LX138 From United Kingdom, joined Jul 2009, 374 posts, RR: 0 Reply 2, posted (3 years 3 months 3 weeks 5 days 10 hours ago) and read 6909 times:
How to you mean? They are taking deliveries of new aircraft AND they do have significant orders on the longhaul side - A380's, 787's, A320's and have just taken a load of E-jets! They put back the A380's to defer capital spending during the recession. That's all.
GDB From United Kingdom, joined May 2001, 12952 posts, RR: 79 Reply 3, posted (3 years 3 months 3 weeks 5 days 8 hours ago) and read 6687 times:
Well the 787 is delayed due to circumstances outside of BA's control - the same for everyone else.
I suspect the A380 slippage was due to financial issues.
But - we have the 777-300ER's coming apart from the RJ's.
Bongodog1964 From United Kingdom, joined Oct 2006, 3329 posts, RR: 3 Reply 6, posted (3 years 3 months 3 weeks 5 days 6 hours ago) and read 6354 times:
BA took advantage of delays to both the A380 and B787 programmes, delaying their deliveries in order to preserve cash during the recession. Of course it was unlikely that they would ever have received them on time anyway, unless other operators delayed their orders quite significantly.
BA have of course completely replaced the LCY fleet in the past 12 months, 10 E jets & 2 A318's, plus new A320's at LHR and the 773's just commencing delivery. They've probably brought in enough aircraft to either keep the fleet age constant.
B777LRF From Luxembourg, joined Nov 2008, 1143 posts, RR: 3 Reply 7, posted (3 years 3 months 3 weeks 5 days 5 hours ago) and read 6259 times:
I suppose the only really big decision BA has in the medium-term is on a replacement of their 772 fleet - either additional 787 orders or an order for the A350. Top-up A380 orders will probably announced over the coming years as the 747 fleet is being wound down, and there will most likely also be orders for more 77Ws down the line, but apart from that don't really see what else would be in need of replacement within the next 2-4 years.
From receips and radials over straight pipes to big fans - been there, done that, got the hearing defects to prove
vv701 From United Kingdom, joined Aug 2005, 7053 posts, RR: 17 Reply 11, posted (3 years 3 months 3 weeks 4 days 12 hours ago) and read 5581 times:
There are a number of policies that an airline can adopt in terms of fleet replacement.
At one extreme is a policy like that adopted by FR which requires a quick fleet turnover. The advantages appear to be that it maximises both the second hand sale price, maximises the fuel efficiency of the fleet and minimises third party maintenance and repainting costs.
Towards the other extreme is a policy like that adopted by BA which requires a slow fleet turnover. Here one of the advantages is that it minimises fleet depreciation or leasing costs.
Short haul aircraft (like BA's recently retired A320 100s) serve for around 20 years.
Long haul aircraft (like BA's retired B747 100 and 200 fleet) serve for up to 25 and sometimes more years.
It also helps maximises the use of internal maintenance and repainting facilities like those operated by BA at CWL, GLA, LHR and LGW. This helps reduce unit engineering costs while providing BA with a maintenance service whose activities it can prioritise on a day-to-day basis to meet its changing needs.
If aircraft are on lease BA have often extend the original leases, thus reducing leasing costs. As an exampke this is what they did with the fleet of 733s and 735s that they operated out of LGW until recently.
Indeed BA are planning to further exploit their policy by selling their maintenance, engineering and repainting services to other airlines. In the past they have limited themselves to maintaining their own aircraft and only using their paint shop to repaint their own aircraft and paint aircraft in other airlines' liveries prior to returning them to their lessors. Willie Walsh was discussing some of the advantages of the BA/IB merger at the BA Investors' Day Meeting in May. He said that BA planned to learn from IB all the benefits of selling such services externally, an activity IB was already heavilly involved in.
In terms of delaying orders, the one order BA has delayed is that for the 380. The first delivery was postponed to the first quarter in BA's 2013-14 financial year - i.e. in the April to June period of 2013. Originally 6 380s were to be delivered in 2012-13 and six in 2013-14. Now 4 will be delivered in 2013-14, 3 in both 2014-15 and 2015-16 and 2 in 2016-17.
I am guessing that the postponement in 380 deliveries is intimately entwined with the parking of 8 BA 744s following the reduction in traffic during the worldwide credit crunch. And it is probably not unrelated to the unexpected order for 6 77Ws, the first of which will enter service in the next couple of weeks and will provide for passenger growth and (most importantly) freight growth. One of the 8 744s (perhaps 2) will be stood up and returned to service before the end of this year. The remaining 6 can be returned to service at virtually any time to flexibly meet actual demand as world economies improve. Some would argue that BA is in a fortunate position in not having to take a gamble on how quickly passenger and freight growth will return following the credit crunch because it will be able to meet any reasonable return to growth with low capital cost equipment.
Returning to freight growth for a moment, the announcement that was only made a few weeks ago that BA World Cargo will be wet leasing three 748Fs from Atlas Air / Global Supply Systems from early next year (to replace the 744Fs) illustrates the fleet flexibility that BA is aiming for during the hoped for worldwide economic recovery.
Of course history will probably show that some other airlines will have matched their new aircraft plans correctly to future actual as opposed to forecast growth. But few will have the flexibility illustrated in the long haul BA plan to meet different possible traffic growth rates.
LX138 From United Kingdom, joined Jul 2009, 374 posts, RR: 0 Reply 13, posted (3 years 3 months 3 weeks 4 days 8 hours ago) and read 5269 times:
Quoting Scotron11 (Reply 8): Yup...good old UK! But something surely isn't right....they're sitting on a huge cash pile. How come other airlines like SQ, LH, EK to name just a few, are making money and BA are not?
They are based in different regions of the globe. Asia-Pacific has been much less hit than the rest of the world and growth has returned very quickly, helping airlines like SQ and EK which are well positioned to take advantage. Both EK and SQ have far lower cost bases.
Europe is hugely competitive in the airline arena and has been the slowest region to bounce back.
LHRFlyer From United Kingdom, joined Apr 2010, 774 posts, RR: 1 Reply 14, posted (3 years 3 months 3 weeks 4 days 8 hours ago) and read 5237 times:
The 777s that have/are coming online were intended to be for growth, which in light of capacity cuts and storage of aircraft isn't being pursued. Deferring deliveries is sensible for both cash flow and managing capacity.
I think BA deserves credit for managing to continue to invest in the business during the downturn (New First, Club World London City) whilst cutting approriately in other areas instead of just battening down the hatches entirely. It's a delicate balance which is hard to get exactly right but they seem to be roughly doing the right thing.
vv701 From United Kingdom, joined Aug 2005, 7053 posts, RR: 17 Reply 15, posted (3 years 3 months 3 weeks 4 days 7 hours ago) and read 5148 times:
Quoting LHRFlyer (Reply 14): The 777s that have/are coming online were intended to be for growth, which in light of capacity cuts and storage of aircraft isn't being pursued.
The four 772s delivered last year were certainly originally intended for capacity expansion when they were ordered before the start of the worldwide credit crunch. And the (temporary?) retirement of 8 BA 744s resulted in a net reduction of 4 long haul aircraft. However the 6 77Ws ordered since the start of the economic downturn primarily because of the delay in deliveries of the 787 actually results in a net increase of 2 aircraft. With the stand-up of one and almost certainly 2 of the parked 744s this coming winter adds a further 2 aircraft to the fleet as there have been no aircraft cancellations, only 380 postponements.
By postponing the delivery of their 380s BA leave themselves in the fortunate and flexible position of being able to quickly add up to 6 more of their old 744s to their active fleet if the recovery is sharp. But if it is slow they can leave all 6 in the desert. Either way they will avoid carrying the full capital cost of their new 380s during the recovery period. (If the recovery is not completed by the time of the first BA 380 delivery a lot of airlines will already be publishing some very red numbers.)
Scotron11 From United Kingdom, joined Feb 2004, 1178 posts, RR: 3 Reply 17, posted (3 years 3 months 3 weeks 4 days 6 hours ago) and read 5076 times:
Quoting vv701 (Reply 15): By postponing the delivery of their 380s BA leave themselves in the fortunate and flexible position of being able to quickly add up to 6 more of their old 744s to their active fleet if the recovery is sharp. But if it is slow they can leave all 6 in the desert. Either way they will avoid carrying the full capital cost of their new 380s during the recovery period. (If the recovery is not completed by the time of the first BA 380 delivery a lot of airlines will already be publishing some very red numbers.)
Well we all hope the recovery is ongoing and prolonged. Asides from that, how long will they then intend flying thier 744s? The oldest must be well over 20yrs old already, and by 2017 almost 30yrs old.
vv701 From United Kingdom, joined Aug 2005, 7053 posts, RR: 17 Reply 18, posted (3 years 3 months 3 weeks 4 days 2 hours ago) and read 4909 times:
Quoting Scotron11 (Reply 17): how long will they then intend flying thier 744s? The oldest must be well over 20yrs old already
BA'S fleet of 57 744s were delivered over a period of almost ten years starting in June 1989 with G-BNLA. The last delivery in April 1999 (G-BYGG) was one of four delivered to them by Boeing in that year.
The BA Annual Report shows that they depreciate their long haul aircraft to a residual (scrap?) value over a period of 25 years. Of course this does not preclude them selling an aircraft before the end of those 25 years. Then they would hope to get a price for such a machine equal to or above its then current book value.
Looking forward what happened to their 741/742 fleet is not irrelevant. For example G-AWNA was delivered to BOAC in April 1970. BA sold it to AAR Aircraft Leasing in February 1998 but leased it back. They continued to operate it until November that year when it was returned to the lessor and scrapped at Bruntingthorpe. Note that when it was retired it was 28 years and seven months old.
While history may not repeat itself it is certainly a guide to what is possible. And this means it is at least feasible that BA will still be operating a small fleet of 744s post 2025.