Boeing 737 Fuels Virgin Blue Expansion

Read the forum code of contact

Member for

24 years 3 months

Posts: 6,072

SYDNEY, Australia, Jan. 16, 2003 - Boeing today confirmed Virgin Blue's decision to purchase up to 50 additional new Boeing 737 airplanes. The agreement includes a firm order for 10 737-800s and options for 40 more 737s, with an estimated list value of US$3 billion.

The decision follows extensive evaluation of the 737 and its closest competitor, the Airbus A320. The new 737s will meet Virgin Blue's fleet expansion plans for the next 10 years, with deliveries scheduled to begin in August 2003.

The airplanes were recently accounted for in Boeing's published order totals, attributed to an unidentified customer.

"We started this process with a clean sheet of paper to ensure we achieved the best possible result," said Brett Godfrey, chief executive officer of Brisbane-based Virgin Blue. "At the end of the day, the 737 aircraft produced the best results for Virgin Blue, and more importantly our guests. The 737 is the proven leader for low-fare airlines around the world, and it has been crucial to the success of Virgin Blue. We did a very thorough analysis, and Boeing was first past the post."

The new airplanes will have performance-enhancing winglets manufactured by Hawker de Havilland, an aerospace manufacturing supplier based in Melbourne, Australia.

Virgin Blue began providing Australian domestic service Aug. 31, 2000, and has carved a niche in the low-cost market. The Brisbane-based carrier is Australia's largest low-fare airline, operating an all-Boeing fleet that includes 28 Next-Generation 737s and one Classic 737. The airline also has announced its interest in flying to regional destinations including New Zealand and several South Pacific islands.

"After its rigorous examination, Virgin Blue's decision reaffirms the 737 as the best solution for low-fare airlines," said Doug Groseclose, vice president International Sales, Boeing Commercial Airplanes. "One model, one pilot group, and one engineering philosophy all add up to a great recipe for success. Low-cost carriers are driving the airline business globally, and it's no secret that the 737 is the leading airplane for this growing segment of the market."

The low-fare business models of Southwest Airlines and Ryanair replicated around the world are based on an all-Boeing 737 fleet. There are more than 900 737s in service or on order for the low-fare market.

"Having a new fleet of 737s has been one of the key components of customer acceptance of a maverick airline in what was a stagnant domestic aviation market," Godfrey added. "Our guests appreciate the smooth ride and comfortable cabin environment while our operations team found that its efficient design facilitated our quick turnarounds and consistent on-time performance."

Next-Generation 737s have the lowest operating costs in their class -- almost 4 percent lower on a typical route than the closest competitor. The maintenance costs of the 737 are up to 35 percent lower, and the 737 is the industry leader in reliability. The 737 single-aisle airplane also is quicker to load and unload, which allows carriers to make maximum use of their airplane.

Virgin Blue is an award-winning low-fare airline servicing every Australian capital city and a number of regional destinations. The carrier employs more than 2,200 people.

Original post

Member for

24 years 3 months

Posts: 7,536

RE: Boeing 737 Fuels Virgin Blue Expansion

Good news for Boeing... :D ... thanx for the news A330C.

Member for

24 years 3 months

Posts: 3,538

RE: Boeing 737 Fuels Virgin Blue Expansion

I would imagine the generally better Australian weather when compared to North-West Europe makes the 737's lack of Cat 3b capability less important.
There definitely seems to be a trend here with 737 operators saying they get better seat/mile operating costs than the competition and yet Airbus operators saying the same thing!

Member for

24 years 3 months

Posts: 3,279

RE: Boeing 737 Fuels Virgin Blue Expansion

I can understand the price aspect on it but no way would I fly on a long flight of anything up to 7 hours in a 737 from Australia to the Oceanic regions (when their international services start).
Anyway, great to see a new order for Boeing.

Member for

24 years 3 months

Posts: 44

RE: Boeing 737 Fuels Virgin Blue Expansion

[updated:LAST EDITED ON 16-01-03 AT 11:25 PM (GMT)]Fianally a bit of good news for boeing, its seems to be all about Airbus as of late!

C'mon Boeing you can pull in a few more orders! :)

Member for

24 years 3 months

Posts: 1,404

RE: Boeing 737 Fuels Virgin Blue Expansion

Saab

Would you be reluctant because of the way low-cost seating is setup or because of the aircraft itself?
Regards

Sauron

Member for

24 years 3 months

Posts: 3,538

RE: Boeing 737 Fuels Virgin Blue Expansion

Saab - I don't know anything about their new planned routes to the Oceanic regions but if they involve any ETOPS sectors they won'y be using 737s as the type is not approved for ETOPS due to lack of system redundancy (i.e. it only has duplication not triplication).

Member for

24 years 3 months

Posts: 2,491

RE: Boeing 737 Fuels Virgin Blue Expansion

In terms of ETOPS restrictions, I would guess that they would presumably establish a base somewhere like Darwin or Cairns.

Brisbane seems OK for flights to NZ, do you think?

Obviously the figures like "16% lower operating costs" that reports quote are pure drivel - if you want to compare like with like. If that were the case, who would be crazy enough to use the A320? With such low margins, 16% of direct operating cost is a huge number.

We seem to have Easyjet and Jetblue falling into the A319/A320 camp and all the other "majors" going for the 737NG.

Interestingly, the 737 winglets for VB are made in Melbourne. Do you think this kind of industrial offset weighed in VB's choice of aircraft? VB could find it handy as a brownie point when it comes to negotiationg their tax bill you know!

Member for

24 years 3 months

Posts: 7,536

RE: Boeing 737 Fuels Virgin Blue Expansion

Brisbane to NZ on a B737 i dont think that will be appropriate.

Member for

24 years 3 months

Posts: 2,253

RE: Boeing 737 Fuels Virgin Blue Expansion

don't Air NZ currently use 737's on trans-tasman routes?

Member for

24 years 3 months

Posts: 7,536

RE: Boeing 737 Fuels Virgin Blue Expansion

yes...and they will be eventualy replaced by new Airbus.