Cathay buying 14 used B744s
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Maintenance
I think you'll find that O'Leary/Ryanair do "capitalise" major maintenance, and write it off over the period to the next maintenance of that type. It's only a timing difference in the Profit & Loss account, but keep expanding the fleet and the timing difference grows. Once the fleet size stabilises I'd expect the timing differences to reverse.
I suspect it's not the only airline doing that.
Sorry, off topic from the main thread, but I'm an accountant with an interest in aviation.
I suspect it's not the only airline doing that.
Sorry, off topic from the main thread, but I'm an accountant with an interest in aviation.
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Hello chaps,
Just on the point of BA's preferred fleet mix - the following is from Feb 2001. Yes, certainly before 11 Sep 01 but surely if the desire was there then, it's arguably stronger now?
Anyway, here goes:
British Airways' Wyatt on Decision Against Taking A380: Comment
Geneva, Feb. 21, 2001 (Bloomberg) -- Following are comments from Dick Wyatt, British Airways Plc's general manager for fleeting planning, on the carrier's decision not to order Airbus Industrie's 550-seat A380. BA had been studying that option for some time. Wyatt made the comments in a speech to aircraft finance bankers at an aircraft finance conference.
"We are not ordering the A380. There's very few routes that suit large aircraft and we believe markets will continue to fragment. The 15 percent seat-mile cost advantage of the A380 over the 747 is there, I think, but there's a bigger margin between the 767 and the larger aircraft that it competes with. And the 767 is dominating frequency on the North Atlantic.
"Point-to-point frequencies is what the customer wants, particular business customer. We did go into a lot of detail; we did a specific study on the London Singapore route where certainly on Singapore to London we all fly at the same time. London to Singapore we don't, and don't have to. We have a choice of frequencies there and we modelled what we thought everybody else might do -- looking at a host of different scenarios – against what we could do.
"And we found we could not justify the investment, even if the scenario we chose turned out to be the scenario that came about.
"Even if they had done, I think we have been leery of such an investment six years before the expected entry into service in such a rapidly changing environment.
"We don't believe there will be a market for second-hand sale of A380s; it's going to be a very small market, very limited market, it's not a plane you can buy and then say, whoops, we shouldn't have done that, let's sell them. We'd be stuck with them. There's very few routes and therefore very few economies that the market will depend on. You only need one or two of those to turn against you and you're stuck with an aircraft that you can't use.
"And the low utilisation is a big factor. If we fly wing tip to wing tip from Singapore to London we can then send the 747 off to different places -- say on the West Coast, which links neatly from a scheduling point or view. If we have an A380 we would really have to park it for the whole day at Heathrow before we send it back out East again. Such a high-cost asset with such low utilisation does not make for good profits.
"If we could have a dozen less 747s than we currently have and a dozen more 777s, we'd like to. That's the base line we ought to be at.''
And another thing! re: GE vs. RR - I read somewhere a comment that RRs are more economical on long sectors, but on shorter sectors, CF6s are more economical. Also mentioned was intake diameter - something about the CF6's greater intake diameter making for better payload/take-off performance out of hot/high/short fields.
Just on the point of BA's preferred fleet mix - the following is from Feb 2001. Yes, certainly before 11 Sep 01 but surely if the desire was there then, it's arguably stronger now?
Anyway, here goes:
British Airways' Wyatt on Decision Against Taking A380: Comment
Geneva, Feb. 21, 2001 (Bloomberg) -- Following are comments from Dick Wyatt, British Airways Plc's general manager for fleeting planning, on the carrier's decision not to order Airbus Industrie's 550-seat A380. BA had been studying that option for some time. Wyatt made the comments in a speech to aircraft finance bankers at an aircraft finance conference.
"We are not ordering the A380. There's very few routes that suit large aircraft and we believe markets will continue to fragment. The 15 percent seat-mile cost advantage of the A380 over the 747 is there, I think, but there's a bigger margin between the 767 and the larger aircraft that it competes with. And the 767 is dominating frequency on the North Atlantic.
"Point-to-point frequencies is what the customer wants, particular business customer. We did go into a lot of detail; we did a specific study on the London Singapore route where certainly on Singapore to London we all fly at the same time. London to Singapore we don't, and don't have to. We have a choice of frequencies there and we modelled what we thought everybody else might do -- looking at a host of different scenarios – against what we could do.
"And we found we could not justify the investment, even if the scenario we chose turned out to be the scenario that came about.
"Even if they had done, I think we have been leery of such an investment six years before the expected entry into service in such a rapidly changing environment.
"We don't believe there will be a market for second-hand sale of A380s; it's going to be a very small market, very limited market, it's not a plane you can buy and then say, whoops, we shouldn't have done that, let's sell them. We'd be stuck with them. There's very few routes and therefore very few economies that the market will depend on. You only need one or two of those to turn against you and you're stuck with an aircraft that you can't use.
"And the low utilisation is a big factor. If we fly wing tip to wing tip from Singapore to London we can then send the 747 off to different places -- say on the West Coast, which links neatly from a scheduling point or view. If we have an A380 we would really have to park it for the whole day at Heathrow before we send it back out East again. Such a high-cost asset with such low utilisation does not make for good profits.
"If we could have a dozen less 747s than we currently have and a dozen more 777s, we'd like to. That's the base line we ought to be at.''
And another thing! re: GE vs. RR - I read somewhere a comment that RRs are more economical on long sectors, but on shorter sectors, CF6s are more economical. Also mentioned was intake diameter - something about the CF6's greater intake diameter making for better payload/take-off performance out of hot/high/short fields.
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A lot has been said about the advantages of the RB211 engine, which is why it is a bit surprising to hear about its high noise signature. Would anyone have a link/reference for this?
Thanks in advance
Thanks in advance
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just my two cents.....
Reuters is carrying the story, since Oct 31, that Cathay would be buying up to 15 744's, and quotes a Cathay spokesperson in the article discussing the plans for the planes. The seller is indeed BA, with Boeing the third party in the deal, who will be selling 20 773's to BA as part of the deal. In fact, it is on just about every website and news site that deals with aviation that I go to - the ones I trust as well as those that are rumour mills - and has been for two weeks.
Cheers,
pintail
Reuters is carrying the story, since Oct 31, that Cathay would be buying up to 15 744's, and quotes a Cathay spokesperson in the article discussing the plans for the planes. The seller is indeed BA, with Boeing the third party in the deal, who will be selling 20 773's to BA as part of the deal. In fact, it is on just about every website and news site that deals with aviation that I go to - the ones I trust as well as those that are rumour mills - and has been for two weeks.
Cheers,
pintail
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. . . er . . . and I thought that this was a Rumours & News forum Notso? Anyway, as Pintail and others have noted, Cathay have actually been quoted on this. 
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It's well known that Asian airlines are in growth mode at the moment, with traffic bouncing back stronger than expected. Thai and Korean Air have recently delivered better than expected results and CX has seen traffic bounce back, so it is certainly in the market for new aircraft.
My question is this (and perhaps best answered by CX insiders): CX has expressed interest in an ultra long haul new type - the A346 -v- the 773ER. If the BA 744s are acquired, would these be in addition to an order for new aircraft, or instead of?
Also, in a recent interview, CX seemed to be less than completely impressed by the A340-600, saying that just because they had them on lease didn't mean they were going to buy then and saying that they were "doing okay" - which seems to be curiously downbeat.
My question is this (and perhaps best answered by CX insiders): CX has expressed interest in an ultra long haul new type - the A346 -v- the 773ER. If the BA 744s are acquired, would these be in addition to an order for new aircraft, or instead of?
Also, in a recent interview, CX seemed to be less than completely impressed by the A340-600, saying that just because they had them on lease didn't mean they were going to buy then and saying that they were "doing okay" - which seems to be curiously downbeat.
Meering
Akerosid:
My guess is that CX is desperate for more long-haul capacity (both pax and freight) in the short term, particularly if it's available at the right price. Longer term, they're still evaluating their requirements for new aircraft, viz A340-600, A380, 777-300ER, a new 747-400 variant (if it ever happens), or a mix of those types. Given their past experience with Airbus, they probably want to wait until the A380 proves itself in service before committing themselves, so a decision on new aircraft isn't likely to be made for a while. When they do finally take delivery of some new long-haul types, I expect they will begin to pension off the 747-400s or convert them to freighters, depending on the market conditions at the time.
My guess is that CX is desperate for more long-haul capacity (both pax and freight) in the short term, particularly if it's available at the right price. Longer term, they're still evaluating their requirements for new aircraft, viz A340-600, A380, 777-300ER, a new 747-400 variant (if it ever happens), or a mix of those types. Given their past experience with Airbus, they probably want to wait until the A380 proves itself in service before committing themselves, so a decision on new aircraft isn't likely to be made for a while. When they do finally take delivery of some new long-haul types, I expect they will begin to pension off the 747-400s or convert them to freighters, depending on the market conditions at the time.
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Is this extra long haul capacity for expansion of existing services or might they consider adding previously dropped destinations (such as MAN) or completely new ones?
What is their relationship with Airbus like? Given the size of their A330 fleet (with a few new examples added very recently), one would think they have a reasonably good relationship?
What is their relationship with Airbus like? Given the size of their A330 fleet (with a few new examples added very recently), one would think they have a reasonably good relationship?
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Did I not see somewhere that the A346 costs and, particularly, fuel burn were higher than expected and that both CX and VS were less than impressed? Slightly off topic I know but it might explain why VS are, apparently, looking seriously at 777-300ERs having so recently boasted of only using 4 engine aircraft. It would also explain CX's greater interest in used 744s as near-term capacity enhancement. Any CX/VS people care to comment?
