Air Transat looking to update their fleet

[Henry Tenby]

this article is interesting...

Air Transat shops for new fleet
BRENT JANG
November 14, 2007

Transat A.T. Inc. plans to replace its fleet of aging Airbus planes, entering talks with both Airbus SAS and rival Boeing Co.

The Montreal-based tour operator currently operates four 362-seat Airbus A330s and a dozen 259-seat A310s, but is seeking to drop those planes, which have an average age of nearly 15 years, in favour of a single-model fleet.

Transat's subsidiary, Air Transat, has its eye on the Airbus A350 XWB (extra wide-body) and the Boeing 787 Dreamliner, Air Transat chief executive officer Allen Graham said in an interview yesterday.

"I would love to have one fleet type to do all the missions," Mr. Graham said.

He said Transat would reap the benefits by switching to newer planes because they will be more fuel-efficient, and the use of only one model would reduce maintenance costs. Under one scenario, Transat's A310s could be phased out by 2012. The Airbus A350 is slated to enter service in 2013.

Transat expects to choose between European-based Airbus and Chicago-based Boeing in late 2008 or early 2009, with plans to buy some planes but likely lease the majority.

Other aircraft on Transat's shortlist include the Boeing 767 and a reconfigured A330 that would have fewer than 300 seats because that is the top range of passenger capacity being targeted in future. "Both Boeing and Airbus are pitching new and used planes to us," Mr. Graham said.

On potential new competitors, he said Transat is taking a wait-and-see attitude on NewAir & Tours, a fledgling firm backed by four former WestJet Airlines Ltd. executives. Calgary-based NewAir's Nov. 6 licence application says it plans to use McDonnell Douglas MD-80s as the initial platform for launch, but sources say Boeing 737s could enter the picture, too.

In a shorter-term retrofit, Transat intends to create more legroom on its existing planes by removing some seats in mid-2008.

Mr. Graham added that Transat is weathering red-hot jet fuel prices, having successfully hedged most of its winter fuel requirements at lower costs. But he remains concerned about high landing fees at Canadian airports and security charges.

He made the comments on the eve of Transat's 20th anniversary today. The parent company's chairman and CEO, Jean-Marc Eustache, co-founded the tour operator with Philippe Sureau and Lina De Cesare, who are senior Transat managers.

The first flight departed Montreal for Acapulco on Nov. 14, 1987.

"After 20 years, we are used to the intense competition that continues to prevail in the travel industry," Mr. Eustache said. TRZ.B (TSX) fell 34 cents to $40.16.