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YQBexYHZBGM
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Economics Of 50 Seat RJs

Thu Sep 12, 2013 2:43 pm

Almost every thread about discontinuance of service to smaller destinations, replacement of RJs by props, or possibilities for establishing new service focuses on the fact that 50 seat RJs are no longer economical to operate.

I understand that "uneconomical" may be based on a certain fixed load factor (let's say 60% ?), but if every seat in a 50-seat RJ is occupied, is it still unable to at least break even under current fuel and operational costs?

For example, I was on an early morning flight on a CR2 from BGM to PHL last year that was nearly full. The distance is 144 nm, and block time is about 50 minutes. Is it likely that this flight still lost money, even though it was nearly full?

Would adding 3 rows of F or J seats to a CR2 or ERJ-135 shift the economic balance, as it does for the CR7/9? Is there really a market for F or J seats on such short flights?

-Al
YQBexYHZBGM
 
PSU.DTW.SCE
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 2:59 pm

The notion that 50 RJs are "uneconomical to operate" can be true, but in the media and on a.net for that matter is often used as a blanket statement. In certain applications they can be used and still are the most appropriate aircraft for the route. The full flight on BGM-PHL very well, and likely was profitable (dependent on whatever fares everyone was traveling on), but lets take a step back:


Profit = Revenue - Cost

Revenue - this entirely a function of the price paid by each passenger. On connecting itineraries, the fares are allocated to each segment based on different formulas which can vary by airline.

Cost - Fuel, labor, maintenance, ownership are the primary drivers

Since 50-seat RJs were ordered is mass quantities, a few things have happened.

Fuel costs have risen significantly
Maintenance costs, as the aircraft age have risen significantly. Overhaul costs on CRJs are highly disproportiate for the aircraft size.

With 50 seats there is only so much revenue potential for each flight, and even so, price is driven by demand or competitors.

With costs, on longer stage lengths, the cost per seat mile can be much higher since you are carrying more fuel, and paying to carry and move for fuel. Long/thin 50 seat RJ costs may have been economical when fuel was less expensive, but now the scale has tipped the other way.

In reality, with sufficient demand and pricing power, 50 seat RJs can still be economically on sub-400 mile flights.
 
kcrwflyer
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:05 pm

Quoting YQBexYHZBGM (Thread starter):
I understand that "uneconomical" may be based on a certain fixed load factor (let's say 60% ?), but if every seat in a 50-seat RJ is occupied, is it still unable to at least break even under current fuel and operational costs?

Uneconomical has nothing to do with the amount of seats filled. It's about the operating cost of the aircraft and the lack of seats you get for that cost.

Quoting YQBexYHZBGM (Thread starter):
For example, I was on an early morning flight on a CR2 from BGM to PHL last year that was nearly full. The distance is 144 nm, and block time is about 50 minutes. Is it likely that this flight still lost money, even though it was nearly full?

Every airline allocates revenue to segments differently. It's entirely possible that flight lost money, especially if it was filled with low yield connections.

Quoting YQBexYHZBGM (Thread starter):
Would adding 3 rows of F or J seats to a CR2 or ERJ-135 shift the economic balance, as it does for the CR7/9? Is there really a market for F or J seats on such short flights?

I think if that were a viable option we would've already seen it. I can't see it really working out.
 
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hOMSaR
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:07 pm

Profitability has determined by total revenue minus total costs. Revenue is determined by fare levels and load factor. So, load factor alone will not tell you if a flight is profitable.

For your full flight last year, if those 50 passengers paid $1 each for their ticket, the flight certainly wouldn't have been profitable. If they paid $1000 each, the flight would have been.

Of course, I doubt anyone paid $1000 specifically for that short 144-mile flight, nor did anyone pay $1 (unless they got the flight for free with FF miles or something of that sort). So, it's really a question of yield (revenue per available seat mile, or RASM), and whether or not the yield on that route exceeds the cost.

Given that, it really is dependent on the market.

So, whether or not a flight is economical has nothing to do with load factor, per se. If the fares are high, you can get away with having fewer seats sold than if fares are low.

The real case with 50-seat RJs is that with fuel costs so high, and thus representing a higher proportion of total costs than they did 10-15 years ago, combined with economic downturn, the number of markets that can charge a yield sufficient to cover the costs of flying a 50-seat jet has greatly declined.
 
slider
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:07 pm

Quoting PSU.DTW.SCE (Reply 1):
Fuel costs have risen significantly
Maintenance costs, as the aircraft age have risen significantly. Overhaul costs on CRJs are highly disproportiate for the aircraft size.

These indeed are the two biggies.

For the wave of ERJ deliveries, in particular, they're all hitting very high cycle times and mx costs are becoming rather exorbitant.

One other thing as well, for those majors that have carried them on their balance sheet, depreciation is no longer a factor either.
 
Flighty
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:15 pm

An answer to your question would be very complicated. I have maybe 40% of the info required to answer it.

Short story is, CR2 is the cheapest jet for airlines to maintain a network. If it's empty, you lose the least amount of money. So that's why they are still flying to low volume spokes rather than being withdrawn immediately.

Note, CR2s are usually depreciated now (cheap ownership costs). That helps their economics.

Load factor has almost nothing to do with anything. The CR2 can lose money at 100% or make money at 40%. That is a market phenomenon (low traffic business destinations tend to be excellent CR2 missions).

It is true that CR2 has some of the worst fuel burn per seat of any of today's aircraft. But, that balances with unique low trip costs. Sometimes, new larger RJs beat it on profitability. That's why we see ~500 CR2s leaving the airline fleet. But not all.

Agree with you that airlines should look into F class and greater pitch, becoming a 40-44 seater instead of 50. The CR2 doesn't perform well (bags) at 50 passengers.

CASM isn't everything. If it were, you'd see abusive 200 pax A320 configurations. But there needs to be a sensible optimum here.
 
washingtonflyer
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:16 pm

What do you think a D check on a 50 seat CRJ or ERJ would cost?
 
flyby519
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:41 pm

I thought that generally speaking CASM would reduce as stage lengths got longer, so how about flying these a/c on longer routes that have the potential for higher demand. Maybe fly between competitors hubs where they might have a monopoly.

On a related note, could there be a market for a TATL aircraft that held 30-50 seats? Similar to the BA A318 LCY service, except not quite as posh amd used in other markets like a BOS-AMS for a non skyteam carrier for example.
 
washingtonflyer
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 3:50 pm

Yah, me too. I understand the theory that you have to burn fuel to carry fuel. But I also understand (or at least I thought I did) that flights of 200 miles or less is inefficient owing to flow control issues, low cruise altitude and slow speeds. This was the rationale why a turboprop was actually the better choice on close-in city pairs (i.e., where the difference in speed is non-existent and the efficiencies of a prop are more pronounced).
 
Osubuckeyes
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 4:09 pm

Quoting flyby519 (Reply 7):

I thought that generally speaking CASM would reduce as stage lengths got longer, so how about flying these a/c on longer routes that have the potential for higher demand.

Yes, CASM can reduce depending on fuel load, but in most cases RASM also falls as the stage length increase. If memory serves me correct CASM decreases at a slower rate than RASM once flying a certain distance, there by diluting yields.

I believe that when 50 seaters were popular for airlines they still had the ability to charge premiums for frequency, which is why there were 8-12 50 seaters on a route. The trend now has become larger aircraft at key times and flights throughout the day so they still command premiums but with less aircraft operations.
 
flyby519
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 4:31 pm

Quoting osubuckeyes (Reply 9):

That makes sense. I know RJs have been typically used for long thin routes, I just thought it would be a novelty to see them on longer premium routes and have service that caters specifically to first class pax. Biz jets are tiny compared to RJs, why not take back some of that market share.
 
RamblinMan
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 4:36 pm

Quoting flyby519 (Reply 7):
On a related note, could there be a market for a TATL aircraft that held 30-50 seats?

Unless you're talking about all J-class, this is one of the more ridiculous ideas ever to be floated on this site.

And if you are talking about all-J, such a thing already exists. It's called a 737.
 
washingtonflyer
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 4:52 pm

There is something.... its called a Gulfstream IV (actually, the G-V. But you get the point). I've been on one once - down to EZE on a last minute client trip.

[Edited 2013-09-12 09:55:38]
 
BD338
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 4:55 pm

Quoting flyby519 (Reply 7):
On a related note, could there be a market for a TATL aircraft that held 30-50 seats?

aarrgghhhh!!!!.....7-8 hours on a RJ. In the definition of 'living hell' in the dictionary there is a picture of such a beast. There's no way there would be enough people willing to pay the kind of fare necessary to make, essentially a premium economy product work at such volumes.

For my most recent CRJ flight, DL charged me $0.90/mile for my non-refundable, everything is an extra, ticket. So I suspect they did very well out of me. On the highly notional theory that the 100% full flight paid the same they would be raking it in. On the reasonable theory that probably 70%+ on the flight were connecting in SLC to a much longer flight who likely paid less than I did for their entire journey from, say LAX to BZN than I did for the SLC -BZN leg then the whole equation gets mixed up and it is possible that even 100% full the actual specific flight may have lost money...or made a profit. We can only generalize, the specific data is one of the most closely guarded secrets in any airline.
 
flyby519
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 5:10 pm

Quoting RamblinMan (Reply 11):

Unless you're talking about all J-class, this is one of the more ridiculous ideas ever to be floated on this site.


Yes I was thinking an all J class RJ with 1-1 seating and a Bizjet type interior might make sense, but apparently I was wrong.

Quoting BD338 (Reply 13):
We can only generalize, the specific data is one of the most closely guarded secrets in any airline.

Exactly, that's why I was thinking your example of .90/mile is anecdotal and can't be applied to any other flight.

My thoughts were that TATL premium cabins are bread and butter of the legacy carriers, but if they could fly a small enough aircraft to solely cater to those pax then wouldn't that be more lucrative? AA 772s might typically have 16 F and 37 J on a JFK-LHR flight. If the premium cabins really pay for the rest of the plane, then imagine a plane with incredible low direct operating costs compared to a 777 and focusing only on those 40-50 premium pax.

Yes, AA carries cargo and connecting pax on the route and it feeds a larger BA system in LHR, but what about a non-OW carrier who doesn't have those needs.
 
bohica
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 8:12 pm

Quoting flyby519 (Reply 7):
could there be a market for a TATL aircraft that held 30-50 seats?

TATL in an RJ? Please put your crack pipe away.  
Quoting washingtonflyer (Reply 6):
What do you think a D check on a 50 seat CRJ or ERJ would cost?

I don't have any numbers but I think it would be cheaper to fly it one way to MHV and leave it there.
 
flyby519
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 8:29 pm

I'll lay off the crack pipe, but all I was trying to get at is people pay big bucks to fly long distances in Gulfstream/BBD type biz jets, and those cabins aren't much larger than say a CRJ.

The traditional use of RJs has been horrible! Cramped cabins, short flights, always late/cancelled, etc. if someone re-purposed RJs and small narrow bodies to be used in a high class executive transport type role in a scheduled service environment then I wonder if it would make money. Would AA/DL/UA want to do this? Of course not, they make a killing on TATL cargo and even the Y class pax and ancillary fees. Could a motivated smaller carrier do something like this? I think so.
 
93Sierra
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 9:30 pm

How is this different then Maxjet, Eos and the others that all tried a premium product and failed ? And, they operated with aircraft that were meant for TATL.
 
RamblinMan
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 11:04 pm

Quoting flyby519 (Reply 16):
Would AA/DL/UA want to do this? Of course not, they make a killing on TATL cargo and even the Y class pax and ancillary fees.

Precisely why the entire idea is ludicrous.

Quoting flyby519 (Reply 16):
Could a motivated smaller carrier do something like this? I think so.

There's a reason nobody is running scheduled flights on GVs. The economics just don't work. Let's go with $10,000 and hour...$150000ish for a roundtrip northeast US to the UK. And you're putting what, 20 people on board? $7500 per ticket just to break even, and that's at 100% load factor. Not to mention the fact that such a thing would be SIGNIFICANTLY less comfortable than existing J-class cabins.
 
flyby519
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 11:18 pm

Quoting RamblinMan (Reply 18):
There's a reason nobody is running scheduled flights on GVs. The economics just don't work. Let's go with $10,000 and hour...$150000ish for a roundtrip northeast US to the UK. And you're putting what, 20 people on board? $7500 per ticket just to break even, and that's at 100% load factor. Not to mention the fact that such a thing would be SIGNIFICANTLY less comfortable than existing J-class cabins.

US and B6 operate the E190 (think Embraer Lineage) with an average cost of $3500/hr. An 8hr TATL flight would run $28000. 73% load at 19 seats max would be 14 pax at $2000 each to break even. Unrealistic?
 
AADC10
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 11:36 pm

Quoting YQBexYHZBGM (Thread starter):
I understand that "uneconomical" may be based on a certain fixed load factor (let's say 60% ?), but if every seat in a 50-seat RJ is occupied, is it still unable to at least break even under current fuel and operational costs?

The reason for the 60% load factor is that most regional carriers have a load factor between 60% and 70%. Mainline can get up to 87% but that is about the upper limit. If every seat of a 50 seat RJ is filled at a reasonable fare, then yes then can be profitable and a 60% load at a high fare will also be profitable.

The problem is that in order to get the load factor significantly over 60% on marginal routes, fares have to be cut to the point where RJs are no longer economical at current fuel prices, since they burn significantly more fuel per seat than a current a 737 in most configurations. RJ labor costs are lower which helps but the gap between regional and mainline labor is narrowing.

An 87% load factor on a regional is a pipe dream. The RJ will continue to exist on some routes but they can no longer be counted on to be dropped into just any route under 1,000 miles. The thinnest RJ routes will be dropped and others will see reduced frequencies until it reaches equilibrium.
 
Goldenshield
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RE: Economics Of 50 Seat RJs

Thu Sep 12, 2013 11:41 pm

Quoting AADC10 (Reply 20):
The problem is that in order to get the load factor significantly over 60% on marginal routes, fares have to be cut to the point where RJs are no longer economical at current fuel prices, since they burn significantly more fuel per seat than a current a 737 in most configurations.

Fuel per seat yes, but fuel per flight? No. You'd have to sell a lot more seats on that 737 to reach ITS break-even, and if a CRJ couldn't do it for a market, even with reduced fares, then there's no way a 737 could.
 
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Aesma
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 3:37 am

Quoting flyby519 (Reply 10):
Biz jets are tiny compared to RJs, why not take back some of that market share.

Well actually the CRJ100/200 we're talking about are stretches of the Challenger business jet.
 
RamblinMan
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 2:31 pm

Quoting flyby519 (Reply 19):
US and B6 operate the E190 (think Embraer Lineage) with an average cost of $3500/hr.

No they don't. I guarantee you haven't factored the cost of BUYING THE DAMN PLANE into that rate. But ultimately it doesn't matter...we can argue hourly rates all day long but the cold hard fact is that widebodies are MUCH cheaper to operate on a seat-mile basis than RJs, and that difference becomes greater as the distance increases. As multiple people have pointed out on this thread, the only time RJs make economic sense is if you can't fill something bigger. Flying a CRJ with 20 pax is more cost-effective than a 737 with 20 pax. That's why they are useful for flights such as ORD-PAH...it's short, and not that many people want to go to Paducah. NYC to London on the other hand has upwards of 30 daily flights, most of them on widebodies.

Give this pipe-dream of yours a cruise speed of Mach 2.5 and THEN it's a game-changer. Otherwise all you're doing is entering an already highly-competitive market with significantly higher CASM and absolutely no reason that you would get a revenue premium to justify it. In fact, there's reasons you will get significantly LESS revenue...namely the fact that an RJ in an all-J configuration is still an RJ and will not be competitive with the full-flat seats in a 777, and also the fact that there's no network to tap into, no base of loyal frequent fliers.
 
fpetrutiu
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 3:10 pm

There could be a business model built around the low cost of operating a flight. A regional carrier contract could be made on a fixed price like $X/mile or $X/1hr block. The profit margin can be fixed at say 7-10% and make it worth it for the mainline carrier.

This way, the connections carrier will not carry the risk of operating at a loss, and the mainline carrier could absorb the risk because of connecting passengers. Again, this model will only work from hubs.
 
JA
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 3:16 pm

Quoting RamblinMan (Reply 23):
No they don't. I guarantee you haven't factored the cost of BUYING THE DAMN PLANE into that rate.

The B6 cost of $3,600/hr and the US cost of $4,000/hr include buying the damn plane.
 
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hOMSaR
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 3:17 pm

Quoting fpetrutiu (Reply 24):
There could be a business model built around the low cost of operating a flight. A regional carrier contract could be made on a fixed price like $X/mile or $X/1hr block. The profit margin can be fixed at say 7-10% and make it worth it for the mainline carrier.

This way, the connections carrier will not carry the risk of operating at a loss, and the mainline carrier could absorb the risk because of connecting passengers. Again, this model will only work from hubs.

Don't they already, basically do this (or something similar)?
 
mandala499
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 3:43 pm

Quoting flyby519 (Reply 19):
US and B6 operate the E190 (think Embraer Lineage) with an average cost of $3500/hr. An 8hr TATL flight would run $28000. 73% load at 19 seats max would be 14 pax at $2000 each to break even. Unrealistic?

OK, E-190 will not have the range westbound even if you reduce the load... unless you put extra tanks in. Can't use a Lineage because (I'm told by Embraer) that it's not Part25 certified, it's part23 certified only... can't use it for scheduled service...
I threw such an idea on a sales demo flight with Embraer a few years ago, he says, "we don't think you can fly an all J e190 on anything for anything more than 5hrs end to end." Even when we made the flight a 1-stopper, Embraer was quite reluctant to support it (as it would then compete with the Lineage)... the E170 would have been nice for our needs, but then, he said Embraer would not provide an STC for an extra tank... OK... scrap it... we shifted the plan to an all J A319 instead. It never took off, but at least I got paid for the hassle!   
 
Flighty
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 4:04 pm

Quoting flyby519 (Reply 19):
US and B6 operate the E190 (think Embraer Lineage) with an average cost of $3500/hr.

Hmm that seems low. They burn maybe 600 gallons of fuel per hr. That's $1800. $3500 total would be very sharp.

But let's go with that.

Let's say each aircraft costs $45 million. Gulfstream vs. Embraer. Amortize over 15 years. So that's $3 million in capital cost per year.

Now, say Embraer flies 12 hours per day. That's about 4000 hours. $3m/4000=$750 per hour in capital costs.

Say your average rich guy's Gulfstream flies 1 hour per day. So, that's $9000 per hour in capital costs. That's why those numbers are different. Plus, private jet pilots cost way more per revenue hour. Because of low utilization.

Airline style ops would change that... but it still wouldn't work. For one thing, because of fuel burn.
 
AADC10
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 4:10 pm

Quoting Goldenshield (Reply 21):
Fuel per seat yes, but fuel per flight? No. You'd have to sell a lot more seats on that 737 to reach ITS break-even, and if a CRJ couldn't do it for a market, even with reduced fares, then there's no way a 737 could.

If a route cannot be operated with a few RJs then it would get turboprop service if the distance is short enough. However, many short routes are operated with RJs to keep frequencies up. The danger there on fatter routes is that WN or someone will come in and eat your lunch so there is always pressure on RJ economics.

One place we may see a test of this is UA mainline, VX and WN versus Delta Connection "Shuttle" on LAX-SFO. The shuttle is at a cost disadvantage and if fuel prices rise, it will get even worse so it will be interesting to see if it can survive. DL has similar operations out of LGA but they dominate there. There is tons of competition on that route and between regional airports in the Los Angeles basin and the Bay Area so DL will have to charge a premium to be profitable.
 
BD500
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 4:23 pm

Quoting flyby519 (Reply 7):
On a related note, could there be a market for a TATL aircraft that held 30-50 seats?

I remember that Virgin Atlantic already looked at this idea, they discussed with Bombardier in 2001 to purchase 6 Global Express for TATL service with 19 passengers. I believe the Global Express cabin size is similar to the CRJ-200, but the wing and design are more suitable for long range.

We will never know why it has not been done, but it seems the discussions were already going on with Bombardier, therefore I believe they were assuming a positive business case at the time was possible for this project.

http://www.flightglobal.com/news/art...express-for-virgin-venture-131567/
 
Goldenshield
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 4:31 pm

Quoting AADC10 (Reply 29):
If a route cannot be operated with a few RJs then it would get turboprop service if the distance is short enough. However, many short routes are operated with RJs to keep frequencies up. The danger there on fatter routes is that WN or someone will come in and eat your lunch so there is always pressure on RJ economics.

Yes, but I doubt that WN is going to serve SAN-LAX, or LAX-ONT, or MKE-MDW anytime soon, because such hops have always been connection driven, thus a turboprop or RJ makes sense.
 
tjh8402
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RE: Economics Of 50 Seat RJs

Fri Sep 13, 2013 8:40 pm

Allow me to help with some numbers pulled from Business & Commercial Aviations 2013 planning guide:

Bombardier Challenger 850 (bizjet version of the CRJ2LR):
-$31.9 million purchase price
-hourly operating cost: $2,905 (fuel $2181)
-1000nm trip: $6,828 (fuel $5,125) @ 2hr 21 min

Bombardier Global 6000 (same cabin size as the CL850/CRJ2)
-$60.4 million purchase price
-hourly operating cost: $3779 (fuel $3,029)
-1000 nm trip: $7867 (fuel $6,205) @ 2hr 13
-3000 nm trip: $22,409 (fuel $17,660) @ 6 hr 20
-6000 nm trip: $47,300 (fuel $37,913) @ 12 hr 31

Airbus ACJ318
- $72 million purchase
- hourly operating $5,177 (fuel $3,787)
-1000 nm: $12,685 (fuel $9,278) @ 12 hr 27

Embraer Lineage 1000 (E-190)
-$53 million purchase
-hourly operating $4302 (fuel $3,557)
-1000 nm: $10,037 (fuel $8,300) @ 2 hr 20

Gulfstream G550
-$58 million purchase
-hourly operating $2,917 (fuel $2,289)
-1000 nm $6546 @ 2 hr 20 (fuel $5,080)
-3000 nm $18,250 @ 6 hr 42 (fuel $14,042)
-6000 nm $38,657 @ 13 hr 15 (fuel $30,334)

Note that these calculations are done with fuel @ $6.08/gallon and 800 lb (4 passenger) payloads. Also, on this list, only the Lineage and A318 are approved for LCY ops. My thought is that airlines will not be able to take much traffic off these jets by offering comparable comfort, because they will never be able to match them for time savings/productivity improvements. That's the real benefit offered by these aircraft.
 
flyby519
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 1:30 am

Bah, you guys win. Send all the RJs to the beer can factory!   
 
JA
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 2:36 am

Airline operations pay around $3.50/gal at the high end for fuel. Someone can make the adjustment in fuel costs and see where it gets you.
 
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YQBexYHZBGM
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 3:40 am

Quoting Flighty (Reply 5):
Short story is, CR2 is the cheapest jet for airlines to maintain a network. If it's empty, you lose the least amount of money. So that's why they are still flying to low volume spokes rather than being withdrawn immediately.

This surprises me... the CR2 is even cheaper than an equivalent-sized ERJ with the same LF?

Even though they are high-cycle aircraft because they are used mainly for short hops, I presume most CRJs still have many years of useful life on their airframes. I am surprised no one has bothered to develop a more efficient engine that can be mounted on them when it comes to D-check time, rather than condemning them to the desert. Any thoughts?

The BGM-PHL flight I used as an example is now operated exclusively with Dash 8s. The reasons why BGM-PHL has gone all prop while surrounding airports have retained at least some jet service to PHL has been discussed at length in the "BGM Falls Behind ITH and ELM" thread. Surprisingly, PHL-ABE, a distance of only 48 nm, is still an all-CR2 route with Air Wisconsin / US. The apparent explanation is that the 50-seat props previously used on this route have been shifted to flying out of CLT rather than PHL, hence the CR2 is a like-for-like replacement, whether it makes money or not.

Al
YQBexYHZBGM
 
93Sierra
Posts: 397
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 3:54 am

Is the CrJ cheaper than a comparable Erj?
 
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ADent
Posts: 1218
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 7:22 am

Quoting RamblinMan (Reply 11):
Quoting flyby519 (Reply 7):
On a related note, could there be a market for a TATL aircraft that held 30-50 seats?

Unless you're talking about all J-class, this is one of the more ridiculous ideas ever to be floated on this site.

I don't know - I think pre-merger UA would have flown anything with CRJ-700s if they had the range.   

Of course for TATL they would have used CRJ-900s with 1 F seat and 2 rows of lie flat J.  
 
kcrwflyer
Posts: 2618
Joined: Tue May 18, 2004 11:57 am

RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 3:20 pm

Quoting Flighty (Reply 5):
CASM isn't everything. If it were, you'd see abusive 200 pax A320 configurations. But there needs to be a sensible optimum here.

Depends on who you are. NK puts 178 in there.

Quoting ADent (Reply 37):
I don't know - I think pre-merger UA would have flown anything with CRJ-700s if they had the range.   

Until CO showed them how far you can fly a 145XR.
 
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vfw614
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 8:52 pm

Quoting RamblinMan (Reply 23):
NYC to London on the other hand has upwards of 30 daily flights, most of them on widebodies.

So how do the 757 fit in here that also operate on that market?
 
tjh8402
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RE: Economics Of 50 Seat RJs

Sat Sep 14, 2013 11:44 pm

Quoting 93Sierra (Reply 36):
Is the CrJ cheaper than a comparable Erj?

I won't be able to look that up till I get home Monday, but I'm not sure that I'll have information for the comparable ERJ. Which Embraer product is equivalent to a CRJ200? The only Embraer planes I'll have info for are the Legacy 600 (ERJ-135), Legacy 650 (doesn't have a direct airline equivalent - it's an ERJ-135 fuselage with a lot of ERJ-145XR parts added to give it extra range), and I think they're a size smaller than the CRJ200. I would assume the CRJ2 is a competitor to one of the smaller E jets (E170-175), and I don't have numbers for those since they don't have a bizjet version.
 
kcrwflyer
Posts: 2618
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RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 12:51 am

Quoting tjh8402 (Reply 40):
Which Embraer product is equivalent to a CRJ200?

The 145
 
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lightsaber
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RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 2:27 am

Quoting Flighty (Reply 5):

It is true that CR2 has some of the worst fuel burn per seat of any of today's aircraft. But, that balances with unique low trip costs.

The problem is seat cost relative to market demand. It also leaves the RJs falling further behind. The C-series, MAX, and NEO will make fewer RJ routes viable as their relative cost per flight to the 50-seat RJs will be reduced.

And Mitsubishi has promised 76 seat MRJ per flight costs at the same level as CRJ per flight costs. With a CFRP wing, new wing aerodynamics, GTFs, and a design optimized for commercial duty from the get go make the cost per flight down significantly.

There will be a market for the CR2 and ERJs, I see that market shrinking quickly with future competition. What hasn't already been replaced (e.g., by DL), will be whittled down by more efficient narrowbodies.

Quoting AADC10 (Reply 20):
The thinnest RJ routes will be dropped and others will see reduced frequencies until it reaches equilibrium.

And that is the sad fact.

Lightsaber
 
Goldenshield
Posts: 5033
Joined: Sun Jan 14, 2001 3:45 pm

RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 3:06 am

Quoting lightsaber (Reply 42):
There will be a market for the CR2 and ERJs, I see that market shrinking quickly with future competition. What hasn't already been replaced (e.g., by DL), will be whittled down by more efficient narrowbodies.

You have to remember, too, that the CRJ was produced for over 20 years. Many older frames have already timed out, or are pretty close to it. The 50 seaters were the first generation, which have since been surpassed by the 2nd generation (CRJ/9, E-170/175,) which will be surpassed by the 3rd generation (MRJ, E2, ??) of jets. Time marches on, and technology gets better.
 
apfpilot
Posts: 742
Joined: Wed Jun 05, 2013 4:19 pm

RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 3:18 am

Quoting mandala499 (Reply 27):
Can't use a Lineage because (I'm told by Embraer) that it's not Part25 certified, it's part23 certified only... can't use it for scheduled service...

they told you wrong: http://rgl.faa.gov/Regulatory_and_Gu...004aef50/$FILE/A57NM%20Rev%209.pdf
 
queb
Posts: 1030
Joined: Tue Jun 01, 2010 3:10 am

RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 3:52 am

Anyway, the Lineage 1000 has no cargo space under the floor, it is the auxiliary fuel tanks.
 
mandala499
Posts: 6600
Joined: Wed Aug 29, 2001 8:47 pm

RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 5:05 am

Quoting apfpilot (Reply 44):
they told you wrong:

Cheers for that. The date was interesting, the conversation took place before that document's date, but after the type approval date.... I guess next time I see him I'll throw a fit on him!    I guess he was adamant in trying to sell us a Legacy instead... (this ain't the first time an aircraft sales tries very hard to push the wrong type of aircraft!)
 
slcdeltarumd11
Posts: 5213
Joined: Fri Jan 09, 2004 7:30 am

RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 5:41 am

The CRJ-200 is not bad for routes with high fares and shorter lengths. Clearly you cant operate a CRJ-200 on southwest level 737 fares etc. You can operate them profitably on higher fare routes and shorter routes. For example Air Canada to Ottawa-NYC YOW-LGA is probably profitable with a CRJ-200. No LCC competition and its very short 327 miles. A route like LAX-PDX on the other hand or something long with mainline competition and low fares its impossible to get enough money to make it profitable.
 
frmrCapCadet
Posts: 5054
Joined: Thu May 29, 2008 8:24 pm

RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 1:28 pm

Does anyone have a good sense of how Alaskan divvies up there fleet, and how that might indicate profitability of their smaller planes?
 
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YQBexYHZBGM
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RE: Economics Of 50 Seat RJs

Sun Sep 15, 2013 2:11 pm

Quoting YQBexYHZBGM (Reply 35):

No one answered the questions in my last post, so I'll repeat:

Is the CR2 cheaper to operate than an equivalent-sized ERJ (145) with the same LF?

Any thoughts as to why no one has bothered to develop a more efficient engine that can be mounted on the CRJs at D-check time, thus extending their useful life?

Al

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