Qantas to narrow domestic fleet to A330s and 737s

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Qantas Airways plans to simplify its domestic fleet to Airbus A330-200s and Boeing 737-800s by 2016 as it tries to narrow the unit cost gap with rival Virgin Australia.

The Oneworld carrier will retire 19 Boeing 767-300s by 2016, replacing it with 10 A330s from Jetstar up to 2015. Jetstar, meanwhile, will take 14 Boeing 787-8s which will become the backbone of its long-haul network.

Qantas now has 10 A330-200s flying in its colours, which are scheduled to undergo a cabin reconfiguration between end-2014 and 2016, together with the incoming A330s from Jetstar. The refurbishment will equip the aircraft with new seats in business and economy class, and new in-flight entertainment systems.

The process will put all the carrier's A330-200s in a single configuration, compared with having four different configurations of the type across its fleet.

Qantas is also planning to phase out its six remaining 737-400s as it takes more -800s. Flightglobal Pro data shows that it now operates a fleet of 59 737-800s and has eight more on order, with 30 options.

Qantas says that under the new domestic fleet structure, the A330s will be dedicated to east-west routes, while the 737s will cover east coast routes. QantasLink will also operate Boeing 717s and Bombardier DHC-8s, primarily on regional routes.

The airline adds that narrowing the fleet to two main types will reduce its “unit cost gap” relative to its competitor, Virgin.

Virgin has also structured its fleet around A330-200s and 737s, although it operates Embraer 190s in the 100-seat segment.

Qantas notes that the A330-200s have approximately a 10% improvement in fuel cost per ASK relative to the 767s, while the 737-800s have a 15% fuel advantage relative to the older -400s that are being retired.

The airline is also looking at ways to boost the utilisation of its 737 fleet to further reduce capital costs. It notes that there is scope for additional off-peak and leisure services.

It notes that across the Qantas group – including regional operation QantasLink and budget carrier Jetstar – its fleet utilisation is forecast to grow from approximately 9.4h per day to 9.9h by the end of June 2014.