na
Topic Author
Posts: 9720
Joined: Sun Dec 12, 1999 3:52 am

SQ 777 Retirement News

Mon Sep 16, 2013 11:46 am

http://www.sqtalk.com/forum/showthread.php?p=179258

9V-SRI, the Star Alliance plane has been wfu from the SQ fleet and put on the US register by a company named "Access Industries", and according to the link four 77Es are being retired until next March.

Here is a SQ 777 being scrapped after less than 13 years service:

View Large View Medium
Click here for bigger photo!

Photo © Szabo Gabor

 
aeroflop
Posts: 53
Joined: Thu Mar 29, 2012 7:12 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 12:03 pm

Sad to see B777s being retired already!
 
YQBexYHZBGM
Posts: 214
Joined: Sun May 10, 2009 3:11 pm

RE: SQ 777 Retirement News

Mon Sep 16, 2013 12:17 pm

High cycles, high flying time, or just SQ's usual preference for having new aircraft?

No market for the 777 second hand?

Al
 
LY777
Posts: 2547
Joined: Fri Nov 25, 2005 6:58 pm

RE: SQ 777 Retirement News

Mon Sep 16, 2013 12:41 pm

I am really surprised to see young 777s being scrapped. I am surprised that nobody wants them. Even older 744s/763s find new airlines
Flown:717,727,732,733,734,735,738,73H,742/744/748,752,753,762/2ER/763/3ER,772/77E/773/77W, 788, 789, DC8,DC10,E190,E195,MD83,MD88, L1011, A3B2,A319,A320-100/200,A321,A332/A333,A343,A388
 
celestar
Posts: 536
Joined: Mon Jul 09, 2001 11:37 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 1:00 pm

I am not an expert but I think SQ seems to have some problem with their plane purchasing plan.
I rarely have seen airlines retired plane that early or make aggressive early commitment on new plane like SQ. Maybe because they have changing market condition or may be they are just being very rich....

If you look at JAL or CX or other carrier such as Lufthansa, fleet purchase is always a serious matter, considering all issue no other than ROI. Wonder what's the impact to SQ with their current practice.
 
User avatar
Stitch
Posts: 26523
Joined: Wed Jul 06, 2005 4:26 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 1:04 pm

Quoting YQBexYHZBGM (Reply 2):
No market for the 777 second hand?

There is, however the market for parts is also quite strong (and can be more profitable) so some planes are being parted out while others find new homes. For example, Transaero purchased four of SQ's non-ER model 777-300s in 2011.



Quoting celestar (Reply 4):
I am not an expert but I think SQ seems to have some problem with their plane purchasing plan.

As I understand it, Asset Depreciation rules in Singapore are such that after about a decade it's better for SQ to sell a plane and purchase a new one. So they turn over their fleet very quickly compared to most of their peers.

[Edited 2013-09-16 06:05:35]
 
jfk777
Posts: 7128
Joined: Tue Aug 22, 2006 7:23 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 1:25 pm

Quoting YQBexYHZBGM (Reply 2):
High cycles, high flying time, or just SQ's usual preference for having new aircraft?

Singapore uses/used many 777-200ER for regional Asian routes so it may have many more cycles to flying hours then typical 777 from the late 1990's. The market prces a younger 777 more for its spares then the whole airplane. Certain airlines like buying used planes, Delta could use a few more 777.
 
tortugamon
Posts: 6795
Joined: Tue Apr 09, 2013 11:14 pm

RE: SQ 777 Retirement News

Mon Sep 16, 2013 1:36 pm

There certainly is a market for these second hand but as 777 parts are still primarily controlled by Boeing and their Tier 1 suppliers the costs for replacement parts for the 1,100+ 777s all over the world are sky high making scrapping of these frames very financially rewarding and outpacing the target price of second hand operators.

tortugamon
 
cmf
Posts: 3120
Joined: Sun Jun 12, 2011 11:22 pm

RE: SQ 777 Retirement News

Mon Sep 16, 2013 1:38 pm

Quoting Stitch (Reply 5):
As I understand it, Asset Depreciation rules in Singapore are such that after about a decade it's better for SQ to sell a plane and purchase a new one. So they turn over their fleet very quickly compared to most of their peers.

What do those rules say to create that situation?

As I understand it, all depreciation does is decide over what time you take the costs of that asset. A fast depreciation means you take higher costs and show less profit and a slow depreciation means you take less cost and show more profit. Why tax authorities set minimum depreciation times. I'm not aware of any major differences in minimum depreciation times around the world so it really is about how each airline decide to operate.
Don’t repeat earlier generations mistakes. Learn history for a better future.
 
AngMoh
Posts: 981
Joined: Fri Nov 04, 2011 5:03 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 1:47 pm

Quoting celestar (Reply 4):
I am not an expert but I think SQ seems to have some problem with their plane purchasing plan.
I rarely have seen airlines retired plane that early or make aggressive early commitment on new plane like SQ. Maybe because they have changing market condition or may be they are just being very rich....

I don't think what they are doing is anything new. They have a history of keeping planes very short, with the record being the A340s which got traded in before delivery!

I think their replacement strategy is a bit messed up by the delays in the 787 and the A350:

The ordered 20 x 787-9 in 2004/2005 for delivery around 2010 and 20x A350 in 2006 for delivery in 2012. They ordered 34x A330 and 8x 77W to make up for all the delays...

If they received the A350 and 787s on time, the 777-200/ER fleet would have been a lot easier to place.
727 732 733 734 735 73G 738 739 739ER 742 743 744 752 753 762 772 77E 773 77W 788 A300 A310 A319 A320 A321 A332 A333 A343 A345 A346 A359 A35K A388 DC-9 DC-10 MD11 MD81 MD82 MD87 F70 ERJ145 E170 E175 E190 E195 ATR72 Q400 CRJ200 CRJ700 CRJ900 BAE146 RJ85
 
na
Topic Author
Posts: 9720
Joined: Sun Dec 12, 1999 3:52 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 2:06 pm

Quoting jfk777 (Reply 6):
Certain airlines like buying used planes, Delta could use a few more 777.

To the contrary, as they have just ordered A330s for that roll!

Quoting celestar (Reply 4):
I am not an expert but I think SQ seems to have some problem with their plane purchasing plan.

Its normal for SQ to sell airplanes after 12, or max. 15 years. Only difference is, all 744s, A340s or other types found buyers on the second hand market, while 777s are being scrapped. 772"A" and these rare derated "E" are largely unwanted on the market.
 
User avatar
EPA001
Posts: 3893
Joined: Tue Sep 12, 2006 8:13 pm

RE: SQ 777 Retirement News

Mon Sep 16, 2013 3:52 pm

Quoting Stitch (Reply 5):
There is, however the market for parts is also quite strong (and can be more profitable) so some planes are being parted out while others find new homes. For example, Transaero purchased four of SQ's non-ER model 777-300s in 2011.

As always it is an economic trade-off. Still 13 years is very young for an airliner, especially for the modern B777 (compared to a B767 or B747 for example)
 
jfk777
Posts: 7128
Joined: Tue Aug 22, 2006 7:23 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 5:53 pm

Quoting na (Reply 10):
Quoting jfk777 (Reply 6):Certain airlines like buying used planes, Delta could use a few more 777.
To the contrary, as they have just ordered A330s for that roll!

Just because Delta purchased 10 new A330 doesn't mean they do not need more 777's. Try flying from MSP. DTW, ATL or JFK to NRT with an A330, that is why used 772ER with RR engines are good for Delta. The A330 is an LAX to NRT, Atlantic or GRU airplane.
 
User avatar
Stitch
Posts: 26523
Joined: Wed Jul 06, 2005 4:26 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 6:01 pm

Quoting jfk777 (Reply 12):
Try flying from MSP. DTW, ATL or JFK to NRT with an A330...

The A330-300's DL are taking delivery of have a 242 ton MTOW and a design range of 6100nm which puts MSP, DTW, JFK and even ATL within range of NRT.

Of course, actual usable range will be less, but MSP is certainly doable and even DTW might be possible.
 
theobcman
Posts: 579
Joined: Sun Nov 14, 2010 11:16 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 7:36 pm

Why would Scoot not have this ? Are they ok for aircraft numbers now ??
 
User avatar
Stitch
Posts: 26523
Joined: Wed Jul 06, 2005 4:26 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 8:27 pm

Quoting theobcman (Reply 14):
Why would Scoot not have this ? Are they ok for aircraft numbers now ??

Scoot has 787-8s and 787-9s on the way deliveries start in 2014) so I expect they don't want any more 777s.
 
User avatar
DL_Mech
Posts: 2347
Joined: Fri Feb 18, 2000 7:48 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 10:37 pm

Quoting EPA001 (Reply 11):
As always it is an economic trade-off. Still 13 years is very young for an airliner, especially for the modern B777 (compared to a B767 or B747 for example)

The first D check (HMV) occurs at seven years. The second occurs at thirteen years. I think we have the answer there.....
This plane is built to withstand anything... except a bad pilot.
 
jfk777
Posts: 7128
Joined: Tue Aug 22, 2006 7:23 am

RE: SQ 777 Retirement News

Mon Sep 16, 2013 11:40 pm

Quoting Stitch (Reply 13):
The A330-300's DL are taking delivery of have a 242 ton MTOW and a design range of 6100nm which puts MSP, DTW, JFK and even ATL within range of NRT.

Of course, actual usable range will be less, but MSP is certainly doable and even DTW might be possible.

Which is why now all airlines using 777 for NRT will be using A330's ? Given the Large number of 777 flights to Japan today its doubtful the A330 will be replacing 777 any time soon.
 
User avatar
Stitch
Posts: 26523
Joined: Wed Jul 06, 2005 4:26 am

RE: SQ 777 Retirement News

Tue Sep 17, 2013 12:00 am

Quoting jfk777 (Reply 17):
Which is why now all airlines using 777 for NRT will be using A330's ? Given the Large number of 777 flights to Japan today its doubtful the A330 will be replacing 777 any time soon.

While I don't have the numbers, I would not be surprised if A330-300 movements at NRT have gone up in the past decade with 777-200ER movements going down.
 
col
Posts: 1707
Joined: Thu Nov 27, 2003 2:11 am

RE: SQ 777 Retirement News

Tue Sep 17, 2013 12:52 am

Also these SQ birds are the regional units and have the de-rated engines (control wise)which are quite expensive, for which RR charge a lot to change a chip.
 
DTWPurserBoy
Posts: 2374
Joined: Fri Feb 19, 2010 10:33 pm

RE: SQ 777 Retirement News

Tue Sep 17, 2013 1:10 am

One issue that I have heard from both pilots and maintenance is that SQ does not keep their planes in as reliable condition as other carriers.

Back in the 90's, NW bought two 747-212's virtually sight unseen. Uncharacteristically, NW did not use due diligence and went by SQ's reputation. When they finally took delivery both aircraft suffered from such severe corrosion and it took months longer than anticipated to get them into service--and a lot more money. SQ concentrates on inflight service but then sells the airframes about the time they require some serious work. They make it look like they have the worlds youngest fleet. Just watch them start to ditch the older A380's in a year or two.

It comes as no surprise that the 777's being parted out probably had major issues regarding maintenance.
Qualified on Concorde/B707/B720/B727/B737/B747/B757/B767/B777/DC-8/DC-9/DC-10/A319/A320/A330/MD-88-90
 
User avatar
LAXintl
Posts: 23970
Joined: Wed May 24, 2000 12:12 pm

RE: SQ 777 Retirement News

Tue Sep 17, 2013 1:50 am

Accelerated fleet replacement has paid handsome dividends for SQ.

Under tax and accounting laws combined with investment policies, SQ is able to depreciate assets such as aircraft and engines under 10-15 year schedules down to 10-20% residual values. (Until 1989 SQ actually depreciated aircraft as standard for 8-years)

Combined with relative high resale value of younger frames compared to book value, SQ has been able to leverage a win-win by profitably remarketing assets upon their depreciation life expiration.

Of course, SQ is also lucky that is has the money to self finance many aircraft purchases. Unlike many airlines which are heavily reliant on outside financing for aircraft purchases, SQ has been able to self finance up to 70% of fleet purchases in recent times so it gains on both side of the accounting ledger book.
From the desert to the sea, to all of Southern California
 
Asiaflyer
Posts: 873
Joined: Fri May 11, 2007 11:50 am

RE: SQ 777 Retirement News

Tue Sep 17, 2013 1:58 am

Quoting cmf (Reply 8):
As I understand it, all depreciation does is decide over what time you take the costs of that asset. A fast depreciation means you take higher costs and show less profit and a slow depreciation means you take less cost and show more profit. Why tax authorities set minimum depreciation times. I'm not aware of any major differences in minimum depreciation times around the world so it really is about how each airline decide to operate.



The depreciation is only interesting while you hold the planes, and everyone wants as large and quick depreciation in their books to minmize taxes. IIRC correct Sinagpore allows for faster depreciation than most other countries.

The depreciation is anyhow not relevant the day you sell the plane, as a plane which is fully written of in the books will be subject to capital gain for the differrence between book value and sales price. So in the final end, the actual depreciation is just the difference between purchase and sales price. Hence the fast pace of depreciation is just a way to get tax deduction early and push an eventual capital gain forward.
SQ,MI,MH,CX,KA,CA,CZ,MU,KE,OZ,QF,NZ,FD,JQ,3K,5J,IT,AI,IC,QR,SK,LF,KL,AF,LH,LX,OS,SR,BA,SN,FR,WF,1I,5T,VZ,VX,AC,NW,UA,US,
 
cmf
Posts: 3120
Joined: Sun Jun 12, 2011 11:22 pm

RE: SQ 777 Retirement News

Tue Sep 17, 2013 2:27 am

Quoting LAXintl (Reply 21):
Under tax and accounting laws combined with investment policies, SQ is able to depreciate assets such as aircraft and engines under 10-15 year schedules down to 10-20% residual values.

And

Quoting Asiaflyer (Reply 22):
The depreciation is only interesting while you hold the planes, and everyone wants as large and quick depreciation in their books to minmize taxes. IIRC correct Sinagpore allows for faster depreciation than most other countries.

Lufthansa depreciate at 12 years and 15%. As I understand it most countries allow depreciation over 10 years. It really is a reflection of the airline and not the legal environment when they have long depreciation times.

Quoting Asiaflyer (Reply 22):
Hence the fast pace of depreciation is just a way to get tax deduction early and push an eventual capital gain forward.

How you want to show your profits  
Don’t repeat earlier generations mistakes. Learn history for a better future.
 
JAAlbert
Posts: 1972
Joined: Tue Jan 31, 2006 12:43 pm

RE: SQ 777 Retirement News

Tue Sep 17, 2013 3:37 am

Quoting DL_Mech (Reply 16):
The first D check (HMV) occurs at seven years. The second occurs at thirteen years. I think we have the answer there.....

So did SQ make money on the plane, flying it for only 13 years? How much money does the airline earn with each 777 flight and how long does it take to earn back the purchase price of the plane?
 
PlaneHunter
Posts: 6537
Joined: Tue Mar 14, 2006 3:17 am

RE: SQ 777 Retirement News

Tue Sep 17, 2013 5:49 am

Quoting na (Reply 10):
Its normal for SQ to sell airplanes after 12, or max. 15 years. Only difference is, all 744s, A340s or other types found buyers on the second hand market, while 777s are being scrapped.

The main difference is that market conditions have changed. Back then when SQ got rid of most of its A340s and 744s, there was still a huge demand for various kinds of widebodies, including freighters. And it certainly helped that Boeing bought all 17 A343s.

Only two SQ 777-200ERs have been scrapped so far, while 5 frames are flying for Scoot, 4 for Royal Brunei, 4 for Transaero and 1 for Euro Atlantic. Additionally, Transaero has accepted 5 777-300s.

Quoting na (Reply 10):
772"A" and these rare derated "E" are largely unwanted on the market.

Only 5 777s have been scrapped so far (including 2 frames which were in bad condition after serving for Varig) and 4 frames are currently stored (including an AI 77L which is certainly hard to place anywhere). If airlines desperately wanted to get rid of them, they could store them in the deserts next to countless A300s, A340s, 747s, 757s and 767s.

Btw - up to now 16 A340s have been scrapped and 41 frames are stored. Statistics also shows 63 scrapped/derelict and 75 stored 747-400s.


PH
Nothing's worse than flying the same reg twice!
 
SIA747Megatop
Posts: 412
Joined: Tue Apr 24, 2012 4:36 am

RE: SQ 777 Retirement News

Tue Sep 17, 2013 9:00 am

It was stated in SIA's FY12/13 annual report that it would retire 5 B777-200s from the fleet.

The 5 aircraft are:
9V-SQF the last 3 class 772 in the fleet, also non-AVOD.
9V-SRF 2 class non-AVOD
9V-SRG 2 class non-AVOD
9V-SRH 2 class non-AVOD
9V-SRI already left, now registered as N777UK and painted white.

I'm guessing all these aircraft will be either be stored or scrapped as it seems unlikely Scoot will take delivery of more 777s given that they will be receiving 787s next year.
"I do not yet know of a man who became a leader as a result of having undergone a leadership course." - Lee Kuan Yew
 
User avatar
DL_Mech
Posts: 2347
Joined: Fri Feb 18, 2000 7:48 am

RE: SQ 777 Retirement News

Tue Sep 17, 2013 12:15 pm

Quoting JAAlbert (Reply 24):
how long does it take to earn back the purchase price of the plane?

From what I understand, the plane was owned by ILFC and leased to SQ.
This plane is built to withstand anything... except a bad pilot.
 
Someone83
Posts: 4524
Joined: Sun Sep 17, 2006 5:47 pm

RE: SQ 777 Retirement News

Tue Sep 17, 2013 12:47 pm

Quoting JAAlbert (Reply 24):
only 13 years?

Only 13 years? In many other businesses that quite high payback time for an investment
 
Carpethead
Posts: 2616
Joined: Mon Aug 02, 2004 8:15 pm

RE: SQ 777 Retirement News

Tue Sep 17, 2013 1:16 pm

Quoting na (Thread starter):

No offense, but the plane pictured is former 9V-SQG.
The only other aircraft that was scrapped is 9V-SQE.

With upcoming deliveries of A333 & 77Ws, the retirement of older 772 will continue. I wonder if these aircraft will find other homes or end up on the scrapper. Not sure why these airframes were scapped?

Many Japanese aircraft, even some domestic birds find second homes because they are well maintained. All the ex-JAL A300s found buyers and wound up being converted to freighters even though the oldest had nearly 20 years of domestic flying which is a ton of cycles!

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos