Aer Lingus goes shopping

[akerosid]

From RTE's Aertel:

Aer Lingus has started talks with plane makers Airbus and Boeing to buy as many as 14 planes to replace and expand its fleet.

Chief executive Willie Walsh told the Reuters news agency that the airline was looking to order at least 11 and as many as 14 planes, partly to replace its current fleet of seven Airbus A330s.

Walsh was speaking on the sidelines of the International Air Transport Association's annual meeting in Singapore. He said it was a good time to be talking to manufacturers, given Aer Lingus's financial position.

Aer Lingus currently operates around 30 aircraft, and last year signed a deal with Airbus to buy or lease 17 new planes.

The new order could be worth up to $2.1 billion. Walsh said a decision would be made in the next few months, as the planes would not be needed until at least 2008.

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Interesting to note the date: 2008. So, what are they going to do between now and then? With the strong likelihood of some deal (even if not the final one) between the EU and US to increase access, EI will need to expand its fleet before then. They will also need to spruce up their long haul act a bit, particularly if they intend to start an Asian route. Can this wait till '08?

[SNNEI]

Aeroskid,

I agree totally: if the growth plans go ahead, what in god's name is WW talking about!!

Of course, it may be a ploy to suggest to Airbus "hey, we could wait for the 7E7"... now give us a deal on 330's that we can't refuse!

Alternatively, I may be driven crazy be trying to think of these conspiracy theories, and EI will lease in necessary capacity for growth! ;-)

[WHBM]

Well the current A330 fleet are only 10 years old and must have another 10 - 15 years in them. After all, it's still very much a current model. The A332s average 5 years old. Sure they could do with a full cabin refit but equally sure they're "not done yet".

[akerosid]

Absolutely no doubt that they are fine aircraft, but the question is, are they the right aircraft to grow the business? The 333 is a fine aircraft, but it is short legged and payload limitations mean that EI can't retrofit them with modern entertainment systems (not that they've been in a hurry to do that with the 332s either).

I think Airbus will face a very heavy fight on this one; a resurgent Boeing, with a very effective arsenal of competing aircraft types (the 7E7 particularly) will be well aware of EI's growth ambitions and the advantages of being a partner/supporter/facilitator in that growth. Although the 777 hasn't been given as a likely type, I personally think it would be a good 333 replacement.

Furthermore, the fact that EI doesn't want to take delivery of the new type until 2008 (when the 7E7 enters service), must give Boeing an added advantage; does EI want to take delivery of what will be (in 2008) "old hat" when many of its competitors will be lining up for the 7E7, or, does it want to be first in the queue for a new type?

In the meantime, with increased US access and new Asian routes expected, they will need new aircraft; another opportunity for Boeing to show how it can facilitate that growth . . .

[SNNEI]

Aeroskid,

I just noticed something in the news article that leads me to think there is a mistake there. It is said a decision will be made in the next few months. Would that not mean aircraft delivery well before 2008? It was only a few months between A320 order and first aircraft arriving.

Maybe Aertel got this bit wrong? I read the same piece on Aertel earlier and the delivery date was not mentioned at all. Perhaps EI asked them to correct this?

[Toulouse]

SNNEI,

I'd say that the delivery date is not necessarily a mistake as I'm sure EI could place their order this year and not receive firstl delivery until 2003, yet I would personnally think that the 2008 may be as already suggested by yourself, just a ploy to get Airbus a bit more nervous. One can never know, but I'd be really suprised if they opt for Boeing instead of Airbus after all their talk on operating a "similar" fleet of aircraft and how well the 330 has so far fitted into their operation. Yet as things are certainly changing in EI, one cannot know.

On the point of EI, and going totally of the point (sorry...) I've noticed that on their web page their timetable for the DUB-TLS route for winter is given as being reduced to twice weekly operating Thurs. and Sun, yet when I try to book for the winter 04/05, I get an error message saying flights only operate on Thurs and Sun, I then press their "find other low fares" red button, and I get fares for flights on Mon, Wed, Fri and Sun??? Any ideas??:ok:

[SNNEI]

Toulouse,

There are a number of anomolies in the timetable for the winter operation. If you look at Cork-Amsterdam, it shows this going back to it's rightful frequency of twice a day on 4 days a week. Now, try booking the evening flights.. impossible!

I would trust the booking engine far more than the timetable personally.

Hope this helps.

Regarding the fleet, we were told two weeks ago that EI was going for a combo of 777/7E7.. now they are holding talks with both manufacturers. This is all just WW going through the motions, and I guess as such we should not read too much into it.

[Toulouse]

SNNEI,

Thanks for the info on aerlingus.com bookings. Did you notice the site was down for much of yesterday evening?

I hadn't heard that EI were going for a mix of 777/7E7. I would out of personal choice like to see EI going for Airbus (nothing against Boeing), yet I do have a feeling that Airbus won't push as hard as Boeing for the sale. Don't ask me why, just an inside feeling.

:ok:

[SNNEI]

Toulouse,

I agree: Boeing are in fight mode, and will push hard for this. I think thats why we have had 2 "pro boeing" announcements the last while. First, we're going for the 777, now we can wait until 2008 and the 7E7. Obviously Airbus were not frightened into a big price reduction after the last announcement! ;-)

[akerosid]

I think the loss of the ANZ deal, which must have been a near certainty for Airbus, given that the 332 was such an ideal aircraft and it already had 320s, was a wake up call to Airbus. As you say, Boeing is in fight mode and it has already targeted 200 7E7 sales this year, which I think is achievable.

In EI, it sees a very ambitious airline with high growth plans and with that kind of potential, you can be sure Boeing will go in all guns blazing to get this. Although the 7E7 is mentioned as the competitor, I don't think this precludes the 777 coming into the fleet, particularly as a 333 replacement; I think there are a few 333s coming off lease fairly soon and these could be replaced by 777s. Also, Boeing has an incentive to help Aer Lingus to meet its growth requirements, particularly over the next year or so. With the 332 doing so well and with delivery slots taken up and very few on the market, can Airbus do this? I doubt it. I'm not sure how many 777s are available now, but I think that if Boeing wants to get an EI deal, it will need to be seen as a strong supporter and facilitator of EI's growth. As I said, with Open Skies on the horizon, EI's fleet needs will be increasing and it has said it wants to add three new US cities as soon as it can.

Basically, it'll come down to who wants this deal more; Boeing can get it, if it wants it enough.

[GOH]

I normally tend to lead slightly towards airbus, only slightly but in this case I think boeing is the better option. The 772's have better range and can operate within the runway restrictions of DUB. I am not certain but I think these 772's have the range to serve parts of Asia with full payload, the A332 may do it but with a real struggle (payload restrictions)

So the 777's could serve US routes and maybe help expand into asia and then in 2008 or so they could get 7E7's.

Just my oppinion!

GOH

[SNNEI]

GOH,

The more I read here, the more I am inclined to agree with you!

[fadec_primary_channel]

To take advantage of the shorter route, wouldn't they need 4 engines to avoid the driftdown scenario?


i.e. 340's ???
:)

[MarkD]

WRT the ending of the stopover, since this is being attempted to be negotiated to 4 years from now - see Akerosid's other thread - methinks Willie picked 2008 as the earliest currently feasible expansion date. If the govt caved and made it 2005-6 do you think Willie will wait for Boeing while Air Transat (who has route approval) and US carriers expand?

[akerosid]

MarkD, I don't agree that 2008 would be the earliest possible expansion date. If the ending of the stopover is to be phased (which is the best the Shannonsiders can hope for - and not at all certain), it would start with reducing the DUB:SNN ratio from 1:1 to 2:1. If this happened, EI would be able to double the number of DUB immediately, which would allow three more dailies.

We could find out whether this will happen, as early as Saturday. Obviously, if there's bad news (for SNN), the govt will make damn sure it doesn't come out while the European voting is still going on!

This is the one hole I see in the Boeing possibility; clearly, they need new planes and quick. I think both manufacturers will fall over themselves to provide these, in the clear knowledge that EI is expanding and ambitious. The manufacturer which can prove that it (and its acft) are best places to support and facilitate that growth will have a definite advantage. The mention of 2008 does seem, to a certain extent, designed to put the frighteners up Airbus and the recent loss of the ANZ deal will undoubtedly have helped. However, as I've said, the 7E7 will be a spectacularly economical and innovative aircraft and EI should go for the newest and best available. Boeing will be anxious to get new 7E7 customers and an existing A332 operator would be ideal for their 7E7 plans. To cut a long story short, both manufacturers will be falling over themselves to woo Aer Lingus, like never before. :ok:

[SNNEI]

Aeroskid,

"which is the best the Shannonsiders can hope for - and not at all certain"

Please please please make it clear that it's not all Shannonsiders who want to see this nonsense continued.. there are some of us down here with some common sense! ;-)

Cheers!

[Cyrano]

ATI News reports that EI has narrowed the choice to 7E7s or 330s, i.e. 777s no longer in the equation.

I'm not posting the original article due to copyright, but just to summarise, an EI spokesman is quoted as saying that if they chose 7E7s, they could always lease more 330s for extra capacity in the meantime. A 7E7 order would be for 11-15 aircraft; the size of an A330 order would depend on whether -200s or -300s or a mix were chosen.

The article says that EI will use the aircraft for extra US services and "other long-haul destinations."

C

[GOH]

To take advantage of the shorter route, wouldn't they need 4 engines to avoid the driftdown scenario?

I dont think A340's can be used as they require lengthy runways (if they were to serve their purpose and be used on long haul destinations) which DUB doesnt have.

GOH