Beyond the hype

But there are some signs that the airline does not.

The most obvious is the very slow pace of delivery of four by March and four more in the second half of 2018.

Just a paltry eight on order with Qantas management saying it has to prove [to the markets] the business case of point to point flying.

The next batch of four from the 45 options and price rights will not be delivered till late 2019 according to Qantas executives.

But the Australian markets have already given it an enormous tick of approval.

When Qantas finally received approval in December from Perth Airport to based its Pert-London non-stop from its domestic terminal for a hub operation the airline’s share price was just $3.37.

On the news there was an uptick and the shares rose to $4.10 in April when Bank of America Merrill Lynch upgraded its recommendation from neutral to buy solely on the economics (fuel savings) of the 787.

This is the first time in recent history that a stock market analyst has changed a rating for an airline solely on the basis of a new aircraft.

Qantas shares shot up and peaked at $6.45 before settling back to $5.90 on a more modest outlook forecast from the airline.

The Merrill Lynch report said that “the Dreamliner could make a material impact to International, which we see as a structurally difficult market for QAN.”

“We think the aircraft range should help QAN compete with hub airlines, and turnaround loss making routes like Melb/London and LA/New York.”

Qantas is a conservative company which is important in aviation but is it being too conservative?

The 787 is not new and Qantas has the advantage of all the other operators experience and route developments.

Ticket sales on the Melbourne / Perth / London route are said to be “very strong” and there are so many routes begging for the Qantas 787 non-stop capability.

And most are not the ultra-long haul like Perth to London.

Adelaide-Los Angeles, Sydney–Seattle, Cairns–Los Angeles, Melbourne-San Francisco, Sydney to Chicago and the list goes on and on with Perth to Paris, Berlin and Rome all no brainers.

The 787 – and A350 – are a new breed of aircraft. Total game changers and the market is convinced of the business case.

Another sign that Qantas don’t quite get the 787’s potential is the size of the Premium Economy cabin which only has 28 seats.

This was based on the take-up on A380 but an ultra-long-range flight begs more PY seats as the value case becomes more compelling.

Air New Zealand is now deploying its 787s on Houston and it’s fitting 33 PY seats, although it has fewer business beds than on the QF 787.

But the pioneers of premium economy, British Airways and Virgin Atlantic, have the mix right in their 787-9s with 39 and 35 seats respectively.

PY is the future of air travel for legacy carriers because of huge number of baby boomers who want to continue travel in retirement – but not in economy.

While the population grows in height and width airlines are being forced to reduce the personal space for passengers to meet the price points set by and ever-increasing number of low cost airlines.

And the move by airlines like Scoot and Norwegian onto long-haul routes adds further pressure on traditional airline’s offerings.

Qantas chief executive Alan Joyce and his management team have done a superb job turning Qantas around and the 787 has arrived at the right time with the airline in great shape financially and importantly – culturally.

Staff are onboard, the markets are onboard and the 787’s credentials are top of class.

There never has been a more ideally suited aircraft – except the 777 – for Qantas.

If Qantas can’t convince the markets of its true potential then there is something very wrong.

And if Boeing was to build Qantas’s perfect aircraft from scratch they would have built the 787 or the 777-8.

So, is Qantas going to switch 787 options and price rights for the 777-8 and -9?

Either way these types of aircraft are its future and the sooner the better.