Sponsor Message:
Civil Aviation Forum
My Starred Topics | Profile | New Topic | Forum Index | Help | Search 
Low Cost Long Haul Airline Using A380  
User currently offlineBAfan From United Kingdom, joined May 2008, 189 posts, RR: 0
Posted (5 years 5 months 1 week 19 hours ago) and read 15961 times:

Hi Everyone,

I apologise if this has been discussed in a previous post but would very much like to hear peoples views.

I am an aviation student, and my friends and I have recently been discussing whether or not the Long Haul Low Cost model could work by using the A380 in a maximum or near maximum capacity configuration.

We are aware that the logistics in terms of airports that can currently cater for the aircraft might present a problem, but surely from the economic sense it could work?

Is there any chance that Michael O'Leary will attempt this with the proposed RyanAtlantic?

My friends and I are looking forward to hearing peoples views, especially as so many members actually work in the aviation industry.

45 replies: All unread, showing first 25:
 
User currently offlineKaitak From Ireland, joined Aug 1999, 12482 posts, RR: 34
Reply 1, posted (5 years 5 months 1 week 18 hours ago) and read 15910 times:

Far too big for FR, I'd say - if it ever gets around to flying long haul (lots of talk, very little action apparent).

I'm not convinced that this will happen; I can see something along the lines EK is proposing - i.e. a high density config of about 650, with a premium layout, but I just cannot seat 850 seats in an all-Y layout.

Maybe in a few years, when secondhand A380s are available at a relatively low acquisition cost (much like 330s are now), it could be a paying proposition, but really, I don't see any finance company being impressed with the idea of configuring a $300m airliner with Y Class seats only.


User currently offlineBMI727 From United States of America, joined Feb 2009, 15749 posts, RR: 27
Reply 2, posted (5 years 5 months 1 week 18 hours ago) and read 15898 times:

Well, an airline can lower their CASM by flying a larger plane. The caveat though, is that the plane must be filled. Naturally, filling an A380 is difficult on many routes, even before taking into account the frequencies. There is always a balance that must be struck between keeping costs low and providing the necessary frequency on a given route. Frequency is less important to leisure travelers, and more important to business travelers. Right now, the pendulum has swung far over to the frequency side, with RJs being misused on many routes.

In short it might theoretically work, but only on a very very limited scale. I doubt that we will see this in the near future.



Why do Aerospace Engineering students have to turn things in on time?
User currently offlineTheginge From United Kingdom, joined Oct 2006, 1132 posts, RR: 0
Reply 3, posted (5 years 5 months 1 week 18 hours ago) and read 15853 times:

The low cost long haul model is a difficult one that some have tried, and indeed failed. Doesn't mean it won;t work though. Although the choice of the A380 would mean the airline would have to fill it all the time, something that I don't think is feasible in the current climate.

Quoting BAfan (Thread starter):
Is there any chance that Michael O'Leary will attempt this with the proposed RyanAtlantic?

Not with an A380, think that would be too big for a low cost airline across the Atantic.


User currently offlineStitch From United States of America, joined Jul 2005, 31062 posts, RR: 87
Reply 4, posted (5 years 5 months 1 week 18 hours ago) and read 15864 times:
Support Airliners.net - become a First Class Member!

Any city pair that can support an 800-seat A380 likely already will have a number of 450-500 seat A380s on it already. Also, many LCCs make their money through aircraft utilization and long-haul services do not allow for this. You also cannot directly scale stage-length with fare. Yes, a fare for a trip across 5000nm is more expensive then one across 500nm in general, but usually not ten times as much.

So FR adding a 200-seat 739ER and flying it four times a day around the EU would likely generate far more money then adding an 800-seat A388 and flying it once a day to Asia.


User currently offlineNycbjr From United States of America, joined Aug 2007, 447 posts, RR: 0
Reply 5, posted (5 years 5 months 1 week 18 hours ago) and read 15844 times:

Wasn't there an order announcement for some low cost all Y airline about 2-3 months ago?

User currently offlineSlz396 From , joined Dec 1969, posts, RR:
Reply 6, posted (5 years 5 months 1 week 18 hours ago) and read 15767 times:



Quoting Nycbjr (Reply 5):
Wasn't there an order announcement for some low cost all Y airline about 2-3 months ago?

Yep, Air Austral.

http://www.airbus.com/en/presscentre...ems/09_01_15_air_austral_a380.html

The A380 will be a good low cost plane on the intra-asian routes in 10 years time...


User currently offlineBeeweel15 From United States of America, joined Nov 2003, 1758 posts, RR: 0
Reply 7, posted (5 years 5 months 1 week 18 hours ago) and read 15696 times:



Quoting Slz396 (Reply 6):

The A380 will be a good low cost plane on the intra-asian routes in 10 years time...

Would be good in Japan where they use the B747D in high density between city pairs there.


User currently offlineLipeGIG From Brazil, joined May 2005, 11440 posts, RR: 58
Reply 8, posted (5 years 5 months 1 week 17 hours ago) and read 15509 times:
AIRLINERS.NET CREW
FORUM MODERATOR



Quoting BMI727 (Reply 2):
Well, an airline can lower their CASM by flying a larger plane. The caveat though, is that the plane must be filled. Naturally, filling an A380 is difficult on many routes

The problem is how to be profitable in a so competitive environment. If we imagine city pairs like LHR-JFK, we also have to imagine the reaction by VS, BA, AA, DL and CO.
The A380 can offer a very low CASM, that's true, but a lot of "smaller" planes can offer flexibility. So, i believe 3x B772 daily service with different schedule works better than 1x A380.

In the end, in my view, the A380 need to be used by an airline with the condition to react to competitors (i.e. downgrade the route), otherwise, will be in severe problems.



New York + Rio de Janeiro = One of the best combinations !
User currently offlineStitch From United States of America, joined Jul 2005, 31062 posts, RR: 87
Reply 9, posted (5 years 5 months 1 week 17 hours ago) and read 15475 times:
Support Airliners.net - become a First Class Member!



Quoting Beeweel15 (Reply 7):
Would be good in Japan where they use the B747D in high density between city pairs there.

Actually, NH and JL have phased out (or are in the final stages of phasing out) the 744D. It's not as efficient as using twins and new regulations at many Japanese domestic airports prevent quads from operating (though that is likely due to noise which the A380 might be able to bypass).


User currently offlineViscount724 From Switzerland, joined Oct 2006, 25473 posts, RR: 22
Reply 10, posted (5 years 5 months 1 week 17 hours ago) and read 15365 times:

I don't think the order is final yet but French carrier Air Austral, signed a memorandum of understanding earlier this year for two A380s in a high-density 800+ seat configuration for service between Paris and French territorities, mainly the island of Reunion (RUN) in the Indian Ocean. It was covered in this thread:
http://www.airliners.net/aviation-fo...eneral_aviation/read.main/4282913/

Related FlightGlobal item:
http://www.flightglobal.com/articles...to-acquire-two-800-seat-a380s.html

RUN-based Air Austral recently took delivery of their first of two 777-300ERs.


View Large View Medium
Click here for bigger photo!

Photo © Royal S King



They also operate 3 777-200ERs. Both types have 3-class configurations (business, premium economy, economy) with 10-abreast seating in economy. 14/34/316 (total 364) on the 772ER and 18/40/384 (total 442) on the 773ER. They recently started twice-weekly 772ER service CDG-RUN-SYD-NOU It's the first direct service France-Australia since QF suspended CDG service a few years ago.
http://www.air-austral.com/accueil.php?lang=en


User currently offlineNEMA From United Kingdom, joined Feb 2006, 717 posts, RR: 0
Reply 11, posted (5 years 5 months 1 week 17 hours ago) and read 15358 times:



Quoting BAfan (Thread starter):
Is there any chance that Michael O'Leary will attempt this with the proposed RyanAtlantic?

I think they would make excellent revenue even with free flights on the A380 if they keep to their normal rip off business strategy...

I would picture just two cabin crew on board..keeps wage costs down...and then possibly one of the flight crew has to come into the cabin to help for a spell. Then theyd have the usual 1000% + mark up on food prices, maybe inaugurate the £1 fee for the use of their toilets and just think of the baggage revenue, a real sting (sorry profit) with a full A380.



There isnt really a dark side to the moon, as a matter of fact its all dark!
User currently offlineAADC10 From United States of America, joined Nov 2004, 2092 posts, RR: 0
Reply 12, posted (5 years 5 months 1 week 16 hours ago) and read 15156 times:

A large part of operating an airline is servicing debt, just as it was for railroads before WWII. If you look at many airlines earnings announcements from last year, they will point out that they had an operation profit but took gigantic losses. The losses were on fuel hedges and servicing of debt. Actually flying the planes turned a profit. If capital expenses were financed by the Tooth Fairy (as Warren Buffet called EBITDA earnings) loss making carriers would turn a profit. However, somebody has to buy or lease the planes.

It would be difficult to have discount flights on expensive hard to obtain aircraft. If someone wanted to attempt a low frequency, high capacity discount airline, there are plenty of used 744s available and the difference in cost would compensate for the additional fuel burn for years.


User currently offlineIkramerica From United States of America, joined May 2005, 21534 posts, RR: 59
Reply 13, posted (5 years 5 months 1 week 15 hours ago) and read 15011 times:



Quoting BAfan (Thread starter):
I apologise if this has been discussed in a previous post but would very much like to hear peoples views.

It has, but people's views change.

The question about the A380 is if you can put in 3-5-3 seating on the main deck. If you can, then it may make sense in such a role. Because that would still allow for a large "business" 2-3-2 cradle seat style cabin upstairs, and even a Y+ section upstairs too, and hold 600+ pax.



Of all the things to worry about... the Wookie has no pants.
User currently offlineAirNZ From , joined Dec 1969, posts, RR:
Reply 14, posted (5 years 5 months 1 week 14 hours ago) and read 14940 times:



Quoting BMI727 (Reply 2):
Right now, the pendulum has swung far over to the frequency side, with RJs being misused on many routes.

But you're only talking about the US with that, and which is certainly no definitive model for world aviation.

Quoting NEMA (Reply 11):
I would picture just two cabin crew on board..keeps wage costs down...and then possibly one of the flight crew has to come into the cabin to help for a spell. Then theyd have the usual 1000% + mark up on food prices, maybe inaugurate the £1 fee for the use of their toilets and just think of the baggage revenue, a real sting (sorry profit) with a full A380.

Could be indeed......and guaranteed that many will be queuing up for it while fashionably pretending their displeasure.


User currently offlineCloudy From , joined Dec 1969, posts, RR:
Reply 15, posted (5 years 5 months 1 week 14 hours ago) and read 14937 times:

Emirates has expressed an interest in this kind of service, using the A380-900 - if it is ever built.

User currently offlineManfredj From United States of America, joined Mar 2007, 1132 posts, RR: 0
Reply 16, posted (5 years 5 months 1 week 13 hours ago) and read 14446 times:

I keep thinking Oasis when I read this thread. It has been tried but I think has failed more times than saw success. There might be a key difference, however. I true and tried airline that already has a name for itself like Ryanair may be able to pull it off.

Ryanair, however, is a little known name in the US. Would that keep people from booking their flights across the Atlantic on them in favor of a better known mark? Risky I think.

Quoting AirNZ (Reply 14):

But you're only talking about the US with that, and which is certainly no definitive model for world aviation.

I'm not sure what you mean by this, but certainly you must be referring to the use of RJ's and not the Aviation industry in general.



757: The last of the best
User currently offlineAlangirvan From New Zealand, joined Nov 2000, 2106 posts, RR: 1
Reply 17, posted (5 years 5 months 1 week 13 hours ago) and read 14240 times:

LCC has only been a term since 1995. Virgin Atlantic was a Long haul LCC in 1984 when it started with one 747 - the biggest plane of the day. Not exclusively LCC, because they have always had their Upper Class seating ( SRB wanted to start by calling the Economy section Riff Raff). So, you never know what someone might do with a second hand A380 in 10 years time.

Emirates did have an idea of operating Emirates Lite, which might have flown out of Stansted, with a stop in Colombo, to Adelaide. Adelaide is not a current EK port. The idea was that it would cater for backpackers. In recent years rumours went around that Qantas might make some A380s available to Jetstar, and Jetstar might have been interested in operating those to Stansted, though it looks as though that will not happen while Alan Joyce is on the watch at Qantas.

Just about all the A380s in the world will operate between London and Sydney, with stops in various cities, whether they are SIN, DXB, KUL, BKK.


User currently offlineKL911 From Czech Republic, joined Jul 2003, 5147 posts, RR: 15
Reply 18, posted (5 years 5 months 1 week 12 hours ago) and read 14011 times:



Quoting LipeGIG (Reply 8):
The problem is how to be profitable in a so competitive environment. If we imagine city pairs like LHR-JFK, we also have to imagine the reaction by VS, BA, AA, DL and CO.
The A380 can offer a very low CASM, that's true, but a lot of "smaller" planes can offer flexibility. So, i believe 3x B772 daily service with different schedule works better than 1x A380.

But if FR would do it and offer oneway fares of 30 euro to a secondary New York area airport it would be possible. It would be a total new market, people who cant afford to fly now. And don't forget that FR gets only 33 percent of it income from tickets. The rest is all commission on insurance, car rental, hotel, gambling etc etc etc..


User currently offlineDocLightning From United States of America, joined Nov 2005, 19807 posts, RR: 59
Reply 19, posted (5 years 5 months 1 week 12 hours ago) and read 14011 times:



Quoting BMI727 (Reply 2):

In short it might theoretically work, but only on a very very limited scale. I doubt that we will see this in the near future.

The thing is that part of being a LCC is simplicity. That's why LCC's tend to operate a single type (and yes, there are exceptions, like B6). So you would need to be able to fly an A380 on just about every route in order for this to really work. You couldn't have a mixed fleet of some A380's and some 77W's and some A330's because then the increased complexity (spares, placement, crew/mech certs, etc.) becomes costly.

So what routes can sustain an A380? Well, that's where the problem starts. The more A380's you throw at a route, the less A380's that route needs. If it can sustain 12 daily A380's and 11 of them are already spoken-for... Of course there's the art of figuring out what that number is and if you can change it...

So how many A380's can you fly with that airline? The more planes you have, the cheaper it is to have them per plane. In other words, it costs less per A/C to own 30 of a plane than one of it.

Oh... and then you have another problem: you have to get all 800 pax. to the A380 at about the same time. That's no small feat, since I guarantee you that very few routes have that many O&D pax. per day. And passengers, even fare-conscious ones, might not be willing to take a fare cut in exchange for a 15-hour layover. So are you going to partner with a domestic LCC? Schedule your flights in sync with them? Oooh, my head hurts.

And the other issue is this: for flights of that length, do you really think that you can get your fares so low that you can compete with another carrier that gives you miles and the potential for an upgrade and all those goodies?

And finally, the A380 is just a bear to operate for extrinsic reasons, the failure of the U.S. to properly maintain its infrastructure notwithstanding. Is there a single customs facility in the world that can efficiently and quickly handle 800 people all showing up at once on top of a few 77W's and the odd 744/8i and A350-1000 arriving in a steady pitter-patter? Your airport facilities both shared and private, have to be up to handling mobs of that many people showing up all at once. That requires an enormous initial capital investment.

A380's can be flown profitably if the proper investment is made, if the routes are well thought-out, and if they aren't flown in a high-density configuration. The world simply isn't ready for routine flights of that many people at once.


User currently offlineAUSisAwesome From United States of America, joined Jan 2009, 94 posts, RR: 0
Reply 20, posted (5 years 5 months 1 week 11 hours ago) and read 13463 times:

This may sound crazy, but how about possibly Air Asia X, perhaps from Kuala Lumper, to Perth. With a possible LARGE passenger velocity in the future the large aircraft could be good for LCC on those flights, especially since most airports are now equipped to handle such a large aircraft.

User currently offlineSlcdeltarumd11 From United States of America, joined Jan 2004, 3480 posts, RR: 0
Reply 21, posted (5 years 5 months 1 week 9 hours ago) and read 12199 times:

How about an airline that offered LAX-JFK or JFK-LHR on an A380 all coach once a day with the lowest possible prices. I think people on a high O&D market would jump on board.

Maybe all seats on LAX-JFK are 69 each way for all seats only coach. No increases all seats are sold at the same price. Luggage is extra of course. No fare classes or frequent flyer program. Going strictly for non business travellers. An A380 at high density configuration could probably make money on this?


User currently offlineLufthansa From Christmas Island, joined May 1999, 3217 posts, RR: 10
Reply 22, posted (5 years 5 months 1 week 7 hours ago) and read 11512 times:



Quoting Slcdeltarumd11 (Reply 21):
No increases all seats are sold at the same price. Luggage is extra of course. No fare classes or frequent flyer program. Going strictly for non business travellers. An A380 at high density configuration could probably make money on this?

Didn't you ever read the history of peoplexpress?

The whole idea of "all seats at the same price... though sounding some what more fair and equitable, is EXACTLY what lead American to develop the first sophisticated computer based yeild management systems so they could undercut those prices on seats that would have otherwise remained empty. That there in itself was a major major major blow the the LCC model and probably the beginning of the end for People expresss...and many others like it. Why put up will all the crap when American was cheaper? (price motivated ppl only...same target customer)

This didn't really change until a few things happened. First the internet led more customers to have a direct relationship with the airline itself and others...just as Ryanair also adopted the principles of yield management. Thats why the offer stupid fares like $5. They know provided it has to be booked a billion years in advance, it wont eat into the traffic that would have paid more anyway. So they get both lots of passengers. the LCC model took it a step further by selling them everything...where as for american at the time (not now but at the time) they still had to incurr higher marginal costs for services consumed. Ryanair sells them anything they can possible shove down their face and makes a few extra bucks on top of it.

Moving to 'one price fits all' would completely Kill that model and what it would effectively mean is the others would undercut the carrier and kill off its revenue base at the cheaper end... whilest the carrier didn't get the more expensive revenue at the last minute either. Bad Bad move strategically.

Those sorts of flights can really only work in markets where they're all going to beach resorts etc. and you dont have a mixture of different customer types on the route. For example...the British Based charter carriers flights to beach resorts in Spain or Central America. What effectively has to happen is as there is no sort of premium pax, the average fare has to be closer to the average cost of production at least until they get close to their break even point. After that they can discount a bit more but it means generally a higher load to break even. Holliday ppl generally won't pay double to go at the last minute...they just go a week or two later on the same trip.


User currently offlineAirIndia From United Arab Emirates, joined Jan 2001, 1642 posts, RR: 1
Reply 23, posted (5 years 5 months 1 week 6 hours ago) and read 11194 times:

Capt Gopinath, founder of Air Deccan (now Kingfisher Red) had expressed years ago, he woul be interested in packing 800 pax on a one-class 380 and ferry them DEL-BLR or DEL-BOM....... not exactly long haul but certainly at that time had enuff traffic on the route to support the idea...

User currently offlineLeftWing From Singapore, joined Mar 2006, 284 posts, RR: 0
Reply 24, posted (5 years 5 months 1 week 6 hours ago) and read 10985 times:

SQ should try it with SIN - CGK (Jakarta)

[Edited 2009-04-28 22:58:01]

25 NCB : It is possible. Let's imagine that we must setup such an airline. I would preferably wait or push for the A380-900 with XWB engines and technology. Th
26 Panais : Excellent point. There is definitely a time slot when everybody wants to fly to a certain destination and I really do not think that price will play
27 DfwRevolution : The long-haul LCC is generally a poor business model. It has been tried numerous times with the 747s over the years and the majority failed or morphe
28 Pe@rson : Ummm... it LEGALLY has to have 1 crew member per 50 seats. Why do they stick to their "rip off business strategy"? Because mugs will pay £900 for a
29 AAMDanny : Hey I'm doing BA Hon's in Airline + Airport Management. I'm sure a while ago we was toying with the idea of a LON-NYC route (E.g. STN - to somewhere n
30 Naritaflyer : They are using 777s with 500+ seats, so the impact is the same. I think the A380 long haul would work in a low fare environment. It is a big plane bu
31 Luzezito : I tend to think that the real business of LLC like Easyjet and Ryanair lies in their capability of buying one type of aircraft in the hundreds for a b
32 FiestaFlight : Didn't Freddie Laker do this with DC-10s for awhile in the seventies? He had cool ads for cheap fares across the pond, but can't remember how successf
33 PlymSpotter : I think the problem with Oasis was the loads up front in their Business cabin. It was huge; the upper deck and a third of the main deck was taken up
34 Theginge : All very well in theory, but then the current airlines on that route would be able to drop their prices on that route for a time, and the new LCC wou
35 413x3 : an economy cabin full of people looking to spend the least amount of money possible? airlines make their money off business and first class travelers
36 LipeGIG : No doubt, but considering cost of transportation (commute) both ways, will be not so different from the US$ 120 each leg currently charged. And if yo
37 Naritaflyer : That's a great myth. Let me see the most profitable airlines, Southwest, Ryanair, EasyJet, Air Transat, Air Asia, and countless others are very profi
38 Stitch : It is because they earn more per average from each Economy class customer due to a higher average fare. Since most of them do not allow their fare in
39 DfwRevolution : That is 100% wrong. Southwest in particular relies heavily on business travelers (more than 50% of their passengers) and offers a fare called Busines
40 NCB : That may be the case with Southwest in the U.S. but it's definitely not the case of the LCC's in Europe. They just rely on acillary revenues.They are
41 413x3 : Ryanair only make money because of advertisement deals, paying for every amenity on board, etc. Southwest also rely on business travelers. No airline
42 Naritaflyer : I am hearing two million reasons why Ryanair makes money none of which I care for. Bottom line is they are making money without having Business Class
43 Viscount724 : Laker's "Skytrain" service LGW-JFK was successful when it first started (after a very long delay waiting for government approvals), but quickly becam
44 DfwRevolution : Well you should start caring because the reasons why Ryanair and Southwest are successful would not necessarily apply to a long-haul carrier. And doi
45 AirbusA6 : A Ryanatlantic at least would have the advantage of deep pockets, indeed deeper than the legacy carriers at the moment, so it would be difficult to dr
Top Of Page
Forum Index

This topic is archived and can not be replied to any more.

Printer friendly format

Similar topics:More similar topics...
Low Cost Long Haul posted Tue Jan 31 2006 19:49:54 by Peterinlisbon
QF 743s For Low Cost Long Haul? posted Sat Nov 12 2005 06:51:31 by Simpilicity
Low Cost Bosses To Form Budget Long Haul Airline? posted Mon Jan 1 2007 12:24:46 by Airpearl
Low(er) Cost,long Haul, How Did They Survive? posted Sat Jun 7 2008 19:05:01 by B-HOP
Will We See Another Long Haul Airline In HKG? posted Thu Jan 1 2009 19:41:48 by United Airline
Auctioning Of Long Haul Airline Seats? posted Sat Jun 7 2008 02:21:49 by REALDEAL
Germany And A Second Long-Haul Airline? posted Fri Aug 19 2005 21:34:33 by Avianca
Air New Zealand Voted Best Long Haul Airline posted Fri Sep 17 2004 12:58:46 by 777ER
Low-fare, Long Distance, Airline posted Sun Sep 7 2003 13:37:15 by SK A340
Which Long-Haul Airline? posted Tue Dec 19 2000 16:11:49 by QantasA330