A Fleet Renewal Plan for SriLankan
SriLankan Airlines ( IATA: UL ) fleet is now getting a bit too old – with an average fleet age of around 12 years. The oldest aircraft, 4R-ADA ( MSN-032, the first ever Airbus A340 of Asia ), is already more than 15 years old. With every new airliner backlog still around 3 years into the future – it is good to think about a fleet replacement strategy now, unfortunately UL does not seem to have any in mind.
Let’s start with an analysis of UL’s current fleet and the routes that they fly.
Airbus A340
4R-ADA – A340-300, MSN 032, first flown in 1994 and delivered to Air Lanka as original customer, along with ADB&C
4R-ADB – A340-300, MSN 033, first flown in 1994
4R-ADC – A340-300, MSN 034, first flown in 1994
4R-ADE – A340-300X, MSN 367, first flown in 2000 and delivered to AOM as F-GTUA
4R-ADF – A340-300X, MSN 374, first flown in 2000 and delivered to AOM as F-GTUB
Current A340 destinations : Bahrain, Bangkok, Chennai, Doha, Frankfurt, Kuala Lampur, London, Paris, Riyadh, Rome, Singapore, London.
Seating : ADA,B,C- 18C/295Y, ADE,F- 18C/296Y
Airbus A330
SriLankan originally ordered nine Airbus A330-200 aircraft from Airbus, the single largest aircraft order in its history, in 1998. Six of these were delivered by 2001, including 4R-ALE and 4R-ALF. But unfortunately both of ALE and ALF, the latest with less than a year on service, were brutally attacked by Tamil Tiger terrorists while on the ground and this caused both aircraft to be written off. With this, SriLankan had to cancel its remaining order and the next A330, already registered as 4R-ALG, was taken delivery by Emirates as A6-EAA ( Spirit of Birmingham ), along with the other two aircraft.
All aircraft are A330-200s and delivered originally to SriLankan Airlines
4R-ALA – MSN 303, Delivered on 26/10/1999
4R-ALB – MSN 306, Delivered on 15/11/1999
4R-ALC – MSN 311, Delivered on 10/12/1999
4R-ALD – MSN 313, Delivered on 12/01/2000 ( Ed – showing the true state of misery at SriLankan, I just realised that this aircraft is available for wet lease from SriLankan, which means their network is set to be reduced further )
A330 Destinations : Bangkok, Beijing, Dammam, Dubai, Frankfurt, Hong Kong, Jeddah, Kuala Lampur, Kuwait, Malé, Singapore.
Seating : All – 12C/275Y
Airbus A320
By the time Emirates ended the management contract, UL had five A320s. But this is now down to three.
4R-ABE – MSN 169 Operated for Mihin Lanka, reportedly under a wet lease – but it is not known whether UL is paid for this.
4R-ABG – MSN 2908
4R-ABH – MSN 2914
4R-ABJ – MSN 2564
All three are leased and are ex- Air Deccan aircraft.
Seating: 20C/132Y
Destinations : Abu Dhabi, Bangalore, Chennai, Delhi, Karachi, Malé, Mumbai, Trichy, Trivandrum
By analysing the routes these aircraft operate, we can see that none goes in excess of 12 hours ( with London being the longest ) . The largest aircraft is A340 which seats 314.
The most favourable aircraft that can be seen as a replacement to both A330 and A340 are the Boeing 787 and Airbus A350XWB. Both of these aircraft offer unmatched cost savings and both have the possibility of directly replacing both the A330 and A340. The 787 is a bit smaller sized than the A350 and thus would have been the perfectly suitable aircraft for UL, like I have suggested in my earlier articles. However, with SriLankan being an all Airbus operator and having a good experience with Rolls Royce engines, Airbus A350XWB emerges as the likely candidate for a fleet renewal. Nevertheless, since both of these aircraft will not have a much difference in economics it will not matter much whichever aircraft they choose. And the A350 will enable SriLankan to introduce a much needed Business Class refurbishment while still keeping the same capacity as previous aircraft, thanks to the bigger capacity it offers.
Fleet Renewal
I suggest a new Business Class, with lie-flat seat beds with a new IFE to be introduced onboard the new aircraft.
The A330-200s should be replaced by A350-800.
A350-800 has a range of 15400 km and seats up to 275 passengers in a three class layout. It can easily accomodate the current 287 passengers carried in the A330 while still having space for the new Business Class I have proposed. This aircraft with its range can not only serve all of current A330 destinations, but also open up new destinations that would have otherwise being impossible with A330′s economics.
Boeing 787-8 is the other most suitable aircraft with identical features although a little capacity sacrifice will be required.
The A340s should be replaced with A350-900. The A350-900 has a range of 15000 km and can seat about 314 passengers in a three class layout. Like with the A350-800, this aircraft can also seat as much or more than the current seating of the A340 while still having a newer Business Class and will also enable SriLankan to launch a nonstop flight to North America if they wish to, although the economic feasibility of such a route will be a question.
The other candidate for this replacement would be the Boeing 787-9, however it will again come with a capacity penalty.
However, it would be beneficial for SriLankan if they increased the Business Class seats on both types to at least 18 and 24 respectively. Configuring a few aircraft in different configurations is also an option however this should be done in a well managed manner otherwise this exercise would end up increasing costs for the airline.
Airbus A320s will not need any immediate replacement as these are relatively new aircraft. However SriLankan should seriously consider adding one or two Airbus A321s to its fleet as this would be a perfect aircraft for most of SriLankan’s regional routes. And SriLankan really needs to increase the utilization of its current A320 fleet which will enable them to serve around ten more weekly short haul flights without adding any new aircraft.
Whether SriLankan selects the 787 or the A350XWB, having a single fleet type will always come with benefits of lower maintenance costs and pilot and crew training. The better MTOW of these aircraft will also enable SriLankan to operate its daylight long haul sectors without the load penalty caused by the 3350m runway at Colombo.
The higher utilization rate of these aircraft will also enable UL to operate more flights with lesser aircraft required.
The higher resale value of these aircraft will make it a golden investment for UL.
If they order the aircraft now, the will probably get delivery of them in around 2016 which will be perfect for the replacement of both the A330 and A340.
As 2016 is still seven years away, I won’t go into detailing any routes they should launch with these aircraft. But some routes that are currently not served, but can be profitably served with these aircraft are as follows-
From Colombo,
Sydney (SYD)
Melbourne (MEL)
Milan (MXP)
Amsterdam (AMS)
Munich (MUC)
Shanghai (PVG)
Guangzhou (CAN)
Nairobi (NBO)
Lagos (LOS)
Ho Chi Minh City (SGN)
Although some of these destinations might deem unimportant, they will certainly be important if UL is to acquire these aircraft and mark its place firmly on the map. Specially important will be the links to NBO and LOS since connecting Africa with Far East is a business that UL can pioneer thanks to Colombo’s strategical location which is ideally placed between Africa and the Far East. I have some ideas to write an article on how UL’s future route network should be set up, which I will write depending on your response.
Do you think this fleet plan is good ? What should be added, or removed ? Please leave your comments.
Before going to a fleet renewal plan Srilankan must get rid of the Emirates Airlines stigma. Everything good or bad that happens is and will be attributed to the Emirates era.
Srilankan needs to look inwards and reinvent itself for the post Emirates era. The airline needs to redefine itself and look at where it wants to be, say in 2015. Things have changed the Tamil problem is resolved and hopefully peace will prevail, that is a new reality that should bring prosperity to the country and Srilankan must be part of it. The network has to be redefined to reflect the new realities, Srilankan can help defining these realities.
Everything else is economics.
Certainly Mr. Oussama, I fully agree with you. However the current politics biased management seems to be incapable of running the airline. There are many battles among the employees and the management. The only thing that the management has done so far, as revealed in an earlier article of mine, is cutting services and selling aircraft. With the newly dawned peace UL has got a golden opportunity to expand while others are downsizing – let me ask you, do you think that they should be doing this ?
However it is very sad to see the way the CEO had given an interview to a local paper, when they asked why UL’s losses have increased, his answer was everyone is losing money and that it was not his fault. When they asked why aren’t you resigning even when the unions are forcing, his answer was I am a paid employee of the company and I am not resigning .
I think this is the right time for the Srilankan Airlines Management to think about the future of the airline. As the war has come to an end and the tourist level increasing this is the right time refleet their aircrafts. Srilankan Airlines is troughly a awsome airline but in order to gain more passengers, I think the fleet should have refurbishment program and start changing its economy and business class cabin with a much newer look. I really dont know how the newer 320′s is and i am waiting forward to get some pics.
Well, well it’s nice to be discussing what they could do with UL – if only someone ‘important’ would care to read and pick some ideas……but would they………..especially when they think they know it all? So, if I may deviate your thoughts for a while………
At a time the Company is losing money, it is hell bent on changing the color of the saree from green to Blue……any reason for this extravagance at a time like this? Some believe that it is the first of many steps to get it under Mihin so that UL won’t have to pay EK for their 40% stake and not share profits (if it comes), but didn’t the ole’ witch hand over to EK with the damning clause that which ever is the National Carrier the shares are still valid?
Your thoughts on this please ?
Flying appu, unless UL takes over Mihin and rebrands itself as Mihin, it will not happen. EK shares will still be valid. However, if GoSL can buy EK shares, they can do whatever. EK is not interested in UL anymore. But do you think there will be any profit to share at all ?
If the saree color change tells us a story that is yet to unfold (unless it’s for personal profit in percentages! ) it is that Mihin- the- piggy- back-rider may take over UL. How they would finance it I wouldn’t know……..but what assets do UL hold anyway as their aircraft are not owned by them?
EK may not want to sell the shares as they know that they hold the trump card where any National Carrier is liable to have them aboard – thanks to that madam whoever. The GoSL may never be able to buy the shares even if it is up for sale due to their cashflow situation. The employees hold (many of them have left the Company already) 9% of the shares which are worthless today but the GoSL has not shown any interest in purchasing that either.
As for profit sharing, I certainly don’t think there was any reciprocating mode in this regard even before the recession ! Both EK and UL are deep in red with no profits to share these days. The low cost operators are happily chipping into the National and other established carrier’s markets today and I doubt if the peers would ever be able to lift their heads again. JET, KF, AL-Jazeera,Air Arabia and AA and many more are chipping away on all fronts aren’t they?
Emirates in red ? You’re totally misled.
EK is one of the best performing in this situation. They have strict financial policies and importantly, an excellent management. However, FlyDXB is not yet much ‘sound’. From the ones you’ve mentione above, only AirArabia is doing good.
The saree and logo change is something I certainly hate. They’re talking about a unifying like they’ve no clue about branding. Oh well, may be they don’t .
EK is now being funded to some 40% by Abu Dhabi am told, perhaps you are aware of the true story on this? I certainly am aware that some of their Pilots are now looking elsewhere and it’s the uncertainty that’s holding them back. I doubt if EK is doing all that well these days and specially after Dubai glitter faded with the recession. I hope I am wrong on this.
There has been some rumour going on about it ( Abu Dhabi ), but nothing is confirmed. But I can safely assure that EK is nowhere near the red. Plus, some pilots leaving out won’t bother them since they are looking at hiring more Emiratis.
Btw, just curious, are you a UL pilot ?
Good to know that EK is not in the red. But from what I hear there is a great reluctance to give out details concerning finances. That’s to be expected as ‘loss of face’ is a great deal out there. Am also told that there is funding going on right now and the story is not denied by EK. Pilot’s leaving also has something to do with it though am not sure of the numbers.
No am not a pilot at UL.
There are many strict cost reduction efforts going on at EK. But I am sure they are not in the red. If you don’t mind my asking – If I’m not mistaken, you’re an aviation professional ?
[...] website had brought facts on SriLankan’s current state on many articles and represented a few suggestions to bring the airline back into the black. However, very unfortunately, the management [...]
[...] Apart from these efforts, SriLankan should consider maximizing the revenue from its fleet. SriLankan should consider upgrading its business class product and increase the number of business class seats by at least 50% on selected widebody aircraft. There certainly is enough demand for this and it will help SriLankan immensely to increase the yield. Although SriLankan needs to replace its long-haul fleet by 2013-4, there doesn’t seem to be any strategy towards it currently. The best choice would be using either the Boeing 787 or Airbus A350 to replace both A330s and A340s. However, with SriLankan’s current financial situation, it would be better for them to wait for sometime before making a large order. It should also be a consideration to stop offering Airbus A340 aircraft for President’s official travel. Although the President might need an official aircraft for overseas travel and SriLankan has a responsibility as the national career to do so, the national career’s own financial stability should become the first priority at this moment. Any good government will agree with it and if the President still needs an official aircraft, the airline can offer one of the less utilized A320s. However it will be well worth the investment if SriLankan could lease an A321 and use it to regional high density destinations as this will not only free up widebodies for the long-haul network but also help the airline achieve the maximum out of increasing tourist arrivals to Sri Lanka. You can read more on how should SriLankan’s future fleet be shaped, here [...]