SAA needs to choose well as it expands its fleet
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By 2032, African airlines will need to take delivery of 970 new aircraft to meet the growth of domestic and regional traffic, which is projected to expand by 4.2 percent a year on average.
With the South African market alone projected to require more than 300 planes to serve its passenger flows, aircraft manufacturers are pulling out all the stops to increase their appeal to continental carriers such as SAA. Last week Airbus hosted South African journalists and SAA representatives at its headquarters in Toulouse, France.
The company has over 7 500 aircraft in service, and more than 360 customers. Every month it produces three of its highest-end long-haul model, the A380, and is expecting its newest, lightweight A350 to take to the skies next month.
Airbus and Boeing have been a duopoly in the large jet airliner market since the 1990s, with the former rising fast to catch up with the latter in terms of market share.
Figures presented by Airbus showed that between December 2006 and April this year, it sold 252 more wide-body aircraft than Boeing.
Last year, Airbus received 341 net orders for its two-aisle aircraft, the A330, A350 and A380. Boeing received 309 net orders for its 767, 777X, 777 and 787 jumbo jets.
Almost every industry is competitive and when there is a duopoly, as in this case, the two parties keep each other on their toes, regularly coming up with innovations to improve their “just launched” products.
In the contest between Airbus and Boeing, “every inch counts”, the former explained to SAA and the media.
“Our standard (seat) size is 18 inches whereas the competition’s standard size is 17 inches,” said Claire Nurcombe, Airbus’s aircraft interiors marketing manager.
But as SAA spokesman Tlali Tlali explained, the national carrier had experienced the same competitor-bashing exercise when it visited Boeing recently. Boeing might not have mentioned the seat sizes, but it picked on Airbus on any aspect it could.
Airbus delivered its first aircraft to SAA, an A300, in 1976. All of the carrier’s wide-body fleet is from Airbus, ranging from the A330-200 to the fuel guzzling A340-600.
SAA uses a narrow-body Boeing aircraft, the 737-800, to fly domestically and regionally, but it is expecting to phase out all 13 by the end of 2016.
Airbus’s head of marketing communications, Alan Pardoe, said the company held 19 percent of the market share in 1995 in terms of gross aircraft orders, and Boeing held 81 percent. Fast forward to last year, and Airbus held 51 percent with Boeing lagging at 49 percent.
“It’s a very competitive market… Last year was our best year. We even outperformed our own expectations,” Pardoe said.
The rivalry between the two manufacturers is nowhere more apparent than in their comparisons between the giant Airbus A380 and the Boeing 747.
“It [the 747] is not really selling. We think it will go out of production,” Pardoe said.
Until now, Airbus has been toeing the line, keeping its operations out of the US. But it has taken a bold decision to open its fourth production line in the US next year. It will deliver the first batch of its A320 single-aisle family of aircraft from there in 2016.
The A320 and the wide-body A330 have also overtaken their rivals from Boeing in terms of orders placed.
But while Airbus was busy making a noise about this, Boeing’s 787 Dreamliner got approval to extend its operating minutes from the US Federal Aviation Administration.
This means that the 787 can be operated up to 330 minutes away from a landing field, an increase of 150 minutes from what had been allowed for the Dreamliners since they were introduced into service in 2011.
This means that airlines with Dreamliners can introduce additional routes after receiving approval from their own regulatory agencies, and that is sure to spark more interest among operators.
The 787 made up the biggest share of Boeing’s net orders last year and between December 2006 and April this year, it has led in Boeing’s wide-body aircraft sales.
More than 1 030 of these aircraft have been ordered by 60 customers to date, and Boeing has delivered 146 Dreamliners to 19 customers.
But Airbus claimed that its A330 had a 56 percent share of the regional market; Boeing’s 767, 777 and 787 together took the remaining 44 percent. And the 787 specifically had the smallest share of 5 percent.
And while Boeing caught up with Airbus in making its 787 Dreamliner lighter by using composite materials for 50 percent of its makeup, Airbus marketing director Mike Bausor said its A330-200’s maximum take-off weight was comparable to that of the Dreamliner.
With air traffic expected to double in the next 15 years and the seven fastest-growing origin and destination flows connecting Africa, there is a definite need for new aircraft for the continent’s carriers if they want to avoid the trend of Middle Eastern airlines taking their market share.
According to Chris Klick, the Star Alliance vice-president, the Gulf carriers, though operating outside alliances, account for 10 percent of Africa’s traffic flows at present. SAA’s overall traffic share is 8 percent.
SAA has reviewed its existing routes and is expected to announce new routes in future. It is forging ahead with the establishment of a hub in west Africa. But it seems the carrier will have to scrutinise every fact brought to it by Boeing and Airbus when the two manufacturers market their aircraft.
Their competitiveness has created too much noise to make rushed decisions when buying new aircraft.