Wja To Lgw

[Thebean]

If Dag is correct, maybe some LHR slots will come available...

If I were a betting man, Germany, Italy and perhaps Netherlands will be on the hit list down the road.

Then there's the whole trans pacific thing.

[Boney]

Or South America.

[Maverick]

I'm not sure what to make of this but I like the fact that the 767-300's that we've bought can be sold with no real pain if this widebody experiment doesn't work. I'm not sure what 4 767's are worth but I'd guess it's less than one new 737NG?

The one constant in my 16+ years here is that WJ does not allow emotion to cloud business decisions. If a route doesn't work, poof, gone.

I am sure that if the 767 numbers don't do what they should they will be gone just as fast as YYZ-ACY was.

As for expanding internationally, almost every failed airline in Canada I can think of merged their way to history...

[Super 80]

The planes are leased from Boeing Capital.

I guess it’s a question of defining success.

Profitably flying 767’s from YYC and YEG to Hawaii in the winter and from YYZ and YUL to European destinations in the summer with YVR and YYC to YYZ mixed in, barring a total economic meltdown should be relatively idiot-proof.

However any plan that requires securing prime slots at international hubs for the purposes of feeding an alliance hub seems doomed to failure.

[Maverick]

The planes are leased from Boeing Capital.

I guess it’s a question of defining success.

Profitably flying 767’s from YYC and YEG to Hawaii in the winter and from YYZ and YUL to European destinations in the summer with YVR and YYC to YYZ mixed in, barring a total economic meltdown should be relatively idiot-proof.

However any plan that requires securing prime slots at international hubs for the purposes of feeding an alliance hub seems doomed to failure.

The aircraft are owned.

I doubt any alliance feed is even being factored in. WJ has a very good feeder network that should allow optimal use of a small widebody fleet.

40 widebodies would be a different story.

[Guest]

The aircraft are owned.

I doubt any alliance feed is even being factored in. WJ has a very good feeder network that should allow optimal use of a small widebody fleet.

40 widebodies would be a different story.

I checked the transport canada data base and they don't show any B767s currently owned by WestJet. Are they still not certified / licenced? I understood their 1st one was to carry the following Mark: C-FOGJ

http://wwwapps.tc.gc.ca/saf-sec-sur/2/ccarcs-riacc/RchSimp.aspx

[airbrake]

Once the checks are complete by Bleing the sales are supposed to be completed.

The numbers Ive heard thrown around by the people in the know is for the cost 1 - 787 we can purchase up to 18 of these 767-3 if there were that many available.

When the tails arrive in Canada there is still maintenance to do, add in printer and ACARS. For what ever reason Boeing is not installing those components.

[Guest]

Once the checks are complete by Bleing the sales are supposed to be completed.

The numbers Ive heard thrown around by the people in the know is for the cost 1 - 787 we can purchase up to 18 of these 767-3 if there were that many available.

When the tails arrive in Canada there is still maintenance to do, add in printer and ACARS. For what ever reason Boeing is not installing those components.

Let us not forget the crew, dispatch, mtce etc training. I do wonder how this aircraft will be treated due $$$$ for flight crew, bidding, and of course manning in the back end. How will WestJet service the plus seats - meals, perks etc? Looking at this winter sked, where will Westjet be offering YYC to Hawaii nonstop service on the 767s, for some reason I can not find the service?

[inchman]

Once the checks are complete by Bleing the sales are supposed to be completed.

The numbers Ive heard thrown around by the people in the know is for the cost 1 - 787 we can purchase up to 18 of these 767-3 if there were that many available.

When the tails arrive in Canada there is still maintenance to do, add in printer and ACARS. For what ever reason Boeing is not installing those components.

And you could probably by 100 used 727s for the price if a 787 but there is a break-even point on fuel and maintenance. Not sure what the break even is, but I do know that a single 787 saves about $30,000-$40,000 worth of fuel a day while carrying 50 more passengers than the 767. That works out to over $11 million a year in direct costs and the equivalent of $13 million when passenger numbers are taken into account. That just about pays for a 20 year amortization just on fuel savings alone (rough numbers). And new airplanes don't need engine overhauls anytime soon and generally have better dispatch reliability.

If old airplanes made sense, there would still be many of WS's old -200s flying around. The fact is that the fuel savings and the new engines makes deserting old aircraft make sense.

I have no doubt in my mind that WS would gladly have some 787s if they could get their hands on them.

[Maverick]

And you could probably by 100 used 727s for the price if a 787 but there is a break-even point on fuel and maintenance. Not sure what the break even is, but I do know that a single 787 saves about $30,000-$40,000 worth of fuel a day while carrying 50 more passengers than the 767. That works out to over $11 million a year in direct costs and the equivalent of $13 million when passenger numbers are taken into account. That just about pays for a 20 year amortization just on fuel savings alone (rough numbers). And new airplanes don't need engine overhauls anytime soon and generally have better dispatch reliability.

If old airplanes made sense, there would still be many of WS's old -200s flying around. The fact is that the fuel savings and the new engines makes deserting old aircraft make sense.

I have no doubt in my mind that WS would gladly have some 787s if they could get their hands on them.

Not quite my metrically challenged friend. I read somewhere a while back that ANA was getting just a bit better than a 20% fuel burn saving on their 787's compared to the 767-300ER's. The article stated that they were burning the same amount of fuel with 60+ more PAX.

Impressive for sure but not exactly to the degree you are saying. Also ANA does have not have winglets on their 763 which accounts for at least a 5% improvement over baseline.

Also of note, AC mainline 763's do not have winglets while Rouge aircraft do which is probably why comparisons between Rouge and mainline always need to be viewed a bit more critical eye.

This article explains it better than I can.

http://www.flightglobal.com/news/articles/analysis-after-three-years-in-service-how-is-787-performing-405814/

[dagger]

Not quite my metrically challenged friend. I read somewhere a while back that ANA was getting just a bit better than a 20% fuel burn saving on their 787's compared to the 767-300ER's. The article stated that they were burning the same amount of fuel with 60+ more PAX.

Impressive for sure but not exactly to the degree you are saying. Also ANA does have not have winglets on their 763 which accounts for at least a 5% improvement over baseline.

Also of note, AC mainline 763's do not have winglets while Rouge aircraft do which is probably why comparisons between Rouge and mainline always need to be viewed a bit more critical eye.

This article explains it better than I can.

http://www.flightglobal.com/news/articles/analysis-after-three-years-in-service-how-is-787-performing-405814/

Further complicating comparisons, ANA was the first operator of the 787, and GE has made two upgrades to the GEnx since for new production units, and is proceeding with further enhancements, as is standard practice. The newest 777-300s have had significant performance gains as a result of these progressive improvements. The article you cite would not necessarily have reflected these enhancements. Of the 246 GEnx engines delivered for the 787 program by the end of Q3 2014, only the most recent 150 were the enhanced version. So comparing the 767-300ER to the 787-8 performance really is a question of which 767 and which 787 fins we are talking about. I believe all AC 787s have the enhanced engines.

[Super 80]

The aircraft are owned.

I stand corrected. Oddly it was Boeing that told me the ex-Qantas aircraft were being leased.

[better4me]

I checked the transport canada data base and they don't show any B767s currently owned by WestJet. Are they still not certified / licenced? I understood their 1st one was to carry the following Mark: C-FOGJ

http://wwwapps.tc.gc.ca/saf-sec-sur/2/ccarcs-riacc/RchSimp.aspx

The aircraft are owned.

The planes are leased from Boeing Capital.

I stand corrected. Oddly it was Boeing that told me the ex-Qantas aircraft were being leased.

Looking at the Westjet Q1-2015 fianncial release on page 18 gives the correct answer.

Looking forward, we have firm commitments to take delivery of an additional 15 Boeing 737 NG aircraft, 65 Boeing MAX aircraft and an additional 12 Bombardier Q400 aircraft. As previously disclosed, we agreed with Boeing to lease four 767- 300ERW series aircraft with an option to purchase prior to lease commencement, with the first scheduled deliveries still expected to occur in the summer of 2015. As at the date of this MD&A, we intend to exercise our option to purchase these wide-body aircraft. The combination of our firm commitments, the lease renewal options, and the sale of aircraft to Southwest, help us to optimize the size and age of our fleet. This provides us with the flexibility within our firm commitments to end 2027 with a fleet size between 172 and 220 aircraft, depending on future decisions to exercise options to purchase and lease renewals.

The bolded part clears up the confusion. WestJet leased the aircraft with a bargain purchase option and now intends to take up the purchase option. Therefore when WS goes to pick up the keys, they will hand over a large cheque to Boeing for the aircraft rather than rent the airplane.

The news that WestJet will purchase 763 rather than lease surprised me.

[CanadaEH]

Would that have anything to do with the amount of money being invested in the aircraft?

[Thebean]

Looking at the Westjet Q1-2015 fianncial release on page 18 gives the correct answer.

The bolded part clears up the confusion. WestJet leased the aircraft with a bargain purchase option and now intends to take up the purchase option. Therefore when WS goes to pick up the keys, they will hand over a large cheque to Boeing for the aircraft rather than rent the airplane.

The news that WestJet will purchase 763 rather than lease surprised me.

WJ learned long ago that owning aircraft is far preferable than making lease payments on aircraft.

In a low margin industry, the idea is to recapture as much of the margins available rather than giving the margins away, a la New Leaf's "plan". Using other people's money costs money, and the cost of that money might very well be your profit.

Owning the assets keeps the costs down and also allows the flexibility to not have to find profitable flying for, in the case of high capital cost wide body aircraft, 17-18hrs a day, 50 weeks a year. Going this route dramatically lowers the risk profile.

Then again, should WJ operate the 767's from YYC and YYZ, just how much risk is there trying to fill 280 seats given the reams of network feed available into and out of these two markets?

Allegiant are good example of what can be done with a fleet of ultra low capital cost older aircraft.

WJ operated gas guzzling 737-200's when others had far more efficient Airbus narrow bodies.

Things worked out ok for WJ in that scenario.

[anonymous]

Air Canada Adds Lyon, London-Gatwick to its Growing Global Network

• New Air Canada rouge route to London-Gatwick complements and builds on the success of Air Canada flights to London Heathrow, Air Canada's largest international gateway
  

MONTREAL, June 25, 2015 /CNW Telbec/ - Air Canada today further expanded its extensive global network with the announcement of new non-stop services to Lyon, France and London's Gatwick airport beginning in summer 2016. The two new routes will provide customers even more convenient options when travelling to Europe for business or leisure.

"Pursuing our ongoing strategy to expand internationally, Air Canada is pleased to offer customers non-stop, year-round service between Montreal and Lyon, heart of the second largest metropolitan area in France. Air Canada continues to serve Paris Charles de Gaulle and this new Air Canada mainline route will further increase convenience for customers travelling to France as well as provide the only year-round service between North America and Lyon. It also complements our Air Canada rouge Nice-Côte d'Azur service," said Benjamin Smith, President, Passenger Airlines, at Air Canada.

"Our new seasonal Air Canada rouge service between Toronto and London's Gatwick airport will complement our extensive operation at London Heathrow, our largest gateway outside Canada with non-stop service from eight Canadian cities. Air Canada rouge is ideally-suited to serve London-Gatwick, with its focus on leisure travel and provide easy access to southern London. This new service will also make us the only Canadian carrier serving multiple airports in the London region and complements our Air Canada rouge service to Manchester and Edinburgh. Both new routes offer customers convenient connection times with our extensive domestic, U.S. transborder and international network."

Tickets for both routes will be available for purchase starting July 2, 2015 and service between Montreal and Lyon will begin June 16, 2016 and operate up to five-times weekly with an Airbus A330-300 aircraft with 37 International Business Class lie-flat suites and 228 Economy class seats. Air Canada rouge's summer seasonal service between Toronto and London-Gatwick will begin May 19, 2016 and operate up to seven-times weekly with a Boeing 767-300ER aircraft with 24 Premium rouge seats and 256 rouge seats. All flights are timed to optimize connectivity through Air Canada's Montreal and Toronto hubs respectively.

Air Canada rouge Toronto-London-Gatwick

Flight

From

To

Depart

Arrive

Frequency

AC1924

Toronto

Gatwick

22:10

10:15 (+1 day)

Up to seven times a week

AC1925

Gatwick

Toronto

12:00

15:00

Up to seven times a week

[Guest]

Hmmm, more Rouge Long Haul , I guess a preemptive move to make WestJet think hard about their newly announced UK plans.

[inchman]

I wish AC serviced LGW Far better Drive to my destination and saves 2 hours on the motorway.LHR Sucks

Wish granted.

Shoulda wished for a lotto win.

[inchman]

Not quite my metrically challenged friend. I read somewhere a while back that ANA was getting just a bit better than a 20% fuel burn saving on their 787's compared to the 767-300ER's. The article stated that they were burning the same amount of fuel with 60+ more PAX.

Impressive for sure but not exactly to the degree you are saying. Also ANA does have not have winglets on their 763 which accounts for at least a 5% improvement over baseline.

Also of note, AC mainline 763's do not have winglets while Rouge aircraft do which is probably why comparisons between Rouge and mainline always need to be viewed a bit more critical eye.

This article explains it better than I can.

http://www.flightglobal.com/news/articles/analysis-after-three-years-in-service-how-is-787-performing-405814/

I'm boarding about 20% less fuel out of TLV than I was on the 763, carrying 50 more passengers. The -9 is supposed to burn the same fuel per hour, carrying 40 more, using different engines and a unique horizontal stab technology.

I'm just going by what I see on the gauges. They're comparing actual burn to a "virtual model of a comparable[?] 767". Not sure exactly what a "comparable 767" is. But overall burn, tube to tube, is almost 20% less.

My rule of thumb on the -87 is 5000 per hour... on the -67 it was 6000 per hour. And it works out pretty close to what LIDO figures out.

And all at .85-.86 instead of .79-.81.

[Thebean]

Hmmm, more Rouge Long Haul , I guess a preemptive move to make WestJet think hard about their newly announced UK plans.

Just as every other preemptive move over the last 20 years has made WJ "think hard" about their plans...

http://go.distance.ncsu.edu/gd203/wp-content/uploads/2014/10/little-dutch-boy-political-1.jpg

You get the idea....

This changes a couple of things.

1. WJ's timing to commence service to Germany, and

2. Air Canada's pilots unions support of the Rouge scheme. If they can't see the end game now, their leadership is deaf, dumb and blind.

A yield and rasm destroying move into the key TATL market to chase a ghost? And by the way, who said anything about Toronto - London flights in the first place?

"All flights are timed to optimize connectivity through Air Canada's Montreal and Toronto hubs respectively". Well, that will certainly isolate the network yield implosion, eh?

Why not expand the fun and do the same into Frankfurt with a couple flights a week to HHN, Munich or perhaps Berlin to further entice the incumbent to further decimate it's own TATL profitability?

That's what I'd do.

AC is getting premium yields day after day at LHR. WJ isn't gonna get LHR slots any time soon. Those LHR yields are going to go poof with even wider low cost expansion to LGW. AC's profitability and margins already are amongst the worst in North America and those margins are underwritten by TATL in the key summer months. Why waste time, resources and fritter away precious margins messing around with LGW?

Running a parallel service into the same market with lower fares that will have to be matched by all carriers into LHR to remain "competitive"? Just what do you THINK will happen?

A quick check shows about 20 airlines one stop options available from LHR to YYZ. Once AC cuts those fares, everyone will match. The bigger carriers might even launch some "disciplinary" pricing just to reinforce the point, further widening the meltdown.

Take a look at Qantas's route map. I don't see ANY parallel routes from ANY Australian gateways to ANY city with multiple airports? Sydney to Haneda on Jetstar and Sydney to Narita on the mainline? Not a snowball's chance......

http://www.qantas.com.au/travel/airlines/route-maps/global/en

Do the same for Singapore Airlines:

http://www.singaporeair.com/en_UK/plan-and-book/where-we-fly/

Their map doesn't even refer to Scoot. That's how separate they keep the brands...

This is one of the funniest moves I've ever seen in 20 years observing the business and absolutely, unequivocally proves Fang's statement that "you are only as smart as your dumbest competitor".

[Thebean]

I'm boarding about 20% less fuel out of TLV than I was on the 763, carrying 50 more passengers. The -9 is supposed to burn the same fuel per hour, carrying 40 more, using different engines and a unique horizontal stab technology.

I'm just going by what I see on the gauges. They're comparing actual burn to a "virtual model of a comparable[?] 767". Not sure exactly what a "comparable 767" is. But overall burn, tube to tube, is almost 20% less.

My rule of thumb on the -87 is 5000 per hour... on the -67 it was 6000 per hour. And it works out pretty close to what LIDO figures out.

And all at .85-.86 instead of .79-.81.

From a fairly recent edition of Plane Business:

Another subscriber wrote this week,

Hey Holly,

What are you hearing about fuel performance on the 787-8s and 787-9s? I've heard from more than one source that the planes simply are not performing as had been promised. While we all know the aircraft came in heavier than projected, I'm hearing that even with almost constant mods from Boeing that the aircraft simply is not living up to the hype in a number of areas. Have you heard anything?

Yes, I have. When both United and American modified their 787 delivery schedules earlier this year, we wondered then if one of the reasons wasn't because there continued to be "issues" with the performance of the aircraft.

We were told this week by more than one source (from both domestic and international operators) that the engine improvement mods that Boeing has been putting out for install on the 8s is still not getting the job done. Fuel performance on the 787-9s is not coming in as advertised either.

[dagger]

What AC says, and frankly, passenger-only comparisons also neglect the added cargo uplift on a long-haul route like YYZ-TLV, or Canada-Asia. Yields to and from Tel Aviv have always been better than the typical rates between North America and Europe because of "constraints" that limit some of the big cargo operates into Israel. You don't have big capacity dumpers like EK or QR or EY, and for routings like Australia-Israel, you have a double constraint - lack of Australia outbound freight capacity to North America that can be allocated to secondary or beyond markets like Israel. Thet 767-200LR from SYD brings in a good bit of freight which can then be routed over Canada to YYZ and on to TLV, which is short of inbound and outbound cargo capacity and which on the export side, sends out a lot of higher yielding high tech traffic.

On the other extreme are Air Canada’s expectations for the Dreamliner. After taking delivery of its first two General Electric GEnx-1B-powered 787-8s earlier this year, chief executive Calin Rovinescu told analysts that he expects the aircraft to yield 29% lower unit seat-mile cost than the 191-seat 767-300s that are being replaced. In a second-quarter earnings call, Rovinescu cited the example of the Toronto-Tel Aviv route, on which a 251-seat 787-8 can carry 31% more passengers and more than triple the cargo while burning 3% less fuel per trip than the 767.

This will tend to rise if/when AC uses a 787-9 on that route. More seats and more cargo than the 787-8. Same fuel consumption.

[FA@AC]

I was thinking the same thing yesterday evening when I was in T1 at CYYZ and could see only Rouge fins down the entire side of the terminal.

I know of a number of AC pilots who consider Rouge a better gig than mainline.

[Thebean]

Well, I hope that's because it's a better place to work, even though it's the same company with a different paint job.

If it's because they can earn more money than at mainline, that isn't exactly consistent with the spin that pilot costs at Rouge are sooooo much cheaper than at mainline, therefore, the "overwhelming" success and profitability of the brand.

[Homerun]

It's because they get a Captain upgrade 10 years earlier or they get to avoid reserve or a crappy junior schedule.

The pay rates at Rouge are significantly lower than mainline. It is possible to make more money than at mainline however if you are willing to work many more hours and/or work on your days off by essentially turning yourself into a voluntary reserve pilot.