Airlines In The Philippines II

[Evodesire]

Lets see who will put an order first, PAL or CebPac.

[xzibit31]

https://manilastandard.net/business/314374803/cebu-pacific-discloses-plan-to-acquire-boeing-fleet.html

5J plans to purchase aircraft from a US Manufacturer to "diversify risk".

[JNC03]

"In the coming week or two, we will formally launch the request for proposal and may the best man win," he added.

"It will be one or the other, we're not gonna split it between the two. It could be that we order a whole load of new Airbus again, or it could be [that] we order a whole load of Boeing. We would think three to six months would be the whole process, hopefully."

Szucs said Cebu Pacific was looking at Boeing aircraft to diversify risk "because we're facing issues at the moment," referring to the engine aircraft issues with P&W.


https://www.manilatimes.net/2023/09/29/business/corporate-news/cebu-pacific-considering-acquiring-boeing-aircraft/1912329

[Eurest]

The buzz around Boeing (Seattle, Illinois, Virginia & NC) is that 5J is livid over P&W's1100G's upcoming recall on A320Neo, which will decimate its fleet, as well as the RR delays on the A339 deliveries
Though there will need to be massive retraining to transition to the Max or Dreamliner, 5J sees it as a new market opportunity. 5J has taken notice of PR speedy C11 recovery, caused by the US market despite the Chinese market getting murky due to political and socioeconomic risks
Airbus & the EU have failed to open up growth opportunities for 5J beyond ASEAN, and has even hampered it in OZ with the delay of the 339.
There has also been a concerted effort to support massively increasing economic trade between like-minded countries, because the ME3, who got exceptional support via Ex-Im, etc and US taxpayer money, haven't been as cooperative in the Russia brouhaha.

So there is renewed confidence, this might be the closest in a long while Boeing is able to snag Toulouse's shining star.
Of course, will those loyal from the old Commercial Aircraft CEO allow that to happen?
So is All NEO by 2027, going to all-new by 2029?

[Evodesire]

Will 5J also purchase 787s and introduce ultra long-haul low cost flights? Or will they still stick to what they said that their goal is to expand within the region, ME, and Oceania? It might be a huge gamble for them, especially that PAL is set to receive A350-1000s and is also about to put in another widebody order.

[Eurest]

What is certain is that the Airbus whitetails, or what the employees call "clouds" , don't reflect well on their intent to be a dynamic & chic Philippine carrier.
Those borrowed planes make them look plebian, and they may have to again because of the new P&W directive

The industry recognizes 5J's intent to still have long-haul operations, and the A339 was supposed to be that. But it hasn't, because of the global engine problems
They had to deal with CoViD, then the RR & GTF issues, so All NEO went Oh NO
Most of the long-haul LCCs do operate Dreamliners, but competitors like EK will have A380 ops soon, likely CRK or a dawn MNL service?
The expectation is that the RFP is for narrowbodies, unless there's some financially tasty financial packages for a few widebodies in the medium or long-term
Don't discount A220s, E2s or C919s

[Evodesire]

Unless Airbus offers the A320neos with LEAP engines.. Not sure if that would be feasible and possoble though.

[Eurest]

The diversification objective is real. No longer a happy marriage with Toulouse, CRK hub will soon have to temporarily cease, aside from CRK-CEB, as they face with the GTF recall.

History has revealed 5J taking ex-AAX 339s, would the FR dithering of Max8's, benefit 5J to get some of the 737Max production slots?

[Arianespace]

Welcome back Eurest. We missed your insightful analysis.

According to a 5J official attending a senate hearing last June, they were notified about the PW problem late 2021. They were comforted by P&W that everything would be fine, until it wasn't, beginning with India's Indigo debacle. Lucky for PAL they deferred remaining 21n orders for 2026 before this bruhaha started. By 2023, it was clear to them 5J paralysis is on the way unless they do anything drastic. That was reported here on this forum.

One procedure adopted was leasing some old A320s in the interim to cover shortfall. They are flying like this:


By the middle of this year it became apparent that all their jet delivered until 2021 will be affected and would be on maintenance cue for a longer period than initially thought. By the latest count, it covers more than 60% of their A320neo fleet and all of their A321neos. Cue time is 9 months at that time. It is now down to 5 months. Do the math.

The other is considering another plane option for its fleet, as other airlines scramble to get hold of old A320 frames to fly. They are not that many flying around. Delivery is thought to be beginning 2026 when leases of this soon to be grounded planes ends.

The Boeing option is grounded on their survival. I hear Airbus is giving 5J an offer it can't refuse. So now their decisions are becoming more difficult.

[Evodesire]

Is it possible that Airbus will offer the neos with the LEAP option?

[JNC03]

Discounted neos with LEAP engines🤔🤔

Their investor Indigo Partners which owns IndiGo did this ordering new neos with LEAP engines. For the A321XLR of 5J the engines might be CFM because it will be certified first

[Arianespace]

CFM also has problems with their engines, the LEAP-1A. It was just not prevalent as GTF. Its Boeing counterpart, the LEAP-1B doesn't have problems at all. The LEAP is tempting, but there is another even better P&W coming in 2025. The GTF Advantage (GTFA). According to P&W, it can generate 4% more thrust at sea level and 8% at high and hot airports (34,000lbs,151Kn), 1% lower fuel burn.



Now, you truly think about that if you are the CEO.

[Evodesire]

Wow, I hope this will not result to another round of retrenchment. I heard that the flying hours of many 5J crew members are low, like 50 to 60 hours a month. I think they also had to reduce capacity by a significant number.

[Eurest]

It's why they're flirting publicly with Boeing, as they need planes now.

The Leap 1B vs 1A&1C are as different as the GENx on the 787 and 747-8, the tech predecessor of the LEAP
Fan diameter is 1B:68" vs 1A:78" GTF:81", and the size difference is also reflected on weight as well.
The industry now accepts that over a 360-500nm difference, the MAX8 is 2% more fuel efficient than the A32N on latest PiP & weight builds
As long as 5J accepts there will be NO discounts, even for a large order, Boeing may be able to accommodate a few air frames in a relatively soon-ish delivery schedule. Aided by the fact that, there are a good number of LCC spec'd Max8s in terms of cabin interiors

[Evodesire]

So what variants are we looking into? MAX 8 and 9? The 10 would have been the most ideal but its not yet certified and 5J is itching to get their hands on new planes.

[JNC03]

The engineering chief of Philippine low-cost carrier Cebu Pacific Air sees little sign of improvement in the availability of aircraft spare parts.

Shevantha Weerasekera, vice president of engineering and maintenance at Cebu Pacific, says that while there has been much discussion about supply chain issues since the industry emerged from the coronavirus pandemic, there has been remarkably little action.

https://www.flightglobal.com/mro/cebu-pacific-engineering-head-sees-oems-making-no-progress-on-spares/155233.article

[Eurest]

Any MAX model, or even NG, may very well be on consideration

The hope, I believe, is to get diverted planes from others that may not need delivery yet.
Similar to how IX got diverted for China planes, for early delivery asap

Aircraft sourcing, even in Europe, is extremely difficult atm

[JNC03]

Used 737NGs🤔🤔

[Evodesire]

No wonder why airlines are putting huge orders lately. The early bird gets the worm principle maybe. They aside also from expansion, airlines are now after better redundancy, especially after this PW issue crippled A321neo and A320neo operators.

[Eurest]

Would not rule NG out as interim stop gap, similar to the PR ex-IB A343 prior to A350

The clear MAX availability is only from 2030.
Not sure though if there will be more China deferred delivery
Political tension, C919 going online (see how US & EU electric cars are being shunned for Chinese domestics)
Might be financially better to go with a more sure buyer, who won't suddenly ground all your newly delivered aircraft. US will also lessen Chinese leverage politically with fewer MAX delivery liability.
Plus, Boeing gets more positive commercial reputation in the region if it nabs 5J
Imagine the badge of honor when 5J returns to profitability amidst the constant delivery & reliability of the MAX
Instead of Lion Air as the idea of MAX, its' renewed 5J & SQ headlining MAX in ASEAN