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keesje
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Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 10:55 am

Southwest, the largest customer of the 737 MAX ..., insists it has “no current plans” to fly any jets other than the 737. But it’s at least eyeing the possibility.
The airline’s management has proposed new language in the contract with its flight-attendants union that would grant it the flexibility “to fly more narrowbody aircraft types.”
Southwest told the union in a proposal this month that the ability to operate aircraft other than the 737 "would give us the flexibility ... to better compete and grow."
Jon Weaks, president of the Southwest Airlines Pilots Association, said in an interview that the carrier's chief executive, Gary Kelly, "has bet the company on the Max."

https://www.seattletimes.com/business/boeing-aerospace/southwest-a-stalwart-boeing-737-max-customer-eyes-other-jets/
https://www.arkansasonline.com/news/2019/aug/15/southwest-signals-jet-search-20190815/

Southwest flies mostly 3 cabin attendant 737-700's, 500 of them. They introduced bigger -800s on some routes, those require 4 ca's. SW are slowing 737-700 retirements because of the MAX grounding.

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Dutchy
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 10:58 am

If they want a 1 for 1 replacement, an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.
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JonesNL
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:06 am

The A220 would be an option if Airbus is able to pump out 60 p/month to fill in the demand. I am not seeing that happening anytime soon.
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:17 am

JonesNL wrote:
The A220 would be an option if Airbus is able to pump out 60 p/month to fill in the demand. I am not seeing that happening anytime soon.


Airbus has deliberately slowed down the ramp. If they won WN as a customer, you can bet they'd build production lines just for them.

That said, I don't buy this rumour. This is Southwest just putting some pressure on Boeing. I'm not sure Southwest even knows how to operate other aircraft profitably. They couldn't get rid of those 717s fast enough.

Hopefully, Moxy can put a dent in them with the 223s. They are overdue for some lessons.
Last edited by TObound on Thu Aug 15, 2019 11:20 am, edited 1 time in total.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:19 am

TObound wrote:
JonesNL wrote:
The A220 would be an option if Airbus is able to pump out 60 p/month to fill in the demand. I am not seeing that happening anytime soon.


Airbus has deliberately slowed down the ramp. If they won WN as a customer, you can bet they'd build production lines just for them.

No they have not.

It is important that Airbus profitability ramps up production. There is no use in Airbus building all these aircraft and taking money for orders if they ultimately losing money every time they make a delivery.
 
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N776AU
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:21 am

Their livery looks better on the A320 anyway :stirthepot:
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TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:24 am

Polot wrote:
TObound wrote:
JonesNL wrote:
The A220 would be an option if Airbus is able to pump out 60 p/month to fill in the demand. I am not seeing that happening anytime soon.


Airbus has deliberately slowed down the ramp. If they won WN as a customer, you can bet they'd build production lines just for them.

No they have not.

It is important that Airbus profitability ramps up production. There is no use in Airbus building all these aircraft and taking money for orders if they ultimately losing money every time they make a delivery.


Nothing you said here contradicts what I said. Sure they have reasons for why they slowed the ramp up. But that doesn't change the fact that they did. And I actually think it's a good thing they did. It's giving them time to invest in facilities like the pre-FAL shed in Mirabel. And to work on supplier pricing and maybe even some PIPs.

But I can't help but wonder how much more motivated they'd be to put substantial sums of their own money if they got a large order tomorrow. Let's not forget. They are still running off Bombardier's committed spending on the program till 2021.
 
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Polot
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:28 am

TObound wrote:
Polot wrote:
TObound wrote:

Airbus has deliberately slowed down the ramp. If they won WN as a customer, you can bet they'd build production lines just for them.

No they have not.

It is important that Airbus profitability ramps up production. There is no use in Airbus building all these aircraft and taking money for orders if they ultimately losing money every time they make a delivery.


Nothing you said here contradicts what I said. Sure they have reasons for why they slowed the ramp up. But that doesn't change the fact that they did. And I actually think it's a good thing they did. It's giving them time to invest in facilities like the pre-FAL shed in Mirabel. And to work on supplier pricing and maybe even some PIPs.

But I can't help but wonder how much more motivated they'd be to put substantial sums of their own money if they got a large order tomorrow. Let's not forget. They are still running off Bombardier's committed spending on the program till 2021.

I don’t have any confidence that the C series/A220’s ramp up would have been any faster without Airbus (or with another company as partner). C series ramp up has been terrible from the get-go. Money only helps things to a point, it doesn’t deliver results instantly.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:33 am

Dutchy wrote:
If they want a 1 for 1 replacement, an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.

They don't need a 1 for 1 replacement. The plan was/is to replace retired -700s with MAX8s. For routes that can't support aircraft over 150 seats, they will have hundreds of -700s still in the fleet for the next decade at least.

When they actually need more aircraft in that size, there will likely be a competitor to the A220 launched by Boeing Brasil Commercial. I'd put my money on Southwest being the launch customer for that aircraft. Boeing didn't form the JV with Embraer to market the E2.
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:34 am

Polot wrote:
TObound wrote:
Polot wrote:
No they have not.

It is important that Airbus profitability ramps up production. There is no use in Airbus building all these aircraft and taking money for orders if they ultimately losing money every time they make a delivery.


Nothing you said here contradicts what I said. Sure they have reasons for why they slowed the ramp up. But that doesn't change the fact that they did. And I actually think it's a good thing they did. It's giving them time to invest in facilities like the pre-FAL shed in Mirabel. And to work on supplier pricing and maybe even some PIPs.

But I can't help but wonder how much more motivated they'd be to put substantial sums of their own money if they got a large order tomorrow. Let's not forget. They are still running off Bombardier's committed spending on the program till 2021.

I don’t have any confidence that the C series/A220’s ramp up would have been any faster without Airbus (or with another company as partner). C series ramp up has been terrible from the get-go. Money only helps things to a point, it doesn’t deliver results instantly.


Money absolutely helps. Helps them build more efficient production facilities. Helps to fund advances to suppliers to motivate them to up output. Etc.

Airbus hasn't really invested their own capital in the program yet. Because they don't see the return yet. A large order that guarantees say an additional 5 frames/month would very much motivate them to advance their plans.
 
ewt340
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:36 am

Yeah, it would be stupid to pass on A220-300. It's the most fuel efficient replacement for A319 and B737-700 right now.

I think if southwest actually order couple hundreds A220-300, Airbus would expand it's production capacity for it. They are desperate for big orders for A220.
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:40 am

planecane wrote:
Dutchy wrote:
If they want a 1 for 1 replacement, an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.

They don't need a 1 for 1 replacement. The plan was/is to replace retired -700s with MAX8s. For routes that can't support aircraft over 150 seats, they will have hundreds of -700s still in the fleet for the next decade at least.

When they actually need more aircraft in that size, there will likely be a competitor to the A220 launched by Boeing Brasil Commercial. I'd put my money on Southwest being the launch customer for that aircraft. Boeing didn't form the JV with Embraer to market the E2.


That's a strange line of thought. Southwest can't wait almost a decade for Boeing to build them a great 150 seater. Imagine how many A223s will be zipping around the the US by then. Or even 225s.

While Southwest dithers, DL and B6 are making their fleets vastly more efficient. And if they feel confident enough, there's markets they'll attack Southwest.

I wonder how the 195-E2 compares to the 7M7. Might provide temporary relief. But be a massive challenge for one of the key drivers of the cockpit commonality demand that's grounding the Max today.
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:46 am

I gotta say the irony of the major driver behind the Max's problems ordering anything from Airbus would be absolutely hilarious.
 
planecane
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:52 am

TObound wrote:
planecane wrote:
Dutchy wrote:
If they want a 1 for 1 replacement, an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.

They don't need a 1 for 1 replacement. The plan was/is to replace retired -700s with MAX8s. For routes that can't support aircraft over 150 seats, they will have hundreds of -700s still in the fleet for the next decade at least.

When they actually need more aircraft in that size, there will likely be a competitor to the A220 launched by Boeing Brasil Commercial. I'd put my money on Southwest being the launch customer for that aircraft. Boeing didn't form the JV with Embraer to market the E2.


That's a strange line of thought. Southwest can't wait almost a decade for Boeing to build them a great 150 seater. Imagine how many A223s will be zipping around the the US by then. Or even 225s.

While Southwest dithers, DL and B6 are making their fleets vastly more efficient. And if they feel confident enough, there's markets they'll attack Southwest.

I wonder how the 195-E2 compares to the 7M7. Might provide temporary relief. But be a massive challenge for one of the key drivers of the cockpit commonality demand that's grounding the Max today.


They can wait because they already own enough 150 seaters. Just because an A220 is more efficient doesn't mean it is worth buying one to replace an already paid for 737-700 that still has a decade or more of service left in it. They have over 500 -700s. Even if the retire them 1 for 1 with MAX8 deliveries, they'll still have over 300. If Boeing Brasil Commercial launches a competitor to the A220 next year or in 2021, deliveries will start before the -700 needs mass retirements.

In reality, outside of Delta and Southwest, the other mainline carriers have gone 737-800/A320 and larger for new orders. WN had ordered very few MAX7s. I don't get the insistence that WN needs smaller aircraft. Honestly, the A321 would make more sense to me if they were to go beyond the 737 to allow international growth with higher capacity.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:54 am

The key thing here is the contract with the flight attendant union about flying more than one narrowbody type.

It seems to me this is a measure they have taken in case the MAX grounding goes on longer than planned.

If the contract with the union is updated, Southwest can introduce leased aircraft of another type as a temporary solution with regards to the MAX grounding.

I don't think it necessarily means Southwest suddenly ordering another narrowbody type.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 11:59 am

Southwest [...] the largest customer of the 737 MAX [...] proposed new language in the contract with its flight-attendants union that would grant it the flexibility “to fly more narrowbody aircraft types [...] the ability to operate aircraft other than the 737 "would give us the flexibility ... to better compete and grow."
Jon Weaks, president of the Southwest Airlines Pilots Association, said in an interview that the carrier's chief executive, Gary Kelly, "has bet the company on the Max."

1) This announcement is so unusual that it better be taken seriously, it may or may not lead to a diversification, but it does show deep mistrust in the management as to send it company-wide : it's ground-shaking, the very concept of Boeing's natural monopoly on SW is trounced & ingrained on everyone's mind. The Chicago boys have put themselves in a dire industrial, financial & communication nightmake. Now, it won't have devastating effects because of the duopoly & because of inelastic ramping-up possibilities.
2) betting the company on one single model is a very bad bet, it endangers the company. Of course, it has various financial advantages for bean counters, but JL, formerly Boeing stalwart too for over 50 years, went to Airbus after their woes with the 787. Norwegian is hurting badly, in part because of RR, but the 737-787 combo may cruxify them in the end. Suppose it was the 737-700 that had been grounded instead ?
The risk of being held hostage to one model, one company or one externality is so high that in retrospect it is appalling that big airlines like SW, FR, FZ, U2 still confuse simple with simplistic maths, business is never that simple. With such fleet sizes, diversification is marginally more expensive, it's even a sound insurance policy B6 now has, way cheaper than having part of one's fleet grounded or one's growth stunted.

Dutchy wrote:
an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.

Ditto. But if that happens, cannot be overnight, in theory.
But with the new momentum the recent A220 sales & top ups to DL, AC, AF have sent industry-wide extolling the model, plus customer's positive reviews, I expect new orders to follow & Airbus to pull some rabbit out of their hat, possibly in Mobile, perhaps even in Toulouse when the last A380 is delivered, freeing what is left of the space.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:01 pm

The lighter CS300 is a better aircraft for smaller markets than the MAX7 (or A319neo - not that it's relevant in this case), so it's an interesting proposition. Still very unlikely though. I don't see any point in WN buying neos.
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DWC
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:05 pm

JetBuddy wrote:
It seems to me this is a measure they have taken in case the MAX grounding goes on longer than planned.

If the contract with the union is updated, Southwest can introduce leased aircraft of another type as a temporary solution with regards to the MAX grounding.

It's a fair possibility, yes, does match Occam's razor.
But I feel the message then would have been phrased differently, like clearly stating "temporary leasing". ( and from whom ? ). And if so, communication wise, management would probably have hushed until the decision was imminent for a few frames only relative to SW's size.
Here is a company-wide announcement, I would rather consider it on a wider scope, whatever that is.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:16 pm

DWC wrote:
Dutchy wrote:
an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.

Ditto. But if that happens, cannot be overnight, in theory.
But with the new momentum the recent A220 sales & top ups to DL, AC, AF have sent industry-wide extolling the model, plus customer's positive reviews, I expect new orders to follow & Airbus to pull some rabbit out of their hat, possibly in Mobile, perhaps even in Toulouse when the last A380 is delivered, freeing what is left of the space.


We have seen the case of Easyjet, making the switch for the whole fleet. How long did that take, from the first delivery of the A320, till they had a sizeable fleet of say 50 or 100 a/c?
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DWC
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:26 pm

True. Something is cooking at SW.
And with that, at other airlines.
Possibly at Airbus too.
The next years will tell.
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:32 pm

TObound wrote:
Airbus has deliberately slowed down the ramp. If they won WN as a customer, you can bet they'd build production lines just for them.
Polot wrote:
It is important that Airbus profitability ramps up production. There is no use in Airbus building all these aircraft and taking money for orders if they ultimately losing money every time they make a delivery.
TObound wrote:
Sure they have reasons for why they slowed the ramp up. But that doesn't change the fact that they did. And I actually think it's a good thing they did. It's giving them time to invest in facilities like the pre-FAL shed in Mirabel. And to work on supplier pricing and maybe even some PIPs.

But I can't help but wonder how much more motivated they'd be to put substantial sums of their own money if they got a large order tomorrow. Let's not forget. They are still running off Bombardier's committed spending on the program till 2021.
Polot wrote:
I don’t have any confidence that the C series/A220’s ramp up would have been any faster without Airbus (or with another company as partner). C series ramp up has been terrible from the get-go. Money only helps things to a point, it doesn’t deliver results instantly.
TObound wrote:
Money absolutely helps. Helps them build more efficient production facilities. Helps to fund advances to suppliers to motivate them to up output. Etc.

Airbus hasn't really invested their own capital in the program yet. Because they don't see the return yet. A large order that guarantees say an additional 5 frames/month would very much motivate them to advance their plans.

Hmm, I opened this thread thinking I'd learn about WN and perhaps Boeing too, but instead I learn a lot about Airbus and CSALP/BBD as well.

I didn't realize Airbus had slowed down the A220 ramp up, yet we have two different members saying this.

I do believe Airbus will keep the pressure on CSALP to prosper within its current financial parameters before it puts its own resources into the company.

The resources Airbus puts into the company shall only increase the price Airbus will need to pay for the remaining half of CSALP subject to call/put options circa 2024.

The resources Airbus has put in so far are things that aren't costing Airbus a lot such as marketing and access to Airbus suppliers and technology.

Keep in mind the BFS facilities as well as Mirabel expansion is happening because Airbus is funding facilities that CSALP leases back from Airbus.

This allows Airbus to keep the pressure on CSALP to perform.

Pretty much a carrot/stick approach, IMO.
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MIflyer12
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:35 pm

TObound wrote:
That's a strange line of thought. Southwest can't wait almost a decade for Boeing to build them a great 150 seater. Imagine how many A223s will be zipping around the the US by then. Or even 225s.

While Southwest dithers, DL and B6 are making their fleets vastly more efficient. And if they feel confident enough, there's markets they'll attack Southwest.


You vastly overestimate what a small fleet of 60 A220s can do. In the context of the narrowbody fleets of AA/DL/WN/US, it's nothing. (It's not even a tenth of the AA, or DL, or WN narrowbody fleet.) the last of those sixty isn't due until 2025. The Big 4 will probably have taken delivery of 1,000 new mainline aircraft by then. As for costs, WN has the labor productivity to run MAX 8s against Delta 220s and win big.

Airbus doesn't have the capacity to build a bunch more A220s. We don't know that the vendor base (resources, tooling) can be scaled up 3x-5x.

Carriers are going to be buying and flying MAXs for a long time to come. It's not as if anybody has the production capacity for an extra 50 narrowbodies a month. (Recall recent pieces on how Airbus isn't even making current Neo obligations.) The current Mirabel production rate? A joke. Six years after the targeted delivery date they're still running this like some junior high school kid's science project, not a high volume manufacturing line. Three or four a month 'by mid-next decade' from Mobile? Big whoop. https://www.airbus.com/newsroom/press-r ... craft.html The tremendous unwillingness to accept this basic fact of scale of industrial organization makes some people here look utterly silly. Pretty Photoshopped images don't change that a bit.
 
cledaybuck
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:36 pm

DWC wrote:
The risk of being held hostage to one model, one company or one externality is so high that in retrospect it is appalling that big airlines like SW, FR, FZ, U2 still confuse simple with simplistic maths, business is never that simple. With such fleet sizes, diversification is marginally more expensive, it's even a sound insurance policy B6 now has, way cheaper than having part of one's fleet grounded or one's growth stunted.
No it's not. There is a reason that virtually every LCC has gone to a single type. Groundings are (thankfully) increadibly rare. Even if WN had half A320's and half 737's, they would still be totally screwed if one was grounded.
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:54 pm

MIflyer12 wrote:
TObound wrote:
That's a strange line of thought. Southwest can't wait almost a decade for Boeing to build them a great 150 seater. Imagine how many A223s will be zipping around the the US by then. Or even 225s.

While Southwest dithers, DL and B6 are making their fleets vastly more efficient. And if they feel confident enough, there's markets they'll attack Southwest.


You vastly overestimate what a small fleet of 60 A220s can do. In the context of the narrowbody fleets of AA/DL/WN/US, it's nothing. (It's not even a tenth of the AA, or DL, or WN narrowbody fleet.) the last of those sixty isn't due until 2025. The Big 4 will probably have taken delivery of 1,000 new mainline aircraft by then. As for costs, WN has the labor productivity to run MAX 8s against Delta 220s and win big.

Airbus doesn't have the capacity to build a bunch more A220s. We don't know that the vendor base (resources, tooling) can be scaled up 3x-5x.

Carriers are going to be buying and flying MAXs for a long time to come. It's not as if anybody has the production capacity for an extra 50 narrowbodies a month. (Recall recent pieces on how Airbus isn't even making current Neo obligations.) The current Mirabel production rate? A joke. Six years after the targeted delivery date they're still running this like some junior high school kid's science project, not a high volume manufacturing line. Three or four a month 'by mid-next decade' from Mobile? Big whoop. https://www.airbus.com/newsroom/press-r ... craft.html The tremendous unwillingness to accept this basic fact of scale of industrial organization makes some people here look utterly silly. Pretty Photoshopped images don't change that a bit.


exactly, people completely overestimate the effect of a few A220 which maybe very efficient but would add a lot of complexity to a single fleet airline like WN. WN will have to move on at some point since 737 won't be in production forever, but they will keep absorbing new MAX for a long time to come. And I say this as a big fan of A220.
 
boeing773er
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:55 pm

I smell BS.

As much as I would love to see a diversified WN fleet, it’s not going to happen. Boeing will give WN whatever concessions they want so they will order more, or keep the amount of 737Ms on order. They still have a defacto Gentleman’s Agreement that all the other US carriers got rid of years ago.
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TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:56 pm

planecane wrote:

They can wait because they already own enough 150 seaters. Just because an A220 is more efficient doesn't mean it is worth buying one to replace an already paid for 737-700 that still has a decade or more of service left in it. They have over 500 -700s. Even if the retire them 1 for 1 with MAX8 deliveries, they'll still have over 300. If Boeing Brasil Commercial launches a competitor to the A220 next year or in 2021, deliveries will start before the -700 needs mass retirements.


That's the absolute best case scenario. In all likelihood, a Boeing facing major capital draws for the Max and the 777X, is going to put off developing the NSA. Keep in mind this is a company that's absolutely commited to drawing every last drop off profit and not investing more. They'll be happy to sell Southwest 7M7s if they want 150 seaters. And everyone knows that Southwest has no choice but to buy whatever Boeing offers.

planecane wrote:

In reality, outside of Delta and Southwest, the other mainline carriers have gone 737-800/A320 and larger for new orders. WN had ordered very few MAX7s. I don't get the insistence that WN needs smaller aircraft. Honestly, the A321 would make more sense to me if they were to go beyond the 737 to allow international growth with higher capacity.


Upgauging works up to a point. There's a lot of places where sending multiple 180+ seat aircraft just isn't as effective. And unlike the past, competition is catching up.

Let's be honest though, Southwest will give up profit before they give up Boeing. I honestly think operating anything not from the 737 family is too taxing for their operational abilities.
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 12:58 pm

boeing773er wrote:
I smell BS.

As much as I would love to see a diversified WN fleet, it’s not going to happen. Boeing will give WN whatever concessions they want so they will order more, or keep the amount of 737Ms on order. They still have a defacto Gentleman’s Agreement that all the other US carriers got rid of years ago.


Same here. This is WN sniffing for more discounts.
 
HIA350
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:02 pm

N776AU wrote:
Their livery looks better on the A320 anyway :stirthepot:
Image



i agree :)
 
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:03 pm

Dutchy wrote:
DWC wrote:
Dutchy wrote:
an A220-300 would do nicely. But that means introducing another jet, but then again with a fleet as big as theirs, that should hardly matter.

Ditto. But if that happens, cannot be overnight, in theory.
But with the new momentum the recent A220 sales & top ups to DL, AC, AF have sent industry-wide extolling the model, plus customer's positive reviews, I expect new orders to follow & Airbus to pull some rabbit out of their hat, possibly in Mobile, perhaps even in Toulouse when the last A380 is delivered, freeing what is left of the space.


We have seen the case of Easyjet, making the switch for the whole fleet. How long did that take, from the first delivery of the A320, till they had a sizeable fleet of say 50 or 100 a/c?


They received them very quickly, IIRC 30-40 in the first year. Pretty sure a similar thing would be close to impossible with the 220. 320 would be a possibility.
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:06 pm

MIflyer12 wrote:

You vastly overestimate what a small fleet of 60 A220s can do.


60? I agree 60 wouldn't do much. I was thinking more like 300. As in, if Southwest decides to get a 73G replacement, they buy in sufficient quantitities to make a difference. If that were the 223, Airbus would have to up production rates by 3-5 frames per month, specifically for WN. Even if that were the E2, they'd be looking at increasing production to fill the order.

MIflyer12 wrote:
Airbus doesn't have the capacity to build a bunch more A220s.


Absent evidence, this is entirely an unsubstantiated assumption on your part.

MIflyer12 wrote:
We don't know that the vendor base (resources, tooling) can be scaled up 3x-5x.


There's nothing special about the 220 (or the E2) from the vendor side that makes ramping up different from other programs. The only difference might be the time it takes and the cost scaling.

MIflyer12 wrote:
Carriers are going to be buying and flying MAXs for a long time to come.


Nobody said otherwise. The only question is the appropriateness of Southwest's business model where their commitment to exclusively flying 737s now requires them to upgauge substantially.
 
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Dutchy
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:10 pm

runway23 wrote:
Dutchy wrote:
DWC wrote:
Ditto. But if that happens, cannot be overnight, in theory.
But with the new momentum the recent A220 sales & top ups to DL, AC, AF have sent industry-wide extolling the model, plus customer's positive reviews, I expect new orders to follow & Airbus to pull some rabbit out of their hat, possibly in Mobile, perhaps even in Toulouse when the last A380 is delivered, freeing what is left of the space.


We have seen the case of Easyjet, making the switch for the whole fleet. How long did that take, from the first delivery of the A320, till they had a sizeable fleet of say 50 or 100 a/c?


They received them very quickly, IIRC 30-40 in the first year. Pretty sure a similar thing would be close to impossible with the 220. 320 would be a possibility.


That's quite fast, certainly with the production levels of around the turn of the century. Must be a good month of production. For the A220 to reach that kind of levels is a bit too far, I agree, unless there are a number of orders like this and give a few years. The mobile plant was set up in quite a quick fashion, so if the demand is there, it should be possible.
Many happy landings, greetings from The Netherlands!
 
buzzard302
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:14 pm

Any smart CEO would be looking at alternatives and have a back up plan. Never hinge your business on one supplier, it is a recipe for failure.
 
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adamblang
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:19 pm

The linked articles read to me that Southwest is looking ahead to the long term, that realize they're approaching the limit of the number of markets that can support a 2500 nm 150 seat aircraft, and realize to grow they're going to need to introduce another fleet type to continue growing into new markets. And with those looming necessities they're going to have to get their labor agreements in order. Since that's a slow process, they need to start now.

This would've happened with or without MAX groundings.
146 319 320 321 332 333 343 717 734 735 73G 738 739 744 752 753 763 764 772 773 789 AR1 AT4 CNA CR2 CR7 DC9 ER3 ERD ER4 E70 E75 E90
 
estorilm
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:23 pm

N776AU wrote:
Their livery looks better on the A320 anyway :stirthepot:
Image

Wow, it really does!

Still - I agree with some that this is yet another airline's way of putting pressure on Boeing and possibly setting things up for some future price negotiations.

If anything, they'd go for the A223 though - as others have said. I mean a domestically-built A220 would be a winner (and let's face it, efficiency-wise, it's almost impossible to ignore, as even senior WN management have admitted.)

Let's see some livery of that. ;)
 
DWC
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:24 pm

cledaybuck wrote:
DWC wrote:
The risk of being held hostage to one model, one company or one externality is so high that in retrospect it is appalling that big airlines like SW, FR, FZ, U2 still confuse simple with simplistic maths, business is never that simple. With such fleet sizes, diversification is marginally more expensive, it's even a sound insurance policy B6 now has, way cheaper than having part of one's fleet grounded or one's growth stunted.
No it's not. There is a reason that virtually every LCC has gone to a single type. Groundings are (thankfully) increadibly rare. Even if WN had half A320's and half 737's, they would still be totally screwed if one was grounded.

Financially, as I stated, it makes sense to have one fleet, agreed.
I also mentionned large companies, where having a split fleet doesn't tickle their finances.

The problem is to internalize risk when bad luck strikes, when the plague sweeps all the company's fleet to the ground.
Has happened, what, about 4 or 5 times in the century ? Those that I remember grounded : Comet, Tu-144, 737, 787, may be others, but all in all so negligeable that it is overlooked. Just like when the Tsunami swept across south east Asia in 2004, people knew it could happen, last time had been over a century ago so they decided they wouldn't internalize it, not in my back yard. And then hell broke out.

That is when it affects you, it's negligeable no more.
It is not because everyone forgets about it, that it is right. Some things could have been done. Most large companies have split fleets, actually due to availability & political considerations, but in the end that also serves to mitigate risks.
Relying on one model can kill you, specially with Boeing that is collecting these days an astounding number of blunders & problems. For instance, quality problems have been rampant in the last decade, there is a thread here on problematic 787s, pannels falling off, there's also a good Al-Jazeera documentary on Boeing, shot on site, should still be on youtube - pathetic. I am one of those who makes sure I never fly a 737, prefer E-jets or 320s, roomier. With the grounding, I now make sure to tell friends to MAX all 737s, as most cannot distinguish an NG, a max7, 8, 9 or 10. So I keep it simple, a simple rule to save perhaps a life.

You are right in that with a split fleet, you are still "screwed" to the ground.
But only hemiplegic, still alive.
My guess, and I mean it, just a guess, is SW wants to diversify for that reason & never be paraplegic : they can afford it.
There is a wide pool of A320 & 737 out there, so leasing some is not a problem, but just how many would be available in the next 6-12 months ? I don't know.

Because I remember JL CEO stating that their airline could not rely on a sole OEM, because I remember how that ended with JL ordering Airbus, this msg from SW has a particular ring. Naturally, SW is a different animal than JL, different business model, but they are healthy & way larger : they can afford whatever they want to ensure they stay sound & stolid.
Last edited by DWC on Thu Aug 15, 2019 1:35 pm, edited 2 times in total.
 
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keesje
Topic Author
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:28 pm

estorilm wrote:
N776AU wrote:
Their livery looks better on the A320 anyway :stirthepot:
Image

Wow, it really does!

Still - I agree with some that this is yet another airline's way of putting pressure on Boeing and possibly setting things up for some future price negotiations.

If anything, they'd go for the A223 though - as others have said. I mean a domestically-built A220 would be a winner (and let's face it, efficiency-wise, it's almost impossible to ignore, as even senior WN management have admitted.)

Let's see some livery of that. ;)


https://sjc1.discourse-cdn.com/infiniteflight/uploads/default/optimized/3X/b/8/b8bb2ecded34736d622936a647d12723bcb7a075_2_830x560.jpeg

I think the A220 FAL at Mobile earliier this week shows how much pressure there is on ramping up production. Issue is A is fully dependent on the supply chain.
"Never mistake motion for action." Ernest Hemingway
 
bob75013
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:33 pm

TObound wrote:
planecane wrote:

They can wait because they already own enough 150 seaters. Just because an A220 is more efficient doesn't mean it is worth buying one to replace an already paid for 737-700 that still has a decade or more of service left in it. They have over 500 -700s. Even if the retire them 1 for 1 with MAX8 deliveries, they'll still have over 300. If Boeing Brasil Commercial launches a competitor to the A220 next year or in 2021, deliveries will start before the -700 needs mass retirements.


That's the absolute best case scenario. In all likelihood, a Boeing facing major capital draws for the Max and the 777X, is going to put off developing the NSA. Keep in mind this is a company that's absolutely commited to drawing every last drop off profit and not investing more. They'll be happy to sell Southwest 7M7s if they want 150 seaters. And everyone knows that Southwest has no choice but to buy whatever Boeing offers.

planecane wrote:

In reality, outside of Delta and Southwest, the other mainline carriers have gone 737-800/A320 and larger for new orders. WN had ordered very few MAX7s. I don't get the insistence that WN needs smaller aircraft. Honestly, the A321 would make more sense to me if they were to go beyond the 737 to allow international growth with higher capacity.




Let's be honest though, Southwest will give up profit before they give up Boeing. I honestly think operating anything not from the 737 family is too taxing for their operational abilities.


That's pretty funny. The fact that SW has been profitable for something like 40 consecutive years (thru recessions and difficulties that drove ther airlines to BK - sometimes multiple times) tells me you are severly underestimating SW's "operational abilities."
 
flyingcat
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:35 pm

JonesNL wrote:
The A220 would be an option if Airbus is able to pump out 60 p/month to fill in the demand. I am not seeing that happening anytime soon.


Canada would probably make WN flights tax exempt if they ordered this many planes.
 
bob75013
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:37 pm

DWC wrote:
cledaybuck wrote:
DWC wrote:
The risk of being held hostage to one model, one company or one externality is so high that in retrospect it is appalling that big airlines like SW, FR, FZ, U2 still confuse simple with simplistic maths, business is never that simple. With such fleet sizes, diversification is marginally more expensive, it's even a sound insurance policy B6 now has, way cheaper than having part of one's fleet grounded or one's growth stunted.
No it's not. There is a reason that virtually every LCC has gone to a single type. Groundings are (thankfully) increadibly rare. Even if WN had half A320's and half 737's, they would still be totally screwed if one was grounded.

Financially, as I stated, it makes sense to have one fleet, agreed.
I also mentionned large companies, where having a split fleet doesn't tickle their finances.



.


Are you sure of that? Then why is WN's gross profit margin ALWAYS higher than it's legacy competitors?
 
TObound
Posts: 309
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:38 pm

DWC wrote:
Financially, as I stated, it makes sense to have one fleet, agreed.
I also mentionned large companies, where having a split fleet doesn't tickle their finances.

The problem is to internalize risk when bad luck strikes, when the plague sweeps all the company's fleet to the ground.
Has happened, what, about 4 or 5 times in the century ? Those that I remember grounded : Comet, Tu-144, 737, 787, may be others, but all in all so negligeable that it is overlooked. Just like when the Tsunami swept across south east Asia in 2004, people knew it could happen, last time had been over a century ago so they decided they wouldn't internalize it, not in my back yard. And then hell broke out.

That is when it affects you, it's negligeable no more.
It is not because everyone forgets about it, that it is right. Some things could have been done. Most large companies have split fleet, actually due to availability & political considerations, but in the end that also serves to mitigate risks.


I wonder if airlines can buy business insurance for catastrophic risk.

To be fair, most of these grounding tend to happen early in the lives of these programs. At a point at which exposure wouldn't kill the airline. The real risk here is not the grounding but a failure to recover. For example, let's say that Boeing concludes that the only way to truly recover is to scrap the Max and launch the NSA. Could Southwest wait survive with no deliveries for 6-7 years? Leasing would be challenging because everyone would take up any aircraft sitting around.

DWC wrote:
Because I remember JL CEO stating that their airline could not rely on a sole OEM, because I remember how that ended with JL ordering Airbus, this msg from SW has a particular ring. Naturally, SW is a different animal than JL, different business model, but they are healthy & way larger : they can afford whatever they want to ensure they stay sound & stolid.


Another aircraft type doesn't necessarily mean buying from Airbus. They could buy E2s.
 
lostsound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:39 pm

IMO SW is additionally interested in A220s in part due to the potential entry Moxy which if materializes, will have leverage on lighter non-stop routes due to better aircraft sizing for the market. A220s would allow SW itself to expand in these areas while continuing to offer their customer beloved ticket price and service ratio. While it's unlikely they ever buy an aircraft that's not a 737, A220 could definitely increase their already impressive reach. Perhaps the potential A220-500 AF/KLM are interested in would also hold value to SW?
 
TObound
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:48 pm

JonesNL wrote:
The A220 would be an option if Airbus is able to pump out 60 p/month to fill in the demand. I am not seeing that happening anytime soon.


That's a ridiculous and nonsensical number. Why would 60/month be needed to fill demand? This is above the 320NEO production rate at the moment.

Southwest itself tends to keep their aircraft for 20-25 years. Replacing ALL of Southwest's fleet would add about 3 frames per month to an OEM's production line. Of course, if Southwest were to order anything else, it'd be far less, so the reality is probably 1-2 frames per month in demand from WN and the odd surge order to maybe 4-5 frames/month.
 
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keesje
Topic Author
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:52 pm

lostsound wrote:
IMO SW is additionally interested in A220s in part due to the potential entry Moxy which if materializes, will have leverage on lighter non-stop routes due to better aircraft sizing for the market. A220s would allow SW itself to expand in these areas while continuing to offer their customer beloved ticket price and service ratio. While it's unlikely they ever buy an aircraft that's not a 737, A220 could definitely increase their already impressive reach. Perhaps the potential A220-500 AF/KLM are interested in would also hold value to SW?


Probably not. Likely the -300 would best fits the requirement. Comfortably <149 seats / 3 attendents, like the older 737-700s up for replacement.
"Never mistake motion for action." Ernest Hemingway
 
TObound
Posts: 309
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:52 pm

lostsound wrote:
IMO SW is additionally interested in A220s in part due to the potential entry Moxy which if materializes, will have leverage on lighter non-stop routes due to better aircraft sizing for the market. A220s would allow SW itself to expand in these areas while continuing to offer their customer beloved ticket price and service ratio. While it's unlikely they ever buy an aircraft that's not a 737, A220 could definitely increase their already impressive reach. Perhaps the potential A220-500 AF/KLM are interested in would also hold value to SW?


Business intelligence. They need to know what Neeleman can really do with those 60 223s. And Airbus isn't going to readily give up info unless they at least fake some interest. Moxy is only 2 years from launch. And Southwest is facing their sole airplane supplier having major issues. Not spending some solid effort to truly understand the 223 would be business malpractice.
 
planecane
Posts: 1080
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:53 pm

TObound wrote:
DWC wrote:
Financially, as I stated, it makes sense to have one fleet, agreed.
I also mentionned large companies, where having a split fleet doesn't tickle their finances.

The problem is to internalize risk when bad luck strikes, when the plague sweeps all the company's fleet to the ground.
Has happened, what, about 4 or 5 times in the century ? Those that I remember grounded : Comet, Tu-144, 737, 787, may be others, but all in all so negligeable that it is overlooked. Just like when the Tsunami swept across south east Asia in 2004, people knew it could happen, last time had been over a century ago so they decided they wouldn't internalize it, not in my back yard. And then hell broke out.

That is when it affects you, it's negligeable no more.
It is not because everyone forgets about it, that it is right. Some things could have been done. Most large companies have split fleet, actually due to availability & political considerations, but in the end that also serves to mitigate risks.


I wonder if airlines can buy business insurance for catastrophic risk.

I would assume so. In a very different business that I used to be in, our insurance policy covered loss of income in the event something happened like a building became unusable for a period of time due to storm damage. Obviously there will be some maximum that they will pay out but I'd imagine that the airline's insurance policies cover this type of event.
 
TObound
Posts: 309
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 1:54 pm

bob75013 wrote:
That's pretty funny. The fact that SW has been profitable for something like 40 consecutive years (thru recessions and difficulties that drove ther airlines to BK - sometimes multiple times) tells me you are severly underestimating SW's "operational abilities."


Past performance is always an indicator of future results. I am typing this on my Compaq laptop right before I board my Pan Am flight.
 
cledaybuck
Posts: 1522
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 2:03 pm

DWC wrote:
cledaybuck wrote:
DWC wrote:
The risk of being held hostage to one model, one company or one externality is so high that in retrospect it is appalling that big airlines like SW, FR, FZ, U2 still confuse simple with simplistic maths, business is never that simple. With such fleet sizes, diversification is marginally more expensive, it's even a sound insurance policy B6 now has, way cheaper than having part of one's fleet grounded or one's growth stunted.
No it's not. There is a reason that virtually every LCC has gone to a single type. Groundings are (thankfully) increadibly rare. Even if WN had half A320's and half 737's, they would still be totally screwed if one was grounded.

Financially, as I stated, it makes sense to have one fleet, agreed.
I also mentionned large companies, where having a split fleet doesn't tickle their finances.

The problem is to internalize risk when bad luck strikes, when the plague sweeps all the company's fleet to the ground.
Has happened, what, about 4 or 5 times in the century ? Those that I remember grounded : Comet, Tu-144, 737, 787, may be others, but all in all so negligeable that it is overlooked. Just like when the Tsunami swept across south east Asia in 2004, people knew it could happen, last time had been over a century ago so they decided they wouldn't internalize it, not in my back yard. And then hell broke out.

That is when it affects you, it's negligeable no more.
It is not because everyone forgets about it, that it is right. Some things could have been done. Most large companies have split fleets, actually due to availability & political considerations, but in the end that also serves to mitigate risks.
Relying on one model can kill you, specially with Boeing that is collecting these days an astounding number of blunders & problems. For instance, quality problems have been rampant in the last decade, there is a thread here on problematic 787s, pannels falling off, there's also a good Al-Jazeera documentary on Boeing, shot on site, should still be on youtube - pathetic. I am one of those who makes sure I never fly a 737, prefer E-jets or 320s, roomier. With the grounding, I now make sure to tell friends to MAX all 737s, as most cannot distinguish an NG, a max7, 8, 9 or 10. So I keep it simple, a simple rule to save perhaps a life.

You are right in that with a split fleet, you are still "screwed" to the ground.
But only hemiplegic, still alive.
My guess, and I mean it, just a guess, is SW wants to diversify for that reason & never be paraplegic : they can afford it.
There is a wide pool of A320 & 737 out there, so leasing some is not a problem, but just how many would be available in the next 6-12 months ? I don't know.

Because I remember JL CEO stating that their airline could not rely on a sole OEM, because I remember how that ended with JL ordering Airbus, this msg from SW has a particular ring. Naturally, SW is a different animal than JL, different business model, but they are healthy & way larger : they can afford whatever they want to ensure they stay sound & stolid.

I just don't see how, for instance, having lets say 100 A220's would make any difference at all at WN if the 737 were grounded.
As we celebrate mediocrity, all the boys upstairs want to see, how much you'll pay for what you used to get for free.
 
Sokes
Posts: 232
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Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 2:07 pm

I can understand that a low cost carrier wants to fly only B737 or only A320. But why to have 500 B737-700 instead of a mix of -700, -800, -900.
Wikipedia says exit limit for passengers is
-700: 149 passengers
-800: 189 "
-900: 220 "
Wouldn't it be worth to have one stewardess extra for 40 extra seats?
Or is it a stewardess and ground crew complication?
Is it better for ticket prices if there is a shortage of seats?
What do I miss?
Why can't the world be a little bit more autistic?
 
planecane
Posts: 1080
Joined: Thu Feb 09, 2017 4:58 pm

Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 2:11 pm

keesje wrote:
lostsound wrote:
IMO SW is additionally interested in A220s in part due to the potential entry Moxy which if materializes, will have leverage on lighter non-stop routes due to better aircraft sizing for the market. A220s would allow SW itself to expand in these areas while continuing to offer their customer beloved ticket price and service ratio. While it's unlikely they ever buy an aircraft that's not a 737, A220 could definitely increase their already impressive reach. Perhaps the potential A220-500 AF/KLM are interested in would also hold value to SW?


Probably not. Likely the -300 would best fits the requirement. Comfortably <149 seats / 3 attendents, like the older 737-700s up for replacement.


As best as I can tell without spending too much time looking at it, of the 512 737-700s in WN's fleet, 190 are over 15 years old, 148 between 10 and 15 years old and 174 are less than 10 years old. They have at least 174 <149 seat aircraft that can remain in service until 2030, assuming retirement at 20 years. I don't really see a need to order a replacement for 4 or 5 years. I would be absolutely shocked if Boeing Brasil Commercial didn't launch a 150 seat and under model series before then. Whether the NMA turns into the NSA or there end up being two projects, I would expect the NSA will have the smallest model be in the 737-800 size range or slightly larger.

The current MAX8 orders (plus the 34 at VCV) can cover retiring all of the -700s over 15 years old and grow the fleet by 90 aircraft (or retire over half the 10-15 year old -700s and maintain fleet size).
 
planecane
Posts: 1080
Joined: Thu Feb 09, 2017 4:58 pm

Re: Southwest, a stalwart Boeing 737 MAX customer, eyes other jets

Thu Aug 15, 2019 2:14 pm

Sokes wrote:
I can understand that a low cost carrier wants to fly only B737 or only A320. But why to have 500 B737-700 instead of a mix of -700, -800, -900.
Wikipedia says exit limit for passengers is
-700: 149 passengers
-800: 189 "
-900: 220 "
Wouldn't it be worth to have one stewardess extra for 40 extra seats?
Or is it a stewardess and ground crew complication?
Is it better for ticket prices if there is a shortage of seats?
What do I miss?


I think when they were expanding, they didn't want to add too much capacity and they wanted complete commonality for simplicity of operations. Then, when fuel costs spiked, they saw the advantage of using the -800 and getting better fuel efficiency per seat and started ordering the -800.

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