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All change!

Posted 15 March 2018 · Add Comment

It’s not often that an airline changes its entire fleet in one fell swoop, but EgyptAir Express plans to do precisely that as it seeks to overcome its operational challenges.

Since it began operations in 2007, EgyptAir Express has operated 12 Embraer 170s on a collection of domestic and international routes. The aircraft have performed well, but some problems have become apparent.
The EgyptAir subsidiary, for example, sometimes operates services for its mainline parent on thinner international routes when reservations are too low to economically use one of EgyptAir’s Boeing 737-800s or A320s, both of which have around 140-plus seats.
However, if the replacement Embraer has a full 74-passenger load on a service to Budapest or Vienna, for instance, there can be problems coping with all the luggage that tends to accompany passengers flying a four-hour sector.
This payload/range limitation was one of the factors behind EgyptAir Express seeking a replacement for the Brazilian regional jets, although they are still relatively young, at 10 years old.
Another factor was that the Embraer’s seat costs were rising, due to the maintenance costs associated with a relatively high number of cycles. Flights to central Europe are in the minority, with most of EgyptAir Express’s sectors being just an hour or slightly longer. The large number of periods on the ground between such short sectors also means that utilisation is relatively low at around eight hours a day.
Hence the announcement at November’s Dubai Air Show that EgyptAir was signing a letter of intent (LoI) for ‘up to 24’ Bombardier CS300 airliners, as part of the group’s fleet replacement strategy.
The LoI is for 12 firm orders and 12 purchase rights, worth $2.2 billion at list prices if all the options are exercised.
EgyptAir Express will be the Middle East launch customer for the Canadian-built aircraft. Initial delivery dates for the aircraft were not mentioned at Dubai, but the carrier hopes that the first CS300s will arrive at the end of 2018/start of 2019.
Asked at the air show if October’s announcement that Airbus was taking a 50.01% stake in the CSeries programme had reassured EgyptAir about the project’s viability and encouraged it to sign on the dotted line, group chairman and CEO, Safwat Musallam, said: “No, we were going to buy the CS300 anyway.”
The Canadian jets will give EgyptAir Express a substantial capacity increase, with the aircraft likely to operate with around 120 seats. They will also open up new markets for the airline, said the regional carrier’s chairman, Captain Helmy Rezk. “The route network will expand considerably. As well as the south of Europe it will give us more markets in Africa. We can go to Casablanca, for example. And we can get to Mumbai with a full payload.”
The CS300’s range will also allow direct flights between Egyptian tourist destinations such as Sharm El-Sheikh and Germany or Italy. EgyptAir Express plans to make the Red Sea resort its third operational base, after Cairo and Alexandria.
“This will give us a very big competitive advantage,” said Rezk. “We can serve our domestic routes and other destinations with lower costs.”
Those lower seat costs will allow the company to offer lower fares. Currently, around 75% of EgyptAir Express’ services are domestic and 25 regional; the capabilities of the new aircraft are likely to tip that balance more towards international services.
Although the carrier has its own staff and its aircraft operate in a different livery to those of its mainline parent, the two parts of the company work from a single network fleet plan, explained EgyptAir Express general manager, planning, Ahmed Ali Alashwat. “It’s very dynamic. In the low season, we can take more routes from the mainline operation. And we can use the 737-800 in the high season to go to places like Sharm El-Sheikh.”
One advantage that EgyptAir Express enjoys is the speed with which it can take decisions. “I sit with operations and maintenance beside me,” said Alashwat. That allows it to react swiftly to changing conditions.
Like most Egyptian carriers, EgyptAir Express has found itself having to battle against outside conditions, such as the country’s political upheavals of recent years. Profitable until 2011, it broke even in 2016. It hopes 2017’s accounts will see it back in profit and that its new equipment will keep it on an upward trajectory.
 

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