Does Comair have eyes on Africa expansion?

2014-03-19 14:34
Comair CEO Erik Venter says the carrier's new aircraft remain the best solution to the rising fuel price.  (Supplied)

Comair CEO Erik Venter says the carrier's new aircraft remain the best solution to the rising fuel price. (Supplied)

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Johannesburg - South Africa’s private domestic airline operator Comair Limited has just announced a R9bn ordered for eight Boeing 737 MAX 8s – making Comair the first airline in Africa to order these new fuel-efficient planes.

Erik Venter, CEO of Comair says, “This R9bn investment in Comair’s fleet upgrade is fundamental to its business strategy of consistently improving customer service and value, while ensuring a sustainable airline, by minimising the impact of the fuel price on airfares.”

The 737 MAX, which is the most technologically advanced 737 variation to date, designed by Boeing, will go into production in 2017 and Comair will take delivery of the first of 8 planes in 2019 and the last by 2022.

Interestingly enough the airline has a second batch of eight 737 Max planes waiting in the wings, locked in at the same estimated order price. That’s a potential R18bn investment, six times its last fleet upgrade investment of R3.5bn, which began in 2012.

It therefore begs the question, is this profitable domestic carrier, in operation since 1946 and currently servicing South Africa, Sub- Saharan Africa and the Indian Ocean Islands, planning a bigger Pan-African route network?

Not underestimating the degree of regulatory and application approvals required, would it not make business sense?  

“It’s simply too early to tell,” says Venter.

While Comair certainly has a lot to be optimistic about, like how these new Boeing Max planes will add an additional 14% fuel saving to the current 28% saving made on current Boeing 737-800 - Comair has already taken delivery of four aircraft from its current order for eight Boeing 737-800 with the remaining four to be delivered in late 2015 and 2016 - Venter confirmed the new ordered is meant to be replacement aircraft to support Comair’s  future fleet renewal.  

And while the new Boeing Max builds on the Boeing 737 attributes of efficiency, economics, reliability and customer appeal it does have more capacity - increasing profit-generating ability – currently 92% of which is filtered back to Comair passengers says Venter.

The 737 MAX has already amassed more than 1 800 orders worldwide since its development was announced in 2011.

Here's a closer look at what makes it so technologically advanced and fuel efficient

-    Latest technology CFM International LEAP-1B engines.

-    Aerodynamic improvements such as new Advanced Technology winglets, resulting in less drag and further performance optimisation.

-    Delivery of 14% fuel-efficiency improvement over today's most efficient single-aisle aircraft.

-    737 Boeing Sky Interior will be standard in these planes, featuring modern-sculpted sidewalls and bigger windows.

-    The Max is said to build on the best reliability record of any aircraft, with 99.7%  of Next-Generation 737 flights ready to depart within 15 minutes of schedule (based on industry data) – this improves on-time performance and fewer delays based

It will be interesting to see if the airfares are affected down the line as the strategy behind this R9bn, potentially R18bn, investment unfolds.

Either way, with domestic carriers failing to get off the ground or simply closing down in South Africa, it appears Comair isn’t going anywhere but up.

Read more on:    boeing  |  comair  |  flights  |  air travel  |  travel international  |  aviation

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