The wide-bodied choice

The apparent reason for the Australian airlines’ delay has been the impact of the troubled Australian economy on the airline industry here. Put simply, the bottom fell out of the domestic traffic early in the 1970s as inflation cut into the national fabric.

The first signs of recovery came in the first quarter of this year, when there was an industry-wide rise of 6.7 per cent in passengers and 5.2 per cent in cargo. Ansett Airlines recorded a plus of 6. 5 per cent and TAA 7. 1per cent. Even with this last-quarter rise, the year ended March 31, 1977, actually returned a drop of 1. 2 per cent in passengers and a rise of 2. 4 per cent in cargo. So the first half of that year was a very tough period indeed. (The quarter percentages are compared with the same quarter in the previous year, it should be noted.) This January/February/March 1977 rise was maintained in the quarter ended June 30. Airline executives were naturally jubilant and at last there was some hint from the Ansett area that even though it was early winter, men’s minds were blithely turning to thoughts of spring. For it has been the Ansett people who have all along argued that introducing the wide-bodied before the 1980s could be a national disaster for the airline industry.

The difference in opinion between Ansett and TAA on the wide-bodied question has been fascinating. Back in the early 1970s the TAA people were all set to get into the wide­ bodied area. This was before the recession in the industry. It is hard to realise now in 1977 that before the Whitlam Government came into power TAA executives were making public statements that they would soon get into the wide-bodied field. They were in fact very impressed by the Lockheed L-1011 TriStar when it toured Australia, arguing this was the big aeroplane they needed. We all thought they would get something.

The Ansett outlook was different. Right from the start, the Ansett people have argued they did not see the right growth rate for wide-bodieds to be justified. They were say­ing this in the pre-Whitlam era and when the bottom fell out of the industry as inflation and the Whitlam Government coincided (and the Minister for Civil Aviation, Mr Jones, made it plain he was not mad about airlines), the Ansett folk regarded the whole situation as proof of their genius.

TAA quickly backtracked on the bigger TriStar or DC-10 and there was a very strong movement in Franklin Street behind the European Airbus A-300B, which is smaller than the two American aircraft.

One of the great “ifs” in Australian civil aviation history is what would have happened to the industry if TAA had ordered the Airbus around 1973/4 and had introduced it into operation about 1975/6. The younger and brighter group of the TAA brass wanted it and still regret it. But by the 1970s the pioneering days of TAA were passed – remember when TAA pioneered the pressurised airliner here (the Convair 240) and brought out the first propjets (the Viscounts) in the 1950s? TAA no longer has the punch and spirit it has in its first two decades.

TAA could have had the original version of the A-300 in service here in the mid-1970s. This would have forced a reac­tion from Ansett, either to follow TAA with the A-300 or to go for one of the bigger types, or to stay with the Boeing 727 and risk what might have been extinction.

Ansett’s actual reaction was that by going wide-bodied too early it would be TAA which crashed – if the Govern­ment would allow its own operator to crash. Ansett argued that without a big and steady growth factor, too-early introduction of a wide-bodied would force TAA to reduce fre­quencies, which would in turn force passengers to fly the more frequent Ansett Boeing 727 services. Ansett needed a return to the12 per cent annual rise in passenger traffic which was the general trend in the 1960s, if not higher.

TAA argued that by introducing a new type of aeroplane the lagging market would be revived, because new aeroplanes had always brought new surges of business to the airlines in the past. At least that was the Young Turks’ thesis in TAA. The people who were decision-makers just did not believe it or were scared of what would happen if theory gave way to practice.

There is good reason for arguing that TAA missed its great chance. General opinion is that Ansett would not have followed TAA into a wide-bodied type and that TAA would have increased its percentage of the market. Politics being what they were in the mid-1970s, the Government would most likely have permitted the Government airline to operate bigger and better aircraft than the Private Enterprise airline, if Ansett had been given the chance and had refused it on logical grounds. There would have had to have been the usual parity of actual seating capacity between the two fleets, of course, but by the 1970s the politicians were coming around to the opinion that the rigidity of the Two-Airline Policy could be relaxed under circumstances such as this. If TAA showed more spunk than Ansett, then TAA should be allowed to risk its neck. There has always been a memory of the tragic Government refusal to allow TAA to buy the Caravelle and introduce it to domestic jet travel around 1960, or a year or two earlier.

Well, what does the wide-bodied offer that the smaller and older Boeing 727 Series 200s do not? The advantages are not simply connected with size, though size has to be a major factor in the equation.

The simple fact about the wide-bodied aeroplane is that if you have the traffic to fill them you will make far more profit than if you carried the same amount of traffic in the smaller types. The TriStar, the DC-10 and the Airbus are all cheaper to run on the seat-mile basis than the previous generation of smaller aircraft.

Any of the three types can be operated to break-even or better if the cargo-holds are filled and there is not a passenger on board! For the cargo capacity of any of them is as big as an all-cargo Electra.

In practice the wide-bodied needs 40 per cent to 50 per cent passenger load-factors, with some cargo, to be a profitable operation, when all direct and non-direct costs are taken into account.

One of the wide-bodied’s great advantages is that it is far less thirsty than its predecessors. European airlines operating the Airbus report it drinks 40 per cent less fuel on 500/1000 mile routes, compared with the previous aircraft used on the same routes. With fuel costs rising each year, this will be a growing advantage for the wide-bodied family of aeroplanes. Noise factors are also highly weighted in favour of the wide-bodied aircraft. In the 1980s that advantage will be more important than today, as airports are more congested and aviation enemies increase.

From the Australian standpoint, the wide-bodied must come in the early 1980s to get Sydney airport off the hook. This is a main factor in making the Ansett people think now in terms of having a wide-bodied in operation for the Christmas holiday period of 1980. (This really means introduction in 1981, but our airlines always try to introduce new aircraft before the end of the year to have them operating for the high-density Christmas-New Year period.)

Ansett thinking now runs on the lines that a 7 per cent growth factor from today through the rest of the 1970s would make the wide-bodied mandatory for 1981 because of the congestion at Sydney – and to a certain extent also at Brisbane. The stacking delays at Sydney are already worrying and they will get worse. In the peak periods each day a wide­ bodied carrying roughly twice the passengers that today’s DC-9s or Boeing 727 Series 200s lift will help ease the situa­tion. Both airlines take it for granted that no government will move to build a second Sydney airport or the second runway at Mascot before the 1980s, if then. The only method easing the situation is by the wide-bodied, which will cut down the growth in aircraft movements at peak periods.

The problem at Sydney is aircraft movements, not passenger handling facilities. It is a matter of helping the air traffic control system. As 40 per cent of all Australian domestic passengers fly between Sydney and Melbourne or v. v. , the advantages of the wide-bodied, with a carrying capacity of 240 to 300 passengers, must be obvious.

Ansett and TAA are now thinking in terms of orders for two wide-bodied aeroplanes each, for delivery around Oc­tober/November 1980 and introduction into service in time for the holiday rush. These would be operated mostly between Sydney and Melbourne but also to Brisbane, with Perth flights being made to provide the utilisation needed, and Adelaide soon to be served.

The Boeing 727 Series 200s would be retained into the 1990s as mainline aircraft together with the wide-bodied – though two more wide-bodied aircraft would be introduced within a few years. The DC-9s would be pushed down into the air route system to smaller airports.

A problem with the wide-bodied is that it cannot be used on many of our airports, even if there were enough traffic to justify it. Another problem is that in the 1980s the airlines will be operating three major types of aircraft instead of the pre­sent two. They are talking in terms of a DC-9 replacement in the later 1980s. (The current Series 100 Boeing 727 will dis­ appear within the next year or two and the Ansett cargo Elec­tra will follow in the early 1980s.) What will the passenger get out of the wide-bodied? He will not get a faster flight, for the speeds have not increased to any appreciable extent. He will have more company in flight, as the wide-bodieds will have eight or nine seats abreast. On short flights, such as Sydney, this does not matter, but he may feel the difference to Perth, for the toilets are more in use on longer journeys.

There will be less noise at airports: the airlines pray they will be allowed to fly into Sydney and Melbourne through the night. The curfews now make it impossible to provide those cheap night-flights the Europeans enjoy.

The wide-bodied’s advantages are largely for the airlines and for the airport authority, the Department of Transport. But they will have a spin-off for the passenger probably in that their better economics will help to keep down the steady rise in air fares. They will not reduce fares but they will cushion the otherwise higher rises.

Economies will be apparent to the passenger, who will see the same crew in the cockpit flying twice the number of passengers, though there will of course be more hostesses in the cabin.

All these savings add up to a more economic aeroplane, even though the capital cost is so high. And that, when you think about it, is the most important aspect of any change of equipment in any industry.