Wednesday, March 12, 2014

Its A Mad Mad Mad 787 World

Air India sighs as it reflects on why they did what, and where they flew when, and then starts to smile a little. Norwegian Air gloats as O'leary flames away at what Norwegian has done to Ryan Air purchase opportunity. These three airlines remarkably peal back the layers of the 787 Onion in a dramatic fashion. Its happening down under with Jet Star and will break out this summer with New Zealand Air with its 787-9's. What is happening is the unraveling of the market place as the 787 becomes ensconced in its rightful place in aviation' s history channel. The "Making of a giant, The 787.

Despite several glitches, Air India swears by Dreamliner

"HYDERABAD: Despite several glitches dogging Boeing's 787 Dreamliner since its debut in 2011, it is slated to continue its dream run in the country as state-run Air India is 'quite satisfied' with the aircraft and has no plans of grounding it, said Air India chairman Rohit Nandan on Wednesday.

The Air India top boss' shocking clean chit to the Dreamliner comes even as Boeing discovered 'hairline cracks' in the wings of about 40 Dreamliners under production at its US unit. Even the US Federal Aviation Administration (FAA) had launched a top-priority review of the much-hyped aircraft in January last year and had temporarily grounded all the Dreamliners in operation in the US market after battery related issued cropped up.

According to data provided by Union civil aviation minister Ajit Singh to Parliament, as many as 136 'minor errors' were recorded in the aircraft between September 2012 and November 2013.

"We have had a spate of incidents and we have had detailed discussion with the Boeing team on this matter. These incidents are not unusual in a new fleet or aircraft and everybody is trying to adjust to the new machine. There have been no safety issues involved and these incidents are related to software or technical matters and our engineers are very competent to handle that," Nandan said on the sidelines of the India Aviation 2014.

He further stated that the dispatch reliability of 787 Dreamliner was 98.6% for Air India, which was better than that of Dreamliner's global delivery average of 98%. "As far as the grounding of Dreamliners is concerned, Air India has got no such plans as of now. It is for the regulators to take a view on the matter, but we are quite satisfied with the quality of service that we have received from this plane," said a confident Nandan."

O'leary from Ryan Air Quips: 

Bjørn, godammit, you’ve taken all the aircraft!'

Norwegian Air Shuttle's chief executive Bjørn Kjos has boasted that his risky bet on Boeing’s new 787 Dreamliner has given him a five-year head start on long haul routes over his Irish rival Ryanair.
"I know Ryanair is just waiting to get underway with their long-distance efforts, but we have taken all the planes,” Kjos gleefully told his audience at Oslo's BI Norwegian Business School. "I heard that when I asked [Ryanair CEO] Michael O’Leary how it’s going: ‘Bjørn, godammit, you’ve taken all the aircraft!’"
Kjos argued that while Norwegian had seen a string of damaging delays as a result of using the new aircraft, it had secured them ahead of its rivals. 
“Those companies that have not positioned themselves for the future will not survive,” he said, according to Norway's Dagens Næringsliv business newspaper. “Be my guest if you want to fly with seven to eight year old aircraft.“
Kjos defended his decision to register new aircraft in Ireland, and to hire crews at lower wages in countries such as Thailand, arguing that any airline which attempted to keep Scandinavian cost levels was doomed.

A perfect storm for Qantas

It was a perfect storm for Qantas, with all the elements ripe for the anticipated drama. The Australian flag carrier lost A$252 million (US$225 million) for the FY2013/14 first-half ending December 31st and announced it would cut 5,000 jobs as part of a three-year plan to reduce costs by A$2 billion. Other measures include deferring delivery of eight Airbus A380 for the parent airline and 3 Boeing 787 Dreamliner aircraft for budget subsidiary Jetstar.

The many aviation players are beginning to scramble as they realise the 787 is the real deal. It flies, and it lands, and then flies again. Only much cheaper and much better than its competition. The Mad Mad rush is on to get some 787 right now not later. The 787-9 is the spoon in the pot that will stir aviation's commercial world even at a tempestuous rate, not seen for some time in the annals of aviation's story.

The 787 is bringing all this conversation to the surface of aviation's keen sensibilities. Airline CEO's make jokes such as O'Leary has, and Air India reassures they have a winner, "no problem all good". Those 136 glitches were used to game Boeing. Meanwhile we need 14 more 787's before the end of the year. Air India has a large bucket placed at the back of the 787, for its bucket loads of money they gather from its customers.  

Norwegian had a few mishaps with its 787, and went into conference with Boeing carrying a stern expression for its lunch date. Now Norwegian winks at Ryan Air and brags we are five years ahead of all those suckers who didn't take the gamble. Good job Norwegian, you didn't blink and got very lucky. Ryan Air don't worry, it will only get better as the 787 fully blooms. You may get in line for a fully enhanced 787 model as your empire grows. 

Jetstar and New Zealand are just positioned on the front row of a marathon race. All others will climb on board by 2017. Boeing's 787 back-log after three more years of furious production will look about the same in 2017 with 1,000 unfilled 787's level that it finds itself in 2014, even though they will crank out a plus 100 a year rate. Enhancements on the model will continue as the learning curve from R&D keeps the wax shine on the wings. 

I love the market ruckus.