Issue 331: QF787

Sydney-New York (JFK) is seen as something of a holy grail for the airline, with Qantas chief executive describing it as “the pinnacle of what we’d want out of aircraft range”. However, there is yet to be an aircraft capable of

We are the airline that loves range. ALAN JOYCE

making the 8,646nm journey with a commercially viable payload.

“We’d love to have the capability of being able to get there someday because there is a demand for it,” Joyce told journalists after a Royal Aeronautical Society Australian Division lunch in Sydney on September 9.

“It is going to be the 777-8X or an aircraft with that technology and range, that potentially could do New York – Sydney in both directions. ” While Boeing lists the 787-9 as capable of carrying 290 passengers in a two-class configuration 7,635nm, Qantas plans to fit just 250 seats in its Dreamliners across business, premium economy and economy.

Should the 787-9, even with fewer seats, not have the legs to make Sydney-New York nonstop, Boeing’s 777-8X could prove to be the solution to Qantas’s holy grail. The manufacturer lists the -8 variant as having a 8,700nm range with 350-375 passengers.

Indeed, a map showing the “new opportunities for destinations around the globe” that accompanied the 787 order showed New York just beyond the range of the aircraft from Australia’s east coast.

Joyce says discussions with aircraft manufacturers are always centred around Qantas’s “critical mission”. And traditionally, for the Flying Kangaroo’s international network, that meant long-haul flights primarily across the Pacific.

“We are the airline that loves range so we are also thinking about where could this technology go, could you do New York-Sydney and if you could do New York-Sydney – and that is a big market for us, we don’t like stopping off in LA – if you could do that, that would be fantastic,” Joyce said.

“So we are probably unique in that, because not many airlines need to have the range of New York-Sydney. But we would love to have that. ” Currently, Qantas serves New York John F Kennedy Airport via Los Angeles with a daily Boeing 747-400 service.

Although Qantas first ordered the Dreamliner in December 2005, delays to the 787 program allowed the airline to not just restructure its confirmed deliveries, options and purchase rights for the next-generation aircraft, but also pit the Boeing against newer models such as the Airbus A350.

Joyce says in every case the 787-9 emerged as the perfect aircraft, given it has lower seat mile costs than the 777‑300ER and, being a smaller aircraft than the big Boeing twin, represented less risk.

“You are always continually reviewing this and making sure it is the right decision,” Joyce tells Australian Aviation in an interview.

Here for the long haul

Qantas announced the 787 order on the same day it reported a return to profitability, a decision Joyce says shows the airline has been revitalised and is “here for the long haul”.

“This milestone acquisition marks the scale of our turnaround and looks ahead to a new era for our iconic international airline,” Joyce says.

“This is unbelievably exciting for Qantas going forward and we are happy to be in the position to be able to afford the aircraft and get the business case to work. ” Joyce had set out three criteria for any potential Dreamliner order, namely Qantas International’s return to sustainable profitability, repaying $1 billion of debt and establishing appropriate staff conditions to ensure the business case for the new aircraft type stacked up.

In a slide presentation accompanying the full year results,Qantas says the 787-9’s ultra long range and lower unit costs presented the airline with “future opportunity for growth into markets presently unserved directly from Australia”.

Qantas’s 787-9 estimated 250 seats, compared with the the 350-360 seats on the airline’s 747-400 fleet (depending on configuration) gives it a “greater level of protection against potential market downturns”.

The 787-9 uses an estimated 20 per cent less fuel than the 747-400 and is 15 per cent cheaper to maintain, Qantas says, with the first heavy maintenance check due after 12 years in service.

On potential uses of the 787, Joyce says: “Routes that are long-range routes that we don’t fly today, routes that have low levels of traffic volumes that didn’t justify a 747 or routes where we have less than dailies where we would love to get to dailies or routes that we want to fly over a hub and go directly intoother destinations not having to fly through LA. ” “It’s got better range, can operate on routes the 747 can’t with full payload, it is a fantastic replacement aircraft with less risk associated with trying to fill up a smaller aircraft,” Joyce explains.

“Markets like Melbourne to Dallas open up as an opportunity for us because the aircraft has the potential range to do that in both directions. ” Joyce also raises the prospect of Qantas growing its European network from Perth, given the distance to London Heathrow from the West Australian capital is 7,829nm, telling Australian Aviation contributor Geoffrey Thomas such flights could be operated with specially configured 787‑9s with just first, business and premium economy cabins.

The Qantas chief executive also told the RAeS lunch it would open up routes into Asia “like India that we would love to get back to”.

Qantas’s order consists of five exercised options and the reallocation of three 787-8 orders for its low-cost carrier subsidiary Jetstar to 787-9s.

The company 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 of aircraft (any of the original -8, the stretched -9 and the double stretched -10) that can be exercised between now and 2024/25.

Qantas said it would allocate between $900 million and $1 billion towards capital expenditure in the current financial year, which would include prepayments for the 787-9 order.

Capital expenditure over the following three financial years – 2016/17, 2017/18 and 2018/19 – would total between $3. 6 billion and $4. 5 billion, representing between $1. 2 billion and $1. 5 billion per year.

Joyce says the rest of Qantas’s 747s and A330s will eventually be replaced, with the timing of the fleet renewal program dependent on the performance of the airline in the years ahead.

“We are in a very good position,” he says.