View Full Version : THAI to cut flight fuel excess

22nd Aug 2008, 05:15
Not sure how accurate the reporting is, but the following appeared in todays Bangkok Post

Thai Airways International (THAI) is seeking to skimp on fuel reserves on its aircraft as part of its intensified effort to reduce costs in light of high oil prices. The national carrier wants to halve contingency fuel reserves, legally now at 5% of total fuel load on each flight, in order to reduce weight on aircraft to cut fuel burn and emissions.

The cut, which was proposed to the Department of Civil Aviation (DCA), is part of more stringent fuel management being adopted at THAI. The company is toughening its cost reduction programme as it reported its worst quarterly loss since the 1997 Asian financial crisis in the second quarter of this year.

THAI executives allayed safety concerns about the proposed reduction in fuel reserves, as it is in line with practices in the European Union.

DCA deputy director general Wuthichai Singhamanee agreed, saying THAI's request was not unreasonable and therefore is permissible. ''This is fuel that is not used and there is nothing to be worried about,'' he said.

This portion is in addition to the volume needed to cover the distance on a specific flight, enabling an aircraft to fly to an alternate airport in case the airport where the aircraft is supposed to land cannot be served. The reserve is also in addition to fuel allotted to allow a plane to fly in a holding pattern for 30 minutes when landing is not possible.

Using a flight from Bangkok to London as an example, a THAI executive pointed out that halving the contingency reserve would shed about two tonnes from the 120 tonnes of jet fuel (about 960 barrels) a Boeing 747-400 normally carries.

By doing so, the airline could reduce fuel burned on that flight by about 800 kilogrammes, translating into financial savings of US$800 a flight.

With fuel prices now their biggest cost, airlines including THAI are aggressively enforcing new policies designed to reduce consumption.

Roughly 40% of THAI's total operating costs are for fuel, up from 37% last year.

THAI's fuel bill last year was about 70 billion baht with consumption of three million tonnes. As oil prices started spiking in April this year, its 2008 fuel cost is estimated at nearly 100 billion baht.

The savings arising from reducing fuel reserves could be substantial given the size of THAI's operation and network _ 82 aircraft, 18 million passengers a year and 60 destinations.

Achieving cost savings is critical for THAI, not for profitability but to stop losses from growing.

The carrier recorded a $308-million second-quarter loss, slightly worse than market expectations, on soaring fuel costs and a significant $150-million exchange loss related to its US dollar and euro borrowings, compared to a $43-million gain in the second quarter of 2007.The airline is slowing its planes by nearly 10 minutes, carrying less water, fewer newspapers and blankets, and limiting crew luggage allowances to cut fuel use and reduce weight.
THAI shares closed yesterday on the SET at 15.80 baht, down 30 satang, in trade worth 15.9 million baht.

Bangkok Post | Business news | THAI to cut flight fuel excess (http://www.bangkokpost.com/220808_Business/22Aug2008_biz32.php)

22nd Aug 2008, 07:57
Using the BKK - LHR example from this article, arriving at the LAM hold without contingency fuel is simply going to result not being able to hold for very long. I assume they won't have added holding fuel. Delays at LHR are somewhat random in nature - as little as "no holding" to an average of "5 to 10 minutes" with occasional "20 minutes" thrown in unexpectedly.

One diversion to STN will cost more than $800.................

Shanwick Shanwick
22nd Aug 2008, 08:42
One diversion to STN will cost more than $800.................

With 2 flights to LHR daily that's an annual saving of $584,000. That'll pay for lots of diversions to STN!

22nd Aug 2008, 08:49
Ah yes, this brings back old memories...of SQ doing the same on their SIN-BAH (plus other arabian gulf flights) many years ago.
All was fine and dandy until one evening an SQ B747 had a flame out of two engines whilst taxying to the parking stand at BAH, with the Singapore PM on board.
Strangely enough, this absolute min fuel policy soon was changed...can't imagine why.:}:rolleyes:

22nd Aug 2008, 09:02
Are you an accountant, perchance? Have you any idea exactly how much a diversion would cost?

I don't, actually, but I can tell you that ETOPS' comment was correct, if 'tongue in cheek'.

Let's start with crew ?probably unable? to operate a second sector to LHR due to duty hours. I do not have Thai's FDP to hand but I would guess the delays in getting handling etc plus the extra sector would cripple the FDP.

Now landing fees etc plus 'ad hoc' handling, any engineering work required by non-based staff

Can the new crew operate from diversion into LHR and then home or do we need another crew at LHR and/or a tech stop/crew change en-route?

Do we alternatively, bus the pax and new crew to and from the diversion and operate from there? (Add more costs, transport, parking, timetable disruption etc)

I haven't even started on the commercial implications of the impact on the pax.

Now, I do not know the true cost of such a diversion, but I would suggest that 'skimping' on fuel for delay at a major airport such as LHR is not a good idea. I do however read that they are not doing this, but merely seeking to reduce the contingency fuel, this NOT being anything to do with planning for holding delays? One would hope that the fuel loaded for the inevitable delays will not reduce and that luck is on their side with the requirements for contingency fuel on such a long route.

22nd Aug 2008, 09:23
I seem to recall a number of instances a few years back where an operator arrived at LHR with very little fuel remaining. From what I remember it came to light because the handling agent made it known in some way. IIRC the operator was THAI.

22nd Aug 2008, 09:28
Hmm, a few years back a country just to the south of Thailand had a reputation for arriving at LHR flying on fumes!

411a - Nice one re SQ! :ok:

22nd Aug 2008, 09:56
Thai want to cut contingency fuel by 50% to 2.5% - saying this is in line with European practice.

My reading of JAR-OPS has the following contingency possibilities:-

5% of the planned trip fuel

Provided that an en-route alternate is available, this figure may be reduced to 3% of the planned trip fuel

If the operator has established a fuel consumption monitoring programme for individual aeroplanes, keeps appropriate records and uses valid data so determined, this can be reduced to 20 minutes flying time.

If the operator has a fuel monitoring programme and agrees a particular method of statistical analysis which includes standard deviations this can be reduced yet further by agreement with the Authority.

Therefore Thai don't seem to be proposing much different.

It would be interesting to know which of the above policies are used by some of the European majors - I doubt many still use 5%.

22nd Aug 2008, 10:01
Spitoon, IIRC the carrier you are referring to was MAS.

22nd Aug 2008, 10:23
I'm guessing we can start expecting lots of Thai aircraft in Amsterdam.

22nd Aug 2008, 10:58
Contingency fuel is to allow for errors in forecast winds or temperatures, restrictions on altitude, minor route changes due to ATC or weather and extended taxi times.

Even with zero contingency fuel, an aircraft would normally still arrive with alternate plus reserve fuel, about one hour's fuel.

5% on a long haul flight is actually very generous and unnecessary.

Our company allows a minimum of 5% of the trip fuel from abeam the last suitable en-route alternate to destination, which could amount to next to nothing.

I'm surprised it took them this long to change it actually.

22nd Aug 2008, 10:59
Rather sad to read about Thai's problems. Nice people and nice operation. I suspected that some drastic cost reduction programme was being put in place a short time back when I flew with them, and I watched some of the cabin cost-cutting in J and F class. Now I can see why. Normally I'd use this (PPRUNE insider) knowledge and be a little bit careful about any exposure to them for a while to see how things settle down. But I think this is time for supporting rather than cutting down, so I'm going to do the opposite in Thai's case and buy another load of TG tickets.

22nd Aug 2008, 11:07
Spitoon, IIRC the carrier you are referring to was MAS.

And so it was. HERE. (http://www.iht.com/articles/1999/06/12/rsafety.t.php)

22nd Aug 2008, 12:20
On the face of it, it seems that TG are aligning themselves with JAA fuel policy regarding contingency fuel, i.e. using an abeam en-route alternate for calculation of fuel required. This should not preclude the Captain from uplifting extra fuel if experience and conditions require.
I haven't operated a B744 from BKK to LHR for a few years, but isn't 120 tonnes a bit on the light side? Perhaps the spokesperson is using an average for the 744 fleet world-wide.

22nd Aug 2008, 12:30
quote "If the operator has a fuel monitoring programme and agrees a particular method of statistical analysis which includes standard deviations this can be reduced yet further by agreement with the Authority."unquote

By using the above our contingency fuels range from minimum 5 minutes to sometimes more than half an hour. And I haven't diverted yet, nor landed with less than diversion fuel.
The statistics, if honest, seem to work fine.

22nd Aug 2008, 12:39
On a long haul flight 5% of the burn is often not possible, simply no room in the tanks. What is more common is 5% of the burn OR 5000kgs, whichever is the lesser.
Establishing fuel required when alongside or approaching a suitable en-route alternate is simply using the 're-dispatch' procedure that has been in use for the last twenty years, at least.

23rd Aug 2008, 04:21
The use of the re-clearance (or re-dispatch) flight plans has been long established to maximise payload on weight critical flights. It is legal. It requires a little more work from the dispatcher to to select a re-clearance point, and an extra check from the crew at that point on the re-clearance flight plan fuel minimum.
It only affects the contingency fuel (percentage of trip fuel)- not holding or alternate (diversion) fuel.
If it can save TG a lot of money annually, I am sure many other carriers could also save.
We now use computers for commercial flight planning - not the manual interpretation of weather and wind charts that I was taught so many years ago:rolleyes:.

23rd Aug 2008, 08:57
Tyrekicker2 -as Parabellum has posted, re-dispatch has been in use for at least 20 years (in fact over 30 years as I remember using it mid-seventies) and is still in occasional use today. Using 5% contingency from an abeam en-route alternate or 3% of planned route fuel burn (whichever is greater) is merely a "modernisation" of re-dispatch, as per JAR-OPS.

23rd Aug 2008, 09:02
OverRun: I assume you've never worked at Thai or have been engaged in any business except as a passenger. You would definitely rethink your impression.
Their huge loss is not due to fuel, but due to mismanagement and overstaffing combined with selfish and lazy staff (just look at their unions) - and of course their way how to promote staff (it's not a knowledge driven organisation but mainly seniority - or being in the right family or party)

23rd Aug 2008, 15:56

So their loss is NOT due to fuel. As to selfish and lazy staff!!!!! Get real.

23rd Aug 2008, 21:00
"Reduction of contingency fuel" doesn't mean a lot without further information. More importantly, what is the targeted landing fuel for normal operations?

For example, our 747s are planned for 10,500 Kg for landing at the destination or 7,000 at the alternate, whichever is more restrictive. If the flight is such that FAA required reserves are more, then obviously more is added. HOWEVER, liberal use of Planned Redispatch in flight often gets us right down to the company minimums, even on long-haul flights.

Our company has been employing a "Fuel Wise" program to reduce carried fuel. So far it has resulted in several diverts that would otherwise have not been made, and at least 3 times I have landed with around 5,500 Kg, which goes against another policy statement: "No flight should ever plan to land with less than 5,500 kgs." That 5,500 Kg level guarantees only 1 go-around and subsequent approach...

24th Aug 2008, 04:37
Have to say...
Re-release (re-dispatch) short of destination is a very valuable asset...I personally have used it for the last twenty five years.
Works fine (IF used properly), lasts a long time.
No complaints.
Have to say, however, that I have personally never had a fleet manager dictate what fuel was uplifted...they always mentioned...up to you, your're in charge.

Sorry folks, if the Commander is second-guessed, all bets are off.
Accidents/incidents might indeed follow.

24th Aug 2008, 05:43
Point8six I appreciate your remarks, but so far it seems not all carriers outside EASA are following the JAR-OPS.

As far as the comments of Rolibkk are concerned I have to agree that massive overstaffing, staff attitude and ineffective middle management remain contributing factors to tremendously high costs in TG. Granted the posted huge losses are mainly due to the fuel price crisis.

24th Aug 2008, 11:00
No its not due to fuel. Look at other airlines making profits or even increase profits (QF) in the same period. With their low cost base it should be quite easy to balance a fuel cost increase. TG always finds arguments for their losses. Get real and look at their management and operations.

24th Aug 2008, 12:23
And the point that rolibkk has so far not mentioned is that there is a high level of corruption and 'hands in the cash register' at Thai. I have a friend who was quite senior in Thai management and told stories of huge amounts of money being misappropriated.

24th Aug 2008, 20:34
Re-release (re-dispatch) short of destination is a very valuable asset...I personally have used it for the last twenty five years.
Works fine (IF used properly), lasts a long time.
...and that is a VERY big "IF"!

A few months ago I got one redispatch flight plan that had 4 minutes of reserve fuel at the real destination. I called Dispatch, and he argued with me that there was well over 30 minutes at the redispatch destination (redispatch point was AFTER the redispatch airport). He was not inclined to listen to the reality of the 4-minute actual reserve, so I told him I was adding more fuel and hung up the phone.

Turns out I used up every bit of that original reserve plus another 1.2T due to extended low-level vectoring at the destination...

28th Aug 2008, 12:01
It appears Thai will save approx. $30,000,000 per year in reduced fuel burn costs spread over their fleet of 85 aircraft serving 60 plus destinations.

A significant saving and no doubt the suggester of the idea will be suitably rewarded !.

29th Aug 2008, 04:55
I thought it was desirable to have all the engines running and at stable temperature to get best performance. Probably less of an issue if you've got four and you lose one on take-off, but if you're in a twin and suddenly relying on the one you started a minute or so ago as the other one eats a large bird or throws a fan blade then it might get interesting.

29th Aug 2008, 05:52

Modern jet engines hardly need any 'warm up' at all.

e.g. PW4056. Minimum oil temp 50C before advancing thrust levers to take off power. No time limit specified.

e.g. RB211. Minimum oil temp -10C before advancing thrust levers. No time limit.

Ingestion of a large bird on takeoff would be 'interesting' nonetheless.

29th Aug 2008, 08:38
Chai Ja

Cant believe the amount of positioning flights Ive been on recentley

Has this got anything to do with TG?