After postponing a decision for more than a year, Qantas is once again in discussions with aircraft manufacturers about purchasing new aircraft. A report released on Monday said Qantas is just days away from announcing a formal tendering process to replace its fleet of Fokker 100 and Boeing 717 aircraft.
An official call for tenders is imminent
According to Reuters, anonymous industry sources say the announcement of a formal bidding process is imminent. In-game, orders for around 100 jets are at stake, and all three manufacturers – Boeing, Airbus and Embraer are eager to carve out a slice of the lucrative pie.
Qantas has reported replacement programs for several types of small jets that operate in Australia. In addition to the Fokkers and Boeing 717s, several of the 75 aircraft in Qantas’ Boeing 737-800 fleet are approaching 20 years and nearing the end of their Qantas careers.
Order announcements were expected last year, but the airline has delayed its decision following the COVID-19 outbreak. This delay was as much about saving money as it was about the uncertain flight environment.
However, earlier this year, Qantas reported that it was revisiting the issue later in the year. Now, with the end of the year, Qantas is expected to formalize months of informal talks with aircraft manufacturers.
“We have been saying for some time that the renewal of our national narrow-rocket fleet is on our agenda”, a Qantas spokesperson told Reuters.
Embraers impress at Qantas
The presence of Qantas CEO Alan Joyce in Boston at the IATA Annual General Meeting and World Air Transport Summit is fueling interest. One of the lucky few to get a pass to leave Australia, he is expected to make headlines within the next 24 hours. Simple Flying is advised “something is in the air”.
The Airbus A220 and Embraer E2 planes are in the running to replace the Fokker 100 fleet (average age 28.3 years) and the Boeing 717-200 (average age 19.6 years). Airbus brought the A220 to Sydney in 2019, taking the Qantas boss on a tour of Sydney. Mr. Joyce was suitably impressed at the time.
But Qantas has also adopted Embraer jets, recently starting to fly several of them under a lease with Alliance Airlines. This is Qantas’ first time using Embraers, and despite the turbulent flight environment, the airline seems impressed with the aircraft.
Qantas will negotiate hard
Reuters suggests that the Boeing 737 MAX 7 is also an outside competitor. But Boeing might have better luck focusing on the upcoming 737-800 replacement program at Qantas. The MAX 8 or 9 is an obvious choice for Qantas here.
However, the Airbus A320 is also on the radar. Qantas does not operate many Airbus planes in its national narrow-body fleet, historically staying with Boeing. You might think this would give Boeing an incumbent advantage, but Alan Joyce isn’t particularly brand loyal when it comes to planes and Airbus is a significant part of the airline’s widebody fleet. .
It should also be remembered that the low-cost subsidiary Jetstar flies an Airbus A320 and has 109 more on order. Increasing this order is always an option.
Qantas, like most airlines, negotiates firmly when purchasing aircraft. The airline likes to pit competing bidders against each other and doesn’t hesitate to send back a price revision proposal.
Going public this week marks the start of Mr. Joyce’s dance with the aircraft manufacturers. It will tease and taunt and extract maximum value in the process – and so it should.
What do you think would be the best planes to buy for Qantas? Post a comment and let us know.