Widebody fleet replacements?

[yycflyguy]

I’ve heard that the earnings report on Feb 12th (or shortly thereafter) will be the same time the company announces their future widebody replacement plans.

Through the grapevine it sounds like the company is pushing more towards the A350-1000 rather than the 777-8 or 777-9.

What are you guys’ thoughts on that?

The rumor is that they're navigating how to announce the WB fleet (yet another cost) without tanking the stock. Guess there's concern that if a company with 295.4M publicly tradable shares out of the 296.2M total shares tanks, it doesn't take much for an ONEX (or similar) buying up the majority shares for cheap and owning the majority of the company.

What would Air Canada be worth if it tanked 50%? Just around 3B? Let's not forget when ONEX bought WJ for 3.5B in 2019. It's not a lot of money for these guys if they want to own it outright. And a panic would be the perfect environment to scoop up the company. Sure above 20% they have to send out disclosures to all of the shareholders, blah blah blah, but the reality is 80 ish% (when you remove institutions and insiders) is held by the public float.

It doesn't take much for 5 shell companies to buy up AC stock and be its new majority shareholders. Esp in the private equity space.

I think they need their stock price higher if they plan on announcing another fleet endeavor. Probably 26-30/share (reflecting a 9-12B company). Not down here in the 18-20's. And hey, maybe that's what they're planning. Report solid earnings, and if the stock pumps into the atmosphere, announce the new fleet selection. Would be neat to fly a 350! With the recent shit show between USA/Canada, could be a reality I guess.

Okay I am done trying to sound smart lol. Positive Rate Gear up! Ahhh the world is much better from up here than on the ground

Well, this post aged like milk in the sun.

[flying4dollars]

It talks about ‘new routes’ and shows a graphic with eastern operations out of YYZ/YUL to the Indian subcontinent and South Africa and a single westerly route (Bangkok?).

It didn't look overly accurate but Ho Chi Minh was listed as one of future routes when I started, along with Bangkok and Manila which have indeed materialized since then. I think Vietnam makes sense. Wonder if the A350 means we can do India from out west even with airspace restrictions still in effect in 2030+.

[Eric Janson]

Wonder if the A350 means we can do India from out west even with airspace restrictions still in effect in 2030+.

It's possible to go 'Eastbound around the World' from Western Canada. Tailwind on both sectors!

Airspace restrictions are a real problem. GPS jamming/spoofing is also becoming a bigger issue.

[jonathanedmorris]

I was under the impression that Airbus types have a simplified course if you are already typed on another Airbus as the systems are designed to be as similar as possible.

This means nothing because you get pilots from all walks of life going 350. Bunch of 777 and 787 captains and a sprinkle of junior 330 would hop on the plane. Fo from every single fleet type will hop on as well. It's not like folks are 100% airbus their whole AC career

Really? If we got 350s or they brought 330's back to YVR, there definitely would be Airbus lifers. I'd likely be one

..... noice

[Dry Guy]

What's with the 14000 iPhones for front line staff? Was it really identified that the terrible on-time performance was due to staff not owning phones? It reeks of management trying to spend their way out of problems by buying gadgets instead of investing in their employee's wages.

[Eric Janson]

What's with the 14000 iPhones for front line staff? Was it really identified that the terrible on-time performance was due to staff not owning phones? It reeks of management trying to spend their way out of problems by buying gadgets instead of investing in their employee's wages.

Follow the money.

Big contract = big commissions for someone.

[piedpiper]

What's with the 14000 iPhones for front line staff? Was it really identified that the terrible on-time performance was due to staff not owning phones? It reeks of management trying to spend their way out of problems by buying gadgets instead of investing in their employee's wages.

It's already a thing at other airlines including Delta. All FAs have an iPhone and it's used for their manuals and for on board payments, tracked to each individual.

As for the A350s which was the topic of this thread in the first place, the A350 seems like an odd choice for only 8 + 8 fins. I am frankly suprised they just didn't order another 15-20 787-9/10s. Adding more fleets to the mix is a mess for training purposes and crew/pairing planning.

[Flyboy736]

What's with the 14000 iPhones for front line staff? Was it really identified that the terrible on-time performance was due to staff not owning phones? It reeks of management trying to spend their way out of problems by buying gadgets instead of investing in their employee's wages.

It's already a thing at other airlines including Delta. All FAs have an iPhone and it's used for their manuals and for on board payments, tracked to each individual.

As for the A350s which was the topic of this thread in the first place, the A350 seems like an odd choice for only 8 + 8 fins. I am frankly suprised they just didn't order another 15-20 787-9/10s. Adding more fleets to the mix is a mess for training purposes and crew/pairing planning.

A 787-10 or even 9 isn't going to satisfy the ultra long haul flights that AC wants to do based on demographics. As an example the 350 can do YYZ to Manilla but the 787-9 can't. One of the executives said the practical range for the -9 is 16, 16.5 hrs but it can't really be stretched beyond that without severe penalties

[piedpiper]

Gross I can't imagine sitting on a plane from YYZ to Manilla.

15 hours was always about long enough for me, and we're already past that on a few routes. Any new ULR flights will need to have crewing addresses. I imagine the A350s won't have an RP position since ULR flying is all 2CA/2FO.

[Flyboy736]

Gross I can't imagine sitting on a plane from YYZ to Manilla.

15 hours was always about long enough for me, and we're already past that on a few routes. Any new ULR flights will need to have crewing addresses. I imagine the A350s won't have an RP position since ULR flying is all 2CA/2FO.

That's a good point, but I suspect the plane will rotate between ULR and Europe for timetable purposes. Similar to the 777-200 doing Sydney-Yvr-Yyz-Ams back and forth

[350driver]

I’ve heard that the earnings report on Feb 12th (or shortly thereafter) will be the same time the company announces their future widebody replacement plans.

Through the grapevine it sounds like the company is pushing more towards the A350-1000 rather than the 777-8 or 777-9.

What are you guys’ thoughts on that?

The rumor is that they're navigating how to announce the WB fleet (yet another cost) without tanking the stock. Guess there's concern that if a company with 295.4M publicly tradable shares out of the 296.2M total shares tanks, it doesn't take much for an ONEX (or similar) buying up the majority shares for cheap and owning the majority of the company.

What would Air Canada be worth if it tanked 50%? Just around 3B? Let's not forget when ONEX bought WJ for 3.5B in 2019. It's not a lot of money for these guys if they want to own it outright. And a panic would be the perfect environment to scoop up the company. Sure above 20% they have to send out disclosures to all of the shareholders, blah blah blah, but the reality is 80 ish% (when you remove institutions and insiders) is held by the public float.

It doesn't take much for 5 shell companies to buy up AC stock and be its new majority shareholders. Esp in the private equity space.

I think they need their stock price higher if they plan on announcing another fleet endeavor. Probably 26-30/share (reflecting a 9-12B company). Not down here in the 18-20's. And hey, maybe that's what they're planning. Report solid earnings, and if the stock pumps into the atmosphere, announce the new fleet selection. Would be neat to fly a 350! With the recent shit show between USA/Canada, could be a reality I guess.

Okay I am done trying to sound smart lol. Positive Rate Gear up! Ahhh the world is much better from up here than on the ground

Well, this post aged like milk in the sun.

hahah! right!

Honestly I think the announcement for 8 is still probably a responsible strategy. Judging by the earnings call, they're limiting their cap ex to 12% of revenues. So I'm sure not tanking the stock has a huge part to do with why they are doing it as '8' with options for '8 more'

In any case, interesting strategy for the 350 to replace the 330. Seems like there's more to this story than the 330 replacement.

[Dry Guy]

Adding more fleets to the mix is a mess for training purposes and crew/pairing planning.

What about the risk of a fleet grounding due to manufacturing defects like we are seeing with the A320neo engines? That caused Spirit Airlines to go bankrupt.

I'd guess increased crew training costs are a small price to pay compared to how devastating it would be to have a significant portion of your total fleet be unable to fly.

[piedpiper]

The rumor is that they're navigating how to announce the WB fleet (yet another cost) without tanking the stock. Guess there's concern that if a company with 295.4M publicly tradable shares out of the 296.2M total shares tanks, it doesn't take much for an ONEX (or similar) buying up the majority shares for cheap and owning the majority of the company.

What would Air Canada be worth if it tanked 50%? Just around 3B? Let's not forget when ONEX bought WJ for 3.5B in 2019. It's not a lot of money for these guys if they want to own it outright. And a panic would be the perfect environment to scoop up the company. Sure above 20% they have to send out disclosures to all of the shareholders, blah blah blah, but the reality is 80 ish% (when you remove institutions and insiders) is held by the public float.

It doesn't take much for 5 shell companies to buy up AC stock and be its new majority shareholders. Esp in the private equity space.

I think they need their stock price higher if they plan on announcing another fleet endeavor. Probably 26-30/share (reflecting a 9-12B company). Not down here in the 18-20's. And hey, maybe that's what they're planning. Report solid earnings, and if the stock pumps into the atmosphere, announce the new fleet selection. Would be neat to fly a 350! With the recent shit show between USA/Canada, could be a reality I guess.

Okay I am done trying to sound smart lol. Positive Rate Gear up! Ahhh the world is much better from up here than on the ground

Well, this post aged like milk in the sun.

hahah! right!

Honestly I think the announcement for 8 is still probably a responsible strategy. Judging by the earnings call, they're limiting their cap ex to 12% of revenues. So I'm sure not tanking the stock has a huge part to do with why they are doing it as '8' with options for '8 more'

In any case, interesting strategy for the 350 to replace the 330. Seems like there's more to this story than the 330 replacement.

Realistically I see this as an annoucement for 16 aircraft. AC will most likely convert the order on a following year's balance sheet. The 787 original order was for 17 or 18? And now 15 years later we have double that. 16-20 aircraft for ULR flying would be a good amount to have a fleet that can cover 6-8 routes with reliablity.