Younger Fleets Boost Non-U.S. Airlines

BusinessWeek ^ | June 2, 2008 | Carol Matlack

[MHalblaub]

The aging planes of United, American, and Delta guzzle more gas and make the U.S. carriers more vulnerable to soaring oil prices—and to their global competitors

For a look at one of the biggest headaches facing U.S. airlines, head out to Paris' Charles de Gaulle airport any day and watch the big jets taking off for the U.S. There goes United Airlines to Chicago, American Airlines to Boston, Delta Air Lines to Atlanta, and Air France to New York's John F. Kennedy airport.

What's the big deal? Many of the U.S. carriers' planes are Boeing 767s, a model that dates from the mid-1980s. Most Air France-KLM (AIRF.PA) planes are at least a decade younger—and a lot more fuel-efficient. According to U.S. Transportation Dept. data, the Airbus A330 model that Air France flies between Paris and JFK burns an average 12% less fuel per passenger than the 767 does on a similar flight.

With oil prices above $130 a barrel, that adds up fast. Indeed, if prices remain at current levels, U.S. airlines are forecast to lose a record $7.2 billion this year, triggering what could be a brutal industry shakeout (BusinessWeek.com, 5/28/08). "We're at the precipice of a disaster," says Scott Hamilton, an aviation consultant with Leeham in Issaquah, Wash.

[MHalblaub]

Older Planes, Higher Costs

While the oil spike is clobbering airlines worldwide, the U.S. carriers' aging fleets make them more vulnerable than most. American Airlines (AMR) underscored that fact last month when it announced plans to retire as many as 50 planes, mainly gas-guzzling MD-80s dating from the early 1980s.

In fact, U.S. airlines' fleets are some of the oldest in the world—an average of 15 years old at American, almost 14 years at United (UAUA) and Delta (DAL), about 11 years at Northwest Airlines (NWA), and about 10 at Continental (CAL). By contrast, Air France's planes are only 8.8 years old on average—and some others, such as Singapore Airlines (SIAL.SI), whose fleet averages 7 years, and Emirates, whose fleet averages 6.2 years, are younger still. Even carriers such as Russia's Aeroflot (AFLT.RTS) and THY Turkish Airlines (THYAO.IS) have fleets that are about half the average age of U.S. carriers'.

And the gap is only going to get worse. Financially strapped U.S. carriers have curtailed their orders for new planes in recent years, even as foreign carriers have placed hundreds of orders for new, more fuel-efficient models. Out of 840 orders for the new fuel-sipping Boeing (BA) 787 Dreamliner, only 43 are from U.S. carriers: Northwest and Continental.

[...] According to DOT figures, the Boeing 767 model used by many U.S. carriers on transatlantic routes uses an average $3,946 worth of fuel and oil per hour during a 3,000-mile flight—or $17.85 per passenger per hour, based on an average 221 seats. The Airbus A330 model used by Air France and other European carriers burns an average $15.72 per passenger per hour, about 12% less, under comparable conditions.

[...]

[fuzzy dunlop]

Look at Delta’s recent financial performance.

Can you imagine turning up at work every day, and at the end of the day, know that you’ve just LOST $640 for the company on that one day ?

$6,400,000,000 annual loss with 48,000 employees.

Why are they still flying ?

Why is Alitalia in Europe still flying ?

Oh, I know, restrictive trade practices and hidden subsidies that were made illegal in other industries decades ago.

[MHalblaub]

“Why is Alitalia in Europe still flying?”

Why did the Pope always kiss the earth after flying with Alitalia?

Back to your question:

Unions
Mafia
Clerks
National pride
Elections
...

What I read about the case EU is going to put an end on it.
No more subsidies allowed.

[zeugma]

Notice that this article doesn’t mention Southwest Airline. I believe they are still the only American carrier that is still profitable, and has been since before 9/11.

[Oztrich Boy]

According to U.S. Transportation Dept. data, the Airbus A330 model that Air France flies between Paris and JFK burns an average 12% less fuel per passenger than the 767 does on a similar flight.

Boeing KC-767CGI, because Boeing needs the business as it has politicians to support

[Paul Ross]

Your quoted statment self-discredits your thesis:

According to U.S. Transportation Dept. data, the Airbus A330 model that Air France flies between Paris and JFK burns an average 12% less fuel per passenger than the 767 does on a similar flight.

There are not going to be 266 passengers or so on these planes. So the basis for the calculation is grotesquely flawed, since most refueling missions now with the KC-135...a plane with less capacity than either of the contemporary options ...often had more fuel than actually needed for many if not most assignments. There is a right size....and the A-330 doesn't appear to be it.

The A-330 derived tanker will actually guzzle 24% more fuel per mission....and not even see a reasonable quanity of planes fueled to deplete its capacity. On scarcely any missions. And if you really needed a bigger plane....we already have the KC-10s....when on the rare occasion we need to have large squadrons are cross the Pacific or Atlantic. The KC-10s are more capacity still.

And the DOT data on the 767 is now dated as it does not loook at the new wing and engine combo that puts the 767 as essentially a new plane. Not an "80's" plane.

And it is a plane which passed all 8 survivability criteria with flying colors....while the EADs plane flunked. Flunked 5 of the 8.

The EADS Airbus entry is an unsurvivable turkey of a plane which clearly doesn't save fuel....or precious AMERICAN lives in war.

And EADS has shown that they could care less about American Lives....constantly putting us in danger with their illegal proliferation activity with enemy regimes and terrorist states.

[djwright]

The key there is PER PASSENGER. That is always the key to commercial airplane economics.

So my Suburban at 15 MPG may be more efficient on a 400 mile trip than your Miata. Per Passenger. But that is only if I fill all 8 seats. so the A330 tanker has more capacity. Way more than the KC135. There are only a few missions where that extra capacity will be used. Anything less than that and the 767 would be more efficient.

[Mr. Jeeves]

In fact, U.S. airlines' fleets are some of the oldest in the world...

Just like their flight attendants. ;)

...an average of 15 years old at American, almost 14 years at United (UAUA) and Delta (DAL), about 11 years at Northwest Airlines (NWA), and about 10 at Continental (CAL).

Add 35 to each of those numbers to get the average flight attendant ages.

Best thing we could ever do is to allow foreign airlines to operate domestic routes - the dinosaurs would quickly be forced into extinction, business travelers could enjoy Singapore or Cathay Pacific-quality service between the coasts, and Southwest would remain largely unaffected and dominant within its niche.

[MHalblaub]

“There are not going to be 266 passengers or so on these planes. So the basis for the calculation is grotesquely flawed, since most refueling missions now with the KC-135...a plane with less capacity than either of the contemporary options ...often had more fuel than actually needed for many if not most assignments. There is a right size....and the A-330 doesn't appear to be it.”

You are lost in statistics.

DOT: “A330 [...] burns an average 12% less fuel per passenger than the 767”

So a A330 can't “guzzle 24% more fuel per mission” as you repeat false claims by Boeing . There are about 25 % lees seats on a 767. Where did the 12 % less fuel come from?

You also repeat Boeing's false claims about fuel offload per mission. Boeing looked at KC-135’s average fuel offload by pounds. It's impossible to offload the whole fuel on every mission for security reason. It's not save to return to base with an almost empty plane. The average full offload was about 66 % or two-third. They didn't provide any numbers for KC-10. Maybe also two-third, maybe more.

For sure a KC-45 is to big to deliver KC-135’s average fuel offload. The question is what will be KC-45’s average fuel offload. Only looking at KC-135 numbers won't answer that.

“And if you really needed a bigger plane....we already have the KC-10s.”

There are only 59 KC-10 in service and over 500 KC-135. You missed to mention that with a greater fuel capacity a tanker can stay longer on station.

“And the DOT data on the 767 is now dated as it does not loook at the new wing and engine combo that puts the 767 as essentially a new plane. Not an “80’s” plane.”

Trust the airlines on that. They didn't believed in this “new” wing. Also a new plane as a new tanker has a higher development risk.

[Paul Ross]

Regarding the following:

DOT: "A330 [...] burns an average 12% less fuel per passenger than the 767"

So a A330 can't "guzzle 24% more fuel per mission" as you repeat false claims by Boeing . There are about 25 % lees seats on a 767. Where did the 12 % less fuel come from?

I'm unpersuaded by your reasoning. Fuel burn is affected by many factors. Total aircraft weight is one primary factor. Passengers and seats take up a small percentage of the cabin volume, as there is much empty space. A given volume filled with fuel will weigh much more than that volume containing passengers/seats. The A330 is a bigger plane, and Airbus claims it carries significantly more fuel. Therefore it burns more fuel per mission.

Although an A330 burns less fuel per passenger than a 767, since the A330 has more seats, so which aircraft burns more fuel per same length flight: The fully-loaded 767 or a fully-loaded A330?

I think you have to admit, it's in point of fact, the A330.

Let me emphasize this point with factual comparisons of orange to orange, not oranges to apples as the EADs apologists constantly seek:

Real World Example: If the mission is to fly 1,500 miles and off-load 69,500 lbs, a typical offload and in-line with the required range/offload curve, the KC-767 would burn 89,000 lbs of fuel to do the mission versus 110,000 lbs for the KC-30. The KC-767’s refueling efficiency is 43.9% versus 38.7% (fuel offloaded / (fuel burned+fuel offloaded)).

As another comparison: the A380F has no customers, while the 747-8F does. One reason why: although the A380F has more total payload volume, the 747-8F can carry more total payload weight.

You are lost in statistics.

Again, you are hoist by your petard.

Let me ask you point blank...would you still support the EADs bid even if you had to admit that their fuel claims were completely wrong?

[DoughtyOne]

Thanks for making the arguement Paul. It makes sense to me.

[Paul Ross]

Boeing KC-767CGI, because Boeing needs the business as it has politicians to support

Actually it is clearly EADs running as a pork barrel jobs program...

And they have not been reticent about lying to the U.S. public before about their supposedly being a U.S.-friendly employer.

You did hear about this, haven't you?

EADS’ Phony 2001 Jobs Claims

In 2001, EADS claimed its operations had 800 U.S. suppliers, a $4.1 billion impact on the U.S. economy and supported 100,000 U.S. jobs.

The Department of Commerce found that EADS in fact worked with only 250 U.S. suppliers and supported only 500 U.S. jobs.

It would be interesting to know how many of those jobs were mere lobbyists for their next big score.

This factual pattern of EADS conflation of U.S. jobs being existant or promised is a rather brazen form of political bribery at best, and insulting degree of stupid cupidity insinuated against the public...and our politicians. While I can believe our politicians harboring such... it seems doubtful the voters are buying this here.

EADs is clearly Playing Both Sides of the Atlantic

EADS has been busy assuring politicians in Europe that its tanker will support tens of thousands of jobs in France, England, Italy, Germany, and Spain.

EADS' CFO Ring stated that shifting final assembly of the tanker to the US shifts 8-10% of the cost of the aircraft from Europe to the US(quoted in Aviation Week & Space Techology). So the real jobs are in Europe.

[As an interesting aside: The engine that is to be used, supposedly to be made in Ohio...is currently also made under license by GE in France...and is the actual engine site used for the enignes on the tanker versions that Airbus has built to date.]

Perhaps this is why Airbus/EADS was telling the European press of the tens of thousands of jobs the contract will mean for Europe.

It's ironic how with this tanker contract the US taxpayer will help Airbus repay the illegal subsidies to its government backers.

Another demonstrable concern is how erratic are job creation assertions of EADs, as note by one critique:

EADS has U.S. Jobs Claims All Over the Board

For months, EADS had only identified about 1,000 jobs that might be supported by their tanker, if the company built the promised new production facility in the U.S.

Then EADS raised its jobs promises to 25,000, claiming a host of suppliers that have never worked with the company on a tanker aircraft.

In response to political pressure about their plan to outsource U.S. jobs, EADS shocked the industry by claiming that their tanker, which will be built overseas, will support a whopping 48,000 U.S. jobs.

Oztrich: You have explicitly stated that you were hoping for a job with the NG/EADs tanker bid...let us know how that works out for you.

[Paul Ross]

You're welcome.

It is time we we all recognized how foreign entities are successfully stealing our country from the U.S. citizenry, co-opting our government, and confusing otherwise erstwhile good people.

It's sad really.