Qantas will further reduce turnaround times on domestic flights from July as part of efforts to improve fleet utilisation and lower unit costs.
A slide presentation accompanying Qantas’s investor day held on Tuesday showed the airline is reducing turn times – how long an aircraft spends on the ground between flights – for domestic Boeing 737-800 services to 35 minutes from 2015/16, from 40 minutes in the current financial year and 45 minutes in 2013/14.
The introduction of 35-minute turns would “drive further operational and schedule efficiencies”, lower cost per available seat kilometre and increase the return on invested capital, Qantas Domestic chief executive Andrew David told the financial community during Tuesday’s presentation.
Also, these initiatives would result in an $80 million benefit by the end of 2015/16.
“In effect, what we are implementing are low-cost carrier practices overlaid with full service end product,” David said.
“No small achievement, and only possible with the operational excellence that is embedded inside the business in our people, processes and systems.”
Qantas noted the utilisation of its 737 fleet, measured by block hours per aircraft per day, had increased five per cent in the second half of 2014/15, compared with the first half. Moreover, about 30 per cent of flights were turned around in 40 minutes in March 2015, according to the slide presentation.
The Australian carrier has trialled the using both the front and rear doors for boarding on flights operated with its 737-800 fleet at Gold Coast Airport (which has no aerobridges) and expanded the initiative to other mainline ports in recent times.
Virgin Australia, Tigerair Australia and Qantas’s low-cost unit Jetstar currently schedule 30-minute turns for most of their domestic flights and use dual-door boarding.
The investor day presentation also showed Qantas International had increased its fleet utilisation by 16 per cent since 2011/12 to 13.6 average hours per aircraft per day, which had allowed the airline to create additional flying opportunities.
Qantas’s Airbus A380 fleet, which serves Dubai, London, Los Angeles, Dallas/Fort Worth and Hong Kong (during peak periods) fly an average of 13.9 hours per aircraft per day, which was up 14 per cent from 2011/12.
Boeing 747-400s were also working a lot harder, with utilisation up 19 per cent over the past three years to 12.7 average hours per aircraft per day. Qantas plans to reduce its 747 fleet from 12 currently to nine.
Also, the Airbus A330-200/A330-300 fleet had also recorded a 15 per cent increase in utilisation to 15 average hours per aircraft per day, while the Boeing 737-800s were flying seven per cent longer at 12.6 average hours per aircraft per day.
“We are using our assets and flying our assets much harder than we ever did before,” Qantas International chief executive Gareth Evans said.
“That’s enabled us to change our network, generate more revenue with the same asset base, add new points to the map, add new services and additional services to new markets.”
Qantas is launching new Brisbane-Tokyo Narita services from August and has planned an increase in seasonal services to Vancouver, along with extra flights to destinations such as Honolulu, Hong Kong and Santiago, as well as to New Zealand, in peak times.
It had also retimed its Melbourne-Dubai-London service, which leaves Australia at night and departs from London Heathrow in the afternoon, reducing ground time in London and freeing up the A380 fleet to do more flying.
Evans said Qantas’s two daily services London from Melbourne and Sydney via Dubai were now being operated by five A380 aircraft, compared with six before the Melbourne service was retimed.
That schedule change, plus tweaks to Qantas’s Los Angeles service and maintenance schedule that freed up another aircraft, had enabled the airline to replace the three-class Boeing 747-400ERs flying between Sydney and Dallas/Fort Worth with the A380, which offers first class, extra seats and was able to fly non-stop in both directions. (The 747 made a technical stop in Brisbane on the way back to Sydney.)
“That’s a win-win on London and a win-win on Dallas and a hugely positive impact for the network as a whole,” Evans said.
“There’s multiple examples of that happening and we are right now leading edge in terms of the utilisation of our fleet because of some smart things we are doing leveraging our partners and leveraging the network that we have.”
However, the changes to Qantas’s London schedule had “placed some additional stress on our network and turn-around times” according a Fairfax Media report that quoted a memo to staff from Qantas’s manager of base operations at Sydney Captain Martin Gardiner.
“As a result of our performance, London airport has given Qantas an official warning; meaning that we could be fined £20,000 for each non-compliance of our slot time, or worse lose our slot,” Captain Gardiner said in the memo.
“We have been asked to advise Heathrow what our plans are to improve this performance. All areas of the business including flight operations are now monitoring the performance of these services very closely so that we can improve our performance and retain our landing slots in [London].”
Fairfax Media reported Qantas was the 75th out of 80 airlines that flew to London Heathrow in February.
Qantas chief executive Alan Joyce said the issue was being well-managed by the airline.
“We are not going to do this and have utilisation go through the roof and end up having customer satisfaction collapse on us,” Joyce said during the investor day.
“This is day-to-day management of slots.”
Evans said one factor that had impacted the Melbourne flights to London was air traffic control issues through Dubai Airport.
Qantas representatives had recently spoken to the slot coordinator at London Heathrow, Evans said, adding there were plans to “tweak” slots for the next scheduling season “so that we’ve got a little more time to get around the loop and get in on time in London”.
“It was never an issue of losing slots,” Evans said. “We remain incredibly focused on being as punctual as we possibly can be.”
Evans said the on-time performance of Qantas’s international operations had continued to “hold at high levels even though the utilisation has been increased”.