Dreamtime?

With 50 Boeing 787 Dreamliners as options or purchase rights, together with an entire industry’s worth of quietly leaked intentions, Qantas seems set to select the 787-9 as its next generation aircraft.

Qantas needs to firm up its order this year if it wants deliveries to startin 2017, when some of its existing A330s will be 15 years old and its oldest 747 will be 18.

The 787’s benefits notably include cross-Group standardisation

Extolling the benefits of nextgeneration twinjets like the 787 is easy, with Qantas quoting a 20 per cent fuel efficiency gain, 20 per cent reduction in carbon emissions, 40 per cent drop in nitrous oxide emissions and 50 per cent cut in the airport noise footprint.

Yet with the drop in fuel prices, the 20 per cent fuel efficiency gain translates less directly to operating costs. Most airlines are now quoting somewhere between 10 and 20 per cent gains in the near term, depending on the efficiency of the older aircraft being replaced. Those

A successful result will tick another box on the to-do list that ends with “Buy Dreamliners”.

airlines who chose late-model Airbus A330 or Boeing 767 aircraft – as a general strategy, as an interim lift option, or as part of a deal with Boeing to make up for Dreamliner delays – are looking smart right now.

Of course, for the Qantas Group, efficiency is about more than just how much it costs to operate an aircraft. It’s also about finding commonalities across its operating units, which it has done with the retirement of its Boeing 767 fleet, retirement of older 747-400 aircraft, and consolidation of subfleets.

Qantas Group subsidiary Jetstar will finish converting its long-haul flying entirely to its eleven-strong 787-8 fleet by mid-September, on routes including Tokyo,Singapore, Honolulu, Denpasar, Phuket, Bangkok and Osaka. It will complete the “hand-me-up” process where its existing fleet of Airbus A330‑200 aircraft is passed back into Qantas service at that point.

Qantas’s long-haul fleet : candidate for replacement?

The last arrivals with Jetstar will give Qantas two dozen Airbus A330-200 and -300 aircraft of varying ages – the oldest, VH-EBA, is an ex-Jetstar -200 that was MSN 508 and initially delivered to Qantas in 2002, while the newest, VH-EBV, is also a -200 (MSN 1365) and was delivered directly to Qantas in 2012. These twinjets range up to 7,250nm for the A330-200, with the larger -300 maxing out at 6,100nm.

Their replacement is not an immediate concern, although as they approach heavy maintenancechecks, and when the decade ticks over into the 2020s, the oldest are likely to be swapped out for Dreamliners. Qantas has made much in recent media and investor presentations of the decreasing age of its fleet and the resulting efficiencies it has realised from newer aircraft with reduced maintenance requirements.

Meanwhile, the soon to be nine-strong Boeing 747-400 fleet will by 2017 comprise the six -400ER models delivered in 2002 and 2003 and the three youngest RB211-powered -400 models delivered in 1999 and 2000. The range of these ‘Longreach’ jumbos is a key part of their fit in the Qantas fleet, with the standard -400 aircraft reaching 7,250nm and the -400ER fleet ranging to 7,700nm.

Twelve Airbus A380 superjumbos are between four and eight years old

Offering premium economy is a smart passenger experience move.

right now, and seem likely to remain in the fleet for some years yet.

The Dreamliner’s range and lift make it ideal for Qantas

The 787-9’s 8,300nm reach makes it a real option to replace the entire 747 fleet in particular, without any operational constraints on the existing network. While the Dreamliner is significantly smaller, capacity can be boosted by adding frequency – or by codeshare operations.

The smaller aircraft is also a prime choice for expansion if Qantas decides not to replace the 747 fleet as a priority. Most of the US west of New York and Washington is within range of Sydney, and anywhere west of the Mississippi is within range of Melbourne. Crucially, that includes the increasingly popular American Airlines hub at Dallas/Fort Worth. Most passengers seem pleased with how the SYD-DFW Airbus A380 operation is running, and the extensive selection of onward connections to the US east coast from Dallas is a real boon. Adding Melbourne passengers to that mix would seem to be a no-brainer.

Yet in replacing both the A330 and the 747-400 (and the 747‑400ER), Qantas faces a passenger experience dilemma. These two aircraft are outfitted quite differently – not least in that the A330 lacks a premium economy cabin. And what makes sense in terms of cabin and seats on a 16-plus hour flight from Melbourne to Dallas might make different sense on a short redeye into Asia.

Other operators face a similar issue with their 787s

The Dreamliner is, of course, already in operation into Australia by overseas carriers including Air New Zealand, China Southern, Royal Brunei, Qatar Airways, Etihad, Thai Airways, Scoot, United and LAN. Japan Airlines seems to continually be mullingAustralian operations with its Dreamliners, and ANA is reported to be returning to Australia later this year with the 787-9, with the Dreamliner’s long-and-thin economics particularly attractive given ANA’s lack of local partners in Australia for connecting feed.

Etihad is the only airline servicing Australia to offer first class in its Dreamliners. Business class varies markedly on the 787s flying to Australia, with most operating a fully flat bed in a 2-2-2 configuration, although notable exceptions are the direct aisle access forwards-backwards stagger in an effective 1-2-1 layout on Etihad and the updated inward-facing herringbone product in a 1-1-1 configuration from Air New Zealand.

Interestingly, only Scoot and Jetstar operate a premium economy‑style cabin, with each of the LCCs offering a fairly standard recliner seat in the Dreamliner’s usual 2-3-2 layout – but as their top cabin on board.

Down the back, all 787 operators, apart from Japan Airlines, do or will operate the nine-abreast, 17in seat, narrow aisle configuration. Despite passenger experience complaints, the economics of adding 12. 5 per cent more economy seats in the same aircraft make a strong financial argument for this seating.

It’s unlikely that Qantas will offer a first class cabin on its Dreamliners, which makes the choice of which kind of business, premium economy and economy seats – and how much of each – an important one and a sign of how the airline sees itself and its markets.

Business class is likely to remain the new Qantas suite

Qantas’s business offering on the 787-9 is likely to be the new A330-outfitted Business Suite, a Marc Newson-designed implementation of the Thompson Vantage XL staggeredseat, which is also used by Aer Lingus and SAS. The stagger comes from the feet of each passenger sliding forwards into an enclosed foot cubby under the side-table of the passenger in front.

Each passenger has direct aisle access, which is increasingly the standard for full service airlines that want their brand to be associated with positive passenger experience. Direct aisle access is required to avoid the “midnight clamber” where a window or middle seat passenger must vault like a gazelle (or lumber like a hippo) over the person sleeping in the aisle seat in order to stretch their legs, visit the lavatory or grab a drink.

Newson’s extensively customised version of the larger evolution of the popular Vantage seats is impressive, although the seats are not at the forefront of business class space and comfort globally. The issue is that half the seats in the cabin are winners and half are losers, with the seats separated from the aisle by the side-table having a lot more privacy, a lot less disturbance from passing passengers and slightly more legroom.

It’s certainly possible that Qantas and Newson (despite his commitments to the Apple Watch) could be working on a herringbone implementation, but it would be a remarkable climbdown from a very heavily marketed seat by an airline that has had serious issues with business class consistency in the past.

Passengers who experienced the early 2010s’ transcontinental lottery between the 2-3-2 premium economy‑style seats, 2-2 Boeing 737 recliners, angled lie-flat Mark I Skybeds, and the frequent flyer upgrades to fully flat first class on a three class 747 sold as business class will remember that inconsistency well. A third long-haul business class offering to match the existing Skybeds andnew Business Suites would seem unwise.

If, as expected, Qantas does plump for the Thompson Vantage XL product, it will be the first time that the Northern Ireland company’s seats have been installed on a Dreamliner, which will naturally require certification and testing to be carried out.

We can likely expect the seats to be pitched at the international standard – the pitch is greater on the mostly international A330-300 than on the mostly domestic A330-200 – but the real question is about layout.

The Dreamliner’s cabin is 21cm wider than the A330’s (5. 49m vs 5. 28m), and Thompson advertises several options for seating density on the 787: eight, nine or ten seats per staggered pair of rows.

Eight would be the same as the A330, nine would add a seat to every other row on one of the window sides, and ten would add a seat to every row on alternating window sides. The impact would be narrower seats and even more of a disparity between the good seats and bad seats in the cabin.

A selection of the eight seats per two rows option would show Qantas still views itself as able to command a premium in the market, and is dedicated to ensuring its business class has direct aisle access for every passenger. A selection of nine or ten rows would signal the opposite.

Premium economy seems more likely than not

Regardless of whether the Dreamliners are intended to supplement or replace the existing intercontinental fleet, premium economy seems to be a no-brainer for Qantas.

For a start, premium economy is good business sense. Airbus analysis suggests that most operators can charge twice as muchfor premium economy as economy.

Qantas also seems sold on the concept, despite not installing it on the Airbus A330 fleet. In the 2012 reconfiguration of its Airbus A380 aircraft, premium economy gained three seats, increasing from 32 to 35 passengers. The 2011 refurb of the Boeing 747-400 aircraft, however, shrank premium economy to 36 from 40 seats.

But crucially, offering a premium economy cabin is a smart passenger experience move for airlines that select a nine-abreast economy configuration – among the narrowest in the skies. If an airline can point to a seven-abreast Dreamliner premium economy cabin as an option for passengers who want or need more space, it goes a small way towards mollifying critics.

Eight or nine abreast economy is the make or break decision

The Qantas Group would be breaking ground with a two-brand Dreamliner order. No other 787 operator has both premium full-service and low-cost carrier arms using the Dreamliner.

While pitch is almost a given at the longtime Qantas standard of 31in, the question for Qantas is how it configures each row in the economy class cabin on its red-tailed aircraft: eight-abreast like Japan Airlines’ international layout (and like ANA initially outfitted its long-haul Dreamliners), or nine-abreast like every other operator.

Let’s be clear: nine-abreast seating on the Dreamliner in a 3-3-3 layout is one of the least comfortable ways to fly, with a centimetre less space per passengerthan even the previous bête noire, a ten-abreast Boeing 777.

To achieve a 3-3-3 layout, seats, armrests and aisles all shrink. The exact numbers depend on the balance of armrest, seat pan and aisle width selected by an individual airline, but the bottom line is a seat width of 17in or below, slimmed-down armrests and aisles so narrow that passengers in aisle seats are jostled every time someone goes past. And the density means overhead bin space is at a premium, even with the big pivot bins in the Dreamliner.

It’s a big decision to make, especially for an airline group that needs to differentiate its products. One of the issues with bothQantas and Jetstar flying A330s internationally was that the seat product was practically identical: 31in eight-abreast seats in a 2-4-2 layout. Competitor AirAsia X went nine-abreast with a 16. 5in wide seat, which certainly made for some interesting cost comparisons, but meant that the two Qantas Group airlines were too similar.

The thing is, if Qantas wants to differentiate itself from Jetstar with product, it really has to go eight-abreast on the Dreamliner. But it’s not just Jetstar – it’s also the low cost-base competition of Chinese airlines, which also offer a nine-abreast Dreamliner.

The only way that Qantas can really justify a nine-abreast Dreamliner is if it dedicates the aircraft to only markets where the average femur length and shoulder width is smaller.

The split between the cabins is also important

With a significant stretch to the 787-8’s zone 1 area between doors 1 and 2, the 787-9 provides a number of cabin layout options for Qantas. Just how big is that stretch? Air Canada fits nine rows of B/E Aerospace Super Diamond outward-facing herringbone seats into its 787-9 compared with just five in its 787-8.

Qantas’s decision on the proportion of business, premium economy and economy will reflect its perception of its future international market segmentation – at least on the routes these aircraft are intended to operate. Examples from 787-9 operators in a similar market position to Qantas, with premium economy offerings, shed some light on the dynamics of this decision.

Air Canada has a business-heavy, premium economy-light 787-9 with 30 business seats throughout all of zone 1, plus 21 seats in premium economy behind doors 2.

ANA is business-heavy, premium-economy-light in the 787-9 where more than half the aircraft is taken up by premium seating: 48 outward-facing herringbone business class seats that stretch halfway through the middle section of the jet, plus 30 in premium economy. Just 26 seats make up zone 1, with a pair of lavatories and a galley.

Air New Zealand, meanwhile, has opted for a business-light configuration of just 18 inward-facing herringbone business seats set 1-1-1 ahead of 21 premium economy seats, both in zone 1.

Virgin Atlantic uses the same business seat (an updated version of its 2003 Upper Class Suite) and the same layout but chose to install 31 of them in zone 1 ahead of 35 premium economy seats at the front of zone 2 – heavy in both business and premium economy.

In terms of airlines without a premium economy cabin, United offers 48 B/E Diamond fully flat beds in a 2-2-2 layout, split between 30 ahead of doors 2 and 18 behind. The remainder of zone 2 is taken up by its Economy Plus extra-legroom economy seats in a 3-3-3 configuration.

KLM’s 787-9 will have 26 outward-facing herringbone seats in zone 1, while its Economy Comfort extra-legroom nine-abreast economy seats are located at the front of zone 2.

Qantas’s outfit is likely business-heavy

For the 787-9, Thompson shows an example LOPA (Layout Of Passenger Accommodation) with a 1-2-1 effective layout, eight seats per two rows. That works out, the seatmaker states, at a 79in bed length from a 45in pitch thanks to the stagger effect. (The 11in of pitch not counted in the bed length are taken up by the gangway enabling passengers seated across a side table from the aisle to pass through. )Thompson’s LOPA fits 27 passengers in zone 1, although the seatmaker is also displaying one solo seat (often nicknamed the ‘throne’ or ‘Captain Kirk’ seat) with side tables on both sides, at the very front of the centre section, where the narrowing fuselage perhaps restricts width. However, it would seem relatively simple to move the centre section of seats rearwards by a matter of inches in order to enable an extra seat to take the count to 28 passengers. That’s just two fewer than United’s notably inferior product, and an impressive use of space.

Thompson’s LOPA doesn’t appear to take into account the stairs required to access pilot rest space in the crown of the aircraft. If Qantas intends to operate its Dreamliners on ultra long‑haul flights, it would be surprising if it didn’t order the rest area included.

Still, somewhere in the range of 26-30 business class seats in zone 1 would seem to be the right balance for Qantas – especially compared with the 58 Skybed Mark II seats on the 747 fleet and 28 Business Suites on the A330-300.

Behind business class, if Qantas selects premium economy it will need to take seats in multiples of seven given the 2-3-2 configuration. Given other airlines’ decisions, the size of the aircraft, the ultra long-haul missions and the size of existing cabins, 21 or 28 seats would seem to be the most likely selection here. A 28-seat cabin or larger would suggest Qantas sees premium economy as a significant growth area, particularly compared with Virgin Australia (which is to cut its premium economy cabins on the Boeing 777‑300ER from 40 to 24 seats – see Cabin Pressure, elsewhere this issue).

A wildcard option for Qantas would be an extra-legroom economyoffering, which Virgin Australia has been mooting and which is offered by a number of airlines, including Qantas’s transpacific joint venture partner American. Given American’s plans to operate the LAX-Sydney route with a Boeing 777-300ER starting this December, product alignment here could be of benefit.

Signs and portents suggest white smoke may rise from Mascot

It seems increasingly likely that Qantas will take up its 787‑9 Dreamliner options, but the timing will depend on a number of factors.

The first is what happens to fuel prices. With Qantas International now downsized to a late-model Boeing 747‑400 and -400ER fleet, together with existing Qantas A330-200 and -300 aircraft boosted by Jetstar’s hand‑me‑up castoffs, the operational cost urgency of refleeting is less pressing.

The second is the approval of the in-principle pilot agreement, notably including a change to the structure of ultra long-haul flying, which was reached in late May but as yet has not been ratified by the Australian and International Pilots Association – when that happens, Qantas’s intentions will be even clearer.

The third is the performance of Qantas and its international arm in its full year results, which ended June 30 and are expected to be announced on August 20. A successful result will tick another box on the to-do list that ends with “Buy Dreamliners”.

“We and everybody in Qantas want to see those aircraft coming in but the aircraft have to make the right returns, have to be brought in under the right conditions and have to be brought in when the balance sheet of Qantas is strong enoughto take it,” said Alan Joyce earlier this year.

Those aircraft – and when they arrive, and how they are configured – will reflect the vision of Joyce and his management team for the future of Qantas.