SAA says fairwell to 747 Fleet

[anthonyrees 0]

It's a sad month for South African Airlines, who have now officially grounded all their Boeing 747 type aircraft, and retrenching 80% of it's flight engineering staff.This means SAA will no longer be flying 747's anymore, in terms of their modernization program. Over the last 5 years, SAA has been gradually replacing it's older Boeing fleet with a brand-new Airbus fleet. The 747 has been replaced with A340-600 models. Many older 737's (200/300/400 and 500 series) were gradually replaced a few years back with new 737-800NG models serving the mid-range/regional routes. However, as new aircraft are ordered, smaller Airbus models such as the A319 and A320 are being ordered. It is expected over the next five years to convert the entire fleet to Airbus aircraft.It is reported that SAA's long-haul routes such at Cape Town to London lost about R500 000 000 (five hundred million SA Rand) ($72 000 000 US) a year because of the high operational costs / fuel consumption of the aging 747-200 and 747-400 fleet.Therefore PMDG, I wish you sooth flying with your upcoming projects. I sincerely look forward to your Airbus A320 model on my South African airport ramps in FSX sooner than later. I would also like to modernize my fleet and catch up with global trends.AnthonyCape TownSouth Africa

[Guest btclarke]

Hi Anthony,SAA *never* operated B737-300/400/500s, in pax configuration. They have recently acquired 2 B737-300's (ZS-SBA and ZS-SBB) on lease from GECAS for freighter conversion. They arrived as N700JZ and N701JZ. 1JZ finished it's conversion and did it's test flight today. Should be in operation shortly.I would be surprised that SAA makes a loss on their B747-200 fleet. The reason is it's been gone for years - they have no 747 classics in their fleet at all. I think 5 or so B747-400's remain. The classic B742's & B743's were replaced initially with the 6x A340-200's from Lufthansa (ZS-SLA/B/C/D/E/F), and then later the A340-300E's (ZS-SXA/B/C/D/E/F) of which some were subleased straight to Jet Airways in India, of which one found it's way to Gulf Air on sub-sub-lease hehe. They are all back with SAA now, along with all their 9 A340-600's (ZS-SNA/B/C/D/E/F/G/H/I).Ummm - SAA are blaming everything except the REAL factors behind their R883 million loss last year. The B747-400 fleet is far from that reason (contributing factor, but not the sole factor). Apparently the MD11's they have leased from Gemini are expensive leases too.####, British Airways have 57, they should be GBP400 gazillion trillion in debt by now. Cr@p management and cling-ons, followed by exorbitant salaries from top down, are more cause for concern at SAA's red line. Their trend of selling their assets and leasing them back (B737-200's, A340-600s most recently) are also reasons for high expenditure.SAA's fleet renewal saw their A300B's and pretty new A320's being sold by Conman Andrews and replaced with 21 B737-800's along with an additional 737-200's sourced from various places. (ZS-SIN/O/P/R/S/T/U). As mentioned earlier, the B737-200's were sold to Safair on a lease-back basis. They have subsequently terminated the leases for all the pax version of the B732. Only ZS-SID and ZS-SIF remain as the 2 -200F freighter aircraft. The B737-800's will be here for a while. Although some are being given off to Mango. To the best of my knowledge the A320 deal has been put off, given they are more likely to go bankrupt than get another new fleet of aircraft.Anyway, just to put things into perspective.Pity that the B747-400 will leave the SAA livery, but life goes on.Cheers from JNB.Bryan.

[michal 44]

>Anyway, just to put things into perspective.I agree. Not to mention SAA could also compute how much $$ they are losing using A340 on long-haul trips, talking about 'trends' - there is a trend to move to something much more efficient for long-haul like the 777.Michael J.http://img142.imageshack.us/img142/9320/apollo17vf7.jpg

[Guest btclarke]

Hi Michael,My point at the end of the day I guess, was that blaming the 744 (and quads) for their losses is not entirely true.There are airlines out there whose long-haul fleet is majority or even entirely quads (albeit A340 or B744 or both) and they are pretty profitable as airlines....For JNB the hot and high is probably better suited to quad operations (1 engine out and all that)...CheersBryan

[rsrandazzo 6,353]

Gents-Bryan: I love a well informed post!One other factor that doesn't get much consideration (until it's too late) it seems is below deck load capacity.Boeing and Airbus appear to design airplanes and their associated operational costs with vastly different mind-sets. When I was managing at UAL's hub at IAD- we conducted ground handling under contract for a number of european carriers who did not wish to staff the ramp-side arena on their own. That gave an interesting opportunity to work with various fleet types from Lufthansa, Virgin, Sabena, to name a few (also Varig, Ethopian- althought they don't fit my "european" definition above...LOL)Working with Sabena, we found that the A330s being used on the same route against our 777s- we generally had many many tens of thousdands of pounds of available payload that the A330 would not have been able to haul over the same route with very similar fuel burns.We saw this same phenomena take place with both LH/VS as they would alternate 400s and A340s in and out on ther respective routes.... The airbus airplanes just didn't want to carry additional cargo capacity to the capabilities of the 400s. Certainly an airline must look realistically at it's own market and decide whether below deck lift weight is of value- but having grown up in the US airline business- I've been "managerially trained" to view below deck space as a way to offset fluctuations in ticket prices with premium cargo that costs only marginally to carry.Would seem to me that SAA must be passing up some magnificent opportunities to haul below deck freight if they aren't maxing out their 400s.... and if it can't be carried on the A340s then it is money left on the table. (Might explain why they tried to lease MD-11s from Gemini? hmmm....)Either way- I'm a big believer in packing the lower holds until they bulk out or weight max out....You only get one shot at making money with every takeoff and landing cycle- you might as well carry everything you can!

[Guest btclarke]

Hi Rob,Thanks - just trying to fend off some rubbish SAA are spouting...As far as I knew, the A340-600 could carry more cargo than the B747. If I'm wrong I stand corrected. They are losing out on the USA-SA route as far as cargo goes. Both the A340-300E and the A340-600 do the IAD-JNB (SAA208) non-stop which is around 15:30 flying. Sp I guess cargo takes a 'back seat' on that flight, if there's room they *could* put it in.But, the two daily flights from JNB-LHR are pretty much *always* full. If your aircraft is carrying it's load and you're losing money, then something is wrong. The 747-400 is not a money loser if you're filling it properly. My sources within SAA ops are now gone, but as far as I remember, the cargo holds were not empty on their routes. If cargo is still being considered today as a cash cow, I cannot be certain. Many things over at SAA are a mystery.I know of airlines that have left pax behind in order to carry cargo. It wasn't often, but if the money is better it's all about business. And cargo pays.The MD11's - I don't know their route structure, but GEC (Lufthansa Cargo) have snapped up many as they can, and have plenty of them in their fleet, and I expect they are turning a good profit for them.You're 100% right about the one shot at profit, and SAA seem to be missing it.(EDIT: I digress on this forum, not really about SAA. So I end it here. - And Thanks for the detailed update Rob, I appreciate it, looking forward to it. Bought all your aircraft, including the 757 :))

[anthonyrees 0]

Thanks Robert and others. SAA is spewing out so many conflicting reports in the media. One never knows what is truly the issue there, except that it seems some idiots have hijacked the airlines operations.RegardsAnthony ReesCape TownSouth Africa

[rsrandazzo 6,353]

Bryan / Anthony-Yes- same is true for my old airline, UAL.I have many fond memories of the years I worked there- but unfortunately the airline I worked for is gone, replaced by an airline managed by folks more interested in their personal feather nesting than in the survival of the airline or it's employees.United appears to make money at this point in spite of it's best efforts. Whenever the next down cycle comes- I wouldn't be surprised to see UAL finally slide down the drain.

[Guest btclarke]

>but unfortunately the airline I worked for is gone, replaced by an>airline managed by folks more interested in their personal>feather nesting than in the survival of the airline or it's>employees.Hi Robert,Never a truer paragraph written.... Fortunately I am only indirectly connected with SAA, but nevertheless, it's been many years and is still sad to watch it happen...CheersBryan

[anthonyrees 0]

SA Airways grounds costly Boeing 747 jets------------------------------------------September 19, 2007, 09:00South African Public enterprises minister Alec Erwin says South African Airways (SAA) has grounded its entire fleet of Boeing 747 jets because the cost of running them far outweighs the economic benefits. He was responding to a question in Parliament. Erwin says the decision to ground the jumbo-jets is in line with SAA's restructuring and cost reduction strategy.SAA thinks of retrenching workers---------------------------------October 17, 2007, 14:30South African Airways CEO, Khaya Ngqula, has told Parliament that the company may have to retrench more than 2 000 employees within the next three weeks. Ngqula told Parliament's public enterprises committee that the airline is working out a range of ways to cut costs, including cutting the subsistence and travel allowances of cabin staff and other employees.So far 711 employees have been offered voluntary severance packages.Last year the treasury injected 1.3 billion rand into SAA. Ngqula says the company broke even this year and it is hoping to make a 7.5% profit in the next financial year. But costs remain a challenge. "The restructuring plan is driven by the need to reduce costs, improve revenue and transform SAA into a profitable world-class organisation."The airline has grounded five 747 Boeing aircraft in a bit to cut costs.Ngqula says the negotiators have 20 days to make concessions, including renegotiating conditions of employment. "We are talking to labour ... to give SAA a chance. If we can get rid of the things we can do without, like taking salary cuts ..."However the South African Transport and Allied Workers Union says conditions of employment are not the only consideration. The union's national aviation coordinator, Kenneth Monnana, says the airline has been losing money due to inefficient management.The unions and SAA are meeting tomorrow.copied as fair use from SABC News: http://www.sabcnews.co.za/economy/business...,157646,00.htmlRegardsAnthony ReesCape TownSouth Africa

[golli 0]

WOW what an interesting and different thread. A welcome diversion from the usual release dates questions. Reminds me of the Airliners.net forum.I want to question (if Capt. Randazzo could chime in). Why is the Md-11 so widely regarded as a DUD, if it can, in fact, be filled with PAX and belly freight and still be able to operate 13.000km+?? And then we have the A330-200 that is regarded as one of the best RASM aircraft in it's class?? Did SAA not get their hands on MD-11's??Golli.

[MarkLawrence 0]

If I remember correctly, Airbus gave a lot more concessions to the SA government and donated more money to projects in SA than Boeing was prepared to give - that's why the ended up with the order. Realistically, the 777 route would have been far better for SAA, particularly with the 200LR and 300ER now, and it could have worked them into the B748 program as well.In talking to some of the pilots, they much preferred the 744's over the Airbus fleet..a couple said the 744 was a dream to fly..

[NicholasB 0]

I agree too, a very interesting thread that is creating alot of discussion. This just proves even more that before we are flight simulation enthusiasts, we are aviation lovers first.I do suspect, however, that SAA will be reborn in some new fashion, just like Swiss International Airlines was a few years ago. Furthermore, I find it particulary interesting that Airlines and especialy national carriers are so deeply affected by political outcomes.This brings to mind a similar instance a few years ago where the US government placed a tremendous amount of pressure upon the Taiwanese government to sway the descission making proccess of EVA Airlines in Taiwan to purchase Boeing products instead of Airbus (This pressure was in the form of security gaurantees, and was by no means subtle). From what I heard EVA was more partial to Airbus in economic terms, despite the fact that the pilot body of the airline prefered to go with Boeing.The end result was some spanking news 777s for EVA, but not at a premium.On another note, since im raving on about national carriers. what US airline would be considered the national carrier for the USA these days?. when I was growing up, surely it was Pan Am, but as we all know those days are long gone.Cheers to all,NicholasB

[Guest btclarke]

Hi Mark,With regards to the 777-300ER over the A340-600.Due to the altitude of JNB (nearly 5600' AMSL) and temperature during the day, the one-engine-out performance on a quad is just better than a twin. And the Boeing 777 that came for a demo (at the time of selction A340 vs B777) had an engine failure, and at best offered the prospective buyers a free taxi around the airfield. Granted that could have happened to either, but still...Very few twins operate from JNB on long-haul. The longest scheduled flight in a twin I think is the Nationwide (NTW) to LGW. The middle east/asia flights (SIN, KUL, CAI, DOH, JED, DXB and AUH) are the other twins, with UAE using B77W's, SVA& SIA B772, MAS use B772 or B744 and the others usually either A332 or A333's. Delta operate a B763 to JNB, but route through Dakar, so that's not effectively long-haul.Just a glance at our daily arrivals...China Eastern: A343Iberia: A343Swiss: A343Thai: A346Cathay: A343/A346TAP: A343Turkish: A343Virgin Atlantic: A346Lufthansa: B744BA: B744Qantas: B744KLM: B744Air France alternate with the B77W and A343Nationwide: B763Both Airbus and Boeing are a dream to fly - it's much like the BMW vs Mercedes argument. Every pilot I have spoken to thinks that the aircraft they fly is the best. Airbus and Boeing have different cockpit philosophies, but I think both are just as good as each other. That's only *my opinion*. There is no cast-in-stone answer - merely opinions.My point is, if SAA went Boeing with the B77W, it's not the airframes causing the most loss - it's other factors. And SAA cannot afford the 200LR and in any event, it's not a good fit for the fleet. The bigger aircraft (A346) with a stop in Dakar on the way out to the ATL or IAH makes better sense. More pax & more cargo.CheersBryan

[Guest btclarke]

>Last year the treasury injected 1.3 billion rand into SAA.>Ngqula says the company broke even this year and it is hoping>to make a 7.5% profit in the next financial year. But costs>remain a challenge. "The restructuring plan is driven by the>need to reduce costs, improve revenue and transform SAA into a>profitable world-class organisation.">>The airline has grounded five 747 Boeing aircraft in a bit to>cut costs.>>Ngqula says the negotiators have 20 days to make concessions,>including renegotiating conditions of employment. "We are>talking to labour ... to give SAA a chance. If we can get rid>of the things we can do without, like taking salary cuts ...">>However the South African Transport and Allied Workers Union>says conditions of employment are not the only consideration.>The union's national aviation coordinator, Kenneth Monnana,>says the airline has been losing money due to inefficient>management.I would like to know during which 'year' it is that SAA broke even. For the 2006/2007 they posted the R883M loss. If they again consider that selling their A340-600's and leasing them back, is considered profit, they are again wrong.Mr Kenneth Monnana hit the nail on the head. Management, followed by exceptionally high salaries in some areas (compared to fellow airlines like Nationwide or Comair/BA) are the main reasons for wallowing in the results of megamillions of Rands lost...