Airlines In The Philippines II

[Arianespace]

Just got words that 74 and 75 sale leaseback are supposedly meant for down payment of new planes pre-covid. Just like 77 and 76 for the 359s. Now that makes a lot of sense.

Another info worth the while is why the 359s got more seats. Short story is Airbus over-engineered the plane that it can fly farther than earlier thought. Maybe after taking into consideration its full belly weight and pax. mix, ex JFK. More efficient than earlier thought I think.

Could this be the reason for this sales pitch, pre-covid (2018)? So, I guess its no novel idea after all.

[Eurest]

Airbus tailored the A350 line for the ME3, thus the range considerations to be able to make 17hr flights. The first A350 w/c had to be redesigned was less capable.

The A350-1000 with a higher MTOW than 316T will be able to carry more payload than both B77W and B779.
The initial 308T A35K might, depending on the configuration. But is it worth selling the B77W, for add'l capex for A35k that perform  fairly similarly? A lot chose not to.
As for configuration, Toulouse seems to be strict with the A359. Medium to long-haul gets access to 2-2-2 J, long-haul&ULH gets 1-2-1 J
Look at the BR&CI A359, very close to the initial PR 295& 313 seat config. Fairly similar JFK range and routing but I think the Taiwanese ones are 276T. The IB 280T is at max pax and does also fly their longest route.

The B779 will carry less payload than both B77W and A35K but it will offer PR flexibility.
During peak season, max on pax (415+). During leaner days, allot your MTOW to cargo.
Boeing has way less leverage though, and may price more aggressively, especially to retain PR

The 319T A350-1000 though, what configuration could Airbus offer PR to make financial sense.
Can they offer 400 seats and 17-18 hrs? But their production line is pretty full.
Will they price as aggressively seeing as demand is strong?

Thus, why I feel the fiscally responsible option is to lease later production B77W to replace the B77W
Cheap to lease by 2026. No crew retraining. Lessors will have birds that will not need heavy checks. Reliability assured, with many, many, many spares from any part of the world.
CapEx to refresh cabin product would not be as substantial.

B77W will have a fairly low resale value by end 2020 considering their sheer number about to be retired from the ME3, SQ, NH and CX alone.
So PR will need billions of pesos to get the newer planes, straining the balance sheets once more, exposed to the inevitable airline industry cyclical downtrend

The safest strat to adopt IMO, is the US3 post 2008. They kept long-haul birds like the B744 until 2017, for DL 10 years after emerging from bankruptcy until they got new A359 flagships.
744's with no seatback IFE until 2015 and very sparse catering, but they priced aggressively. Focused on volume markets

PR is in a perilous situation.
Who knows,
ASEAN may finally see the mergers that occured in Europe & the US after 9/11...
5J may finally get US mainland...
CX may move to the PH...
There might even be a new carrier...
They need to do things drastically differently from before.
Gotta be smart & dynamic. Or have Berkshire Hathaway to invest, Mr. Buffett likes to invest as the cycle is fairly predictable for him.

The 787ER though...

[Arianespace]

The difference between the 35K and 77w is 25% less fuel for the same payload to LAX according to Airbus. No matter the cost of oil, that is still 25% less. I'm not sure if the price difference between 35K and 77w is negated in long years to subscribe to use the old model. Notwithstanding its low acquisition cost. Because it will still have to pay for fuel.

Airbus said 2 years is what it takes to quantify the difference in pricing. After that, the 25% is yours. That 25% is money in your pocket. I suspect the difference could be had in 3-5 years. But still, closed enough to let PR decide to consider it buying. Consider because they did not buy it yet.

If these assumptions were wrong then CX could have their figures wrong as well. Yet, they took them so real world figures must be pretty close. Or even better, considering the additional PR seats. It literally takes more weight on the plane for the same result, which I think is money in the bank.

I have no idea about the weight option Airbus offered in 2018. For all we know PR might not need the 319t (v6) variant of the 35K after all. PAL did not took the the 280t version of the 359. Instead they settled for the 275t because that fits their need to JFK. And yet discovered newer benefits still.

But of course the pricing difference was made in 2018. Facts could change as you said, maybe this year all the way to 2026. Airbus could also offset the price difference of the 77w with newly discovered advantages, like PAL recently did.

PAL is known to retire fleet that is very old. B744 operated for 26 years. C11 or not. So it is not a US3 thing at all. And they have history of that all the way to DC-8, their first jet.

Sometimes, I fail to grasp why PAL doesn't use their own plane at all, ie 77w,320/21s,D8s. The rationale still evades me up to now. Sta. Maria had good idea dropping all the leases in C11, but brighter ideas came along the way. So I thought there must be a better strategy. Just doesn't figure out yet. Could be the reason why I'm still armchair CEO.

Anyway, CX does have dreams about PH. Long way before the fabled takeover of PAL in 1998. Its dreams goes back further in 1986. Perhaps acutely aware of the HK takeover. But CX in 1998 is a different CX now. Ask Air China. By the way, PAL is also full Chinese, almost.

[Arianespace]

In addendum to 77w vs. 35k

Do you remember the time when PAL could take the A346 instead of the 77w, if not for the 744 deposits?

Apparently, the reason for that is the 346 could carry 10 tons more payload. The catch, 8-9% more fuel. Virgin Atlantic did a good computation of that in 2004. To make it brief, the 346 can return home to MNL full, while the 77w can't. In fact, it still can't with the PIPs.

In irony of fate, the 77w caused the misery of the 346 because of that fuel efficiency difference. Now the 346 replacement more than double that efficiency.

[XWB_flyer]

Since the B744 served for 26 years I'm speculating the B77W will served for at less between 18 to 20 years with a replacement likely to be made in the middle of the decade 2024-2026 with delivery to be made before the end of the decade or 2030 either the A35K or B779

Gonna be intresting to see the sale prospect of the Boeing 777X in the coming years same with the A350-1000.

[seven13]

When you mentioned the highlighted part, does this factor in headwind? Full load belly and pax cabin non-stop ex-JFK? How come PR needed to block seats to make it nonstop JFKMNL? Or this was discovered just recently?

Arianespace wrote

Just got words that 74 and 75 sale leaseback are supposedly meant for down payment of new planes pre-covid. Just like 77 and 76 for the 359s. Now that makes a lot of sense.

Another info worth the while is why the 359s got more seats. Short story is Airbus over-engineered the plane that it can fly farther than earlier thought. Maybe after taking into consideration its full belly weight and pax. mix, ex JFK. More efficient than earlier thought I think.

Could this be the reason for this sales pitch, pre-covid (2018)? So, I guess its no novel idea after all.

[peterpiloto]

Arianespace wrote

In addendum to 77w vs. 35k

Do you remember the time when PAL could take the A346 instead of the 77w, if not for the 744 deposits?

Yep, Airbus offered PAL the A340-600HGW, like the ones operated by Etihad, and Qatar back in 2006.

[Arianespace]

seven13 wrote

When you mentioned the highlighted part, does this factor in headwind? Full load belly and pax cabin non-stop ex-JFK? How come PR needed to block seats to make it nonstop JFKMNL? Or this was discovered just recently?

I guess it does.

Airlines preconfigures their plane according to their payload and longest planned route, taking into account diversions, reserves, and of course headwinds.

Airbus typically sells their plane with the headwinds included in the calculations. See this offer to project sunrise
https://www.cnbc.com/2017/04/06/airbus-boeing-close-in-on-qantas-ultra-long-haul-dream.html

JJB said that they don't need the 280t because Airbus said 275t was enough for them. FACT.

Headwinds however is a relative term. While it does not affect ones flight, it does affect your time of arrival. And thus the calculations for fuel and payload. I would say, it could be a "reasonable" headwind.

So for this basic example( because I only have working idea), ex JFK, if the aircraft is configured to fly 18 hours for a 16 hours flight, and normal headwind, typically around 10-20 knots, would translate to additional 320nm or roughly equivalent to 30 minutes more, plus landing. JFK-MNL is normally 16 hours 50 minutes. So my calculations does not go that far. With a 45 minutes fuel reserves and another 45 for diversion, PAL has approx flying time of around 18 hours and 30 minutes.(Airlines tend to carry 10 percent extra fuel for the en route portion of long international flights). I would say, Airbus must have found less than strong headwinds in its flightpath.

For us mere mortals, we can always see this guide.

https://i.stack.imgur.com/8gIvA.png

I believe pretty strong headwinds is not counted as they are far beyond the ordinary. And so, It certainly is no secret why PAL fly JFK to MNL westward.

To make that a better fit to your question, lets make another route of similar nature. A good example to this Australia bound PAL 21N aircraft eg. 9938 which has 195 seats. While 9933-36 has 168 seats.

We could argue that both planes can reach MEL from MNL. But only one plane can reach it fully loaded, while the other one has to block seats. Certainly, its not gonna be 9938.

There are plenty of reasons why airline blocks seats. One reason is a no-show passenger. Another reason is purposes of balance. Third one is payload, which of course affects balance. Fourth one is flight crew ratio to pax exceeds regulation, plenty of that happening in the US. Fifth one, selling Y seat as W. Sixth one is routing changes or ATM: ATM/CNS restrictions, among other things. There are more other reasons which the airline only knows.

FYI, I was in JFK last year and we are fully packed, as in all seats, including business class, taken for trip to MNL. Certainly, no seats were blocked that time around.

[Arianespace]

And so the son-in-law is talking,

PAL is also set to return leased aircraft next year. The flag carrier will be strategizing this year what new aircraft to purchase or lease and what new destinations will be opened, the new executive shared.

"We are in the process of reviewing the strategy moving forward. We'll return some of our airplanes in 2024, so now is actually the right time to start looking what will be our medium to long term plan in terms of fleet," Ng said.

 ABS-CBN News

So I would assumed the JJB strategy needs revising, ie wide-body fleet, because the narrow body fleet is already there. I would assume too that the return planes doesn't refer to the narrows because they still have deferred 21N orders.

So What is the new strategy? Eurest had a headstart on this debate.

[XWB_flyer]

With narrow-body fleet already well planned could we see the remaining A350-900 sold of to LH and replace by new orders of Boeing B787-9 and B787-10? And how about the remaining B777-300ER 6 of the 10 still feature the old cabin will become harder to maintain as time gose on so will need to be refurbished eventually?

On an Airbus scenario will PAL order 2 new A350-900 to replace those returned to lessor? And could included the A330-900neo to replace the A330-300 and the B777-300ER be downsized by 2-4 with the remaining frame densified to 400+ seats?

And PAL divesting from Premium Economy Class I could see service actually improve with only two classes to foucs on and domestic becoming a single class service with business class available on select destinations?

I have so many scanario this are just some of the extreme example btw!

[JNC03]

Will PAL get discounted planes from Airbus same with Cebu Pacific did with their A330neos?

Airbus has some A330neos NTU from Garuda Indonesia, Aeroflot A350s (obviously they will just sell it to other airline due to sanctions) and Qatar A350-1000s which is canceled.

Boeing has some to offer including 787s

Or they can find good deals from the lessors since many airlines returned their planes

[XWB_flyer]

PAL will be soon launching door-to-door cargo delivery soon!

I wonder if this is a sign that eventually PAL will operate dedicated freighters? Like the Airbus A321P2F which maybe too large as a start aircraft but will meet future demand!

https://www.google.com/amp/s/business.inquirer.net/346443/pals-door-to-door-cargo-delivery-coming-in-next-2-months/amp

[seven13]

I forgot to think about the other factors that might affect why seats were blocked when I flew JFKMNL Dec 2019. Thanks for the insights!

On another note, I'm guessing UAL is still blocking the PAL+AAL codeshare deal. I really wish this ends soon and common ground/deal could be found so that PAL can have access to other USA cities via AAL

[peterpiloto]

RP-C7781 left as PAL5001 bound for Honolulu. Wonder where’s it going?

[Arianespace]

Marana airport  (MZJ) for long term storage.

[peterpiloto]

I see. Thank you, Arianespace! Not being returned to Voyager?
How many A330s will remain?

[frequentflier]

It’s sad that they’re returning one of the newest 777.

[Arianespace]

Actually Arizona is better storage place than Clark. It is still Voyager though.

[Arianespace]

[XWB_flyer]

 32 years ago Philippine Airlines flight 143 was a scheduled domestic flight between Manila (MNL) to Cagayan de oro (CGY)
https://www.instagram.com/p/Cdac7vcvIEu/?igshid=YmMyMTA2M2Y=