Swift Aviation Completes A Giant Task; Eyes Fleet Growth

If someone asked me to name the winner of the Super Bowl – and told me I couldn’t Google the answer – I’d be hard-pressed to say who played whom or where the event was held (unless the Pittsburgh Steelers were involved). Please don’t judge me. I spent some rather formative years in Ireland and then moved to western Pennsylvania.

But even I admit I was impressed by some Super Bowl stats (and glossy pics) made available by Swift Aviation Group, a fixed based operator (FBO) with a luxury terminal at Phoenix Sky Harbor International Airport.

Swift, which was the official FBO of the Super Bowl Host Committee last weekend, handled 455 aircraft and pumped over 280,000 gallons of Jet A fuel during this period. The company filled up all of the available parking space at its terminal as well as a special overflow area secured specifically for the Super Bowl (see pic to the right).

It was, by all accounts, a record for the company. In fact, it pretty much blew "the charts off on that", Swift Air VP of flight operations Michael White tells Runway Girl.

Okay, you ask: "What does all of this mean to me, a commerical air transport staffer, executive, enthusiast, avid Runway Girl reader (ahem)?" Well Swift’s charter airline, Swift Air, operates a fleet of 10 aircraft, including Cessna Citation and Embraer Legacy business jets and three 68-seat Boeing 737s (one former Icelandair bird and two ex-US Airways aircraft). It mainly flies for sports teams and corporations. And while Swift isn't interested in competing with scheduled carriers, it is eyeing fleet growth "and is looking at a handful of options right now", including more 737s, reveals White.

Should you be interested in chatting about these opportunities with Swift, you should know that the firm really hasn't looked outside of the 737 in terms of narrowbodies because it "likes the reliability", has a lot of experience with the type and "a lot of support with vendors and partners with that particular model", says White.

However, he adds: "We previously owned a 757 – we might look at that again at some point."

Very light jets might be on the horizon if a business case can be made. "We’re taking an optimistic view on that market until we make a determination. There is room for expansion but don’t know what our role will be at this point. [I'm] not sure that the model is mature enough to support it from a business perspective," says White.

Swift is also studying "other opportunities in other parts of the country"

All this action helps explain why the company recently announced it is one of the “few charter airlines in the country” to reach an agreement with the FAA to establish an aviation safety action program (ASAP), which encourages voluntary reporting of safety issues at airlines and maintenance centres.

“Participating in ASAP not only the right thing to do for our customers, it’s also a strategic business decision that we believe will set us apart from our competitors,” says White.

“In fact, we’re one of only a handful of companies to participate in all four areas of the program – pilots, maintenance, dispatch and flight attendants – even among the major commercial carriers.”

JetBlue to Defer Delivery of 16 A320s; Sell-off Six Aircraft This Year

A plan has been revealed by JetBlue Airways to defer delivery on 16 Airbus A320s and sell at least six of the type this year.

JetBlue has been mulling options for its fleet since deciding to slow capacity growth for the year. During an earnings conference call this morning, JetBlue executives revealed that 16 A320s - which had been scheduled for delivery in the 2010 to 2011 timeframe - are being deferred until the period of 2012-2013.

The carrier has also brokered commitments to sell six A320s for 2008, including two sales announced during the previous earnings call.

Additionally, JetBlue exercised three E-190 options in the fourth quarter 0f 2007. These are due for delivery next year.

By year-end, JetBlue's fleet will comprise 110 A320s and 36 E-190s. "This may change if additional sales opportunities are realized," says JetBlue.

(JetBlue logo from www.JetBlue.com)

One-on-one: Embraer VP Sergio Chiessi Talks Shop

Embraer vice-president market intelligence – airline market Sergio Chiessi says the company is moving closer to a launch decision for its C-390 tactical transport jet, a program that could be officially kick-started this year. For more on that, check out this link.

However, during my interview with Chiessi, the Embraer executive had loads more to say about the company’s 2007 delivery accomplishment – a record 169 aircraft – and how it will achieve up to 215 deliveries in 2008. Here is a slightly abridged version of the interview in Q & A format.

Question: Embraer cites adaptations to its industrial processes for the 30% increase in deliveries in 2007. Can you give me any further specifics, such as how many new employees were hired in 2007; what exact production processes received a third shift; as well as any details about the lean manufacturing concept?

Answer: In terms of new employees hired in 2007, the total number is 4,500 - not just here in the San Jose Dos Compos plant in Brazil but at other plants. All of these people didn’t get up to speed immediately. You have to train. [Within] three to six months you have people getting wages but not involved in real production so we have an initial period of training and after that we have supervised it very closely for more experienced employees. In reality the learning curve increased along the year. We are quite assured they [the new employees] will enter 2008 almost with their full capabilities.

We did implement a third shift. We don’t have the third shift implemented in all activities of the plant here, but [we implemented it in] final assembly of 170/190, the mating of wings and fuselages. The painting shop also got a third shift [as did] composites. Those are in a rough way the areas of the production where we implemented the third shift.

One other thing that helped us a lot and we expect is going to help even more in 2008 and 2009 is the lean manufacturing processes that we started implementing in the second half of the year. It is giving very sound results. The lean is something that you start doing it and you don’t stop. We are in very early stages of lean manufacturing techniques but we already have been able to achieve very interesting improvements so people down here are very excited and there are many lean projects under analysis and under implementation.

Question: The robust forecast for 2008 will no doubt reflect the improvements made in 2007. Are any additional changes/improvements planned this year to accomplish the 215-strong delivery goal? Additional employees, etc? What still needs to be accomplished in this area?

Answer: We do believe that it will help us to achieve a 215 aircraft target. You have to consider that some 10 to 15 of those 215 will be Phenoms (very light jets) … Final assembly of the Phenom is much faster, not easier, but faster.

We hired the people along the year and we extend a lot of effort into training so the results showed up a little bit in the third quarter of 2007, much more strongly in the fourth quarter and of course we will see those results along 2008 but we don’t have plans to increase additionally the working force. We believe that with the learning curve and the lean implementation in additional areas, we do believe we can accomplish the 215 without additional manpower. We finished the cycle of hiring. We don’t have plans unless for replacing of some people due to regular turnover. We don’t’ have any plans to increase the working force in 2008.

Question:Can you give a sector breakdown for the 215 aircraft delivery goal for 2008? How many will be in the commercial sector, business aviation sector, etc?

Answer: We don’t do this normally because the finance analysts - they are following every company listed on the stock exchange and we believe it is not wise to open up these numbers. However, what I can tell you … the production rate of 12 to 14 (commercial regional jets) will be maintained per month in 2008.

Question: According to the backlog figures, the strongest seller thus far is the E-190, followed by the E-175. How do you see things playing out for the E-170 and E-195 in 2008? Do you anticipate a similar picture in terms of popularity of the types?

Answer: Of course predicting exactly the breakdown [for] each of the members of the family is impossible. For instance, when we launched the program in 1999, the scope clauses in the United States were at 50 seats and there was a big question mark as to where the scope clauses would go five to ten years after 1999. Now we are able to understand that they go to 75 to 76 (seats). That’s why the 175 is preferred against the 170. [With regard to the] 190 - due to the fact that a lot of the narrowbodies worldwide are flying with flights with full load factor, the 190 (the 100 seater) is getting a strong preference from the marketplace but I personally don’t break down this family in really four different products. To my understanding, and I’ve been in the airline business on the airline side for more than 25 years before coming to Embraer, I see this family with two products. One product is the 170/175 and the second project is 190/195 so. At 32in pitch we have just eight seat difference between the 170 and 175, so by all means I do understand that 170/175 is one product.

Question: Should the CSeries be launched by Bombardier this year, will Embraer counter with a larger type or does the 108-seat E-195 fit this space nicely.

Answer: If Bombardier launches, I understand that … from what they have been telling the press in conferences, they will launch the 110 [seater] first which is smaller, which makes sense and later on they will stretch to the 130. So the 110 is quite equivalent passenger capacity to the 195, and it can be substituted by the 190 in some applications. So, what we see is that we have been doing from the very beginning from the first day of entry into service, we have been putting our engineering towards improving the product and certifying additional capabilities of those aircraft. [We are] continually enhancing the product and we will keep doing this and if they [Bombardier] come with an entry into service in 2013 or 2014 we believe that with the customer base that we have conquered … we believe we can resist the competition with Bombardier.

Of course we respect them as a competitor. We understand that they are evolving slowly with the CSeries, but we are not afraid. We don’t intend to increase the capacity of the 195 trying to be more competitive against them.

Question: Do you have any final comments about Embraer’s prospects?

Answer: I would say two important things from our perspective. We are entering 2008 with almost $19 billion firm backlog, which is really an outstanding result. If we factor revenues in 2007, we have more than three years of production ahead of us, 3.5 years of production so this is quite important for us. It shows the amount of confidence the marketplace has in our products.

The second point in 2008 is the certification and the start and entry into service of the Phenoms. It is a fantastic program. We achieved more than 700 firm orders of the Phenoms even before the entry into service. The entry into service will be the second half of this year. So those are the most remarkable things.

Another important activity for 2008 is the customer service network extension. This is related not only to commercial aviation but also executive aviation expansion for Embraer.


(Photo from Embraer image gallery: http://mediamanager.embraer.com.br/english/content/busca/detalhe_publico.asp?que_pagina=1&pagina_anterior=categorias)

Eight is Great: Embraer Reveals Timeline for Next Generation Aircraft

Embraer could introduce its next generation aircraft in under eight years. The Brazilian manufacturer has revealed it is looking at a "mid-next-decade" timeframe. Hey folks, that's right about the time that Boeing is expected to introduce a new-technology replacement for its 737.

Far be it for me to speculate, but could Embraer be gearing up to challenge Boeing - and Airbus for that matter - in the mainline sector? CEO Frederico Curado in July told Bloomberg that the company is mulling it over. A decision now, he said, would be "premature" because "there'd be no sense bringing to the market a product that will be similar to existing products". New engine technology must first be developed, he said.

Nonetheless, the use of composites seems almost assured. Embraer VP market intelligence-airline market Luiz Sergio Chiessi says composites will probably be considered for the next generation airliner's wing and fuselage. He sees no point in rejigging the current E-Jet line with these materials.

Bombardier, meanwhile, is looking to bridge the gap between regional and mainline with its proposed CSeries. As currently defined, the CSeries will be made up of 46% composites, but retains an aluminium lithium fuselage. A launch decision is expected by calendar 2008 with a targeted entry into service in 2013.

Chiessi says he is "almost sure" Bombardier will opt for Pratt & Whitney's geared turbofan (GTF) to power the 110- to 130-seat aircraft.

Curb Your Enthusiasm: Canada's Submission in EU-US Subsidy Row is Standard Practice

Some journalists got excited this week over the news that Canada has jumped into the EU-US row taking place at the WTO concerning large aircraft subsidies. In a third party submission, Canada says Europe’s argument fails on a number of levels. The home of aircraft maker Bombardier certainly has reason to care about the case since it could set precedent in other commercial discussions, like the previous one fought between Canada and Brazil, where rival manufacturer Embraer is based.

What hasn't been mentioned yet is that the submission is standard practice. Oh yes, and Brazil has made one too, as has China, Korea, Australia and Japan (let’s try to sniff these out…such submissions are confidential unless made public by the submitting country)!

The EU says it feels Canada’s submission “is fully appropriate” since WTO Members frequently intervene as third parties to express views. After all, the EC does this in almost every case.

It hasn't yet responded to Canada’s arguments, saying the appropriate time to do that would be at the so-called third-party session, a meeting in Geneva with the panel, the parties, and third parties, currently scheduled for January 15.

Both the EU and the USA have filed separate subsidy complaints with the WTO. The core of the EU’s challenge is the alleged research and development support provided by the US government to Boeing. The EU claims the US airframer will have benefited from more than $23 billion worth of subsidies between 1987 and 2024.

The USA, meanwhile, alleges the benefit of EU member state financing to Airbus alone amounts to as much as $205 billion.

40 Years Old But No Virgin

Northwest Airlines has begun touting its international fleet as "the youngest" of any North American airline, after taking delivery of its 32nd Airbus A330 aircraft. The self-promotion certainly makes sense. Travelers like flying in brand spanking new aircraft because they're seen as safer, more comfortable and friendlier to the environment. Is there anything less reassuring than stepping onto an old, paint-peeled aircraft that looks like it is being held together with masking tape?

Why then does Northwest continue to push back a decision on replacing the over 100, aged McDonnell Douglas DC-9 aircraft in its domestic fleet? Some of these jets are 40 years old, boasting build dates from 1967 - the same year that Lyndon B Johnson was President; Elvis and Priscilla were married; the Beatles released Sgt. Pepper's Lonely Hearts Club Band; and Pamela Anderson was born. Unlike Anderson, however, Northwest's DC-9s haven't received much plastic surgery of late. Some of them look downright decrepit.

Northwest says it expects to make a decision about DC-9 replacement next year. The company claims it is holding off to see if a manufacturer makes a new 100-seater that has the same carbon composites as the 787, of which Northwest is the North American launch customer with an order for 18.

The airline remains one of the leading candidates to launch Bombardier’s proposed 110-to 130-seat CSeries (it is also evaluating the Embraer E-Jet, and the Sukhoi Superjet 100). But Bombardier isn't expected to make a CSeries launch decision until calendar 2008 with a targeted entry into service in 2013. If Northwest opts to replace it's DC-9s with CSeries aircraft, will travellers be flying on near 45-year old DC-9s by the time CSeries deliveries take place?

That’s a question only Northwest can answer. For now, however, the carrier’s decision to advertise the newness of its international fleet only serves to highlight the fact that it’s domestic DC-9s are anything but.