Air Canada places huge order for new planes

[I-Hate-Hulse]

AC places a Huge $6 Billion dollar order for new Boeings today, it's seen as a huge win for Boeing as AC has been a largely all Airbus fleet. Here's an excerpt from Robert's message to employees:

Hello, it’s Monday, April 25th and this is Robert.

Early this morning, ACE took a huge step into the future with the announcement of our selection of the Boeing 777 and Boeing 787 to renew and modernize our widebody fleet

This aircraft order fulfills a key element of our business plan to ensure the right aircraft in every market that we serve and is important not only for the employees of Air Canada but for the employees of all the companies that make up the ACE Group.

This aircraft order places our company at the forefront of the industry creating one of the youngest and most simplified airline fleets in the world and puts us in the clear lead among North American airlines where no other carrier is currently in a position to acquire the latest and most capable variants of the 777 – the 200LR, the 300ER – or also the 200 LRF, the new triple seven freighter. And also, we’re in a position to acquire the new, revolutionary 787 Dreamliner. With the superior comfort and operating economics of these aircraft, Air Canada will be in a class unto itself, in the company of the leading airlines of Europe, the Middle East and Asia.

This order also comes at a time of a major new development in our international route plans.

Just last week, we announced our intention to significantly grow our services to China as a result of the recently negotiated bilateral Air Services Agreement which will permit a major increase in air services between both countries.
These plans will require an additional three aircraft by the summer of 2006. The delivery of the first Boeing 777 next summer, which we will deploy on our Vancouver-Narita route, will allow us to reallocate aircraft to launch our new daily Toronto-Shanghai non-stop service in 2006.

During a period of near record high fuel prices, the new Boeing aircraft will also deliver significant cost savings and operational efficiencies. The fuel burn and maintenance costs of the 787 Dreamliner, for example, are approximately 30% lower than the 767s that they will replace -- twice the incremental ownership costs of acquiring these new aircraft.


As someone who was stuck flying a lot for work, I welcome the new generation of widebody planes, the old 767's were a little ragged, and the A340's were far and few between on the flights I flew. A common questions is how can AC afford this, but as it turns out, Boeing will buyback or assume the leases on many of the A330/A340's that AC has - that with the recent reorganization has freed up much of the equity need to finance something like this. Also, I'm sure Boeing reached deep into it's bag of incentives to get a major Airbus customer to turn to it, and torpedo hopes of the new A350. Huge op cost savings with these new Boeings too.

Service of course, will be the determining factor of many Canadians, but on the transcontintental flights, choices are much more limited. I haven't flown AC since the re-org but it will be interesting to see if they can keep this airline profitable.

[jonesy]

ok, one minute* bankrupt, in receivership, big fat debt, pilot paycuts. the next order a bunch of planes??

Whats up?


*note: not an actual minute, but a period of time deemed to be too short for this sort of spending turnaround.

[JohnnyO]

And all that $$$$ for Dion.

This is one of the poorest run companies of all time!!!!

[Agamemnon]

I'm not sure what sort of plane I flew to Ottawa on, but is was flown by Westjet. Every seat had a TV in the back, and you could listen to it on headphones, and each had about 20ish channels.

That is the only way to fly imo... flight w/out TV _sucks_, w/ TV? Like sitting in your (cramped) living room.

If you can, try to get the window seat in the emergency lane; beaucoup leg room

[Tron_fdc]

Originally posted by Agamemnon@Apr 25 2005, 08:45 PM
I'm not sure what sort of plane I flew to Ottawa on, but is was flown by Westjet. Every seat had a TV in the back, and you could listen to it on headphones, and each had about 20ish channels.

That is the only way to fly imo... flight w/out TV _sucks_, w/ TV? Like sitting in your (cramped) living room.

If you can, try to get the window seat in the emergency lane; beaucoup leg room

I'm flying to China next month, and was told that I couldn't have the emergency exit seats....they were reserved for people with physical handicaps that needed the extra space.

Sweeeeeeeet safety policy

[BlackArcher101]

Either this is a gamble and they hoping more customers will choose AC because of these aircraft, or they are thinking ahead in trying to compete with the american airlines. If their operational costs are lowered, lease payments are about the same, then this is a really good move by AC. Quite a few people choose which airline or flight they will fly on by looking at the aircraft. An A340 can't compete with the reputation that the 777 has here in North America. The only plane that would have a better popularity is the A380.

[Displaced Flames fan]

I wonder if the fact that Onex, a Canadian corporation, is purchasing the commercial airplane division of Boeing here in Wichita has anything to do with AC switching to Boeing.

A fellow Canadian corporation doing all the subassembly work for their airplanes might have been a motivating factor.

[JBR]

It's been almost 2 years since I took a parachute from Air Canada. I just recently recieved my pension to invest. Maybe Celine let Uncle Milton miss a payment or two to write me a cheque..

Now that I have my cash, AC can buy enormous boxes of shinguard, strap some wings on it, crash 'em, fire everybody, start from scratch, hire people back at 50% of their old wage and buy some more shinguard.. I could care less.

[browna]

A pretty big investment for a company with low cash flow. Maybe they needed the new planes, as the old ones were getting too heavy with the 4 or 5 different AC paint schemes they've had in the last 10 years.

Vancouver-Narita & DAILY Shanghai/Toronto NON STOP flights? Seems quite excessive..not sure how many people they're going to shuttle between TO and Shanghai (Beijing maybe). Those seats would have to cost $1500 and the plane would have to be full every day for that route to come out ahead. At least stop in Vancouver and increase your load.

[Tron_fdc]

Originally posted by fotze+Apr 25 2005, 09:23 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (fotze @ Apr 25 2005, 09:23 PM)</td></tr><tr><td id='QUOTE'>

I'm flying to China next month, and was told that I couldn't have the emergency exit seats....they were reserved for people with physical handicaps that needed the extra space.

Sweeeeeeeet safety policy

Yes cause how many planes crash gently into the ocean so that the doors can be opened from the inside. I welcome the handicapped at the e exits, they may cushion my jump as I land on them. [/b][/quote]
"Quick, open the emergency exits!!"

"I can't, I have no arms"

You'll all be glad to know however, there are WAY worse airlines than Air Canada. Air Korea for one.....JEEEEEEBUS. I think they picked up used planes from Iran, painted them baby blue and, and put the pilots through 2 hr courses on "how to burst your wheels on landing". It's faaaaaantastic flying with them.

Air China is a treat as well. All the planes were crashing all over the place, and whenever they flew overseas the planes kept on getting grounded because of safety concerns (I heard a story about an engine held together with seatbelts). So what do they do? They buy a bunch of planes from Bombardier, and last I heard they keep on getting grounded/crashing as well. Sweet.

Can't wait till I'm there month!!