PPRuNe Forums - Virgin may lease 10 Ansett A320s

Thurs "The West Australian"

Virgin may lease 10 Ansett
A320 jets
By Geoffrey Thomas

VIRGIN Blue is looking at leasing some of
Ansett's A320 jets as part of a $4 billion
overhaul of its fleet to meet aggressive
expansion plans, including international flights.

Virgin Blue's David Huttner said yesterday the
airline was examining a proposal from Airbus
Industrie, backed by Singapore Aircraft Leasing
Enterprise (SALE), for an order for 40 Airbus
A320 aircraft to replace its 16 Boeing 737s.

Mr Huttner said if the airline chose Airbus it
would immediately lease up to 10 A320s from
Ansett's administrator for up to six months
while the new A320s were being delivered.

These aircraft were used to operate Ansett Mark
II till late in February and are still operational,
unlike Ansett's 737 fleet, some of which have
been mothballed or returned to owners.

Representatives from Airbus and SALE, in
which Singapore Airlines has a 35 per cent
stake, met Virgin Blue executives in Brisbane
on Tuesday and a decision will be made within
10 days.

The A320s would replace Virgin Blue's Boeing
737 fleet and be used to meet expansion plans
that include flights to New Zealand, Fiji and
Bali.

Boeing is fighting to retain Virgin Blue's
business but has problems with availability of
aircraft after winning large orders from Qantas
and Ireland's Ryanair for up to 225 Boeing
737s.

Virgin Blue's dilemma is that buying the A320
requires a sizeable investment in expensive
ground-handling equipment to unload baggage
and cargo.

For this reason Ansett used A320s only on
major routes and 737s, which don't require the
same equipment, were operated to smaller
centres such as Kalgoorlie, Karratha and
Broome.

Offsetting this is the availability of A320 ground
handling equipment and spares from Ansett,
along with a pool of pilots, cabin crew and
ground engineers qualified on the A320.

Another important consideration is that the
Ansett A320s are certified for extended
over-water flights to Bali, Fiji and New Zealand.
Virgin Blue has been looking at gaining similar
approval for its 737s but it is an expensive and
time-consuming process.

The routes to other countries are part of longer
term overseas plans made possible after
Australian-owned Patrick Corporation bought
50 per cent of Virgin Blue last month.

Under international air service agreements, an
airline must be 50 per cent Australian owned
for it to gain permission to fly overseas routes.

Analysts suggest that Singapore Airlines, which
saved Virgin Atlantic from collapse late last year
with various financial guarantees, is yet to play
its hand in Virgin Blue's expansion.

Singapore Airlines has a 49 per cent stake in
Virgin Atlantic, and it wants a significant
presence in Australia with a similar styled
product to attract business travellers.