IranAir Finally Takes Off

For the first time in more than 20 years Iran Air has received new aircraft. As Andreas Spaeth finds out, the Persian carrier is planning to establish a major hub in Tehran

Iran Air was the last airline to cancel an order for two Concorde aircraft, which it ordered in 1972. Only after the Iranian Revolution and Concorde production ended, which both took place in 1979, did the official cancellation come in April 1980.

That was how sophisticated the oldest airline in the Middle East had been before the Shah was toppled. Its predecessor, Iranian Airways, had been founded in 1944; the current name was introduced in 1961, decades before anyone would even think of founding airlines in the much smaller Gulf states who rule aviation today.

In 1976, four years before the Concorde order was formally scrapped, Iran Air was one of the forces behind the shortened, longerrange Boeing 747SP. It received four, starting in March that year, to serve daily non-stop routes between Tehran and New York. A full 40 years later, the last 747SP was finally retired in mid-2016. At the same time, Boeing was able to engage with Iran again for the first time in decades. In an exclusive interview with AIR International in Toulouse, Iran Air Chief Executive Officer Farhad Parvaresh said: “Joe Sutter, the father of the 747, sent us a letter and a video last year as he had delivered the first 747SP to Iran Air himself in 1976. He said he was admiring us for our maintenance and [for having] operated this aircraft safely for so long, despite all the sanctions, because at the time we still had one or two SPs operating.”

The heyday of Iran Air and commercial aviation in Iran in general had long been over. However, a deal was signed in 2015 between Iran and the UN Security Council, starting a process to end the embargoes and sanctions.

Airbus Agreement

In January 2016, an agreement was signed between Iran and Airbus for an order of 118 aircraft from the European manufacturer: 21 A320s, 24 A320neos, 27 A330s, 18 A330neos, 16 A350-1000s and 12 A380s. Then the process started for Airbus to obtain all the necessary licences and permissions for the export of the aircraft including US-built parts to Iran.

Parvaresh explained the process to work out the actual aircraft mix to go into the contract: “Our commercial department determined which aircraft types are needed, so they came from the number of seats required and the routes to be flown to the number of aircraft. We chose the A320 family, as this is the right aircraft for our routes and we have experience with it, operating six A320s in our fleet already.”

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This photo, taken at Tehran Mehrabad Airport on January 19, 2017, shows the first commercial flight using Iran Air’s initial A321 EP-IFA, with the city of Tehran in the background. Mehrad Watson/ AirTeamImages
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Airbus formally delivered Iran Air’s first A321 during a handover ceremony in Toulouse on January 11. Andreas Spaeth
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Farhad Parvaresh is Iran Ai’sr Chief Executive Officer. Andreas Spaeth

Iran Air started operating the Airbus twin in 2009, taking used aircraft from airlines in Turkey, and its pilots have been receiving training in Toulouse for over a decade. The captain of the first Iran Air A321 delivery flight recalled: “I first came here to fly in the simulator 13 years ago, so this is not new territory for us.”

Almost one year after the initial agreement, the final contract was signed on December 22, 2016, comprising 98 new aircraft plus two used ones. It included the full number of A320 family and A350 aircraft in the January 2016 agreement, but only 38 aircraft of the A330 family and, in a big blow to Airbus, no A380s.

Parvaresh explained to AIR International: “The necessary infrastructure in Iran would not be ready in the near-term future to accept the A380, so we decided to drop it and stay with the other new aircraft first to get more familiar with them. As Iran Air, we presently have no plans to buy any Boeing 747s or A380s.”

In terms of widebodies, the airline will receive both A350-1000s and Boeing 777s, the latter through a separate, still to be approved deal with Boeing, currently comprised of 80 aircraft (50 737 MAX 8s, 15 777-300ERs and 15 777-9s). On top of that, Iran Air is close to signing a final deal for 20 aircraft with regional aircraft maker ATR, also based in Toulouse, bringing the total of new airframes arriving in the next 11 years to 200. Iran Air denies any further interest in products of other manufacturers or even larger aircraft. “This is sufficient capacity, maybe in the future there is a need for bigger aircraft, we will see,” said Parvaresh.

Historic Delivery

January 12, 2017, was a truly memorable day in Iranian aviation history. Persian TV broadcast live when flight IR700 from Toulouse landed at Tehran’s Mehrabad Airport. It was the delivery flight of an Airbus A321, registered EP-IFA (msn 7418).

Its landing marked the arrival of the first new aircraft to any of the country’s airlines since 1994. Even then, 23 years ago, Iran Air only received two Airbus A300-600s by special permission, as compensation for another one of the type shot down over the Persian Gulf by the USS Vincennes in 1988. The last regular delivery of any factory-fresh Western aircraft to Iran was in April 1980, when an A300B2 was ferried to Tehran. This aircraft was one of six ordered in 1978, before the Revolution.

“This aircraft, registered EP-IBS, is still flying safely, despite all the imposed sanctions and problems they made for us, all thanks to Iranian maintenance crews. We will fly it as long as we can,” said Parvaresh.

He has been with the national, stateowned airline for decades, holding the top post for almost eight years. With Iran becoming internationally more and more isolated over the years due to suspicions about its nuclear programme, the country had to improvise and rely on middlemen to keep their airlines aloft. As all Western aircraft contain American components, sales of new aircraft were out of the question.

Parvaresh anticipates five more A320s and three A330s will join his fleet during 2017. In any case, 200 new aircraft are a lot to swallow for an airline that is tiny by any global standard, with currently just 23 active aircraft and about six million passengers a year.

Iran is the second-largest country in the Middle East after Saudi Arabia and home to 80 million people. It is similar in size to Turkey, but has only half the GDP. So nobody denies Iranian aviation has huge potential. Airbus Chief Executive Officer Fabrice Brégier stressed during the delivery ceremony in Toulouse: “The renaissance of the Iranian aviation industry is one of the most important developments in this industry for a long time.”

Talking to AIR International, Brégier said: “It is amazing to see how quickly we got one of the biggest contracts ever for Airbus to work, and this is only the start.”

Farhad Parvaresh seems to be equally stunned at the pace: “You can’t find an airline in history which has signed a contract with a manufacturer like Airbus, and then the aircraft is delivered a few weeks later. It was all prepared before of course, but we signed it about three weeks ago and now we have the first delivery.”

This is all the more remarkable as Airbus’ chief salesman John Leahy had stressed how single-aisle production is sold out until 2021. Quizzed by AIR International about how he was still able to accommodate Iran Air at such short notice, Leahy grinned: “We can always find a slot or two for single-aisle aircraft by shifting things around a bit, or maybe we reserved them a slot already…”

It turns out the A321 delivered to Iran Air (first flown November 16, 2016) was ordered but not taken up by Avianca. This explains why the cabin of the Iran Air aircraft is unique for the carrier in boasting in-flight entertainment screens in all 194 seats (12 in business, 182 in economy) for the first time, a configuration built for Avianca.

Leahy also revealed that two of the A330s now destined for Iran Air were built two years ago and not been taken up either: “They have never been flown commercially and are now stored in Europe.” One of these aircraft is msn 1540, an A330-200 first flown in June 2014 and intended for Avianca Brazil, but not taken by the airline and since stored in Teruel, Spain. Now delivery to Iran Air is imminent, the aircraft has been newly registered EP-IHA.

Fleet Renewal

These new arrivals are eagerly awaited, as Iran Air’s 23 active aircraft are also over 23 years old on average and about the same number of aircraft are in storage. Parvaresh explained: “Some are under maintenance, and some are waiting for engine replacements for example, but we think it wouldn’t be economical to bring them back and spend money on them as we are receiving new aircraft.

“Within the next five years, we will gradually phase out some of the other types like the Fokker 100s or the MD-82, of which we operate four each, as well as older Airbuses.” With the exception of one freighter, all 747s have already been grounded for some time, with the 747SPs being the last ones to retire in 2016. Iran Air’s fleet has shrunk considerably recently. “Six years ago we had 54 aircraft flying,” recalled Parvaresh. This means stafflevels are currently too high, which is a boon at a time of almost unexpected, immediate growth for the airline. “For the next few years at Iran Air we will not have a problem, because we have enough experienced personnel. For the next 20 aircraft we won’t have any pilot shortages, but we have to start training pilots, cabin crews and technicians as we begin to receive the new aircraft.”

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Iran Air’s Chief Executive Officer says the arrival of the new aircraft symbolises how the lifting of sanctions can bring results for Iranian citizens. Mehrad Watson/AirTeamImages

IRAN AIR FACTS AND FIGURES

IATA code: IR

ICAO code: IRA

Ownership: 100% Iranian Government

Operations started: 1944 as Iranian Airways Company, 1962 as Iran Air

Employees: 10,696 (2013)

Passengers carried: about 6 million (2016)

Fleet (January 2017): 8 Airbus A300s, 2 Airbus A310-300s, 6 Airbus A320s, 1 Airbus A321,4 McDonnell Douglas MD-82s, 4 Fokker 100s, 1 Boeing 747-200 Cargo

Aircraft orders: 20 ATR 72-600s, 20 Airbus A320 family, 24 Airbus A320neos, 38 AirbusA330ceo/neos, 16 Airbus A350-1000s, 50 Boeing 737 MAX 8s, 15 Boeing 777-300ERs, 15 Boeing 777-9s

Hubs: Tehran Imam Khomeini International Airport (international), Tehran Mehrabad (domestic)

Network: Iran Air flies to 27 domestic destinations in Iran and 20 international cities, among them three weekly flights to London Heathrow

Revenue: $329.74 million (2013)

www.iranair.com

Fresh metal is something Iran Air’s competitors, including the market leader, privately owned Mahan Air, would need as well. No information has yet been received, however, as to whether they have started any negotiations with Western manufacturers.

According to Parvaresh: “There are 150 passenger aircraft flying now in Iran altogether, about 100 are stored, for all the 16 airlines we have.” Before the current deliveries, only six aircraft currently registered in Iran were built after the year 2000, all second-hand A340-600s operated by Mahan Air. “This is not good, and it shows the demand for aircraft in Iran,” said Parvaresh.

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A321 EP-IFA at Iran Air’s facility at Mehrabad Airport following its delivery. Mehrad Watson/AirTeamImages
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The Iran Air A321 is configured with 194 seats, each of which have in-flight entertainment screens – a first for Iran Air. A Doumenjou/Airbus
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Iran Air is due to receive 98 aircraft from Airbus, among which are 20 Airbus A320 family jets and 24 Airbus A320neos. Andreas Spaeth

Passenger Demand

Parvaresh sees great potential for a major hub operation once the infrastructure is ready: “Due to our location, we can offer a flight time of up to two-and-a-half hours less between Europe and southeast Asia than via the current Gulf hubs, so it would be less fuel and time-consuming and you could offer less expensive tickets. We all have to work on that to make it happen.”

Currently, flydubai and Turkish Airlines take the biggest share of the growing Iranian international market via their respective hubs in Dubai and Istanbul. “We have to compete with the Gulf carriers in the future, because most of the passengers they are generating are from Iran,” acknowledged Parvaresh.

“Passenger demand will come both from domestic and international travellers. There are about three million Iranians living overseas who are now coming and going. We are not counting the third generation, and these are just passengers on family visits, with business travellers and tourists coming on top. If the infrastructure becomes available, 200 new aircraft in 11 years would not even be sufficient.”

Currently, Iran Air serves 27 domestic airports in Iran, as well as 20 international cities, with Beijing and Kuala Lumpur flights resuming in March.

Parvaresh explained: “We stopped a number of international destinations, because we didn’t have the right aircraft to serve them economically. We have stopped routes to Seoul, Beijing and even Tokyo. We can resume flying to all these destinations that we used to fly to once we have suitable aircraft. We want to extend the current schedule – for example, we are flying to London Heathrow three times weekly but I think there is demand for at least daily services. BA started six flights a week after many years of not flying, so there is a demand.”

Currently, just six European flag carriers serve Imam Khomeini International Airport (IKA) – Air France, Alitalia, Austrian Airlines, British Airways, KLM and Lufthansa – plus Germania from Berlin. “Many other airlines either expanded their flights to Tehran or they resumed them, when they had stopped before because of all the problems they had with the previous government. Now that everything is mostly clear, they are all taking advantage. All airlines who used to go to Iran ask for more slots now,” observed Parvaresh.

Airport Infrastructure

There is also improvement on the way for Tehran’s and the country’s most important airport, IKA, which handled about eight million passengers last year. Traffic has surged after the nuclear deal went through. “We have seen passenger numbers increase by 20% in the last six months, since the agreement,” reported Parvaresh.

An expansion in airport infrastructure is overdue. “The Iran airports company is currently building two new terminals at IKA. One is finished maybe 60%, and if everything works out with the financing, it will be ready within the next four to five years,” said Parvaresh. “By then we might be able to add some domestic flights at the international airport, as there is no capacity for transit passengers now at the domestic airport in Mehrabad. If they will have these new terminals at IKA, the capacity will move to 12–15 million passengers per annum.”

Parvaresh thinks aviation will become symbolic of new times in Iran: “So far, many people in Iran were afraid to fly because of the old aircraft. This will definitely change. I think many people should be happy about the recent developments. This is a visible sign the embargo’s lifting, which the people want to see in reality.”

There are other improvements as signs of the new times as well, like an increase in oil exports, for example, but that’s not visible for the average citizen: “New aircraft coming to Iran, despite all the issues we had, can be a symbol for the normal people that the agreements bring results for them.”