so 127 seats in total. The cost savings (over a 15 year period) of operating + purchasing + retraining the CS300 should outweigh the commonality positives gained by having an A320/A321NEO fleet !

Qatar Airways has officially announced many capacity changes to its route network for the current IATA W13 season of which the main highlights are as follows:

CMB – effective 01JAN14, capacity increased from triple daily A321s to daily B773ER + double daily A321

DWC and SHJ – effective 01MAR14, new double daily flights to be launched to both airports using an A320

HGH – new 4 weekly nonstop flights to be launched using an A332 effective 20DEC

BRU – capacity increased from daily A332 to daily B787

TXL – capacity increased from 4 weekly A320 to 4 weekly A332

In addition to the above, QR also revealed that it will be launching new 4 weekly nonstop flights to MIA-Miami, USA effective 10JUN14. All flights will be operated using a Boeing 777-200LR using the same schedule as its current JFK, ORD and IAD bound services.

Cathay Pacific has officially announced that it shall be significantly increasing capacity to Chicago (ORD) and Los Angeles (LAX) from the on set of the IATA S14 season in the following manner:

ORD – frequencies increased from daily to 10 weekly nonstop flights using a B773ER

LAX – frequencies increased from triple daily to 4 times daily with all flights operated with a B773ER

In addition to the above as part of the on going cost reduction measures being implemented by the airline, it will be reducing capacity to both JNB and SFO from IATA W14 season as follows:

JNB – capacity reduced from daily B744 to B773ER

SFO – all double daily flights to be exclusively operated using a B773ER

The significant operational cost savings of the B773ER being used instead of the B744 + the extra cargo revenue uplift were key aspects for CX to make this decision.

Emirates has officially announced that it has been granted additional bilateral access to the highly lucrative Luanda (Angola) market by being the only 2^nd long haul carrier allowed to operate more than 3 times per week to the country. Effective 01DEC13, EK will be operating a daily nonstop service between DXB and LAD using a B773ER with its current standardized schedule.

American Airlines has officially announced that it will be undertaking significant long haul expansion out of its primary DFW-Dallas hub to Asia from June 2014 onwards. AA revealed two new long haul routes i.e. daily DFW-PVG (Shanghai) effective 11JUN14 using a B772ER + daily DFW-HKG effective 01JUN14 using a B773ER. As far as its JFK-HND (Tokyo Handea) flights are concerned, AA announced that the current daily nonstop service using a B772ER will be discontinued effective 30NOV13 as the airline seeks to better deploy its assets elsewhere. 

Etihad Airways has officially announced many capacity changes across its medium and long haul network for the current IATA W13 and following S14 seasons of which the main highlights are as follows:

JKT – frequencies increased from daily to double daily B773ERs

CMB – frequencies increased from daily to double daily A320s

LAX – new daily nonstop flights to be launched effective 01JUN14 using a B772LR. This is a new aircraft type obtained by EY via purchasing 5 of them from Air India last month. These B77Ls shall be reconfigured to EY’s specifications which are 8F/40J/189Y.

PER – new nonstop flights from AUH shall be launched in 2014 in collaboration with Virgin Australia

The Iraqi Government has officially announced that it is placed an order on behalf of Iraqi Airways for 5 new Bombardier CS 300s as the carrier looks to expand its regional network in the Middle East region. These five jets are part of an exchange order i.e. replacing 5 CRJ 900ERs which were originally purchased by the carrier many years ago. The price paid for each CS300 was US$ 40 million which is a 44% discount from the published US$ 72 million official price tag as stated by the Government themselves.

Korean Air has officially announced that it has placed a new US$ 4 billion order with Boeing for the purchase of additional wide body jets. These include 5 B747-800Is + 1 B787-900 + 6 B777-300ERs. In total, this brings the KE B748 passenger fleet count to ten units.

Finnair has officially announced few capacity changes to its long haul route network for the upcoming IATA S14 season of which the main highlights are as follows:

DEL – frequencies reduced from 6 to 3 weekly using an A333

YYZ – capacity increased from 3 weekly B757s to 3 weekly A333s

Austrian Airlines has officially announced that it shall be majorly expanding its presence in USA from the onset of the IATA S14 season of which the main highlights are as follows:

EWR – new 5 weekly nonstop flights to be launched using a B763ER

ORD – frequencies increased from 5 weekly to daily nonstop using a B763ER

IAD – capacity increased from daily B763ER to daily B772ER

Air Europa of Spain has officially announced that it has purchased 8 additional Boeing 787-800s as the carrier looks to embark on a rapid expansion drive into Latin America, North America and Asia using this particular fleet. This brings the total number of B788s ordered by the airline to 16.

20SEP edition

Website: http://airline-news.blogspot.com

Lufthansa has officially announced that they have placed the largest ever order by a legacy European airline (in terms of $ value) as the German carrier finally revealed its highly anticipated wide body aircraft replacement order. LH signed up for 34 Boeing 777-900Xs + 25 Airbus A350-900s worth a combined total of US$ 19 billion.

The B779s will be replacing LH’s entire fleet of B744s and A346s by 2020 where as the A359s will be replacing its A343 fleet from 2016 onwards and the A333s during the next decade. The initial routes identified by LH for these aircraft are as follows:

A 359 – FRA/YVR and FRA/SSG

B 779 – FRA/BKK (2 class high density)

B 779 – MUC/PVG and FRA/PVG (3 class)

Philippine Airlines has officially announced that it will be launching new nonstop flights to LHR-London Heathrow from its Manila hub effective 04NOV13 onwards as the carrier looks to embark on a major EU expansion as its ban has been lifted after a security/safety audit being passed. PR will be operating 5 weekly nonstop services to LHR using a B777-300ER which are expected to go daily from June 2014. Flights will be arriving into LHR at 1415 and departing back at 1705. In other EU related news, PAL confirmed that it has secured obtaining bilateral rights to fly double daily flights into Italy effective Summer 2014 i.e. daily to Rome and Milan each respectively. These two cities are expected to be operated as a triangular service 4 times per week as MNL-FCO-MXP-MNL using a B777-300ER.

With regards to its fleet expansion drive, PAL’s Chairman revealed that the carrier will be dry leasing 10 additional aircraft to cater for robust North American and European expansion. Four B773ERs + 6 A343s shall be dry leased into the fleet next year and to cater for replacements from 2020 onwards, the carrier shall be obtaining 10 A350-900s + 10 B777-900Xs.

Emirates has officially announced that it shall be launching 3 new destinations from Dec13 onwards as the carrier continues to aggressively expand its route network in under served niche markets. The main highlights are as follows:

TPE – new daily nonstop flights to be launched from FEB14 using a B773ER

KBL – new daily nonstop flights to be launched from DEC13 using an A345

BOS – new daily nonstop flights to be launched from MAR14 using a B772LR

Qatar Airways has officially announced today details of its route network expansion plans for the upcoming IATA W13 season of which the main highlights are as follows:

JKT - frequencies increased from 11 weekly to double daily using a B773ER

ISB - frequencies increased from 4 weekly to daily (3 weekly A320 + 4 weekly A332)

RGN - frequencies increased from 3 weekly to daily nonstop using an A319LR
DXB - frequencies increased from 11 to 13 daily flights
BAH - frequencies increased from 6 to 7 daily flights
DME - frequencies increased from 10 to 12 weekly
BEG/SOF/ESB/OTP - all shall receive an extra weekly service

Delta Airlines announced that it has placed a major order with Airbus totaling US$ 6 billion for the purchase of 40 new jets from the European manufacturer. The breakdown of the order was as follows:

10 A330-300IGWs of which majority shall be based at SEA for trans-pacific nonstop flying seating 293 pax in a 3 class layout i.e. 34J + 32P + 227Y.

30 A321-200s which will seat 190 passengers in a 3 class configuration i.e. 20J + 22P + 148Y

Etihad Airways has officially announced capacity increases to its Indian subcontinent route network for the upcoming IATA W13 season of which the main highlights are as follows:

DEL – frequencies increased from daily to double daily i.e. daily A332 + daily A320

BOM – frequencies increased from daily to double daily i.e. daily A346 + daily A320. Both the additional 

DEL and BOM services depart AUH at 1530 and arrive back by 2355

MAA – capacity increased from daily A320 to daily A321 (174 seater)

KTM – frequencies increased from daily to double daily using an A320 for both flights

China Southern Airlines has revealed that due to the ever growing popularity of its nonstop Guangzhou (CAN) – London Heathrow service, it shall be increasing its presence on this route effective 27OCT13 onwards. The current 5 weekly nonstop flights operated by a B787-800 shall be increased to a daily nonstop service using the same aircraft type offering quick connections in both directions via CAN to Australia in particular.

Ethiopian Airlines has officially announced that it is extremely pleased with the performance economics that the Boeing 787-800 has brought to the airline and has attributed this as a key aspect to their strong financial performance in 2013. As a result, ET decided to place an order for 8 additional B788s bringing the total number of units ordered to 13 by the East African airline! As far as its route network for the IATA W13 season is concerned, ET announced many changes to its medium and long haul network of which the main highlights are as follows:

SIN – new 3 weekly flights to be launched via BKK using a B763ER effective 17DEC13

COO/ABJ – frequencies and capacity increased from 3 weekly B738s to 4 weekly B757s

BKO/DKR – capacity increased from 4 weekly B757s to 4 weekly B763ERs

HKG – all 3 weekly flights to be operated nonstop using a B763ER instead of via BKK

DEL/HGH – frequencies reduced from 5 to 4 weekly

NIM/OUA – new 4 weekly service using a B757

Alitalia has officially announced that it shall be launching adjusting its services to NRT-Tokyo for the Summer 2014 season of which the main highlights are as follows:

VCE – new nonstop VCE/NRT nonstop flights to be launched using a B772ER

MXP – frequencies increased from 4 to 5 weekly nonstop using a B772ER

FCO – frequencies reduced from 10 weekly to daily nonstop using a B772ER

Air India has officially announced that if it does not hear any positive feedback from Star Alliance by the end of September 2013, it will stall all further attempts to join this alliance group and instead focus its resources to joining One World instead. The carrier is very keen to be part of a large alliance group which would enable it to realize higher yields, revenue and feeder service on board its long haul and domestic route network in particular.

Comments:

Finally AI is thinking sensibly as One World is ideal for them (I am looking at this from their perspective only) as they can code share with:

AA on all their India-USA flights
BA on all their UK-India flights
QF on their new daily DEL-MEL/SYD flights
CX on all their HKG-India flights
JL on all their NRT-India flights
QR on all their DOH-India flights + via DOH to Africa/Europe/Middle East

India-UK is the biggest market in Europe for which a BA-AI JV partnership would be a serious threat to all the direct and in-direct carriers. On the Aussie route, AI/QF can code share on domestic Australia and trans-tasman to boost feed. On the trans-pacific front, AI via HKG or NRT can code share to YVR, LAX and SFO with JL/CX rather than spend reckless amounts of money operating its own services.

British Airways has revealed major expansion plans for its long haul route network for the IATA S14 season as the carrier looks to take opportunities in niche markets that can generate good S/F and yields at the same time. The main highlights are as follows:

AUS – new daily nonstop flights to be operated using a B787

ACC – frequencies increased from daily to 10 weekly nonstop i.e. daily B744 + 3 weekly B763ER

SEA – frequencies increased from 10 to 11 weekly nonstop using a B744

TLV – frequencies reduced from triple daily to double daily

EBB – frequencies increased from 3 to 4 weekly

ICN – frequencies increased from 6 weekly to daily

JNB – frequencies reduced from 17 weekly to double daily