Widebody announcement

[GRK]

787's hey? Here's a question for you engineering fans…Is Westjet ready for the new maintenance required to keep these wonderjets airborne? The company I work for has taken our first and it's proving to be quite complicated to maintain. It's a new type, and even with Boeing support, the engineering side of things is expensive! WS will have to set up a really costly spares pool and from what I see here, they are only thinking about four tail numbers…that's not even close to being economical! Then there's the IT side which has been a huge project for my bunch. It's an airplane that requires a completely new department that is almost completely IT dependent. It's my bet that it won't be the Dreamliner. More like something available, already proven, and has a spares pool that is easy to purchase parts from. Plus I'm pretty sure there are no 787's that have an all economy layout, or even premium economy with normally spaced economy seating behind. Galleys can't be changed without removing/ altering carbon fibre parts, and once the interior is set, it's seriously hard to change. Boeing won't back any STC's as the material is extremely difficult to engineer once it has been manufactured.

[redbaron]

Took Air Canada almost 9 years from ordering to receiving. Unless Westjet buys someone else's slots there would be no 787s on the property until 2023ish.

A little misleading as there were no deliveries to anyone for the first 6 years following that order...

[leftoftrack]

A330 NEO just announced. Which makes the short term A330 CEO lease make sense

[twinpratts]

So there is already a wide body pay scale?

Yes, and my understanding is it's above Rouge and Transat.

[rudder]

So there is already a wide body pay scale?

Yes, and my understanding is it's above Rouge and Transat.

It would have to be since WJ NB pay already exceeds Rouge and Transat WB pay.......

[twinpratts]

Didn't know that .

[yycflyguy]

Took Air Canada almost 9 years from ordering to receiving. Unless Westjet buys someone else's slots there would be no 787s on the property until 2023ish.

A little misleading as there were no deliveries to anyone for the first 6 years following that order...

How is that misleading? Those same customers ordered their aircraft years before the first B787 rolled off the line. With all the delivery delays there is still a VERY long list of airlines awaiting their first FINs. The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.

Widebody flying for Westjet is a mistake. Airtransat has the cheap European seasonal travel locked up and AC gets a mix of business and leisure travel.

The only question remaining is will which airline will merge with which airline? History has a way of repeating itself.

Oh. Why are we celebrating the pay scale being above rouge and Transat? Shouldn't it be the same as AC mainline?

[RustyDeuce]

Widebody flying for Westjet is a mistake. Airtransat has the cheap European seasonal travel locked up and AC gets a mix of business and leisure travel.

Transat had a lock on Caribbean travel, once upon a time. How's that going?

[dukepoint]

Took Air Canada almost 9 years from ordering to receiving. Unless Westjet buys someone else's slots there would be no 787s on the property until 2023ish.

A little misleading as there were no deliveries to anyone for the first 6 years following that order...

How is that misleading? Those same customers ordered their aircraft years before the first B787 rolled off the line. With all the delivery delays there is still a VERY long list of airlines awaiting their first FINs. The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.

Widebody flying for Westjet is a mistake. Airtransat has the cheap European seasonal travel locked up and AC gets a mix of business and leisure travel.

The only question remaining is will which airline will merge with which airline? History has a way of repeating itself.

Oh. Why are we celebrating the pay scale being above rouge and Transat? Shouldn't it be the same as AC mainline?

Your post is a paradox.

Celebrating Transat or Rouge wages......................... only depends on whether or not you want to be economically competitive. Since Westjet won't be targeting high yield business class on its Widebody routes, shouldn't they attempt to model costs based on their direct competition?

WJ is already at a severe "economy of scale" disadvantage when you consider they're only getting four aircraft of this type. It may change when they approach the number planned at Rouge of 20 767's. But until then....$$$ To pay them Air Canada Mainline wages would put them at a further disadvantage. Considering how fast the Westjet model is morphing from the very efficient, single type "Southwest" model into a far more expensive legacy type model, nothing would surprise me at this point. Westjet as we knew it is almost dead.

DP.

[Gilles Hudicourt]

Westjets cost per available seat mile is still way lower than Air Canada's. I would not dismiss them like that......

[KAG]

Wj as most wj employees who've been around for a while all tell you it's dead. That doesn't mean we don't do things well it's just we've changed. I wouldn't be too concerned about us faltering just yet...

[dukepoint]

Westjets cost per available seat mile is still way lower than Air Canada's. I would not dismiss them like that......

Who's dismissing anything? My point is not to dismiss, but observe that the further WJ moves from the "Southwest model", the higher their costs. Pretty simple.

Economy of scale is a simple economic principle that's easy to understand. 20 trumps 4 any day of the week. Rouge pay tops out around 188K, few approach that figure. Rouge FA's average $25k, most make that. Since only the most senior WJ pilots and FA's will likely train on the new equipment, there will be a serious and undeniable disadvantage wage-wise. I can't see WJ cross-training every FA for four aircraft, if they do, more cost yet.

My point is the "gap" is narrowing at a pace never imagined. Multiple bases, multiple aircraft types, mature workforce. Where's the savings now? I do wish them the best though, AC needs a healthy competitor. Passengers need a choice.

DP.

[dukepoint]

Wj as most wj employees who've been around for a while all tell you it's dead. That doesn't mean we don't do things well it's just we've changed. I wouldn't be too concerned about us faltering just yet...

My point is not "Westjet is dead"............I meant the Westjet that modeled itself after an extremely successful US Airline we know as Southwest is dead. It's morphed into something else. Time will tell if it's sucessful.

DP.

[redbaron]

Took Air Canada almost 9 years from ordering to receiving. Unless Westjet buys someone else's slots there would be no 787s on the property until 2023ish.

A little misleading as there were no deliveries to anyone for the first 6 years following that order...

How is that misleading? Those same customers ordered their aircraft years before the first B787 rolled off the line. With all the delivery delays there is still a VERY long list of airlines awaiting their first FINs. The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.

Because orders during that time did not match production rates now. At the current rates a 787 ordered today could be delivered in 7ish years, not 9, and that assumes all production slots are filled (unlikely) and ignores already announced rate increases. In reality somewhat less, probably 5-6 years.

[Realitychex]

[/quote]Widebody flying for Westjet is a mistake. Airtransat has the cheap European seasonal travel locked up and AC gets a mix of business and leisure travel. [/quote]

I can give you about 120 reasons, and another good one every month, as to why other than to France, Air Transat should be very, very concerned about the prospect of WJ WB to Europe.

If you called up Boeing, they'd probably tell you there was no way you could get a 737NG anytime soon either. Dig a little deeper and all of a sudden some of those "firm" orders and production slots aren't quite as firm as people might assume.

[13820]

The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.

Or strike a smoking deal on 4 of the orphans for a three to four year lease. Then slots to replace. After all half of the gas would be bought in Alberta. I am sure the added fuel burn could be offset in the lease terms and not as hard with cheap fuel.

[dukepoint]

The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.The only way Westjet could get a B787 on short notice (next 12-24) months would be to purchase someone else's planes or as Giles pointed out, through a lease holding company.

Or strike a smoking deal on 4 of the orphans for a three to four year lease. Then slots to replace. After all half of the gas would be bought in Alberta. I am sure the added fuel burn could be offset in the lease terms and not as hard with cheap fuel.

How many other operators in the world do you think may have considered aquiring the "four orphans", but passed? Answer, nearly every one. There's a reason. Bad idea.

DP.

[mikeecho]

Wj as most wj employees who've been around for a while all tell you it's dead. That doesn't mean we don't do things well it's just we've changed. I wouldn't be too concerned about us faltering just yet...

My point is not "Westjet is dead"............I meant the Westjet that modeled itself after an extremely successful US Airline we know as Southwest is dead. It's morphed into something else. Time will tell if it's sucessful.

DP.

WestJet stopped modelling itself after Southwest more than a decade ago and to this point it has worked out very well.

[dukepoint]

Wj as most wj employees who've been around for a while all tell you it's dead. That doesn't mean we don't do things well it's just we've changed. I wouldn't be too concerned about us faltering just yet...

My point is not "Westjet is dead"............I meant the Westjet that modeled itself after an extremely successful US Airline we know as Southwest is dead. It's morphed into something else. Time will tell if it's sucessful.

DP.

WestJet stopped modelling itself after Southwest more than a decade ago and to this point it has worked out very well.

Yes....to this point. The world of Widebodys is not a cheep one. Multiple aircraft types and multiple crew bases all have built in divisions and costs that have yet to leave their mark. Don't fix it if it ain't broke.

I remember one of the founding members of WJ with the initials BL, comment that up until 32'ish aircraft, WJ was a licence to print money for all involved, after that it was all downhill. At that point WJ should have moved from a growth company to a divided stock company, and stayed at 32 aircraft like he cautioned. Everyone on the property at that point would be a millionaire today. You cannot grow and print new stock forever. When Clive decided WJ would be a "growth company" indefinitely, he sealed it's fate, and he bailed for the most part.

The side effect of being a growth company, is that the plan eventually runs out of steam, and new revenue streams need to be found. I think Westjet is scrambling for new revenue streams.....this Widebody experiment and Encore are but two of them. Another consequence is that it leaves the company vulnerable to upstarts interested in only the gravy.

But good luck anyway, like I said, Canada needs two healthy airlines.


DP.

[Realitychex]

My point is not "Westjet is dead"............I meant the Westjet that modeled itself after an extremely successful US Airline we know as Southwest is dead. It's morphed into something else. Time will tell if it's sucessful.

DP.[/quote]WestJet stopped modelling itself after Southwest more than a decade ago and to this point it has worked out very well.

Yes....to this point. The world of Widebodys is not a cheep one. Multiple aircraft types and multiple crew bases all have built in divisions and costs that have yet to leave their mark. Don't fix it if it ain't broke.

I remember one of the founding members of WJ with the initials BL, comment that up until 32'ish aircraft, WJ was a licence to print money for all involved, after that it was all downhill. At that point WJ should have moved from a growth company to a divided stock company, and stayed at 32 aircraft like he cautioned. Everyone on the property at that point would be a millionaire today. You cannot grow and print new stock forever. When Clive decided WJ would be a "growth company" indefinitely, he sealed it's fate, and he bailed for the most part.

The side effect of being a growth company, is that the plan eventually runs out of steam, and new revenue streams need to be found. I think Westjet is scrambling for new revenue streams.....this Widebody experiment and Encore are but two of them. Another consequence is that it leaves the company vulnerable to upstarts interested in only the gravy.

But good luck anyway, like I said, Canada needs two healthy airlines.


DP.[/quote]

There's definitely some scrambling going on, but it's not at WJ.

Things are unfolding pretty much according to plan as far as I can see. Some might suggest Encore's growth velocity is a little "Neelemanesque", but then again, Encore isn't challenged with building a brand, as was the case in every market WJ expanded into over the first decade of heavy lifting.

There were high level conversations 10+ years ago to the effect that WJ should ultimately evolve into an airline with 3 aircraft types, a 75 seat highly efficient turboprop, the 737 family and a 250-275 highly efficient long haul jet. If individual markets didn't fit any of those 3 types, fuhgetaboutit. The list of airlines that have been successful trying to operate, whether themselves or by proxies, aircraft ranging from 19 to 500 seats is not very long.

Circumstances may delay the implementation of the 3rd phase, which I personally believe will ultimately be a 787 variant, but it's not as if WJ and others haven't had success operating low capital cost equipment head to head against the latest and greatest equipment in the past. In the initial stages of the WB roll out, it may be advantageous to not have to fly aircraft 17 hours a day, 7 days a week to be profitable.

I find it intriguing that when it is all rolled out, the product and service expectations across the WJ network will be consistent, just like McDonalds. Unless there is a change of strategy, that will not be the case at the other network sched carrier in Canada. I personally believe that is a mistake and will ultimately have to be corrected, one way or another.

The fact the peanut gallery is, once again, forecasting an impending apocalypse at WJ is as sure a sign that the strategy is sound as I can imagine.

It's pretty clear that Southwest's stubborn unwillingness to evolve is severely hurting its position in the marketplace. They remain a force to be reckoned with, but could have been so much more had they taken a few chances. Even today, SWA does not operate red eyes....

As has been correctly pointed out by others, WestJet has been steadily moving away from the generic SW model for years. Aside from some very basic similarities, strategically, SW and WJ were chalk and cheese from day 1. That was by design, not by accident.

To begin with, SW has always been a high frequency operator on high density routes. They would never even begin to contemplate the lower frequency operation WJ rolled out over the first decade and it continues even today.

Jetsgo tried that high frequency strategy out and it didn't work out so well. Porter is struggling to make a go of it, even with the advantage of a monopoly position at the downtown airport at the epicenter of, far and away Canada's largest single aviation market.

Had WJ copied the SW strategy, we would have started with 8x daily on each of the western Triangle routes.

I doubt WJ would be around today had that plan been implemented.