Thursday, December 12, 2013

Oh Canada, What Have You Bought? A 737 MAX Eh?

Air Canada has ordered 61 MAX's in a fleet renewal plan. It also coincides with an order placed multiple years back for 24 787's. Air Canada has A320's (Airbus) in its fleet stable that are aging and need replacement. The order announcement is a victory for Boeing on many levels.

Air Canada had three years to study the NEO
Air Canada has had just 18 months to study the Boeing Max proposition.
Both came to Canada with hat in hand offering a winning price.
Canada ordered Max as it pairs it with its 787  order just as it is about to receives its first 787.
This marks a turning point for Boeing in the North American Airplane wars as did the Battle of The Bulge turned in Europe in late 1945. They, the opposition ran out of gas in that battle.

Boeing Statement on Air Canada 737 MAX Commitment:

SEATTLE, Dec. 11, 2013 /PRNewswire/ -- Boeing [NYSE: BA] is pleased that Air Canada announced an agreement today that includes commitments, options and rights to purchase up to 109 Boeing 737 MAXs. When finalized, the firm order for 61 737 MAX 8s and MAX 9s is expected to be worth $6.5 billion at list prices and will be posted to the Boeing Orders & Deliveries website.

Fleet


Number
of aircraft
Boeing
777-300 (77W)
14
777-200 (77L)
6
Airbus
A330-300 (333)
8
Boeing
787-8 (788)
1
Boeing
767-300 (763)
27
Airbus
A321-200 (321)
10
Airbus
A320-200 (320)
41
Airbus
A319-100 (319)
35
Embraer
190 (E90)
45

Operated by
Number
of aircraft
Bombardier
CRJ 705 (CRA)
Jazz
16
Bombardier
CRJ 200 (CRJ)
Jazz
26
Bombardier
Q400 (DH4)
Jazz
21
Q400 (DH4)
Sky Regional
5
Embraer
175 (E75)
Sky Regional
15
Bombardier
Dash 8-300 (DH3)
Jazz
27
Bombardier
Dash 8-100 (DH1)
Jazz
36
Beechcraft
1900D (BEH)
Air Georgian
14
1900D (BEH)
EVAS Air
3

Number
of aircraft
Boeing
767-300 (763)
2
Airbus
A319-100 (319)
3


http://www.aircanada.com/en/about/fleet/

The bread and butter part of its Airbus fleet works as the key component of its every day service. It has a few long range Boeing's, but by observing this chart you will see that 61 new Max's, plus the additional Air Canada purchase options on the same model, solidifies a Boeing renewal and Air Canada's fleet expansion with this order. Ninety-six Airbus are in the inventory. Many of which are to be replaced, sooner rather than later. The Large 777 and A333 is being replaced with the double niche filler, 787 according to any seating configuration that is required. There is no room in Air Canada for an Airbus order. Boeing has flipped it away from Airbus, a North American significant victory. Air Canada shows that it was sold on the Boeing concept of flying the Boeing family, giving it an edge through its various features of common systems, maintenance and pilot layout and flying feel.

This also underscores that Boeing is not only competing with the Airbus myth spinners but beating the Team Airbus with a ground offensive and breaking its spell. Before throwing Boeing under another "Bus", airlines are now carefull of the long term consequences. Some airlines use mixed orders for leverage with each airline against each other. When Boeing matriculates its master plan of all airplanes are built reaching a high level of standardization, it would be difficult to play that game again of "leveraging with mixed orders".

I still don't understand how an airline would mix its fleet when they find a superior product. Air Canada is taking the approach that Boeing has market answers at all levels. Embraer need not worry because Air Canada has the need for 140 seats and under market in mind, of which they can do nicely with all carriers in that arena. Boeing, by this order have the new 777X as an offering for Air Canada when renewing its 2, 777's in the future. The option amount  of up to 109 MAX's is an Airbus order book downer. Another 49 Max's hang out there for fleet expansion later in its growth. Congratulation to both: Boeing and Air Canada validated the market plan that steps side by side with it Family concept of aircraft.