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Qantas Said To Cancel Order For One 787  
User currently offlineKarelXWB From Netherlands, joined Jul 2012, 11846 posts, RR: 33
Posted (1 year 8 months 2 weeks 2 days 13 hours ago) and read 13427 times:

Reported by Bloomberg:

Quote:
Qantas Airways Ltd. (QAN) canceled one of the 15 orders it has for Boeing Co.’s 787 aircraft, according to a person familiar with the matter.

The cancellation is the first since regulators in the U.S. and other nations grounded the Dreamliner after an emergency landing by one of the planes in Japan. Qantas’s decision to scrap the order for its Jetstar unit isn’t connected to the grounding and had been planned since late last year, the person said, declining to be identified as the information is private.

Planes from the remaining 14 firm orders are due to start arriving from July, the person said. Qantas, which canceled 35 787-9s for its main unit in August, retained the 50 purchase options it has for the Dreamliner.
http://www.bloomberg.com/news/2013-0...der-for-one-boeing-dreamliner.html

So why would an airline cancel just one frame?


Only two things are infinite, the universe and human stupidity. And I'm not sure about the universe.
48 replies: All unread, showing first 25:
 
User currently offlineStitch From United States of America, joined Jul 2005, 31059 posts, RR: 87
Reply 1, posted (1 year 8 months 2 weeks 2 days 13 hours ago) and read 13447 times:
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QF cancelled the bulk of their 787 orders to conserve cash-flow, so that might be it. Or they are going to hold onto a 767 or A330 longer and therefore don't need a 787 to replace it.

User currently offlineanstar From United Kingdom, joined Nov 2003, 5252 posts, RR: 6
Reply 2, posted (1 year 8 months 2 weeks 2 days 13 hours ago) and read 13385 times:

No idea why they just cancelled one.

Though they did originally have a huge 787 65 + 50 options If I am correct.

so they have now cancelled 51 and now only have the 14 + options on order.


User currently offlineClassicLover From Ireland, joined Mar 2004, 4636 posts, RR: 23
Reply 3, posted (1 year 8 months 2 weeks 2 days 13 hours ago) and read 13268 times:

It says in an article in The Australian - http://www.theaustralian.com.au/busi...wdown/story-e6frg95x-1226556154230

Part of the article says -

"QANTAS is hedging against slower growth in Jetstar's long-haul operations by cancelling a firm order for one of the low-cost carrier's Boeing 787 Dreamliners.

But it is boosting its domestic fleet with the addition of five 125-seat Boeing 717 aircraft and three 74-seat Bombardier Q400s, with deliveries slated to start in the second half of the year.

The new domestic aircraft will be used to pursue growth opportunities in short-haul markets such as Queensland and Western Australia.

The decision to cut the 787-8 order predates the problems being experienced by the Dreamliner, which was grounded by the US Federal Aviation Administration yesterday following two battery fires, and is understood to have been taken at the end of last year. Qantas and Boeing have been working since to finalise contractual details ahead of a formal announcement today."

I think that is pretty self explanatory.



I do quite enjoy a spot of flying - more so when it's not in Economy!
User currently offlineKC135TopBoom From United States of America, joined Jan 2005, 12150 posts, RR: 51
Reply 4, posted (1 year 8 months 2 weeks 2 days 12 hours ago) and read 13030 times:

Quoting anstar (Reply 2):
so they have now cancelled 51 and now only have the 14 + options on order.

No, QF canceled 36 total B-787s now, 35 B-787-9s and one B-787-8. They still hold options for 50 B-787s.

Where are they getting the 5 additionl B-717s? MX stored airplanes?


User currently offlineDaysleeper From UK - England, joined Dec 2009, 845 posts, RR: 1
Reply 5, posted (1 year 8 months 2 weeks 2 days 12 hours ago) and read 12900 times:

Are the remaining 787's on order going to be flown under the QF brand? or are they for Jet Star?

I also thought the main reason behind them cancelling the bulk of the order was because it was so late?


User currently offlineStitch From United States of America, joined Jul 2005, 31059 posts, RR: 87
Reply 6, posted (1 year 8 months 2 weeks 2 days 12 hours ago) and read 12859 times:
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Quoting Daysleeper (Reply 5):
Are the remaining 787's on order going to be flown under the QF brand? or are they for Jet Star?

The QF Group have changed their mind from time to time, but at the moment, they are slated for JetStar.



Quoting Daysleeper (Reply 5):
I also thought the main reason behind them cancelling the bulk of the order was because it was so late?

At the time they announced the cancellation, the QF Group stated it was to conserve cash.

If they had cancelled them for being late, they would have ordered a replacement (more 767s and/or A330s or finally adding the 777). Instead, they took a large number of 787 options so that when they were ready to add planes down the road, they were in a position to get them.


User currently offlineClassicLover From Ireland, joined Mar 2004, 4636 posts, RR: 23
Reply 7, posted (1 year 8 months 2 weeks 2 days 11 hours ago) and read 12694 times:

Quoting Stitch (Reply 6):
At the time they announced the cancellation, the QF Group stated it was to conserve cash.

They are getting their house in order - well, their international house anyway. They are working to get international profitable. Domestic already is and has been for years and years.

Quoting Stitch (Reply 6):
Instead, they took a large number of 787 options so that when they were ready to add planes down the road, they were in a position to get them.

Yes indeed. The articles in the Australian newspapers always point to the Qantas 787s coming in 2016. It's virtually a foregone conclusion that the options will be exercised and the aircraft brought into service. It's not as though they were penalised - the options and purchase rights were locked in at the original order price - so they're not losing anything there. Plus they received a hefty compensation package from Boeing in the region of $400m for the late deliveries.

Quoting Stitch (Reply 6):
The QF Group have changed their mind from time to time, but at the moment, they are slated for JetStar.

The 14 Boeing 787-8s are for Jetstar which will replace the 11 A330s they currently have.

Those 11 A330s will go to Qantas to presumably replace the domestic 767 fleet.

After that, one would assume the Qantas 787s will replace the international Boeing 767s first and then all of the A330-300s (which are all internationally configured).



I do quite enjoy a spot of flying - more so when it's not in Economy!
User currently offlinesweair From Sweden, joined Nov 2011, 1824 posts, RR: 0
Reply 8, posted (1 year 8 months 2 weeks 2 days 10 hours ago) and read 12476 times:

I think Qantas will cancel all 787s and go for the A350. They have the A380 so they can pool their pilots etc.

The 787 is EOLed before it really entered the market sadly.


User currently offlineKarelXWB From Netherlands, joined Jul 2012, 11846 posts, RR: 33
Reply 9, posted (1 year 8 months 2 weeks 2 days 10 hours ago) and read 12349 times:

Quoting ClassicLover (Reply 7):
then all of the A330-300s

Those A333s are pretty young, are they leased for a 10-year period or so?



Only two things are infinite, the universe and human stupidity. And I'm not sure about the universe.
User currently offlineClassicLover From Ireland, joined Mar 2004, 4636 posts, RR: 23
Reply 10, posted (1 year 8 months 2 weeks 2 days 10 hours ago) and read 12278 times:

Quoting sweair (Reply 8):
I think Qantas will cancel all 787s and go for the A350.

I doubt that very much. There is no way they're going to get the deal they got for the 787 on an A350 for a start.

Quoting KarelXWB (Reply 9):
Those A333s are pretty young, are they leased for a 10-year period or so?

2003-2004-2005, so they're around 10 years now. The 787 deliveries from 2016 will be spread out over several years, so eventually they will go if Qantas exercises all options. Not immediately of course, there are loads of Qantas 767s that are very very old that will go first.



I do quite enjoy a spot of flying - more so when it's not in Economy!
User currently offlinesmi0006 From Australia, joined Jan 2008, 1535 posts, RR: 0
Reply 11, posted (1 year 8 months 2 weeks 2 days 7 hours ago) and read 11746 times:

Quoting ClassicLover (Reply 7):
The 14 Boeing 787-8s are for Jetstar which will replace the 11 A330s they currently have.

Those 11 A330s will go to Qantas to presumably replace the domestic 767 fleet.

Are we sure the A332s will be going to domestic? I could see them being very useful to open up some smaller Asian markets in light of the QF reshuffle of SIN services. Services like MEL-NRT, MEL-PVG etc. They could replace the oldest 767s and then replace the rest when the 787s start arriving to QF.


User currently offlinesydscott From Australia, joined Oct 2003, 3094 posts, RR: 20
Reply 12, posted (1 year 8 months 2 weeks 2 days 6 hours ago) and read 11544 times:

Quoting smi0006 (Reply 11):
Are we sure the A332s will be going to domestic?

Yes.

Quoting smi0006 (Reply 11):
I could see them being very useful to open up some smaller Asian markets in light of the QF reshuffle of SIN services. Services like MEL-NRT, MEL-PVG etc. They could replace the oldest 767s and then replace the rest when the 787s start arriving to QF.

There is plenty of space International config A330 capacity flying domestically at the moment and QF have already tried, and failed at, MEL-NRT and MEL-PVG. So I wouldn't be looking for them to return. Don't forget the 'reshuffle" of SIN services probably just means re-timing flights, or in PER's case cancelling one, so they arrive earlier into SIN for better connections.


User currently offlineEK413 From Australia, joined Nov 2003, 4929 posts, RR: 4
Reply 13, posted (1 year 8 months 2 weeks 2 days 6 hours ago) and read 11430 times:

Quoting sweair (Reply 8):
I think Qantas will cancel all 787s and go for the A350. They have the A380 so they can pool their pilots etc.

You beat me to it... With a fleet of 12 x A380, large fleet of A330's this cancellation is "probably" a sign QF are leaning towards an A350 order to replace the B744 fleet perhaps...? Only speculating...

Quoting KarelXWB (Reply 9):

Quoting ClassicLover (Reply 7):
then all of the A330-300s

Those A333s are pretty young, are they leased for a 10-year period or so?

Way to young to be replaced when you take into account the age of the B734/B767 fleet... The A330 fleet I believe was sold to QF at a giveaway priced to good to say no...

Quoting smi0006 (Reply 11):
Are we sure the A332s will be going to domestic?

Guaranteed the 1st 4 x A332's VH-EBA,B,C & D will be remaining in the Domestic configuration...

EK413



Good evening, ladies and gentlemen. We are tonight’s entertainment!
User currently offlineStitch From United States of America, joined Jul 2005, 31059 posts, RR: 87
Reply 14, posted (1 year 8 months 2 weeks 2 days 5 hours ago) and read 11346 times:
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Quoting EK413 (Reply 13):
With a fleet of 12 x A380, large fleet of A330's this cancellation is "probably" a sign QF are leaning towards an A350 order to replace the B744 fleet perhaps...?

The QF Group has had the ability to walk away from the 787 order without penalty for years. If they felt the A350XWB was now the better plane for them, continuing to wait to place an order means they will have to wait that much longer to secure airframes. It also would make no sense for them to tie-up money in 787 orders, options and delivery positions.

The QF Group may yet feel there is a role for the A350XWB, but they evidently continue to feel a role for the 787.


User currently onlinetullamarine From Australia, joined Aug 1999, 1586 posts, RR: 0
Reply 15, posted (1 year 8 months 2 weeks 2 days 5 hours ago) and read 11234 times:

This cancellation probably relates to preservation of cash. Domestic ops have been the cornerstone of QF's performance for several years but it is now under severe pressure with increased competition from VA. Yields have dropped across the board with J class yields down around 35% in just over a year!!! Previously QF had a virtual monopoly in J domestically.

Int'l ops remain problematic though it is hoped the EK tie-up will remove some loss making routes but Asia remains a big problem and the US is not the goldmine it once was.

The most profitable part of QF is now undoubtedly the FF scheme which will be further enhanced by the EK tie-up. The value locked up in the FF scheme has prompted a number of analysts to suggest QF float off all or part of the scheme so as to unlock value for long suffering shareholders.



717,721/2,732/3/4/5/7/8/9,742/3/4,752/3,762/3,772,W,A310,320,321,332,333,388,DC9,DC10,F28,F100,142,143,E90,CR2,D82/3/4,S
User currently offlineLufthansa From Christmas Island, joined May 1999, 3217 posts, RR: 10
Reply 16, posted (1 year 8 months 2 weeks 2 days 4 hours ago) and read 10344 times:

Also don't forget, as they get closer to EK, EK have probably the world's largest backlog order for widebodies.
There is room there, for example, for QF to get its hands on potentially new A350s, or used 77W's as additional new aircraft come online at EK.

After all, with the volume EK place, they're most likely getting the best price in the industry out of anybody.


User currently offlineStitch From United States of America, joined Jul 2005, 31059 posts, RR: 87
Reply 17, posted (1 year 8 months 2 weeks 2 days 4 hours ago) and read 10307 times:
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Quoting Lufthansa (Reply 16):
Also don't forget, as they get closer to EK, EK have probably the world's largest backlog order for widebodies.

EK sells and then leases back the majority of their fleet, so QF would be dealing with the leasing companies once those planes are returned by EK. Airbus might also have clauses in their sales contracts with EK that prevent them from selling airframes to other airlines.


User currently offlineDeltaB717 From Australia, joined Jun 2012, 495 posts, RR: 0
Reply 18, posted (1 year 8 months 2 weeks 2 days 3 hours ago) and read 10043 times:
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Quoting Stitch (Reply 17):
Airbus might also have clauses in their sales contracts with EK that prevent them from selling airframes to other airlines.

I don't doubt there would be a clause to that effect, but being EK can't imagine such a clause would last long into the life of each unit?


User currently offlineStitch From United States of America, joined Jul 2005, 31059 posts, RR: 87
Reply 19, posted (1 year 8 months 2 weeks 2 days 3 hours ago) and read 9997 times:
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Quoting DeltaB717 (Reply 18):
don't doubt there would be a clause to that effect, but being EK can't imagine such a clause would last long into the life of each unit?

That I cannot say, as I am not privy to the details of EK's A350XWB order with Airbus. But even if it is a short-term period (say 5 years), that would still be 2020 or later for deliveries and QF could likely get new builds by that timeframe.


User currently offlineDeltaB717 From Australia, joined Jun 2012, 495 posts, RR: 0
Reply 20, posted (1 year 8 months 2 weeks 2 days 3 hours ago) and read 9760 times:
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Perhaps it's not the A350s QF are after... if EK was planning to move on a few 77L/77W in the near term QF might be interested? Probably not but who knows, especially with QF!

User currently offlineStitch From United States of America, joined Jul 2005, 31059 posts, RR: 87
Reply 21, posted (1 year 8 months 2 weeks 2 days 3 hours ago) and read 9733 times:
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Quoting DeltaB717 (Reply 20):
if EK was planning to move on a few 77L/77W in the near term QF might be interested?

I can't see QF ever operating the 777. With Boeing increasing production, now would have been the time for QF to order if they wanted it.


User currently offlinesydscott From Australia, joined Oct 2003, 3094 posts, RR: 20
Reply 22, posted (1 year 8 months 2 weeks 2 days 2 hours ago) and read 9111 times:

Quoting Stitch (Reply 14):
The QF Group may yet feel there is a role for the A350XWB, but they evidently continue to feel a role for the 787.

I'd say they would be open to the A350 but for now the 788, 789 and the proposed 787-10 should be able to fulfill all of the missions QF has for this type of aircraft and satisfy the replacement of the A333/A332/744 fleet in due course.

Quoting EK413 (Reply 13):
You beat me to it... With a fleet of 12 x A380, large fleet of A330's this cancellation is "probably" a sign QF are leaning towards an A350 order to replace the B744 fleet perhaps...? Only speculating...

Again, I would doubt it. QF have had plent of opportunity to entirely dump the 787's and to order the A350. I'd say Airbus would be more than happy for them to do so and would give them a great price on the A350 and the A332. However I'd say it's not going to happen. That's not to say the A350 won't be ordered but I can see it more as a conversion of the deferred A380's on order than anything else.

Quoting Stitch (Reply 21):
I can't see QF ever operating the 777. With Boeing increasing production, now would have been the time for QF to order if they wanted it.

QF won't be a 777 operator. If anything, a further delay in the 787 program highlights a need for more A330's.


User currently offlinesydscott From Australia, joined Oct 2003, 3094 posts, RR: 20
Reply 23, posted (1 year 8 months 2 weeks 2 days 1 hour ago) and read 8553 times:

Quoting ClassicLover (Reply 7):
The 14 Boeing 787-8s are for Jetstar which will replace the 11 A330s they currently have.

As an additional thought, it's interesting that JQ has firmed up the 14 in the way they have. So we know 11 are coming in to replace the A332's, but the key question is what growth will absorb 3 788's of capacity? Maybe we'll see an increase in Australia - Singapore - Asia flying? Maybe some long haul from Auckland say to Los Angeles? With only 3 growth 788's it means JQ won't be adding alot of long distance routes in the near future which is probably a good thing as they fill out Jetstar Japan and slowly expand Jetstar Asia with narrowbody flying.


User currently offlinegreaser From Bahamas, joined Jan 2004, 1101 posts, RR: 4
Reply 24, posted (1 year 8 months 2 weeks 2 days 1 hour ago) and read 8541 times:

Quoting sweair (Reply 8):
The 787 is EOLed before it really entered the market sadly.

I think the hundreds of orders for the 787 would disagree with your uncorroborated statement.



Now you're really flying
25 tullamarine : Rumour is JQ Long-haul is not particularly profitable which is not surprising given most other LCCs have also struggled to make good profits from lon
26 qf002 : The only remaining international 767 route is SYD-HNL (there's also SYD-NOU but that's operated with domestic planes), and that has got to see someth
27 tullamarine : On an assets employed basis, the FF scheme is easily the most profitable (and valuable) part of the business. Domestic has been very profitable but t
28 mariner : I hope they wouldn't want the deal they got on the 787's. One of the major reasons they ordered the 787 was because of the 2008 delivery slots that B
29 CM : Can't afford the PDPs? QF is not in a strong financial position at present.
30 EK413 : Cheers for your responses... So I take it management plan on switching strategy and concentrate on QF mainline domestic opposed to JQ...? EK413
31 sydscott : That's a myth. QF is in a strong financial position with good, positive cash flows and enough profitable units to sustain them. The 787 cancellations
32 qf002 : Huh? $3b in cash isn't a strong financial position? There is nothing more to this than QF/JQ simply not needing the aircraft because their growth for
33 Asiaflyer : I could see QF convert remaining A380s on order to A350-1000 and add another 10 for replacing current 744s. That should give QF a much more efficient
34 XT6Wagon : Not in this industry. For an airline this size of QF, you need seemingly huge cash reserves to just cover normal operating cash flow. Credit Card hol
35 EK413 : Probably I should've been clearer in my quote I was referring to JQ International with the current fleet of 11 x A332's sufficient for the time being
36 tonymctigue : I don't know how profitable domestic is for QF. I've been reading plenty of articles about a bitter price war between Qantas and Virgin Australia on
37 mariner : No, you're not wrong. There is a difference between cash reserve and cash flow. Cash flow is funded from operations. Once credit card holdback is est
38 Asiaflyer : Not necessary. You also have to consider how much debt they have. If overall debts are low, it is might be easy to borrow more if needed. If you are
39 Post contains links mariner : It doesn't necessarily need to be low, as long as it is secured - guaranteed - by assets. Which Qantas is not. Despite a downgrade, Qantas still has
40 ClassicLover : I meant this from the perspective that in 2005 the 787 list price was $125-$135 million - very, very cheap. Qantas would have received a major discou
41 mariner : I understood exactly what you meant - and in the simplest terms you're right, they wouldn't get another aircraft at the same price. My point is that
42 SYDSpotter : Not sure the 787 alone would've solved all of underlying issues with QF Intl, but we can only speculate as to what might have been. Whilst it has cos
43 Post contains images ClassicLover : In what regard exactly? Apparently the value of said lost opportunities is $300m - but which opportunities have been lost? It was always stated the f
44 Post contains images mariner : I'm sure it would not, on its own. But the delays threw the forward plan into complete disarray. And part of the problem was the incremental nature o
45 Post contains links Planemaker : http://atwonline.com/aircraft-engine...-q400s-cancels-one-boeing-787-0118
46 StickShaker : The opportunities lost due to the 787 delays are a subset of those due to QF's failure to invest in any 250-300 seat long haul platform since the 199
47 travelhound : I think the boat had already sailed in 2007/08. I think the A330 and 777 deal should have been made back in 2003. I always say the QF A380 and 787 fl
48 planesmart : As Donald Trump says, it's nothing personal, it's business. Every early 787 customer will have negotiated penalties and concessions from Boeing, inclu
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