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zeke
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 4:21 pm

Antarius wrote:

One does not defer 78 planes indefinitely due to it. The virus is very much real, but this response is many levels above.

The original order never made sense.


It original order made total sense, they now a large player is a one o the fastest growing areas in the world.

Without passengers, they have no income. The airline is fighting to survive, without deferring orders indefinitely they will need make good predelivery cash payments.

Your allegations are baseless, and not surprising as most people on here give zero consideration to the financing of aircraft orders.

BTW I am aware of many airlines in Asia deferring deliveries, the virus is going to have a large impact on A&B.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
Antarius
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 4:25 pm

zeke wrote:
Antarius wrote:

One does not defer 78 planes indefinitely due to it. The virus is very much real, but this response is many levels above.

The original order never made sense.


It original order made total sense, they now a large player is a one o the fastest growing areas in the world.

Without passengers, they have no income. The airline is fighting to survive, without deferring orders indefinitely they will need make good predelivery cash payments.

Your allegations are baseless, and not surprising as most people on here give zero consideration to the financing of aircraft orders.

BTW I am aware of many airlines in Asia deferring deliveries, the virus is going to have a large impact on A&B.


So the bribery investigation coupled with the bribery settlements has absolutely nothing to do with this? We should discard them as unrelated data points. Of course :roll:
2020: SFO DFW IAH HOU CLT MEX BIS MIA GUA ORD DTW LGA BOS LHR DUB BFS BHD STN OAK PHL ISP JFK SJC DEN SJU LAS TXL GDL
 
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zeke
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 4:29 pm

Antarius wrote:

So the bribery investigation coupled with the bribery settlements has absolutely nothing to do with this? We should discard them as unrelated data points. Of course :roll:


The evidence is there for everyone to see airlines all over Asia are parking aircraft at the moment. This is not isolated to the them.

I take it you probably are based in the US, never been to Asia, and never flown on the airline.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
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flee
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sat Feb 29, 2020 4:33 pm

SQ789 wrote:
Do anyone know the serial number or registration that will leave this year? I guess the leaving ones is the former KA A330-300s that are brought by D7 in 2013.

I would think that this is a complex equation that has to be solved! I think their objective would be to only retain aircraft with the lowest lease rates. In addition, they may want to get rid of aircraft that have upcoming C or D checks. They may also look at the cost of terminating the leases early. So, a lot of number crunching will be necessary before we know which frames will depart.
 
3AWM
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sat Feb 29, 2020 4:40 pm

I think the point being made is not the Coronavirus isn't real. It's that it sounds better to say that any cancellation / deferment is down to Coronavirus than to say this order was a bad decision in the first place that only happened because someone's side project got a bung.
 
Antarius
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 4:41 pm

zeke wrote:
Antarius wrote:


So the bribery investigation coupled with the bribery settlements has absolutely nothing to do with this? We should discard them as unrelated data points. Of course :roll:


The evidence is there for everyone to see airlines all over Asia are parking aircraft at the moment. This is not isolated to the them.

I take it you probably are based in the US, never been to Asia, and never flown on the airline.


The evidence is there in terms of bribery settlements. That's a fact

As for the second point, cute but so wrong. Lived in SE Asia for a decade and go to SIN, HKG, KUL, PVG etc. Multiple times a year. So well aware of the nature of the industry there. 100 a330s was insanity, no matter which way you slice it.
2020: SFO DFW IAH HOU CLT MEX BIS MIA GUA ORD DTW LGA BOS LHR DUB BFS BHD STN OAK PHL ISP JFK SJC DEN SJU LAS TXL GDL
 
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flee
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 4:45 pm

Antarius wrote:
zeke wrote:
Antarius wrote:
The virus is a convenient excuse. Better PR than admitting that you over ordered for no good reason, especially with the corruption and bribery probe.

Have a look at FR24 over Asia and come back to us if you still think the virus impact on aviation in Asia is fake news.

One does not defer 78 planes indefinitely due to it. The virus is very much real, but this response is many levels above.

The original order never made sense.

I am sorry to say that you don't know much about how the Corvid-19 virus outbreak has impacted airline operations. I read a report saying that only 10-20% of flights are still operating in China. Do you know how many flights operate everyday in China every day? D7 itself has said that some 30% of its total capacity is into China. Now it also finds itself suspending flights to South Korea. And flights to Japan may also be suspended in the near future. I saw a photo of HKIA that showed parked aircraft filling up remote bays and taxiways! The operational disruption is huge.

I do not think that D7s A330Neo order is too big - the deliveries are due to be made over about 8 years. Existing A330 Ceo aircraft are also scheduled to be retired as new aircraft are delivered. Right now, only Thai and Malaysian units are operational but there are plans to have units in India, Japan and Philippines when the time is right.

The order is not postponed indefinitely, I am sure. We are just waiting for some clarity with regards to when the virus outbreak will be brought under control and businesses all over the world resume normal activity.
 
Antarius
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sat Feb 29, 2020 4:49 pm

3AWM wrote:
I think the point being made is not the Coronavirus isn't real. It's that it sounds better to say that any cancellation / deferment is down to Coronavirus than to say this order was a bad decision in the first place that only happened because someone's side project got a bung.


Bingo. And them acting like they NOW know that the a321 being a better choice for their routes is funny too.

The a321 was always a better choice for them.
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zeke
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 5:01 pm

Antarius wrote:
As for the second point, cute but so wrong. Lived in SE Asia for a decade and go to SIN, HKG, KUL, PVG etc. Multiple times a year. So well aware of the nature of the industry there. 100 a330s was insanity, no matter which way you slice it.


And yet a little airline down the road which only had seven 707s and five 737s in 1972 went on to operate 93 747s. The the fastest growing market in the world for two reasons, the expanding middle class, and the expanding population.

They have on order around 400 A320 series, and 80 A330 series for the total group.

flee wrote:
D7 itself has said that some 30% of its total capacity is into China. Now it also finds itself suspending flights to South Korea. And flights to Japan may also be suspended in the near future. I saw a photo of HKIA that showed parked aircraft filling up remote bays and taxiways! The operational disruption is huge.


That is a huge impact on their operations.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
NZ321
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 5:21 pm

JetBuddy wrote:
Revelation wrote:
One interesting quote:

"We believe advanced aircraft technology has changed business dynamics as we can now fly narrow body aircraft longer," AirAsia X Malaysia CEO Benyamin Ismail said in a statement.

So it seems A321XLR is undermining the A330neo business case.


Yep, it doesn't get any more clear cut than that. If we're to believe the CEO.

The market seems to want smaller long range aircraft. And bigger short range aircraft. Does this chart culminate with a 797 / A360 MOM with two sets of wings? :scratchchin:


That equates with - their widebody product sucks. Everyone of us who has tried it knows it... So why did they order all those darn A330 Neos in the first place? It is and always was a failed strategy IMHO. Just sardines. They need a different brand / product to do widebody / ong haul than Air Asia X. I wouldn't be surprised to see them wrap it up in the near future or confine it to much shorter routes.
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travelhound
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sat Feb 29, 2020 7:34 pm

From what I can work out the only LCC that made Wide Body medium haul flying profitable is JQ in Australia.....and they are currently playing around with the idea of reducing their 787 fleet.

I’d also suggest, if D7 fails the Scoot mandate (compete with other LCC’s in a growing market) would need to adapt to a paradigm where it is the dominant LCC medium haul carrier.

Considering Scoot is financially very marginal, SIA could decide to adjust their LCC strategy in favour of the full service airline.

As such, we could be on the cusp of a structural change within the industry where full service airlines become the growth engines for Medium haul flying.

Ten plus years ago Air New Zealand merged their Freedom Air LCC back into the full service carrier by adopting a multi-economy class financial model. They have been a very profitable airline since that time.

From this perspective we should be comparing the successes / failures from a multitude of airlines with varying business models. The airlines who decided against the LCC long haul model in favour of a (hybrid) multi-economy class model seem to have done very well.
 
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Re: Air Asia-X Defers A330NEO's

Sat Feb 29, 2020 8:00 pm

Antarius wrote:
zeke wrote:
Antarius wrote:

One does not defer 78 planes indefinitely due to it. The virus is very much real, but this response is many levels above.

The original order never made sense.


It original order made total sense, they now a large player is a one o the fastest growing areas in the world.

Without passengers, they have no income. The airline is fighting to survive, without deferring orders indefinitely they will need make good predelivery cash payments.

Your allegations are baseless, and not surprising as most people on here give zero consideration to the financing of aircraft orders.

BTW I am aware of many airlines in Asia deferring deliveries, the virus is going to have a large impact on A&B.


So the bribery investigation coupled with the bribery settlements has absolutely nothing to do with this? We should discard them as unrelated data points. Of course :roll:


THe size of the A330neo order always seemed rather questionable since Air Asia X hasn’t appeared to strategically need a large widebody fleet with all the variability in their long haul route network. The order has changed many times. Given the bribery allegations, it does appear that the order may have been based on bribes rather a sound business plan. Coronavirus related travel disruptions bring to light how Air Asia X likely never had a sustainable business model to utilize all those A330neos. With demand down and revenue collapsing, there’s no way to cover up that the A330neos likely would never profitably fit into the Air Asia X business plan.
 
moa999
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sat Feb 29, 2020 10:42 pm

When fitted out in LCC config, whats the range of a 321XLR? And what cities does that enable D7 to serve that AK (Air Asia) can't.
 
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zkojq
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 2:41 am

Polot wrote:
JerseyFlyer wrote:
AAX has proved there is demand in Asia for its offerings. If it gets killed by coronavirus, someone will pick over the carcass and resurrect an equivalent airline.

That is not entirely true. AAX has been struggling since before the Coronavirus losing money in both 2019 and 2018.

The truth of the matter is Air Asia X has never been consistently profitable, and been surviving based off the strength of their parent company.


The truth of the matter is that Long Haul Low Cost traffic in SE Asia is very volatile and very reactive to economic conditions and factors like the virus. They had some bad years in the early 2010s, cancelled a lot of A330ceo orders and then only a year or two after were short of capacity and said (can't remember if it was explicitly or implicitly) that they'd over cancelled.


I'd imagine that Air Asia X are bleeding cash very badly right now.

Jetport wrote:
This is a perfect opportunity for Airbus. They should announce the quick wind down of A330neo production and convert the line to A32Xneo ASAP.


Why would they do that for the 330 line when they're doing it to the A380 line, no?

Jetport wrote:
What does everyone think about a bold move to stop throwing good money after bad with this dog?


Who's throwing good money after bad? And how do you figure that the A330neo is a dog? Haters gonna hate but the truth is that the Airbus A330 is the workhorse of Asia.
First to fly the 787-9
 
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flee
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 2:45 am

moa999 wrote:
When fitted out in LCC config, whats the range of a 321XLR? And what cities does that enable D7 to serve that AK (Air Asia) can't.

D7 has not revealed the configuration of their A321 XLRs because delivery is not due for another few years.

However, their recent talk about using 236 seat A321 for 4-6 hour flights seems to refer to aircraft with similar configuration to Airasia's (AK). I am guessing that D7 will lease some A321s from AK because they (AK) may also want to reduce the size their fleet in view of lower demand.
 
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zeke
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 3:14 am

Weatherwatcher1 wrote:
THe size of the A330neo order always seemed rather questionable since Air Asia X hasn’t appeared to strategically need a large widebody fleet with all the variability in their long haul route network. The order has changed many times. Given the bribery allegations, it does appear that the order may have been based on bribes rather a sound business plan. Coronavirus related travel disruptions bring to light how Air Asia X likely never had a sustainable business model to utilize all those A330neos. With demand down and revenue collapsing, there’s no way to cover up that the A330neos likely would never profitably fit into the Air Asia X business plan.


I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
JustSomeDood
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 6:39 am

zeke wrote:
Weatherwatcher1 wrote:
THe size of the A330neo order always seemed rather questionable since Air Asia X hasn’t appeared to strategically need a large widebody fleet with all the variability in their long haul route network. The order has changed many times. Given the bribery allegations, it does appear that the order may have been based on bribes rather a sound business plan. Coronavirus related travel disruptions bring to light how Air Asia X likely never had a sustainable business model to utilize all those A330neos. With demand down and revenue collapsing, there’s no way to cover up that the A330neos likely would never profitably fit into the Air Asia X business plan.


I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.


Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.
 
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flee
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 7:42 am

JustSomeDood wrote:
zeke wrote:
Weatherwatcher1 wrote:
THe size of the A330neo order always seemed rather questionable since Air Asia X hasn’t appeared to strategically need a large widebody fleet with all the variability in their long haul route network. The order has changed many times. Given the bribery allegations, it does appear that the order may have been based on bribes rather a sound business plan. Coronavirus related travel disruptions bring to light how Air Asia X likely never had a sustainable business model to utilize all those A330neos. With demand down and revenue collapsing, there’s no way to cover up that the A330neos likely would never profitably fit into the Air Asia X business plan.

I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.

Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.

Airasia X's fleet is currently 40 aircraft as it includes Thai (XJ) and Indonesia (XT) Airasia X fleets. In future, if Airasia X units are established in India, Japan and Philippines, their aircraft will come from the Airasia X order book.
 
moa999
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 7:45 am

flee wrote:
D7 has not revealed the configuration of their A321 XLRs because delivery is not due for another few years.


Can only be a dense Y, or maybe dense Y plus say 8 PE seats of their current sloper in 2x2.

Think my other assumption was that AK wouldn't let D7 compete with AK, ie. Only using them on flights longer than AK.

Is KUL-HKG current longest?
 
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flee
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 8:13 am

moa999 wrote:
Think my other assumption was that AK wouldn't let D7 compete with AK, ie. Only using them on flights longer than AK.

Is KUL-HKG current longest?

D7 has some shared routes operated as JVs with AK, e.g. KUL-SIN

Their longest 6 hour route is possibly KUL-FUK.
 
jeffrey0032j
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 8:27 am

flee wrote:
JustSomeDood wrote:
zeke wrote:
I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.

Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.

Airasia X's fleet is currently 40 aircraft as it includes Thai (XJ) and Indonesia (XT) Airasia X fleets. In future, if Airasia X units are established in India, Japan and Philippines, their aircraft will come from the Airasia X order book.

XT has ended all scheduled operations, XJ hasn't made any money since it started and D7 is losing money. I can't help to see how this is sustainable especially in this climate unless AK group is willing to pour in even more money into this hole. And the situation at AK group is not entirely pretty too, with the Airbus corruption probe and Air Asia India probe ongoing. Plus they don't have the backing of Khazanah,my opinion is that Khazanah would save MH before it saves AK group.

The magic at AirAsia (or marketing BS) is starting to unravel.

Plus, you have Lion, Cebu and Bamboo all ordering eye-watering amounts of planes. And government owned MH, TG, GA losing money while still being able to fly. Do you really think the South East Asian market is able to absorb this number of planes? Maybe 2030s, but not now.
 
jeffrey0032j
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 8:28 am

flee wrote:
moa999 wrote:
Think my other assumption was that AK wouldn't let D7 compete with AK, ie. Only using them on flights longer than AK.

Is KUL-HKG current longest?

D7 has some shared routes operated as JVs with AK, e.g. KUL-SIN

Their longest 6 hour route is possibly KUL-FUK.

D7 going to SIN is probably not a good look, especially when they haven't done so before. Have they run out of further places that they can fly to?
 
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flee
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 8:47 am

jeffrey0032j wrote:
flee wrote:
JustSomeDood wrote:
Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.

Airasia X's fleet is currently 40 aircraft as it includes Thai (XJ) and Indonesia (XT) Airasia X fleets. In future, if Airasia X units are established in India, Japan and Philippines, their aircraft will come from the Airasia X order book.

XT has ended all scheduled operations, XJ hasn't made any money since it started and D7 is losing money. I can't help to see how this is sustainable especially in this climate unless AK group is willing to pour in even more money into this hole. And the situation at AK group is not entirely pretty too, with the Airbus corruption probe and Air Asia India probe ongoing. Plus they don't have the backing of Khazanah,my opinion is that Khazanah would save MH before it saves AK group.

The magic at AirAsia (or marketing BS) is starting to unravel.

Plus, you have Lion, Cebu and Bamboo all ordering eye-watering amounts of planes. And government owned MH, TG, GA losing money while still being able to fly. Do you really think the South East Asian market is able to absorb this number of planes? Maybe 2030s, but not now.

It does not matter if XT has ended scheduled operations - their fleet still comes from D7. If they shut down, the planes will come back to D7 and so need to be counted. D7 has already said in their latest quarterly report that they are planning early lease returns for 5 aircraft and the sale of 2 aircraft. That will take 7 aircraft out of the fleet, if that happens. We were discussing your assertion that they over ordered - but D7 is not only ordering for itself bur also the airlines in their group.

Khazanah is partly responsible for D7s problems because it is pumping money into MH, thus allowing it to offer irrational competition. MH cannot compete with D7 on cost but with subsidies, it is able to undermine D7's yields. That was why it came up with the "brilliant" idea of merging Airasia Group/Airasia X and MAB!
 
abrelosojos
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 8:55 am

Clearly an airline falling apart, and in need of some cash:

https://newsroom.airasia.com/news/2020/ ... imitedpass

I honestly think it is time for Tony to go.

Saludos,
Alex
Live, and let live.
 
jeffrey0032j
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 9:18 am

flee wrote:
jeffrey0032j wrote:
flee wrote:
Airasia X's fleet is currently 40 aircraft as it includes Thai (XJ) and Indonesia (XT) Airasia X fleets. In future, if Airasia X units are established in India, Japan and Philippines, their aircraft will come from the Airasia X order book.

XT has ended all scheduled operations, XJ hasn't made any money since it started and D7 is losing money. I can't help to see how this is sustainable especially in this climate unless AK group is willing to pour in even more money into this hole. And the situation at AK group is not entirely pretty too, with the Airbus corruption probe and Air Asia India probe ongoing. Plus they don't have the backing of Khazanah,my opinion is that Khazanah would save MH before it saves AK group.

The magic at AirAsia (or marketing BS) is starting to unravel.

Plus, you have Lion, Cebu and Bamboo all ordering eye-watering amounts of planes. And government owned MH, TG, GA losing money while still being able to fly. Do you really think the South East Asian market is able to absorb this number of planes? Maybe 2030s, but not now.

It does not matter if XT has ended scheduled operations - their fleet still comes from D7. If they shut down, the planes will come back to D7 and so need to be counted. D7 has already said in their latest quarterly report that they are planning early lease returns for 5 aircraft and the sale of 2 aircraft. That will take 7 aircraft out of the fleet, if that happens. We were discussing your assertion that they over ordered - but D7 is not only ordering for itself bur also the airlines in their group.

Khazanah is partly responsible for D7s problems because it is pumping money into MH, thus allowing it to offer irrational competition. MH cannot compete with D7 on cost but with subsidies, it is able to undermine D7's yields. That was why it came up with the "brilliant" idea of merging Airasia Group/Airasia X and MAB!

It does matter, in fact it matters a lot that XT wasn't working. It just seems like AK Group was expanding too fast when they decided to expand their X brand over to Indonesia and Thailand – note that this was also the period where the idea for Air Asia Japan Mk I and Air Asia Vietnam was floated. I think they were too optimistic and too quick to prove that they are better than the big boys (ie full service carriers) back then, and this is coming back to bite them hard now.
 
VV
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 9:29 am

abrelosojos wrote:
Clearly an airline falling apart, and in need of some cash:

https://newsroom.airasia.com/news/2020/ ... imitedpass
...



It says, "AirAsia Unlimited Pass: all you can fly for a year!" for 499 Malaysian Ringgits.

MYR 500 is about EUR 108. That's cheap for an unlimited flights during a year. I guess there are conditions attached to it like "must book the flight at least one month in advance" or even, "If a booking is cancelled you must pay a penalty of 500 Malaysian Ringgit."
 
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flee
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 9:41 am

jeffrey0032j wrote:
It does matter, in fact it matters a lot that XT wasn't working. It just seems like AK Group was expanding too fast when they decided to expand their X brand over to Indonesia and Thailand – note that this was also the period where the idea for Air Asia Japan Mk I and Air Asia Vietnam was floated. I think they were too optimistic and too quick to prove that they are better than the big boys (ie full service carriers) back then, and this is coming back to bite them hard now.

Well operating an airline is not about short term decisions because aircraft orders take a long time to be delivered. AK has found out that when they needed aircraft, they were short. And after they placed a massive order, business conditions change. Fortunately, they were able to work with Airbus to defer deliveries and now they ended up with a fleet of over 250 aircraft. I think they worked quite well with Airbus to smoothen demand for aircraft in the changing conditions.

D7 is a rather riskier venture and that was why it was decided that the Airasia Group (shorthaul flights less than 4 hours) will not run this venture. In the early years, it progressed steadily but in the last 4 or 5 years, many competitors were focussed on disrupting them to prevent a repeat of the dominance of the short haul operations.

Airasia Japan and Vietnam ideas were not the responsibility of Airasia X management. Airasia Japan Mk 1 ended in 2013 while Airasia Vietnam's joint venture with VietJet did not take off due to Vietnamese government objections. VietJet was approved quickly once it dropped Airasia.

XT was a failure because of the laws in Indonesia and a management that did not understand long haul LCCs making decisions that did not make sense. Both Thai and Indonesia Airasia X commenced in 2014.

It is difficult to identify why Airasia X was not able to overcome the difficulties it is currently facing. There are many factors but none of them would be considered the major factor causing its bad situation now. We will soon know, because I feel that 2020 will either see D7 surviving intact, go under, or being merged with Airasia Group.
 
moa999
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 11:13 am

Despite the number of LCC widebodies in operation and on order, still not sure if the model actually works in Asia.

Jetstar Aus hasn't expanded its 787 fleet since the initial 11 and while it appears to have some solid routes, it continually flips others and has 321LRs and XLRs on order.

Scoot was struggling to make money from the 787s before the Tiger merger which obscures things, though has continued to expand mostly to China, but also including operating to Athens, Berlin and for a time Honolulu.

AirAsiaX as above seems to struggle for profitability. On the routes I'm more familiar with to Australia they have cut capacity and raised fares, particularly in the Premium cabins.

Cebu Pacific I suspect relies on the domestic operations.

And then you've got startups Zip Japan and Bamboo in Vietnam.
 
filipinoavgeek
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 11:39 am

moa999 wrote:
Cebu Pacific I suspect relies on the domestic operations.

And then you've got startups Zip Japan and Bamboo in Vietnam.


5J's long haul low cost services have for the most part failed, with them retreating from almost all of their long haul services except for Dubai and Australia (Sydney and Melbourne). Today their A330s are mostly used to upgauge intra-Asia routes as well as MNL-CEB/DVO, and even their upcoming A330neos are planned to operate short-to-medium haul services too.

Bamboo to my knowledge is a FSC and not a LCC, although their aggresive expansion and big plans are giving me pause with regards to their viability as well.
 
AngMoh
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 1:01 pm

moa999 wrote:
Despite the number of LCC widebodies in operation and on order, still not sure if the model actually works in Asia.


Two factors play a role:
1) There are a lot of routes with a distance past the optimum for narrowbodies although that changes with the A321XLR
2) In general, there are slot restrictions. This is no US or EU with free market and open skies. With the exception of a few places, the LCCs need to adhere to bilaterals that reduces available slots. On many routes, the max for an LCC is only once or twice a day even if there is more demand.
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Weatherwatcher1
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 1:46 pm

JustSomeDood wrote:
zeke wrote:
Weatherwatcher1 wrote:
THe size of the A330neo order always seemed rather questionable since Air Asia X hasn’t appeared to strategically need a large widebody fleet with all the variability in their long haul route network. The order has changed many times. Given the bribery allegations, it does appear that the order may have been based on bribes rather a sound business plan. Coronavirus related travel disruptions bring to light how Air Asia X likely never had a sustainable business model to utilize all those A330neos. With demand down and revenue collapsing, there’s no way to cover up that the A330neos likely would never profitably fit into the Air Asia X business plan.


I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.


Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.


Very true. I wonder if the order was based on some risky growth assumptions combined with Key Air Asia X being influenced to go into this risky growth business model based on bribes paid by Airbus. Was Airbus so eager for A330neo sales that they bribed the Air Asia leaders to build this massive growth strategy? If it worked, it would cement the future of the A330neo, but failure could take down Air Asia X. I have a feeling Airbus had to give very liberal cancellation and deferral clauses in the contract.

In the wake of the Airbus bribery scandal, budget airline Air Asia is facing allegations that it was paid by the planemaker to buy its aircraft. The alleged bribe was worth $50m, and was in return for Air Asia placing a 180 aircraft order from Airbus.


The SFO describes the two incriminated parties as ‘key decision makers’ in AirAsia and AirAsia X, and accuses them of being “rewarded in respect of the order of 180 aircraft from Airbus.”


https://simpleflying.com/airasia-corruption-probe/
 
tphuang
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 2:29 pm

abrelosojos wrote:
Clearly an airline falling apart, and in need of some cash:

https://newsroom.airasia.com/news/2020/ ... imitedpass

I honestly think it is time for Tony to go.

Saludos,
Alex

That is definitely a sign of big trouble ahead.
 
JustSomeDood
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 2:29 pm

flee wrote:
JustSomeDood wrote:
zeke wrote:
I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.

Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.

Airasia X's fleet is currently 40 aircraft as it includes Thai (XJ) and Indonesia (XT) Airasia X fleets. In future, if Airasia X units are established in India, Japan and Philippines, their aircraft will come from the Airasia X order book.


Which doesn't change the reality that they're having trouble with their business model filling 40 A/C profitably as it is (Indonesia winding up, Thai AAX in even worse financial shape than AAX) and are now going to have to find ways of filling 108 A/C profitably. I know for a fact that a good amount of D7's A330s were taken used on cheap leases, allowing for some operational flexibility in low seasons (parking/low utilization) which won't be afforded by brand-new planes.
 
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flee
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 2:32 pm

Weatherwatcher1 wrote:
Very true. I wonder if the order was based on some risky growth assumptions combined with Key Air Asia X being influenced to go into this risky growth business model based on bribes paid by Airbus. Was Airbus so eager for A330neo sales that they bribed the Air Asia leaders to build this massive growth strategy? If it worked, it would cement the future of the A330neo, but failure could take down Air Asia X. I have a feeling Airbus had to give very liberal cancellation and deferral clauses in the contract.

IIRC, Airasia X originally ordered 50 A339s at the initial launch in 2014 (Farnborough). This is later increased to 66 when they decided to convert the final 16 A333 orders to the Neo. At that time, the main motivation for the orders was the launch of new services into Europe. They were pushing Airbus to make the Neo capable of flying KUL to UK non-stop - Airbus later announced the development of a 251t MTOW variant. In 2018, Airasia X topped up the order to 100 (additional 34) but this order was never firmed up until 2019 when it then became an order for 10 A339s plus 30 A321 XLRs. In addition, it took up 2 ex-WoW A339 orders. That was how the number of orders accumulated to 78 - it wasn't a single order. We can see that the requirements changed from 2014 to 2018 and then again in 2019.

In 2019, they decided to take six more A333s from lessors as they "needed them" for expansion. Thai Airasia X also took delivery of their first to A339 Neos. These additions look like opportunistic ones - the aircraft might have been available at good lease rates.

The underlying trend from 2014-2019 Airbus orders and amendments to orders showed that they kept kicking their orderbook down the line. It will be interesting to see if Airbus (now under new management) will be so accommodating with the latest request to defer deliveries.

I do not think that the bribes were the main motivation for the orders. Tony Fernandes and Kamaruddin were involved in many ventures and sponsorship of their QPR football club and Caterham F1 team could have cropped up casually as they were conducting official business with Airbus/GE and other business partners. They are also involved in lots of other businesses (the Tune Group is diversified).

In conclusion, I think that all these accumulated orders are based on a good dose of optimism but there is a genuine belief that they think that Airasia X would expand to Europe, US and other long haul destinations. They might have even factored in the possibility that the A339Neos delivery might be delayed (based on previous experience of Airbus product launches). One thing they could not predict was a global health pandemic.

The story continues....
 
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flee
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 2:39 pm

JustSomeDood wrote:
Which doesn't change the reality that they're having trouble with their business model filling 40 A/C profitably as it is (Indonesia winding up, Thai AAX in even worse financial shape than AAX) and are now going to have to find ways of filling 108 A/C profitably. I know for a fact that a good amount of D7's A330s were taken used on cheap leases, allowing for some operational flexibility in low seasons (parking/low utilization) which won't be afforded by brand-new planes.

Their fleet plan was for the A333s to be replaced by A339s. So it would not be over 100 aircraft because 38 (the two A339s will remain) of them will be retired. The current plan is to retire 7 A333s in 2020 and slow down deliveries of A339s. Whether they will have 78 A339s by 2028 is not known.
 
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 3:17 pm

flee wrote:
Weatherwatcher1 wrote:
Very true. I wonder if the order was based on some risky growth assumptions combined with Key Air Asia X being influenced to go into this risky growth business model based on bribes paid by Airbus. Was Airbus so eager for A330neo sales that they bribed the Air Asia leaders to build this massive growth strategy? If it worked, it would cement the future of the A330neo, but failure could take down Air Asia X. I have a feeling Airbus had to give very liberal cancellation and deferral clauses in the contract.

IIRC, Airasia X originally ordered 50 A339s at the initial launch in 2014 (Farnborough). This is later increased to 66 when they decided to convert the final 16 A333 orders to the Neo. At that time, the main motivation for the orders was the launch of new services into Europe. They were pushing Airbus to make the Neo capable of flying KUL to UK non-stop - Airbus later announced the development of a 251t MTOW variant. In 2018, Airasia X topped up the order to 100 (additional 34) but this order was never firmed up until 2019 when it then became an order for 10 A339s plus 30 A321 XLRs. In addition, it took up 2 ex-WoW A339 orders. That was how the number of orders accumulated to 78 - it wasn't a single order. We can see that the requirements changed from 2014 to 2018 and then again in 2019.

In 2019, they decided to take six more A333s from lessors as they "needed them" for expansion. Thai Airasia X also took delivery of their first to A339 Neos. These additions look like opportunistic ones - the aircraft might have been available at good lease rates.

The underlying trend from 2014-2019 Airbus orders and amendments to orders showed that they kept kicking their orderbook down the line. It will be interesting to see if Airbus (now under new management) will be so accommodating with the latest request to defer deliveries.

I do not think that the bribes were the main motivation for the orders. Tony Fernandes and Kamaruddin were involved in many ventures and sponsorship of their QPR football club and Caterham F1 team could have cropped up casually as they were conducting official business with Airbus/GE and other business partners. They are also involved in lots of other businesses (the Tune Group is diversified).

In conclusion, I think that all these accumulated orders are based on a good dose of optimism but there is a genuine belief that they think that Airasia X would expand to Europe, US and other long haul destinations. They might have even factored in the possibility that the A339Neos delivery might be delayed (based on previous experience of Airbus product launches). One thing they could not predict was a global health pandemic.

The story continues....


Air Asia X has been very optimistic with their order book. Given that Airbus went as far as potentially $50 Million in bribes for parts of the A330neo orders, I doubt they would have been able to get any cancellation or deferment penalties in the contract. Seeing how many renegotiations have happened It appears that Airbus is very lenient on deferring orders as long as the order size goes up during the deferment. Having lenient cancellation and deferment clauses and small deposits helps facilitate an airline to be optimistic since the downside of an unforeseen Crisis like Coronavirus isn’t as bad. The airline can easily defer airplanes.

The airline cancelled 600 flights for March, according to an investor presentation published after it reported a higher quarterly net loss. AirAsia X flagged lower forward bookings and pressure on fares in the presentation.

The virus has deepened the challenges facing the airline and sister carrier AirAsia Group Bhd (AIRA.KL), whose Chief Executive Tony Fernandes and Chairman Kamarudin Meranun have both stepped aside for at least two months amid investigations into a corruption scandal. Airbus was alleged to have paid a $50 million bribe for plane orders


https://www.reuters.com/article/us-aira ... SKCN20L1NX
 
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 3:44 pm

filipinoavgeek wrote:
moa999 wrote:
Cebu Pacific I suspect relies on the domestic operations.

And then you've got startups Zip Japan and Bamboo in Vietnam.


5J's long haul low cost services have for the most part failed, with them retreating from almost all of their long haul services except for Dubai and Australia (Sydney and Melbourne). Today their A330s are mostly used to upgauge intra-Asia routes as well as MNL-CEB/DVO, and even their upcoming A330neos are planned to operate short-to-medium haul services too.

Bamboo to my knowledge is a FSC and not a LCC, although their aggresive expansion and big plans are giving me pause with regards to their viability as well.


South East Asia-Australia/ Dubai is medium-haul rather than long haul.
Basically all long haul attempted of Asian LCC failed,
the only remaining one is Scoot's flight to Athens (and don't know if how long it will last for)
 
jeffrey0032j
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 3:44 pm

flee wrote:
Weatherwatcher1 wrote:
The underlying trend from 2014-2019 Airbus orders and amendments to orders showed that they kept kicking their orderbook down the line. It will be interesting to see if Airbus (now under new management) will be so accommodating with the latest request to defer deliveries.

I do not think that the bribes were the main motivation for the orders. Tony Fernandes and Kamaruddin were involved in many ventures and sponsorship of their QPR football club and Caterham F1 team could have cropped up casually as they were conducting official business with Airbus/GE and other business partners. They are also involved in lots of other businesses (the Tune Group is diversified).

In conclusion, I think that all these accumulated orders are based on a good dose of optimism but there is a genuine belief that they think that Airasia X would expand to Europe, US and other long haul destinations. They might have even factored in the possibility that the A339Neos delivery might be delayed (based on previous experience of Airbus product launches). One thing they could not predict was a global health pandemic.

The story continues....

1) If Airbus didn't win the order using a fair and transparent manner (the regulators have determined that they didn't), then they shouldn't have the rights to even impose any restrictions on order deferrals.

2) With regards to QPR and Caterham, any criminal investigator would tell you, coincidences don't just happen like that. Following this logic, that may be the reason why its flagged in the Airbus probe, notwithstanding any other potential evidences that the officials had.

3) Air Asia group was already facing headwinds even before this. Air Asia India probe, lack of progress with regards to proposed subsidiaries in Vietnam and Cambodia, etc. Air Asia X was in an even worse state, similar issues with starting new subsidiaries in other countries as per parent group, one subsidiary ceasing scheduled ops, another subsidiary that hasn't turned in a profit. Coronavirus is not the cause of Air Asia's troubles, but it will worsen it.

It just seems that Air Asia's modus operandi is:
Dump cheap seats and see what happens, never mind the viability, never mind the other airlines, as long as "Anyone can fly".
Try repeatedly to set up new subsidiaries in other countries.
Then draw up a fleet plan based on the best case scenario where every country welcomes Air Asia and everybody flys Air Asia.
 
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 3:45 pm

hongkongflyer wrote:
filipinoavgeek wrote:
moa999 wrote:
Cebu Pacific I suspect relies on the domestic operations.

And then you've got startups Zip Japan and Bamboo in Vietnam.


5J's long haul low cost services have for the most part failed, with them retreating from almost all of their long haul services except for Dubai and Australia (Sydney and Melbourne). Today their A330s are mostly used to upgauge intra-Asia routes as well as MNL-CEB/DVO, and even their upcoming A330neos are planned to operate short-to-medium haul services too.

Bamboo to my knowledge is a FSC and not a LCC, although their aggresive expansion and big plans are giving me pause with regards to their viability as well.


South East Asia-Australia/ Dubai is medium-haul rather than long haul.
Basically all long haul attempted of Asian LCC failed,
the only remaining one is Scoot's flight to Athens (and don't know if how long it will last for)

They still have Berlin too.
 
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Revelation
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 4:42 pm

Weatherwatcher1 wrote:
Given that Airbus went as far as potentially $50 Million in bribes for parts of the A330neo orders, I doubt they would have been able to get any cancellation or deferment penalties in the contract.

Those negotiations must have been interesting:
    Q: Can't you let us put in standard cancellation / deferment penalties, after all we just bribed your bosses with $50M?
    A: Nope, not unless you increase the bribe.
    Q: Bugger off!

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rbavfan
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 5:47 pm

peterinlisbon wrote:
What are the operating costs of an A330 compared to an A320? It seems to me that they cost twice as much to operate despite only taking a few more passengers. I suppose it makes sense that one long tube is more efficient than a short fat one (that's what she said).


Hawaiin reported they can run 2 A321neo's between Hawaii & west coast for slightly better cost than the A330-200 a while back.
 
Antarius
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 6:33 pm

JustSomeDood wrote:
zeke wrote:
Weatherwatcher1 wrote:
THe size of the A330neo order always seemed rather questionable since Air Asia X hasn’t appeared to strategically need a large widebody fleet with all the variability in their long haul route network. The order has changed many times. Given the bribery allegations, it does appear that the order may have been based on bribes rather a sound business plan. Coronavirus related travel disruptions bring to light how Air Asia X likely never had a sustainable business model to utilize all those A330neos. With demand down and revenue collapsing, there’s no way to cover up that the A330neos likely would never profitably fit into the Air Asia X business plan.


I think the tenuous links being drawn are nothing to the reality.

A330s are the backbone of most airlines in Asia.


Which still doesn't make replacing 24 A330ceos with 78 A330neos + 30 A321 XLRs within 8 years (quadrupling fleet size) any more sustainable or sound a business plan with all the capacity floating around in APAC already.


Exactly. CX has 28 a330s. SQ has 9. Heck, the largest airline in Asia, CZ has 46.

Acting like 100 a330s is a reasonable and normal order is basically holding the party line and discarding any and all available data points.
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zeke
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 6:45 pm

Antarius wrote:
Exactly. CX has 28 a330s.


More like 56 (CX/KA/LD)
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 6:49 pm

zeke wrote:
Antarius wrote:
Exactly. CX has 28 a330s.


More like 56 (CX/KA/LD)


A pedantic correction since 56 is sizeably less than 100.

And LD.. seriously? Such a failing argument that you bolster numbers with a cargo operator.
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zeke
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 6:56 pm

Antarius wrote:

A pedantic correction since 56 is sizeably less than 100.

And LD.. seriously? Such a failing argument that you bolster numbers with a cargo operator.


Have historically operated over 100 different A330 tails, and yes, KA, LD, UO are all CX subsidiaries.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
Antarius
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Re: Air Asia-X Defers A330NEO's

Sun Mar 01, 2020 6:59 pm

zeke wrote:
Antarius wrote:

A pedantic correction since 56 is sizeably less than 100.

And LD.. seriously? Such a failing argument that you bolster numbers with a cargo operator.


Have historically operated over 100 different A330 tails, and yes, KA, LD, UO are all CX subsidiaries.


I'm aware it is a subsidy. It's irrelevant to the discussion of passenger aircraft.

None of your noise is changing the central point that 100 a330s is a huge order, and one that is not "normal" for airlines all around SE Asia. Let's see what happens with the bribery probe.
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Sun Mar 01, 2020 9:11 pm

D7 pulled out of AKL (via OOL) last feb because the operating costs were too high for the money they were making. The OOL-KUL sector by comparison was fuller, so limited the options/cheap far availability for the AKL-KUL market somewhat, and it turns out that D7 was competing directly in price with airlines like CX.MH,PR,CZ.EK and people were reluctant to pay for the D7 product unless it was significantly cheaper. I see these cuts as an extension of that, In a struggling market place that is discounting fares to encourage people to travel, customers will buy the best they can afford, not the cheapest.
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Mon Mar 02, 2020 12:44 am

aerorobnz wrote:
D7 pulled out of AKL (via OOL) last feb because the operating costs were too high for the money they were making. The OOL-KUL sector by comparison was fuller, so limited the options/cheap far availability for the AKL-KUL market somewhat, and it turns out that D7 was competing directly in price with airlines like CX.MH,PR,CZ.EK and people were reluctant to pay for the D7 product unless it was significantly cheaper. I see these cuts as an extension of that, In a struggling market place that is discounting fares to encourage people to travel, customers will buy the best they can afford, not the cheapest.

I travelled on the KUL-OOL-AKL service on their launch fare offer. Normal fares r not that low. They were not able to compete with non stop services.
 
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Mon Mar 02, 2020 12:53 pm

D7 were not able to compete with the nonstops because their high pax A330 configuration are too heavy to make it nonstop. Plus the landing charges at OOL and extra set of crew to operate OOL-AKL-OOL didn't make the AKL tag viable. Then through in MH often charging the same as D7...
 
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Re: Airasia X (D7) in trouble - looking to return 5 leased aircraft early, sell 2 aircraft to raise cash

Mon Mar 02, 2020 1:55 pm

Does anyone know how well is Scoot doing on the SIN-TXL route?

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