deltabos
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Why Is The 747 Still Used?

Mon Aug 09, 2004 11:31 am

I understand the mystique of flying in an airplane such as the 747, and I fully understand that it was the first reliable long-hauler, and obviously the most notable aircraft in the modern world save MAYBE the Concorde, but how do the costs of maintaining an older aircraft like the 747 compare to those of the equally-as-serviceable 777 or A330/A340? Wouldn't the more modern airplanes seem to be safer and much more cost efficient in this day and age? I'm COMPLETELY ignorant about this subject and am somewhat curious as to where the motivation lies to keep the B747 up and running.
 
kcrwflyer
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 11:38 am

well, i hate to say it but as the nw dc-9's, for some airlines, the 744's might be paid for.

And for other airlines, if youve halfway paid off a 744, why give it back, and buy a new a340 or 777, it simply just costs money.

Even maintinance fees on an old 747 is less than buying a new aircraft.
 
unattendedbag
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 11:39 am

Many of the "older" 747's are paid for. A new aircraft costs money, so if an airline has (over the years) completely paid for the 747-200 or -300, that aircraft is free to use. That is just one reason.

Many crews (flight, service, maintenance) are fully trained on certain types of aircraft and retraining those crews for a new aircraft costs money.
Slower traffic, keep right
 
unattendedbag
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 11:41 am

 Smile Kcrwflyer

just a minute too late, sigh
Slower traffic, keep right
 
PhilSquares
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 11:46 am

Are you talking about the 744s too? If so, I guess I'd argue the term "old" since they're still being produced.

I think right now in a CASM basis the -400 is probably the cheapest there is. As far as a freighter goes, there is nothing comparable in terms of payload, range and costs.

Fly fast, live slow
 
Gemuser
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 11:53 am

How about because:

1) Its not old? The 747-400 is still in production, QF reciving its latest less than a year ago and there are rumors of more 744ER orders to come!

2) For some missions it is still the most economical beast there is. For QF what else is there for Kangaroo Route & Pacific services? The 772LR MIGHT offer some advantages, but there are still EPTOS and capacity issues on both Kangaroo & Pacific services, for current 777 models.

Gemuser

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Alessandro
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 12:10 pm

B744 flew first time 1989, thats not that long ago. I think the B747 will continue to be produced at least 10 more years, last one made a cargo one...
From New Yorqatar to Califarbia...
 
spacecadet
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 12:39 pm

Not to mention you've got airports like Narita and Haneda in Japan that are slot-limited.. in those kinds of situations going from a 747 to a 777 is basically kicking those extra passengers and their fares out the door. And you're talking about a 150 seat difference in some configurations.

And yes, the 744 is still in production so it's not "old" and unserviceable... there is only one open order to a passenger carrier right now but most 744's are nowhere near the end of their useable lifespan. And on a lot of routes, there's no better plane flying right now even if the 744's were old. If all of ANA and JAL's 744D's suddenly fell apart on the tarmac, they'd probably have no choice but to buy a bunch of new 744D's to replace them. Same is true for a lot of other Asian carriers that effectively can't run certain routes any more frequently than they do, along with some western carriers (such as BA and NW) that fly to a lot of those Asian destinations.
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jasepl
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 1:37 pm

Also, on long routes where frequency isn't really an issue, it's better to have one big plane than two smaller ones. Whilst the cost of maintaining 2 777s isn't nearly double that of maintaining one 747, it probably is somewhat higher per seat. Often, its a simple case of having two planes where one can do the job.
 
ordpark
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 1:45 pm

Can't speak for everyone, but at UA the new lease rates we have on the 744's have made them very economical to operate...not to mention that they are without a doubt the most awesome commercial aircraft ever built.
 
baw716
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 5:01 pm

There are a lot of great points here...my two cents has to do with the economics of an older 747 vs. a new 777 (since those were the two aircraft that were compared):

There is a point in the ownership of an aircraft (or any vehicle for that matter), where the cost of operation is substantially less than a new aircraft. The older aircraft is usually paid for, the newer one is not. So the new aircraft has high ownership costs. Also, within the scope of that timeframe, the maintenance costs are fairly low, reducing cost of ownership. Once the airframe gets above a certain number of cycles (take offs and landings), the maintenance and operating costs start to go up and at that point, the aircraft is usually refitted for cargo or sold.

.

David L. Lamb, fmr Area Mgr Alitalia SFO 1998-2002, fmr Regional Analyst SFO-UAL 1992-1998
 
bill142
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 5:28 pm

Whilst the cost of maintaining 2 777s isn't nearly double that of maintaining one 747

Not to mention having to fork over more in payments to Boeing, Lessors or Finance companies as 777's cost more then 747's don't they?
Also if the 777 and A340 aren't in your fleet you have to train crews in the aircraft, buy new spares and other additional equpitment. So if you have 747's you might as well keep them as they are still very good aircraft.
 
duke
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 5:38 pm

Plus, many of the older, less economical 747s have already been scrapped or otherwise withdrawn from use.
 
ZKSUJ
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 5:48 pm

The 747 is a great aircraft, and I believe that the 747 advanced will be out in a few years. So we hav't seen the end of it just yet.
 
squirrel83
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 5:57 pm

From my understanding a 747 is quite cheaper to operate than a 777-2 . . Correct me if im wrong ~
A346, 7E7, 747, 777, Sonic Cruiser
 
chicago757
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 6:05 pm

Because the 747 is just a f+cking beauty and kills the A330/A340
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JrMafia90
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 6:32 pm

I think the 747 is the best aircraft. Why shouldnt it still be used?
 
767-332ER
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 8:41 pm


It's like you still see old cars on the road...people don't wanna pay the costs for new ones. Same with the airlines.
Twinjets...if one fails, work the other one twice as hard!!!
 
jasepl
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RE: Why Is The 747 Still Used?

Mon Aug 09, 2004 8:55 pm

Because the 747 is just a f+cking beauty and kills the A330/A340

Here we go again! I was waiting for someone had to go and wreck a perfectly good discussion. So, airlines are using the 747 only because it looks pretty and "kills" the Airbuses? Good God! All the while, of course, we must ignore the fact that the 747 and 330 are so completely apples and oranges, yet agree all around that Airbus are crap. Just because.
 
PIA777
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 12:37 am

Because the 747 is one of the best planes ever built.

PIA777
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keesje
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 12:42 am

Because it is the only 350-500 seat long range aircraft available.



"Never mistake motion for action." Ernest Hemingway
 
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Starlionblue
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 12:46 am

I think KEESJE hit the nail on the head. The A380 is all well and good, but if you can fill 430 seats today, what else can you use?
"There are no stupid questions, but there are a lot of inquisitive idiots." - John Ringo
 
desertjets
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 12:49 am

Most 747s flying in passenger service these days are -400s... which began rolling off the Everett line in 1989. Hardly old by most measures. Fewer and fewer carriers are flying the older models in regular passenger service these days.

As has been discussed above the 747, especially the -400 is relatively efficient. Given that in most international configurations it is seating ~380-420 passengers its marginal costs (CASM) are very competive. Plus there are many routes out there that demand 400 seats per flight, something that a 777-200 or A340-300 cannot do. With at least 100 fewer seats per flight you have in effect lost the capacity of 2 747 flights over the course of the week.
Stop drop and roll will not save you in hell. --- seen on a church marque in rural Virginia
 
StearmanNut
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 2:17 am

I would say that using an older 747 to generate revenue should be profitable despite the maintenance issues. It is considerably more profitable to operate an aircraft that has had the purchase debt against it retired. At that point the only chargebacks to the airplane is the maintenance and peripheral operating costs.

Case in point: DL is now going back to some retired (debt free) MD11's and allowing leased 777's go back. Again, it is cheaper and more profiable to operate an aircaft that is paid for.
If wishes were horses, a Tail Dragger I would fly...
 
NWA757
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 3:06 am

The 747 is a good aircraft and most are owned by airlines. Hence reducing their bills. Furthermore, most passengers enjoy the legacy the 747 has to offer.
Fly High!
 
warren747sp
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 3:08 am

Passenger preference.!
Even VS choose to hold this type in their fleet.
747SP
 
abiomike
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 3:11 am

Some airlines like to market their fleets as among the youngest in the world. Therefore they are buying 777s, 744s and A340s and moving older 747s out of their fleet that are still serviceable.
 
NWA757
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 3:18 am

PASSENGER PREFERENCE!!
Fly High!
 
Boeing Nut
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 3:21 am

As KEEJSE stated, it's the only 400 seat aircraft available in the world.
I'm not a real aeronautical engineer, I just play one on Airliners.net.
 
baw716
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 4:50 am

Squirrel83
I would like to try to answer your question re: cost of operation 747 v. 777-200.
The short answer is yes and no. It depends on what version of 747 to which you are referring. Let's say for argument sake, you are comparing the -400 vs the 777-200ER.

Let's also look at the biggest variable cost (other than crew costs), fuel.

Assume fuel=$1.50/US gal for Jet A.
Max fuel capacity=747-400 57285gal
777-200ER-45220gal
Pax Capacity= 747-400 416 pax (3 cabin)
Pax Capacity= 777-200ER-301 pax

Max range full payload - 747-400 7236 mi
777-200ER 7736 mi

OK: Let's try to get to fuel unit costs: Assume 7000 mi flight max payload
747-400: Gas: 57285gal x 6.84lbs/g = 391829lbs. (JetA)
777-2ER: Gas: 45220gal x 6.84lbs/g = 309305lbs. (Jet A)

p-passenger
m-mile
uc-unit cost
l - weight

747- 391829/416 pax=941.9 speed m0.85-567
772- 309305/301 pax=1027.59 speed m.084-561

seat cost/mi: 1102.93/7000 = 0.158 (744)
seat cost/mi: 1201.86/7000 = 0.176 (772)
Note: This is fuel cost per seat mile at 100% load factor.
Now: factor in gal/hr at gross weight:
747-875000 MTOW Fuel/hr-4695.5g/h 186.4lb/fuel hr
772-656000 MTOW Fuel/hr=3616.6g/h 181.4lb/fuel hr

The key difference is the fuel burn. The fuel burn per lb on the 777 is less than the 747, giving it slightly better range. Therefore, with a full fuel load, it will have more gas left at 7000 miles than the 747. When you factor that in, the 777 is less costly to use.

Now, put revenue into the picture:

However, the extra 100 seats on the 747 make a huge difference. The maximum distance for the 747 is 7200 miles and the 777 only 7700+. This means that you can carry 100 pax more on the same 7000 route than the 777. Assuming that revenue is the same across the three carriers:
F-6500 x 12
C-4500 x 39
Y-1000 x 365
Total revenue at 100% - 618600/7000/416-0.212 rasm

F-6500 x 12
C-4500 x 39
Y-1000 x 258
Total revenue at 100% - 512100/7000/309-0.237 rasm

Over the same distance, the 777 generates higher rasm (unit revenue) due to the higher percentage of premium v. economy seats.

Over the same distance, the 777s casm (cost) are higher so the margin for this aircraft over 7000 mi is: 0.061/asm vs. 0.054/asm for the 747. However, since the 747 can carry 100 more passengers, the aircraft will generate more revenue for the airline than the 777 over the same distance. In margin percentages,

So which airplane is more cost efficient? Over the same long haul distance, if we take only fuel into account, the 777 is slightly behind the 747-400. However, if you factor in crew costs (more crew required on the 747-400 than on the 777, then the 777 becomes slightly more cost effective.

If we look at the margin (profit) based on fuel only, then the difference is very small. 777-25.7% margin 747-25.4% margin. While 0.3 of a point is a lot, it is not that much considering that you are carrying an extra 100 pax doing it. In this case, the revenue value outweights the margin because the margin difference is so small.

However, what I have shown you is a very significant oversimplication of the cost calculation. A number of other factors: Routes, fuel costs, crew costs catering and maintenance costs, especially at out stations will weigh heavily on what aircraft is used for a specific route. Remember, airplanes are fitted to the routes they fly and the size and dynamics of those markets. Not the other way around.

In closing, a purest would say that the 777 is more cost efficient than the 747. They would be right. However, given the multitude of factors that enter into a route/aircraft benefit analysis, the market will ultimately decide the aircraft needed. To get a full picture, you would need to discuss with an airline operations analyst, what factors drive the operational costs of a specificf route. Then you will know what aircraft is right sized (maximizing cost efficiencies) for a particular market.

One last point: Operating costs are always a percentage of revenue. So unit cost based on the number of people actually flown on a given leg will determine the actual unit costs for a given city pair. Calculations:

unit cost = ((flight cost per hour x hours flown) / actual pax flown)/miles).
unit revenue=(pax$F)+(pax$C)+(pax$Y)/total pax flown)/miles.
$ unit margin/flight= unit revenue-unit cost (in asm)
% margin/flight=$ margin/$ revenue (in asm)
Break even LF= (flight cost per hour x hours flown)/miles) = (pax flown x average fare)/mile.

Example: 100 seats per flight. Flight distance: 500 miles. Average fare per seat: $80.00 Flight cost: $10000/hr (crew, fuel, meals, fees, airport costs etc.) Flight time: 1 hour at 500mi/h

$10000 cost/500/100 seats= 0.20casm
$8000 rev max/500/100 seats= 0.16rasm
BLF=125%

AT $135/seat
($135x100=$13500 revenue)/500)/100=0.27rasm
$10000 cost = (0.20casm)
$13500 revenue (0.27casm) = 74% BLF
BLF=74%

I hope this answers your question.
All the best,
baw716

NB: Source data: BCAC Statistics from www.boeing.com
NB2: These calculations are ROUGH. They are designed to give you a sense of how these figures are arrived at. Do not use them for any calculations. The assumptions would be very incorrect.
David L. Lamb, fmr Area Mgr Alitalia SFO 1998-2002, fmr Regional Analyst SFO-UAL 1992-1998
 
BandA
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 5:00 am

Baw716, now thats a well detailed answer... good info!

personally, the day they stop flying 747 pax, would be one of the saddest day in my life...

I really hope boeing has got something up their sleeves regarding the future of 747... it would be real stupid of them (IMHO) if they let it just die...
"They [Terrorists] never stop thinking about new ways to harm our country and our people, and neither do we." - GWB
 
deltabos
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 7:39 am

Thanks so much for the info guys it is well appreciated!
 
Carpethead
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 8:11 am

JAL and NW will have 747s flying into the next century.
 
Lurch
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 8:26 am

Boeing are going to build a super transporter version of the 747-400 to transport large sections of the 7E7 from factory to factory which will be a double deck 747-400 I wonder how much it would take to Build a pax version?
 
Klaus
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Lurch

Tue Aug 10, 2004 8:32 am

Lurch: Boeing are going to build a super transporter version of the 747-400 to transport large sections of the 7E7 from factory to factory which will be a double deck 747-400 I wonder how much it would take to Build a pax version?

It won´t happen. All the "Belugas" have unpressurized fuselages and can only carry a large volume but not really all that much weight compared to the "normal" versions; And they´ve got shorter range on top of that (more drag).

It would simply not make much sense.
 
Alessandro
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RE: Why Is The 747 Still Used?

Tue Aug 10, 2004 5:18 pm

Lurch, I think the # of cycles is also more limited on the Belugas compared with the B744.
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