PATCO LCH

Economics. 777-300 vs. 787

11 posts in this topic

Yesterday I got my copy of "Flying" and as always turned to the back to find Les Abends article. For those who may not know Les is a 777-300 Captain for AAL out of KJFK. This month he tells of being on the KJFK-EGLL run. An old friend was flying not far behind out of KORD in a 787. They had dinner in London and Les ribbed his buddy about his "plastic jet". Next day they were both in Ops. preparing for the return flights and compared their dispatch packages. Because of mid Atlantic turbulence Les was routed on northern tracks. Because of the wing, the 77-300 had to stay in the low 30s. The 787 was capable of FL420 and was able to top the turbulence.  Long story short, the fuel burn for the "plastic jet"  would be nearly half the T7 even with the extra distance to Chicago.  He didn't say the TOW but I still found that quite interesting and thought I would share it. Thought some of you QW787 simmers might enjoy it.  Any comments?

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Think the economics might not be quite as widely spaced as the article may imply. It doesn't say which 787 variant it was, but assuming that too was an American Airlines one, American have more 787-800s than they do 787-900s (over twice as many) so let's assume it was an 800 since the chances are better that it was.

The 777-300 has a larger MTOW (over 100,000lbs more than the 787-800) and a larger seat capacity than the 787-800 (35-40 more passengers, depending on cabin layout), so it's probably also carrying more revenue-earning cargo as well as more passengers and their luggage. Whether that translates into the economics being very much closer is a matter for speculation as well as fuel pricing, but I would assume the difference is not as huge economically as merely the fuel burn might alone suggest.

Still, it's not surprising that a more modern aeroplane trumps an older type on running costs, that is usually the case, as evidenced by the A320 being a bit cheaper to run than the competing, but older, 737 design.

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Here's a guy who has made a number of videos looking at various aspects of aviation.

It's intended for a broad audience, but I enjoy the way he walks through the argument:

 

 

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On 11/14/2017 at 10:48 AM, Chock said:

as evidenced by the A320 being a bit cheaper to run than the competing, but older, 737 design.

Actually not true, the latest generation of 737 is pretty much identical in its operating cost to A320, actually the cost of operating the 737 (again - comparing within the same generation and hull size) is slightly lower than the A320 but A320 is slightly larger than 737 hence the slightly higher cost for A320 is probably justified. The lowest possible operating cost of the 737 family makes it very popular among some mega low-cost airlines like Southwest, Ryanair, etc.

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On 11/14/2017 at 10:23 AM, PATCO LCH said:

The 787 was capable of FL420 and was able to top the turbulence.  Long story short, the fuel burn for the "plastic jet"  would be nearly half the T7 even with the extra distance to Chicago.

It is a bit unfair to compare fuel burns of aircraft vastly different in size, but it is no doubt the 787 is very fuel efficient. But I suggest you compare fuel burn per seat per mile to get the complete picture.

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11 minutes ago, michal said:

Actually not true, the latest generation of 737 is pretty much identical in its operating cost to A320, actually the cost of operating the 737 (again - comparing within the same generation and hull size) is slightly lower than the A320 but A320 is slightly larger than 737 hence the slightly higher cost for A320 is probably justified. The lowest possible operating cost of the 737 family makes it very popular among some mega low-cost airlines like Southwest, Ryanair, etc.

Ryanair and a few other airlines use 737s not because it is cheaper to run in itself, it's because they bought large quantities of 737s and  struck a price deal with Boeing for a lower unit cost of the things because of that. O'Leary could get blood out of a stone. :biggrin:

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737 is cheaper to run per passenger per mile than A320 - consult some well known sources like Aviation Week, etc. Actually there are numerous sources - I encourage you to dig deeper.

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We are accustomed to hearing various stats tossed about by those selling airliners: Stage cost, seat-mile cost etc.

But airlines are in business, and there is only one metric that counts: profit.
How you get there is a complicated mix of many things. Successful low-cost operators have found one sweet spot. Long-running Big Names found theirs had moved with the times, and went bust.

Here's another in the series of aviation insights: 

 

 

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33 minutes ago, michal said:

737 is cheaper to run per passenger per mile than A320 - consult some well known sources like Aviation Week, etc. Actually there are numerous sources - I encourage you to dig deeper.

Digging deeper still, although airlines play their cards close to the chest when it comes to revealing how much they paid for their airliners, it is reckoned by most industry insiders that Ryanair paid no more than 51 million for each of their 737 NGs, but this is not taking into account servicing deals and all that kind of stuff, which if one is to believe industry rumours, has some believing those additional deals might have taken that unit cost down to as low as 30 million per aircraft for Ryanair.

With a deal like that, it is fairly obvious why Ryanair could offer such low seating prices. Having said that, Airbus are known to have struck some serious deals themselves; they are for example, rumoured to have given EasyJet a two for the price of one deal if they went with the A320, to tempt them away from the 737 which they had previously been using. As we've seen recently with Airbus buying a share in Bombardier's new C-Jet to circumvent Boeing's attempt to put the squeeze on them, Airbus are no slouches when it comes to playing that kind of game.

So there's a bit more to all that stuff than merely the daily cost of operating the things. Airlines such as EasyJet and Ryanair fly the living daylights out of their aeroplanes, which is certainly part of what makes them viable, but when it comes to selling their aircraft on as the airframe hours and number of cycles start making them want to get rid, that's where additional profits can be made. If you've not paid anywhere near the list price for your aeroplane, but you're then selling it based on the worldwide price for the things in used condition, which is set by the price all airlines and leasing companies paid for the things, then you can really make the economics work in your favour.

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The fact is that with over 20 years head start over the a320 the 737 is not really ahead in sales so that should tell you something about operating costs. Airlines aren’t charities!

Chris

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