AAEs 737Fs to revitalise airfreight

[Wingnuts]

With the decision of AAE to replace its 727s with 737s, domestic freight forwarders are looking forward to more competitive freight rates. 4 Jetconnect aircraft will be converted next year and possibly up to 4 more thereafter. Qantas and National Jet have been invited by AAE to tender for the contract.

The dilemma for AAE has been a perceived need to update its aging 727s and expose itself to competition or stick to the 72s and maintain its monopoly. The fact that Qantas has surplus 73s that it needs to off load, is not a coincidence. Australia Post, a 50% partner in AAE with Qantas, has swallowed the Qantas synergies spin. After all, what Post knows about aviation, you could write on the back of a stamp with a felt pen.

Those same synergies will also now be able to be exploited by the likes of Patricks. Airfreight is the only area of freight that has eluded them. Not to mention Toll, TNT, presently major customers of AAE, who are believed to have asked Independent Air Freighters to source 3 73s to operate on the east coast in opposition to AAEs.

From a bean counters perspective, the 73 does not stack up against the 72. It represents a capital investment of about $15 mil. versus $2 mil. for the 72. It carries only 8 ULDs as opposed to 12 on the 72. AAE plans to keep them ETOPS compliant, which will lock them into the Qantas maintenance system. Very expensive and costs not applicable to the 72.

Riding on the back of the 727 and 146 with a 97% monopoly of the market, AAE has become fat and overpriced. The 73s will usher in competition and that is where savings for forwarders will be made.

[Buster Hyman]

The fact that Qantas has surplus 73s
That'll be handy, considering there's not a spare CFM engine in storage at the moment...from what I'm hearing. Bit of a backlog of work ay the present...they'll just have to pinch a donk from all those spare 73's!;)

[DJ747]

aha, maybe the rumour of VB getting 737 QC aircraft that fly the parcels at night may be true after all. CC always smells an opportunity.

[apache]

Qantas and National Jet have been invited by AAE to tender for the contract.

From what I heard, Qantas gave AAE no option. They were simply TOLD "We have some 733's that YOU will convert and use"

The 733 is not allowed into SYD after/before curfew. The containers are NOT compatable with the 146, and not many NJS pilots are 737 rated. .... sounds like ANOTHER good financial move by QF!

[Capt Claret]

Wingnuts

I'm a little confused.

You said, The dilemma for AAE has been a perceived need to update its aging 727s and expose itself to competition or stick to the 72s and maintain its monopoly.

why does AAE only open itself to competition if it operates B737? Surely any other wannabe freight operator can come in with whatever type they choose and offer competition?

[MarkD]

The original post presumes 727s being allowed operate indefintely? Is that really a runner with 727 being progressively persona non grata elsewhere?

[Wingnuts]

At the moment AAE has a monopoly because no other aircraft is competitive. Other operators have to bring in 72s as DHL is about to with its 2nd.

Noise is not the issue here that it is elsewhere so I would have thought the 72 would have been good for another 5 or 6 years.

AAE is bitting the bullet sooner rather later and apache maybe close to the mark. QF is the dominate player and they now have an opportunity to sell / lock in lease at a premium to market values. This would be at the expense of Post. But unaccountable government organisations are a soft touch in these types of deals.

[VTM]

I guess with the price of fuel approaching $62.00us the 727 is becoming expensive to operate. I suggest the 733 would only be used to shift mail and high priority freight and the remainder will go in the holds of QF aircraft, this would make the operation more economical in the long term.

VTM

[apache]

I suggest the 733 would only be used to shift mail and high priority freight and the remainder will go in the holds of QF aircraft

This has ALWAYS been the case at AAE. If ALL the "overnight" freight had been uplifted, then there was more room for mail, over and above the contracted amount.

Then of course there were the Horses, FEDEX and DHL normally wanted a container to themselves. ANSETT used to put a container on... and VERY occasionally, when one had a good clerk who uplifted a HUGE amount on the QF earlier flights which SOMETIMES ran late and were upgraded to a 763, there was room left for "less than urgent" freight.

AAE are NOT happy about having 733's shoved down their throats, but have no real argument.

[ITCZ]

The preference was for 757, but 737-400F's are looking the good.

Why should the QF 737s be 'in the frame"? Last time I looked they didn't have those really big doors that they will need for the ULDs.

Be smarter to source aeroplanes that were already kitted out as freighters, would it not?

[apache]

Be smarter to source aeroplanes that were already kitted out as freighters, would it not?

Undoubtedly. But when has that been a priority?

Qantas will no doubt take some OLDER 733's, maybe from jetconnect, put the cargo door in and offload to AAE thru NJS. Jetconnect will get the old QF734's, and QF will replace a/c with JETSTAR or even 738's.

BEcause the 733's are no longer "QF", Dixon will then tender a contract to crewthese a/c's, and pilots will clamber over each other, AGAIN, to do it for the least amount of money.

QF have then offloaded their older a/c at a decent price, have kept the a/c 'in house" and cut pilots wages again.

Being among the first to put the cargo door in the 733 will make them easier to sell in a few years time when the 734's become redundant, and other companies are trying to get out of their 727's.

It is not about what is best for the job, or what AAE want.

[Dehavillanddriver]

Being among the first to put the cargo door in the 733 will make them easier to sell in a few years time when the 734's become redundant, and other companies are trying to get out of their 727's.

Not quite sure what you are saying here, but I was flying a 733 QC freighter in 1994.

The 733 freight conversion has been around for yonks - Pemco being a big converter of airframes.

[Buster Hyman]

5W-ILF (I think) of Polynesian was a 733 combi.

[Dehavillanddriver]

Buster,

It was 5W-FAX.

5W-ILF ended up as VH-TAB (I think) for a while - it was certainly a QF aeroplane after coming off lease with Poly - I think that it went back a year or two ago.

NJS had a 733 QC as well - VH-NJE - it was a "hard ball" ie non efis 300.

From memory Singapore Airlines had a couple as well - Pure freighters though if I recall correctly.

[Buster Hyman]

Thanx DD:ok: I had a 50/50 chance there didn't I?:p

[apache]

Apologies, DD, I meant it will be new(ish) in OZ.
The only real freighters that run around these skies are 74's and 72's, with the fedex MD11.

A fleet of 73F's would be a valuable tool in the pacific.

[Dehavillanddriver]

I don't know if the 733's are the machine for the job.

I accept that they are cheap - being owned by the mothership and are a known entity with regards maintenance history BUT a 757 or A300 would really have been the machines to go for in an ideal world.

Perhaps QF would have been better off sending the 767-200's to Pemco for a freight door rather than having them cut up into tin cans in the Mojave Desert.

The problem with the 737 in the pacific is the distances between airfields - most international ops require an alternate everywhere and when you need to carry an alternate 6-700 nm away it starts cutting into the payload.

The longer legs of the 767/757/A300 would have been ideal for regional pacific work - even on transcontinental work the 733 will be limited.

[Wingnuts]

The word in the bar is that 2 Jetconnect 73s will be taken off line in June and 2 more in August next year. Qantas is negotiating with IAI and Pemco for the conversions to be done under licence at Avalon. Included in the package are the 7473s. (Part glass, Roller powered 7473s could be slow to move. Cargo conversions will enhance price and add another string to Avalon’s bow. AAe is not interested in operating international freight in its own right so Toll, who has expressed keenness to get into China air freight, may be interested.)

The 737 conversion will include winglets and there will not be much change out of $6mil each. So each of its 8 pallets will represent an investment of $2 mil. They will have to be kept full and flying, 10 to 12hrs a day, 7 days. Back of the clock flying burns crews so there should be a requirement for 6 crews per aircraft.

One of the options is for Jetconnect drivers to transfer across with the aircraft on same wages. A similar process as when NJ took over the 727s