Qantas expects to take delivery of the first of 99 Airbus A320neo (new engine option) aircraft the airline group has on order from the end of calendar 2017.
The guidance for A320neo arrivals was outlined at Qantas’s 2015/16 first half financial results on Tuesday. Airbus delivered the first A320neo to Lufthansa in early January.
The aircraft are ostensibly destined for Jetstar as older A320s are paid off and to cover growth, although the company has not ruled out operating the aircraft on Qantas mainline domestic services to replace its Boeing 737-800 fleet.
Qantas chief financial officer Tino La Spina said the Qantas Group fleet plan offered “ultimate flexibility”, with new arrivals able to replace existing aircraft or to support growth.
“We’ve got 99 of those aircraft coming, and we’re due to take those from the end of calendar year 2017,” La Spina told reporters during Qantas’s results presentation.
“With respect to the 737 fleet in Qantas, the candidate aircraft really for that sort of fleet are the 737 MAX, which Boeing have launched, or the A320neo, basically the two narrow-body alternatives.
“At this stage we haven’t made a decision on those. That analysis still goes on, and we’ll make a decision on those when we need to, but we don’t need to make that decision yet.”
Qantas mainline has no outstanding orders for narrowbody aircraft, with the last new 737 – VH-XZP, Retro Roo I – delivered in November 2014.
Instead, Qantas has boosted frequencies and opened new routes through increased fleet utilisation across both its international and domestic operation, as well as switching capacity out of states impacted by the slowdown in mining activity such as Western Australia and Queensland and into areas of growth.
To that end, Qantas said it would add three more Fokker 100s to operate on intra-WA routes, replacing some 737-800s that will be deployed on international routes such as increased frequencies on the Perth-Singapore and Brisbane-Christchurch routes.
The domestic operation has also rolled out dual boarding and reduced turnaround times to get more flying out of the fleet. Further, Qantas’s Australian-registered 737s are currently undergoing a reconfiguration program, with six new seats to be added to the economy cabin to improve the operating economics of the aircraft.
In a slide presentation accompanying the financial results, Qantas said its fleet utilisation in the first half of 2015/16 was up five per cent compared with the first half of 2014/15, while its international fleet utilisation was eight per cent higher from two years ago.
On the international front, Qantas said it planned to maintain its Boeing 747-400/400ER fleet at 11 aircraft for the period ahead to take advantage of the growing demand for international air travel and lower fuel prices.
The two 747-400s previously earmarked for retirement will instead continue to take to the skies in Qantas colours and also receive a cabin update and heavy maintenance check.
Chief executive Alan Joyce said the decision to keep the 747s longer reflected the strong performance of Qantas’s international operations, and the economics of flying the four-engined aircraft during a time of low fuel prices and a weaker Australian dollar fuelling demand for inbound tourism.
“The reason why it’s working is the transformation that’s gone through international getting its cost base right, the Aussie dollar where it is, and the fuel price helping has made a lot of these routes very profitable for us,” Joyce said.
“So when we looked at the potential of keeping a couple of the 747s longer, to take advantage of that opportunity became a no-brainer for us.
“We have so much opportunity ahead of us in the growth potential of international, and with the performance of the business these extra 747s give us the ability to flex capacity up or down dependent on the circumstances. It’s a very efficient form of us keeping capacity within the fleet.”
The first of eight Boeing 787-9s are due to arrive in the Qantas fleet in the 2017/18 financial year and the airline has said previously those aircraft would be to replace five 747-400s due to be withdrawn from the fleet prior to requiring a heavy maintenance check and for growth.
Qantas has 15 remaining options, which have firm delivery dates and a fixed price, and 30 remaining purchase rights, which have a fixed price but no firm delivery date, for the 787 family that have to be exercised between now and 2024/25.
The planned arrival of the 787-9 from late 2017 has also prompted Qantas to hire 170 new pilots over the next three years.
For the second half of 2015/16, Qantas said it would add two Boeing 717-200s to the fleet, while three Q300 turboprops would be transferred from QantasLink to Jetstar’s regional operations in New Zealand.