U.S. airlines watch fleets age as they wait for new planes
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U.S. airlines watch fleets age as they wait for new planes
U.S. airlines watch fleets age as they wait for new planes
By Jeff Bailey
Friday, October 26, 2007
CHICAGO: It is not just flights that are getting delayed. U.S. airlines are also putting off purchases of new planes, meaning their fleet of aircraft, on average, is aging right along with passengers.
Northwest Airlines, for example, flies 109 of the oldest jetliners in the United States, DC-9s, with an average age of 35 years. Northwest has yet to decide how to replace the DC-9s, which could remain in service another five years or more.
American Airlines operates a fleet of 300 older MD-80s, a model that guzzles fuel and lacks the latest in passenger comforts. And American has only a handful of replacement planes coming in the next few years.
The fleet of big jets operated by nine major U.S. airlines has aged steadily since 2002, according to Airline Monitor, an aviation research firm. The average age was 10.6 years at the end of 2002, and it has risen each year, hitting 12.2 years at the end of 2006.
U.S. airlines largely stopped ordering new planes after Sept. 11, 2001, shrinking their fleets to adjust to a drop in demand. Travel has rebounded strongly, but airlines are, for the most part, years away from taking delivery on large numbers of new planes.
A big reason is that Boeing and Airbus have committed most of their airliner production capacity in coming years to carriers in Europe and Asia.
Indeed, only 43 of the 710 Boeing 787s on order have been identified as going to U.S. airlines; 25 to Continental Airlines and 18 to Northwest Airlines. And none of the 165 giant Airbus A380s on order are destined for U.S. carriers. In essence a new generation of jetliners - bigger, more comfortable, more fuel-efficient - is largely bypassing U.S. airlines and their customers.
"The fleet is aging almost one-for-one with the calendar," said Roger King, an analyst at CreditSights, who predicts that trend will continue for about five years.
Scott Carr, a technology executive in Tulsa, Oklahoma, said that when he flies on one of Northwest's DC-9's, "I feel like I'm in a tuna can."
"I've grown to know enough about the various kinds of airplanes," Carr said. "I try to avoid Northwest now whenever possible. If I'm flying Southwest, they're flying newer planes and I can tell the difference."
Warren Miller, co-founder of Beckmill Research, a firm in Lexington, Virginia that appraises privately held businesses, said he braced himself for an old plane except when flying JetBlue Airways, which operates newer Airbus A320s. On other carriers, "The planes are just dirty. The upholstery is just not very comfy," Miller said.
He said he wished regulators would allow airlines from Europe or elsewhere into the United States to fly domestic routes, which would increase competition and bring some new planes into the market.
Airplane cleaning became something of a lost art during the industry's deep post-Sept. 11 swoon. Airlines are increasing the frequency of cleaning again, but still have some catching up to do. And the oldest planes often have the most grime.
Carl Zwisler, a Bethesda, Maryland, lawyer, said he did not think about the age of the US Airways 757 he was flying earlier this month until visiting the toilets.
"The bathroom looked old - dingy, dusty, not inviting," Zwisler said.
Airlines could afford to buy more planes. U.S. carriers collectively socked away about $28 billion in cash, as of June 30. But they are using it to pay down debt or as a financial cushion after lean years that saw much of the industry taking a tour through bankruptcy court.
Older planes are safe, experts said, largely due to nearly 20 years of government and industry research following a 1988 incident in which the fuselage of an Aloha Airlines 737 was torn open in flight over Hawaii, killing one flight attendant. It prompted the Federal Aviation Administration to form the National Aging Aircraft Research Program, studying metal fatigue and other problems in older planes and subjecting them to increased inspection and maintenance procedures.
Even so, the industry's aging jets contribute to the general unpleasantness of air travel these days. They are often noisier and less comfortable than newer models.
They are delayed by mechanical problems more frequently than new planes and often have built-up grime in passenger spaces.
Moreover, airlines are using these planes on longer routes than in previous years, and onboard delays have grown more frequent, meaning a lengthier stay in less-than-ideal quarters. Planes will also grow even more crowded, as rising demand for travel bumps up against a shortage of planes.
Newer planes are generally roomier and some offer conveniences like seat-back television screens and outlets to recharge a laptop computer. But airlines configure them differently (SeatGuru.com provides comparison information on seat width, legroom and other features in the "comparison charts" section of the Web site).
Airlines routinely announce refurbishment programs to install new seats, seat-back televisions, laptop outlets and other features. But they can take two to three years to complete throughout the fleet, because they are typically done when planes are brought in for periodic heavy maintenance.
"Gadgets are very important," said Linda Hirneise, who heads the travel practice at J.D. Power & Associates, the market research firm. "In coach, where most people fly, the airlines have taken away more and more."
King, the analyst, estimates the U.S. industry needs to spend about $280 billion over the next 20 years to replace aging fleets. Even if they had the financial wherewithal, planes are getting hard to come by.
Asian airlines have big orders. Lion Air of Indonesia has 95 Boeing 737s on order. Qantas Group of Australia has signed up for 65 Boeing 787s.
Discount airlines in Europe are also buying lots of new planes. Wizz Air, based in Hungary, ordered 50 Airbus A320s earlier this month. And Air Berlin has about 85 737s on order.
With the exception of Southwest Airlines, the major U.S. carriers have all either been through bankruptcy or narrowly avoided it in recent years. They returned to profit in 2006, but profit margins are still anemic - "amongst the worst industries in the country," said Scott Kirby, president of US Airways. "The whole industry is hardly the poster child for strong credit."
Thus, airline executives are cautious. Even with $3 billion now on hand, "anything we'd do with cash would be related to strengthening the balance sheet - paying down debt," said Kirby. The airline recently placed a huge order for jets, but most of the deliveries are years off.
Philip Baggaley, a credit analyst at Standard & Poor's, said that keeping a large cash reserve is, for some airlines, the best safeguard against another bankruptcy in the event of a recession or labor dispute.
But there are other demands on those cash hoards. Airline workers, who made wage and pension concessions during the past six years, want raises and better benefits. The airlines carry big debt loads, and investors would like to see some money go to stock buybacks.
http://www.iht.com/articles/2007/10/...nes.php?page=1
By Jeff Bailey
Friday, October 26, 2007
CHICAGO: It is not just flights that are getting delayed. U.S. airlines are also putting off purchases of new planes, meaning their fleet of aircraft, on average, is aging right along with passengers.
Northwest Airlines, for example, flies 109 of the oldest jetliners in the United States, DC-9s, with an average age of 35 years. Northwest has yet to decide how to replace the DC-9s, which could remain in service another five years or more.
American Airlines operates a fleet of 300 older MD-80s, a model that guzzles fuel and lacks the latest in passenger comforts. And American has only a handful of replacement planes coming in the next few years.
The fleet of big jets operated by nine major U.S. airlines has aged steadily since 2002, according to Airline Monitor, an aviation research firm. The average age was 10.6 years at the end of 2002, and it has risen each year, hitting 12.2 years at the end of 2006.
U.S. airlines largely stopped ordering new planes after Sept. 11, 2001, shrinking their fleets to adjust to a drop in demand. Travel has rebounded strongly, but airlines are, for the most part, years away from taking delivery on large numbers of new planes.
A big reason is that Boeing and Airbus have committed most of their airliner production capacity in coming years to carriers in Europe and Asia.
Indeed, only 43 of the 710 Boeing 787s on order have been identified as going to U.S. airlines; 25 to Continental Airlines and 18 to Northwest Airlines. And none of the 165 giant Airbus A380s on order are destined for U.S. carriers. In essence a new generation of jetliners - bigger, more comfortable, more fuel-efficient - is largely bypassing U.S. airlines and their customers.
"The fleet is aging almost one-for-one with the calendar," said Roger King, an analyst at CreditSights, who predicts that trend will continue for about five years.
Scott Carr, a technology executive in Tulsa, Oklahoma, said that when he flies on one of Northwest's DC-9's, "I feel like I'm in a tuna can."
"I've grown to know enough about the various kinds of airplanes," Carr said. "I try to avoid Northwest now whenever possible. If I'm flying Southwest, they're flying newer planes and I can tell the difference."
Warren Miller, co-founder of Beckmill Research, a firm in Lexington, Virginia that appraises privately held businesses, said he braced himself for an old plane except when flying JetBlue Airways, which operates newer Airbus A320s. On other carriers, "The planes are just dirty. The upholstery is just not very comfy," Miller said.
He said he wished regulators would allow airlines from Europe or elsewhere into the United States to fly domestic routes, which would increase competition and bring some new planes into the market.
Airplane cleaning became something of a lost art during the industry's deep post-Sept. 11 swoon. Airlines are increasing the frequency of cleaning again, but still have some catching up to do. And the oldest planes often have the most grime.
Carl Zwisler, a Bethesda, Maryland, lawyer, said he did not think about the age of the US Airways 757 he was flying earlier this month until visiting the toilets.
"The bathroom looked old - dingy, dusty, not inviting," Zwisler said.
Airlines could afford to buy more planes. U.S. carriers collectively socked away about $28 billion in cash, as of June 30. But they are using it to pay down debt or as a financial cushion after lean years that saw much of the industry taking a tour through bankruptcy court.
Older planes are safe, experts said, largely due to nearly 20 years of government and industry research following a 1988 incident in which the fuselage of an Aloha Airlines 737 was torn open in flight over Hawaii, killing one flight attendant. It prompted the Federal Aviation Administration to form the National Aging Aircraft Research Program, studying metal fatigue and other problems in older planes and subjecting them to increased inspection and maintenance procedures.
Even so, the industry's aging jets contribute to the general unpleasantness of air travel these days. They are often noisier and less comfortable than newer models.
They are delayed by mechanical problems more frequently than new planes and often have built-up grime in passenger spaces.
Moreover, airlines are using these planes on longer routes than in previous years, and onboard delays have grown more frequent, meaning a lengthier stay in less-than-ideal quarters. Planes will also grow even more crowded, as rising demand for travel bumps up against a shortage of planes.
Newer planes are generally roomier and some offer conveniences like seat-back television screens and outlets to recharge a laptop computer. But airlines configure them differently (SeatGuru.com provides comparison information on seat width, legroom and other features in the "comparison charts" section of the Web site).
Airlines routinely announce refurbishment programs to install new seats, seat-back televisions, laptop outlets and other features. But they can take two to three years to complete throughout the fleet, because they are typically done when planes are brought in for periodic heavy maintenance.
"Gadgets are very important," said Linda Hirneise, who heads the travel practice at J.D. Power & Associates, the market research firm. "In coach, where most people fly, the airlines have taken away more and more."
King, the analyst, estimates the U.S. industry needs to spend about $280 billion over the next 20 years to replace aging fleets. Even if they had the financial wherewithal, planes are getting hard to come by.
Asian airlines have big orders. Lion Air of Indonesia has 95 Boeing 737s on order. Qantas Group of Australia has signed up for 65 Boeing 787s.
Discount airlines in Europe are also buying lots of new planes. Wizz Air, based in Hungary, ordered 50 Airbus A320s earlier this month. And Air Berlin has about 85 737s on order.
With the exception of Southwest Airlines, the major U.S. carriers have all either been through bankruptcy or narrowly avoided it in recent years. They returned to profit in 2006, but profit margins are still anemic - "amongst the worst industries in the country," said Scott Kirby, president of US Airways. "The whole industry is hardly the poster child for strong credit."
Thus, airline executives are cautious. Even with $3 billion now on hand, "anything we'd do with cash would be related to strengthening the balance sheet - paying down debt," said Kirby. The airline recently placed a huge order for jets, but most of the deliveries are years off.
Philip Baggaley, a credit analyst at Standard & Poor's, said that keeping a large cash reserve is, for some airlines, the best safeguard against another bankruptcy in the event of a recession or labor dispute.
But there are other demands on those cash hoards. Airline workers, who made wage and pension concessions during the past six years, want raises and better benefits. The airlines carry big debt loads, and investors would like to see some money go to stock buybacks.
http://www.iht.com/articles/2007/10/...nes.php?page=1
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A big reason is that Boeing and Airbus have committed most of their airliner production capacity in coming years to carriers in Europe and Asia.
The article makes some valid points but the bozo who wrote it seems to be trying to create some kind of anti-American conspiracy where none exists.
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Nothing New...
You have to go back years to find a US Carrier that was a launch customer or an inovator....United was the launch customer for the B777; and in years gone by Pan AM was first with the B707 and B747.
Top execs at US airlines are too busy filling their own pockets to think about trival things such as new aircraft orders. By admitting they have money they might have to give the workforce back some of the benefits/salary they all sacrificed post 9/11.
While the rest of the world is moving to more fuel efficient planes, with less co2 emissions (the likes of VS and NZ investigating bio-fuels) the country which is always the first to point the finger at China and India for being cruel to the environment has a commercial airline fleet that produces a great deal of unessessary co2 emissions. Another "Do as I say..." policies from that wise owl and gang that's been at 1600 since 2000...
Top execs at US airlines are too busy filling their own pockets to think about trival things such as new aircraft orders. By admitting they have money they might have to give the workforce back some of the benefits/salary they all sacrificed post 9/11.
While the rest of the world is moving to more fuel efficient planes, with less co2 emissions (the likes of VS and NZ investigating bio-fuels) the country which is always the first to point the finger at China and India for being cruel to the environment has a commercial airline fleet that produces a great deal of unessessary co2 emissions. Another "Do as I say..." policies from that wise owl and gang that's been at 1600 since 2000...
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AA are trying to do something about the MD-80's economics, not to mention sourcing some APB winglets for their "ageing" 763ERs.
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I would rather fly on an older DC9 that is well maintained by US based mechanics than fly on a newer A320 maintained at some overseas maintenance shope with perhaps 20 pseudo mechanics supervized by one real mechanic.
A friend was an intern mechanic at jet blue and they don't have a lot of capacity to fix things...and when the warranty runs out...watch out for costs.
NorthWest spent 6 million per plane on its DC9 fleet to upgrade them a few years ago.
And a dusty uninviting toilet? I've never been on any airliner (perhaps trump shuttle) where the toilet was inviting.
Allow european airlines to fly domestic US runs? HA.
Every complaint mentioned would have been taken care of by the old CAB...reregulate now~!
A friend was an intern mechanic at jet blue and they don't have a lot of capacity to fix things...and when the warranty runs out...watch out for costs.
NorthWest spent 6 million per plane on its DC9 fleet to upgrade them a few years ago.
And a dusty uninviting toilet? I've never been on any airliner (perhaps trump shuttle) where the toilet was inviting.
Allow european airlines to fly domestic US runs? HA.
Every complaint mentioned would have been taken care of by the old CAB...reregulate now~!
It's been quite a while since I saw so many nonsenses and unjustified know-nothing comments in one article about aviation. I started to list all the errors but the list was too long.
