SAX Q400
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Originally Posted by Avi8tor
Hmmm - think u better check the stats, ERJ/CRJ/Ejet order books are VERY full.
From Flight International 31 Jan - 6 Feb in article entitled "TURBOPROPS BOUNCE BACK; ATR and Bombardier enjoy a renaissance of their propellor driven airliners as demand for small jets collapses"
In summary:
2004
Western TP Net Orders
ATR 42/72: 12
Dash 8 series: 32
Beech 1900: 1
TOTAL 45
Western RJ Net Orders
Dornier 328: 18
CRJ: 130
ERJ: 108
TOTAL 256
2005
Western TP Net Orders
ATR 42/72: 90
Dash 8 series: 61
Beech 1900: 0
TOTAL 151
Western RJ Net Orders
Dornier 328: -6
CRJ: -1
ERJ: 90
TOTAL 83
Here are some quotes from the article:
"Soaring fuel prices have brought the 10 year reign of the small regional jet to a sudden halt"
"....it is no suprise that the production of the CRJ200 is about to be suspended while output of the ERJ is to be significantly curtailed"
"Bagnato says that rising fuel prices have prompted the demise of demand for the small regional jet and the resurgence of the turboprop."
"Bombardier and Embraer have virtually ceased 50 seat jet production, leaving the 30 to 70 seat band to the turboprops"
Can't argue with the numbers!
Last edited by wheels up; 29th Mar 2006 at 12:13.
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I have no doubt that the Q400 will work for SAX in so far as that it will do everything that they want. There are the nuances of these fast turbo-props like turbulence penetration speed of 210KIAS but should do ok for them. Flybe have invested heavily in them and they seem to be confident that they can run them profitably in regional ops as a discounting business model. The long sectors will no doubt errode some of the advantage but the benefits derived from a single fleet may well save them overall
The only thing that irks me as a free marketeer is that these things ain't cheap - $18m+ so has SAX been making the profits to pay for these or is it just one of the perks of being state-owned that you can buy nice new aeries under cut the competition but have no track record of profitability to raise finance on commercial terms. Anyway I'll get off my soap box now.
The only thing that irks me as a free marketeer is that these things ain't cheap - $18m+ so has SAX been making the profits to pay for these or is it just one of the perks of being state-owned that you can buy nice new aeries under cut the competition but have no track record of profitability to raise finance on commercial terms. Anyway I'll get off my soap box now.
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Apparently BBD are looking at stretching Q400 to about 90 seats. Their CRJ705s and CRJ900s are being range extended to fill long thin routes the Q400 can't reach.
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Originally Posted by George Tower
has SAX been making the profits to pay for these or is it just one of the perks of being state-owned that you can buy nice new aeries under cut the competition but have no track record of profitability to raise finance on commercial terms.
Common misconception. SAX has never been re-capitalised by Transnet or Government. Finance has had to be raised on commercial terms. SAX has pleaded with Transnet for a re-cap, but has been turned down. The airline has made an operational profit for almost its entire existence, but finance costs on the RJ's have been a bit of an financial burden.
Let's hope that the plan for the future solves that particular problem.
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Interesting FACTS being quoted out of Flight Int. Just as matter of interest, put the 70 seat Ejets and CRJ900 figures in that, then have another look. U have to compare apples to apples.
BTW, operating profile means that u make money BEFORE u pay for the aircraft. SAX has some R800mil debt. It lost R180mil last yr alone!! And if u dont wanna believe it, just read Transnet's annual report.
It is sad that the govenment seems intent on keeping loss making airlines in business, instead of building houses and fighting crime.
I DONT want to turn this into a SAX bashing thread. But I really would like to see the industry run on a PROFITABLE basis. Its the only way we will see long term growth.
BTW, operating profile means that u make money BEFORE u pay for the aircraft. SAX has some R800mil debt. It lost R180mil last yr alone!! And if u dont wanna believe it, just read Transnet's annual report.
It is sad that the govenment seems intent on keeping loss making airlines in business, instead of building houses and fighting crime.
I DONT want to turn this into a SAX bashing thread. But I really would like to see the industry run on a PROFITABLE basis. Its the only way we will see long term growth.
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Originally Posted by Avi8tor
BTW, operating profile means that u make money BEFORE u pay for the aircraft. SAX has some R800mil debt. It lost R180mil last yr alone!!
It is sad that the govenment seems intent on keeping loss making airlines in business, instead of building houses and fighting crime.
I DONT want to turn this into a SAX bashing thread. But I really would like to see the industry run on a PROFITABLE basis. Its the only way we will see long term growth.
It is sad that the govenment seems intent on keeping loss making airlines in business, instead of building houses and fighting crime.
I DONT want to turn this into a SAX bashing thread. But I really would like to see the industry run on a PROFITABLE basis. Its the only way we will see long term growth.
The point I was trying to make was that SAX has never received money to buy or lease a/c. They have always had to finance it commercially. All airlines have debt. Most that fold do so because they have been unable to service that debt. SAX has managed to keep going for 12 years now, and I think it has a bright future.
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The R800 mil in debt is NOT that to finance aircraft, this is money borrowed to keep the doors open. Transnet has stood good for the money, SAX has NO assets against which to secure that kind of loan independently. I would love to see SAX turn the corner. But i don't see the Q400 as the solution.
It is NOT suited or efficient on a 600nm sector to GRJ. It has to compete against a very low cost JET shortly on BFN. Until all 8 are delivered and the CRJ’s are phased out, there will be NO economies of scale. To run 3 fleets is madness.
I think I am on record as to the solution for the SAA branded feeders and their long term growth.
It is NOT suited or efficient on a 600nm sector to GRJ. It has to compete against a very low cost JET shortly on BFN. Until all 8 are delivered and the CRJ’s are phased out, there will be NO economies of scale. To run 3 fleets is madness.
I think I am on record as to the solution for the SAA branded feeders and their long term growth.
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With SAX's financial affairs so closely tied in with Transnet I think to use the words "operational profit" and pretend that all is well is a bit misleading. Its always easy to bash anything to do with SAA/SAX and I think that would be bad. BA Citi-Express now BA Connect shows that even BA makes a dogs breakfast of the regional stuff as well.
I just think that a complete fleet replacements of Q400s at nearly $20m per aircraft (they ain't going to get much discount if you look at the the Flybe prices and they ordered a lot more) is going to have to be financed some how, and I'm sure that a private business in the same financial standing would not manage to obtain it.
I just think that a complete fleet replacements of Q400s at nearly $20m per aircraft (they ain't going to get much discount if you look at the the Flybe prices and they ordered a lot more) is going to have to be financed some how, and I'm sure that a private business in the same financial standing would not manage to obtain it.
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Originally Posted by Avi8tor
Interesting FACTS being quoted out of Flight Int. Just as matter of interest, put the 70 seat Ejets and CRJ900 figures in that, then have another look.
CRJ = CRJ 100/200, CRJ440, CRJ700-701, CRJ700-705,CRJ900
ERJ = ERJ-135,140,145, 170, 175,190,195
Excuse my ignorance but what is an Ejet?
Last edited by wheels up; 30th Mar 2006 at 14:48.
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They must be doing something right...
Some news from the grapevine:
SAX turnover for the financial year ending March 06 is forcasted to be just short of R1bn - That is approximately R100mil over budget. This means they are performing better than even they expected.
Gross profit for the same year is expected to top R180mil - now pardon me, but if the previous figures as posted are true, then that alone is a turn aorund of R360mil in 12 months!
Given the loads that are being carried, they are in SERIOUS need of BIGGER aircraft...
Wrt the "cheaper" jet on FAJS to FABL route - let's wait and see:
1Time @ 7 Schedules per week versus SAX 7 Schedules per day (excluding the CRJ)
Surely they will need 60%+ loads, if not more, to make this viable, versus maybe 30% on a DH8.
(Difference in fare @ R112 per ticket)
Btw, who has flown in a DC9 lately..?
Q400: It is believed to only be the start of greater things to come...
SAX turnover for the financial year ending March 06 is forcasted to be just short of R1bn - That is approximately R100mil over budget. This means they are performing better than even they expected.
Gross profit for the same year is expected to top R180mil - now pardon me, but if the previous figures as posted are true, then that alone is a turn aorund of R360mil in 12 months!
Given the loads that are being carried, they are in SERIOUS need of BIGGER aircraft...
Wrt the "cheaper" jet on FAJS to FABL route - let's wait and see:
1Time @ 7 Schedules per week versus SAX 7 Schedules per day (excluding the CRJ)
Surely they will need 60%+ loads, if not more, to make this viable, versus maybe 30% on a DH8.
(Difference in fare @ R112 per ticket)
Btw, who has flown in a DC9 lately..?
Q400: It is believed to only be the start of greater things to come...
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ERJ,
Your figures sound impressive. Interesting that because of the whole Transnet/State ownership thing we can't get an accurate picture. Enron and Worldcom are still too recently etched in the memory! During the period you are looking at didn't SAX get given SAA's coastal routes, which if you ask me could account for a large chunk of that extra revenue.
Nice to get that given to you on a plate. Someone said the Q400 could be start of bigger things to come - you mean like SAX taking over all SAA's domestic flights, or that roumered SAA low cost (please spare us) eek:
Your figures sound impressive. Interesting that because of the whole Transnet/State ownership thing we can't get an accurate picture. Enron and Worldcom are still too recently etched in the memory! During the period you are looking at didn't SAX get given SAA's coastal routes, which if you ask me could account for a large chunk of that extra revenue.
Nice to get that given to you on a plate. Someone said the Q400 could be start of bigger things to come - you mean like SAX taking over all SAA's domestic flights, or that roumered SAA low cost (please spare us) eek:
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Wheels up
I think an Ejet is slang for Embraer's regional jet offerings. The E170/175/190/195. Note sure whether they have been the sales success Embraer hoped. I rather think Embraer will have to bet the mortgage on the sales success of these as I can't see the pencil jets (135/145) competing with the Q400 and ATR in view of current fuel prices.
I think an Ejet is slang for Embraer's regional jet offerings. The E170/175/190/195. Note sure whether they have been the sales success Embraer hoped. I rather think Embraer will have to bet the mortgage on the sales success of these as I can't see the pencil jets (135/145) competing with the Q400 and ATR in view of current fuel prices.
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all this economic talk is interesting and relevant. BUT... while taking off in the Q400 yesterday and having my front teeth make contact with my tonsils I couldn´t have cared less for the beancounters! It was just a helluva lot of fun and POWER!!!!!! To all the boys and girls at SAX: ENJOY THE BEAST! 
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GT,
What exactly were SAX given that they dont already have? The routes they operate on require no special right to operate- BA/Kulula and the other carriers operate the same routes. SAX have always had the SA designator and FFP benefits so quite what was "given on a plate" is not clear. SAA under the franchise agreement it has with SAX is entitled to a portion of this "new" revenue so SAX is by no means getting a free ride.
I also fail to grasp your attitude to proposed SAA changes, rumoured or otherwise, to become a more cost effective and efficient airline with a product that speaks to the way the market is moving. Surely that in the interests of the travelling public and the country as a whole? or would you prefer that SAA just stay as it is- a situation we all agree is not satisfactory.
SAX is investing in their future- the only way they can keep the loco's off their routes is to offer more capacity, particularly at peak times, more frequently- whilst keeping your costs as low as possible- all at similar fares to the loco=the Q400 fulfils that brilliantly. Yes it is the start of bigger things for SAX.
The loco's on the other hand are running out of expansion room as there are not really any more domestic routes left that carry the critical population density necessary to maintain their services. If they try and stay on routes like BFN they will only dilute the profits made on CPT and DUR. In the end the market will dictate who wins and who looses. Jets don’t always win- even new ones.
Nice to get that given to you on a plate. Someone said the Q400 could be start of bigger things to come - you mean like SAX taking over all SAA's domestic flights, or that roumered SAA low cost (please spare us) eek:
I also fail to grasp your attitude to proposed SAA changes, rumoured or otherwise, to become a more cost effective and efficient airline with a product that speaks to the way the market is moving. Surely that in the interests of the travelling public and the country as a whole? or would you prefer that SAA just stay as it is- a situation we all agree is not satisfactory.
SAX is investing in their future- the only way they can keep the loco's off their routes is to offer more capacity, particularly at peak times, more frequently- whilst keeping your costs as low as possible- all at similar fares to the loco=the Q400 fulfils that brilliantly. Yes it is the start of bigger things for SAX.
The loco's on the other hand are running out of expansion room as there are not really any more domestic routes left that carry the critical population density necessary to maintain their services. If they try and stay on routes like BFN they will only dilute the profits made on CPT and DUR. In the end the market will dictate who wins and who looses. Jets don’t always win- even new ones.
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Unfortunately, once publicly funded airlines have put the locos out of business as appears to be the plan, prices will once again become ridiculous to reflect well on the books of the national carrier.
Of that I have no doubt...
Of that I have no doubt...
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SRT,
The market will take care of any excess capacity in the normal way- its all about supply and demand.
To date demand has slightly outweighed supply with the domestic market growing by 55% over the last 4 years- the growth has been steady- with possible the exception of last year where the market grew over 17% in one year.SAA has shared in this growth as have the other carriers- however SAA no longer has the market power to drive players out the market- simply because the cost structure of the other carriers is lower than SAA's and therefore their propensity to survive a price war is so much better. Hence some fairly radical changes are going to be implimented in SAA to position the company to go forward. These plans will not involve more aircraft than the airline alrady has on the books but will look into the reduction of costs through a more relevant business model. Since SAA's load factors are at an all time high already and its competitiors are still in business- Im sure no one is going to drop out the market because of these changes. What SAA wants is to make more money out of the business it already owns- without increasing/decreasing the fares.
Whether the other airlines stay in business is more a function of how they run their own businesses- flying to places like BFN is not going to keep you in business for long.
The market will take care of any excess capacity in the normal way- its all about supply and demand.
To date demand has slightly outweighed supply with the domestic market growing by 55% over the last 4 years- the growth has been steady- with possible the exception of last year where the market grew over 17% in one year.SAA has shared in this growth as have the other carriers- however SAA no longer has the market power to drive players out the market- simply because the cost structure of the other carriers is lower than SAA's and therefore their propensity to survive a price war is so much better. Hence some fairly radical changes are going to be implimented in SAA to position the company to go forward. These plans will not involve more aircraft than the airline alrady has on the books but will look into the reduction of costs through a more relevant business model. Since SAA's load factors are at an all time high already and its competitiors are still in business- Im sure no one is going to drop out the market because of these changes. What SAA wants is to make more money out of the business it already owns- without increasing/decreasing the fares.
Whether the other airlines stay in business is more a function of how they run their own businesses- flying to places like BFN is not going to keep you in business for long.
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errr....no New business models only affect those on the lower floors of airways park!
an increase in profits would probably expedite the construction of an elaborate heliport in the technical area
an increase in profits would probably expedite the construction of an elaborate heliport in the technical area
