Browsing Posts in Airbus

Singapore Airlines has announced a big order for a slew of new aircraft from Airbus including more A380s and some new A350s. But buried in the release is the news that Airbus will take back the five A340-500 aircraft in the Singapore fleet. That means the end of the nonstop flights between Singapore and both LA and Newark, the latter being the longest flight in the world. While this may just end up being a footnote in history, it’s worth looking at the A340-500 and how it, like the 747SP before it, was doomed to have a very short lifespan from the beginning.

Shrinking to Gets More Legs
The 747SP and the A340-500 were two peas in a pod. They were both designed specifically for ultra long haul flying and they were made obsolete very quickly by other airplanes. The 747SP was originally developed because Pan Am wanted to be able to fly nonstop from New York to Tokyo and it couldn’t do it with the 747s in service at the time. So what Boeing did was take the 747-100 and shrink it. The result was a smaller airplane with similar fuel capacity so it could fly further. Problem solved.

A340-500

But then, engine technology improved, and they were able to create a normal-sized version of the 747 with the same range. All of a sudden, the 747SP lost its usefulness. Sure, sometimes you might not want all those seats on a full size 747, but the shrunk body made for an expensive airplane to operate. It’s the same reason very few airlines have picked up on the 737-600 or the A318. Those end up being very inefficient for how few seats they have because they still carry most of the guts of the larger airplanes from which they were shrunk.

The A340-500 was the same kind of thing. It was developed in tandem with the A340-600, a much longer version that didn’t quite have the range to reach every destination that Airbus clients wanted to reach. So they shrunk the thing, and there you go. More range.

Rapidly Declining Usefulness
The A340-500 was always going to be limited in its market, but it was hurt by not even meeting initial range plans. Then the introduction of the 777-200LR with two fewer engines and even better range hurt, but it was the 777-300ER that simply killed the thing. The LR was introduced in 2006 and could do everything the A340-500 could do for less, but that in its own right wasn’t the most efficient airplane around and had limited appeal. But the 777-300ER was the true rock star. It has been a wild success in that it can serve almost every market you could ever imagine wanting to serve.

I say “almost” every market, because there are some that it can’t reach, like Singapore to LA and Newark. But those truly ultra long haul markets are very difficult to make money on. Thai tried it from Bangkok with the A340-500 and walked away in favor of a 777 that stops in Korea. Singapore, however, already runs both single-stop flights and the nonstop. But there wasn’t much of a reason to keep the nonstop going other than pride and the fact that it had A340-500s lying around with nothing better to do.

Ultra Long Haul is a Tough Sell
Why is ultra long haul flying hard to make money on? Well you do use a ton of gas, and that’s always painful. But the schedule advantage isn’t that great either when you fly so far.

In LA, you could leave at 345p and be in Singapore at 255a with a stop, an elapsed travel time of 20h10m. The nonstop leaves at 915p and arrived at 540a for an elapsed time of 17h25m. That less than three hour difference might mean something on a shorter flight, but the advantage simply isn’t that important on ultra long haul options because you gain very little.

It was made even worse by the fact that the A340-500 couldn’t even carry a full load. Originally they tried to use a mix of business and premium economy. Then they switched to all business with only 100 seats. But they could never do what they wanted because the range wasn’t there.

Few are Left Flying
Today, I imagine Singapore is thrilled to be getting rid of the A340-500 from its fleet, because it just doesn’t serve a purpose anymore. I’m not sure if Thai still has the A340-500 still flying but it can’t be long for this world. That leaves three commercial operators using the remaining airplanes. There weren’t even 40 built originally.

One is Nigeria’s Arik Air which probably liked the airplane because it was very cheap to acquire. It may be expensive to operate but if you don’t have the capital to buy the airplane you want, then your options are limited.

The others are Etihad with a small subfleet that flies today (to airports including New York and Frankfurt) and Emirates, which still has the bulk of the airplanes that are still operational. I can’t quite figure out why Emirates uses this airplane, because it doesn’t even use it on long haul flying. It goes from Dubai to Dar es Salaam, for example. That flight is only 2,458 miles and could even be flown with a 737 (not that Emirates flies any narrowbodies). It may very well be that Emirates is simply growing so fast that it needs to use whatever airplanes it has instead of being able to use the airplanes it wants. That will change over time.

Eventually, the A340-500 will be just a memory (or operated until it falls apart by countries with trade embargoes like the 747SP in Iran). Singapore is just doing what it probably wanted to do years ago.

Airbus brought out a pretty interesting idea recently that would theoretically make it easier for airlines to charge for aisle seats. How so? It would make them wider. Though I like the thought, I wouldn’t expect to see this on an airplane near you anytime soon.

On the A320 Airbus Wide A320 Seat Conceptfamily, Airbus has long touted how the wider cabin allows for wider seats than its main competitor, the 737, in coach. In general, that’s the truth. The standard layout is for an A320 to have 18 inch-wide seats while the 737 is generally 17 to 17.2 inches wide at most. For me, seat width isn’t a big issue. I don’t have much trouble fitting into any seat, and it’s really those with the narrower armrests (like regional jets) that feel tighter even if they aren’t. But for some, this can be a real issue.

Regardless of whether it’s a real issue or not, it’s certainly an issue perceived to be important by some travelers. People say they want more room, and a wider seat would accomplish that. So Airbus has come up with a unique way to give travelers a wider seat without impacting seat density on the aircraft.

The idea is to shrink the window and middle seats by an inch to get them to standard 737 measurements. Then add two inches to the aisle to create a super-wide 20 inch seat. That’s within an inch of a domestic First Class seat width on most narrowbody airplanes. Of course, it wouldn’t be First Class. The legroom and service would be the same as coach. But it would just be wider than a regular seat. Call it Economy Plus: Wide Edition, or something like that.

I can see this being attractive to airlines but I wouldn’t expect to see a huge order coming down soon. Airlines are already quickly finding out that they can charge for regular aisle seats without any sort of physical improvement. So the threshold for justifying the ordering of all new seats is pretty high in terms of additional revenue generation. I’m not sure it can be met. Now, if I were a brand new airline starting up, I might think about adding those seats assuming that the cost to purchase them isn’t much more than the regular set of three. But you know that these would be somewhat more costly because they aren’t exactly standard seats.

Even if I don’t expect that we’ll see a lot of airlines take this option, I do like the thinking behind it. The idea of trying to improve the traveler experience without adding much cost or decreasing seating density is one that has a better chance of success than most crazy ideas out there. While a jacuzzi onboard sounds great, something like this is far closer to reality.

In case you missed it, American has decided to buy an insanely large number of airplanes. With 460 orders and another 10 million options (ok, maybe just 465), this was easily the largest order ever for an airline. Not only did American order a lot of airplanes, but it gave the lion’s share to Airbus, a huge coup for the manufacturer. This is a huge chunk of change, so why is American, the airline with one of the weaker balance sheets around, playing with fire? A few reasons. This might actually be a smart move.

Unfortunately, we don’t know a ton of details about American’s plans just yet. We do know that American will buy 100 more current generation 737s, 100 737s with new, more efficient engines, 130 current generation A320 series airplanes, and 130 A320neo (new engine option) series airplanes. That comes to a total of 460. How will this massive buy fit into the airline’s fleet? That remains to be seen since American hasn’t said which versions of each series it will take. But we do know something.

The MD-80 is Almost Done at American

When this order is fully filled, the MD-80, 757, and 767-200 will have disappeared from American’s fleet. The MD-80 retirement is no surprise. American has slowly been replacing those with 737-800s, and this will be the nail in the coffin for the older technology, less fuel efficient “Mad Dog” aircraft. I know a lot of people hate MD-80s, but I do have a special place for them. Soon enough, there won’t be any Douglas airplanes flying. Sad.

But time marches on, and it was a given that this would happen. Today, American has 214 MD-80s left in the fleet with 154 737-800s. There were previously 54 737-800s on order, so really, there were just 160 MD-80s that still needed to be replaced. That will undoubtedly happen with the 737 and A320 current generation airplanes on order in some form.

Then there’s the 757. It’s a great airplane that uniquely can fly passengers across the Pond to Europe, over to Hawai’i and into a variety of hot and high locations with ease. No other airplane has been able to duplicate this with so few seats, and even though it’s out of production, the airplane is still a strong performer. American has decided that it can replace it, but I don’t think that will be with one airplane. The 737 can do Hawai’i, the A321neo and next gen 737s should be able to get to Europe. It probably won’t be a one size fits all solution, but with these new-engined airplanes, there is finally a way to replace the 757.

The 767-200 is a niche airplane that primarily flies the JFK to LA and SF routes. That will be easy to replace, and probably should be toast sooner rather than later.

That’s pretty much what we know. The problem, as mentioned, is that we don’t know which airplanes in the series American will actually take. It notes that it has flexibility and can opt for any family member in each series, specifically the 737-700, 737-800, 737-900ER and the A319, A320, and A321 are mentioned. So what will the counts look like of each? We don’t know, and American probably doesn’t know either. The airline does like to talk about what amazing flexibility it has in this deal. It can make changes as it sees fit over time. One thing is clear; this will add a lot of airplanes to the fleet, and it reintroduces Airbus into the Boeing-loyal airline.

American's Two Dads, Boeing and Airbus

I’m still surprised that American bothered ordering from both Boeing and Airbus. It seems to me that Airbus had this thing sewn up thanks to Boeing’s refusal to move on an heir apparent to the 737 while Airbus had the A320neo. When Boeing finally budged (note that the new engine 737 isn’t approved yet by Boeing’s board but is part of the order), it was able to squeeze back in to the race. But why not pick one over the other? It would seem that with a re-engined option, one manufacturer could fill the need. But I think it’s all about money.

As part of this deal, there’s no doubt that American went back and forth to both manufacturers and played them off each other. They got the absolute best deals they could and then, they took them both. That’s a great move. There will be enough airplanes in each fleet to really not make much of a difference whether there’s one type or two. And this way, American can walk away with big money. In fact, the first 230 deliveries are already covered by financing from the two manufacturers. It’s like American is the kid who went up to its parents and asked for money . . . and dad handed over his whole wallet.

But with all these massive orders, American is still going to have a lot more airplanes than it has today. Let’s assume that American retires all its 757s, 767-200s, and MD-80s. That’s 299 airplanes out of the fleet but 460 coming in. Huh? That’s huge growth, and it doesn’t even count the options. I can’t imagine a need for that much growth, so how will this play out?

Some of it could be counting on the new-engined aircraft replacing some of the current generation 737s and A320s that come in, but there could be more to it. And that could lie with American Eagle.

American Eagle Flies Away

American also announced that it will go ahead in spinning off American Eagle into a separate company. As part of that, the Eagle pilots got a guaranteed path into American with 35 percent of new hire pilots at American required to come from Eagle. American likes to say that it’s spinning off Eagle so that it can fly on its own and can start working for other airlines as well. Yeah, right. Eagle is expensive compared to other providers, and its chances aren’t great for getting new flying. The reality is that American really just wants to start looking for other airlines to do some of its express flying for less. So it spins Eagle off and slowly shrinks it into oblivion.

But remember, today American flies nothing smaller than the 140 seat MD-80. What if it chooses to get A319 and 737-700 airplanes as part of this order? You figure those would fly in around a 120 to 124 seat configuration. With that smaller airplane, could American start bringing mainline flights back to places that are served with 70 seaters today?

It might be a stretch, especially since my assumption is that the pilots aren’t going to work for less to win that flying back. But there are a lot of routes out there that are on 70 seaters today, like Chicago to Atlanta, that might work better with a larger airplane. American hasn’t had that type of capacity for years, so we have no idea how the airline would use it. But it could be a way of reducing dependence on Eagle, if labor is willing to take on the challenge.

In the end, we really don’t know what American’s strategy is. I doubt American even fully knows what it’s going to do with all these airplanes. But it is encouraging to see the airline make these moves. American is finally, actually, going to try to do something about its cost problem instead of continuing to whine about how others will eventually catch up. With sweetheart financing from the manufacturers and much more fuel efficient aircraft, this should help the airline keep costs down. If only we had more details to know for sure . . .

[Original Aircraft Photo via Flickr user JF10/CC 2.0]

That’s the question. What will Boeing do? The Airbus A320neo has been a hot seller at the Paris Air Show this year, and even American is said to be in talks with Airbus about buying. (This sounds like an effort to get Boeing off its butt, but that’s just me.) So what will Boeing do? Will it go for a 737 with new engines? An all new 797 to replace the 737? If it wants to keep winning narrowbody orders, it has to do something. The question is . . . what?

When you think of air shows, you probably think of a warm summer day, some cool flying demonstrations to show off military might, and a few static displays of airplanes to walk through. That’s the core of any air show, but for the premier airshows in the world, that’s more of a side distraction than anything else. This week is the biennial Paris Air Show, and what you see happening in the air and on the ground is just fluff. This show is all about doing deals behind the scenes.

Air Show Aircraft Sales

Paris and Farnborough (in the UK) take turns being the premier air show every other year. This year, it’s Paris. There are definitely some very cool flying demos, including the A380 (despite yet another wingtip mishap that almost scrubbed the flight) and a bunch of military flights as well. Why do they bother? They’re trying to get sales. Some airlines, aircraft manufacturers, and suppliers like to hold out to make a big splash at an air show with a big order.

This has never made sense to me. If I were ordering some airplanes, I’d rather tell the manufacturer to save all that wasted money thrown into air show displays and pass the savings along to me. But that’s not how it works. Instead, everyone goes and hangs out in the individual company “chalets” and has a grand old time. During leaner years, the smiles are few and far between, but so far we’re off to a hot start in Paris with almost 300 aircraft orders on the first day alone.

Take a look at some of the aircraft orders that have been announced so far. These are just aircraft orders. There are plenty of other deals with suppliers for a variety of other things as well.

  • Air Lease, the new big aircraft lessor started by former ILFC chief Steven Udvar-Hazy signed up for 50 of the next generation Airbus A320neos with options for 11 more down the road. The company also ordered 20 Boeing 737-800s with 4 options, 11 Airbus A330s, 5 Boeing 777-300ERs, 5 Embraer 190s, 4 Boeing 787-9s, 1 lonely Airbus A321, and a partridge in a pear tree. All of these will be leased out to different airlines.
  • Aircraft lessor GECAS ordered 60 of the Airbus A320neos. It also picked up 15 ATR 72 turboprops with 15 options along with 2 Embraer 190s. Rumor has it we can expect 2 Boeing 747-8 freighters to be ordered today. As with Air Lease, these will all be leased out.
  • SAS out of Scandinavia ordered 30 of the Airbus A320neos and kept 11 options. SAS has struggled a lot lately, so hopefully they’re still around when it comes time to take delivery. These will replace the older MD-80s.
  • Sriwijaya Air (say that three times fast) ordered 20 Embraer 190s to fly around Indonesia along with another 10 purchase rights. What’s the difference between a purchase right and an option? I have no clue.
  • Kenya Airways ordered 10 Embraer 190s with options for 10 more.
  • Bombardier picked up an order for 10 of its new C-Series airplanes with 6 options from a mystery buyer. This will be a launch customer. So who is it? We don’t know, but we do know that Bombardier says it’s a “major network carrier.” I’m eagerly awaiting news of who that might be, but I can’t imagine it’s a US-based airline.
  • Boeing received one order for 15 of its 747-8s and another for two of the big birds. Who ordered them? It’s a secret. Again. While it wouldn’t surprise me if the two were for private owners, those 15 have to be for a major airline.
  • Qatar Airways picked up 6 777-300ERs. It loves making noise at air shows.
  • Saudi Arabian beefed up its A330 orderbook with four more.
  • Almost lost in the shuffle, Air Astana out of Kazakhstan ordered 2 Embraer 190s with 2 options.

If you’re at Paris this week, enjoy all that drinking and schmoozing. If you’re here at home and you’re interested in this kind of stuff, I would recommend following Flightglobal. Those guys have put together some great coverage on what really is a pretty mundane subject for anyone outside the industry.

[Original photo via Flickr user slasher-fun/CC 2.0]



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