Early in December (to coincide with the Copenhagen summit), reports highlighted Air Malta’s efforts to curb CO2 emissions.
While the information provided by Air Malta spoke of the new fleet helping, but gave no details, here are some concrete facts:
Comparing the fuel burn of a B737-300 versus an A319, the switch at Air Malta is equivalent to 2t on a 500km sector, but on a 1,000km sector, there is a small difference of 3.5t vs 3.3t, and on a 1,500km sector 5t vs 4.7t, so saving 0.6t return. 1,500kms is only Malta-Stuttgart or Prague.
All UK sectors – Paris, Brussels, Amsterdam and the German airports further north – are longer, not forgetting Moscow. Some time ago, Air Malta still linked Scandinavia.
Furthermore, the cabin of the current Airbus A319/320 fleet is an improvement over the older A320s and B737-300s.
Improved flight procedures, such as optimising thrust and climb rates, navigation patterns, modernised air traffic control for the whole of the EU and innovations such as GPS-based approaches (GLS), can help reduce fuel burn – not only a saving on fuel in relation to the environment, strategic resources and imports, but also a very important factor for carriers: costs.
And this is a crucial word, because on 23 December, a revealing report by Malta Today/Business Today, highlighted Air Malta’s financial situation as being some e25m in the red. ‘Schöne Bescherun’’ (‘nice Christmas present/surprise’) is an ironic expression in German. High fuel bills were identified as a core reason.
Could this also have something to do with the fleet being too large for the loads actually carried over the year? One reads of around 65 per cent of seats sold on an annual average, despite all the tricks – some months a bit more, some months less. The average from January to October is 67.2 per cent, and this includes the summer holiday months but not lousy November and December.
Naturally, there are also other factors at play, such as the economic situation in consumer markets, internal organisational matters and an unlevel playing field on some routes.
Or, at the same time as running early retirement schemes, also maintaining two international football teams by sponsoring the players’ wages. One can only wonder if it was ever considered what this might communicate to the staff.
For most passengers, what is decisive is not the sponsorship of football teams but directly linked airports within reasonable reach, acceptable fares (not give-away, but not pie-in-the-sky either), good flight times when choosing between carriers or equally distant airports and, above all, demand for the destination.
To be clear, there are indubitably many very good moves, like improved internet ads and the support of TV or print media featuring Malta, all of which create demand for the destination, as explained above, and more codeshares. But, for example, in October one read that France and Germany grew, while no football clubs were paid money there, and such observations could also be seen in other markets, so there seems clearly no correlation between growth in volume and the amount of money given to football clubs, but maybe other factors. And filling, and filling profitably, are also two different things, as are growth or loss rates and actual figures.
Correct sizing
So maybe one does not need such big planes to carry basically the same load, meaning lower costs for the same revenue.
Below, is a comparison between the fuel consumption on 500, 1,000 and 1,500 km sectors, between the 50-seat Embraer E145, the 120-seat Embraer 195 and the 140-seat A319. For the two shorter sectors, I have added the consumption figures of the 76-seat Bombardier Q400 fast turboprop.
One must differentiate according to the length of the sector, due to the influence of things such as take-off/climb, operating altitude, weight reduction due to fuel burnt, etc.
500km sector, eg Malta-Naples
E145 0.8t
E195 1.8t
A319 1.9t
Q400 1t
1,000km sector, eg Malta-Bologna
E145 1.5t
E195 2.7t
A319 3.3t
Q400 1.9t
1,500km sector, eg Malta-Stuttgart or Prague
E145 2.1t
E195 3.9 t
A319 4.7 t
Let us keep the Q400 and E145 apart.
So, while on the short 500km hop, the fuel burn of the E195 and A319 is basically the same, the Embraer 195 has an advantage that grows according to the length of the sector, with already 1.6 tons of fuel saved on just a Stuttgart return, to which can be added lower airport and navigation charges and capital costs. Deliveries of the 90-seat E175 and the 100-seat E190 began in 2005, and of the 120-seat E195 in 2006, so could also have been possible for the fleet roll-over.
Now, it could be argued that one has to see fuel burn according to a per seat ratio. Undoubtedly, the Airbus A319/A320 has a good return, with the A320 performing slightly better.
But for Air Malta this per-seat figure is fairly theoretical, because it is based on the assumption of all seats being sold. Air Malta’s loadfactors are chronically standing around 65 per cent, which means around 90 seats actually sold on the 141-seat A319, and around 110 seats on the 168-seat A320. The A319 and E195 burn equal amounts of fuel on a per-seat-basis, while the Embraer carries fewer empty seats and thus has a lower overall fuel burn and lower charges.
Taking general costs – not just fuel – the experience of various other carriers shows that while cost per air seat kilometre (so unit cost in the theoretical case of all seats sold) is already equal for the E190 model and the A319, which means that the E195 is a tiny bit better, the overall trip cost is 20 per cent lower. The smaller E170/175 has on average around 30 per cent lower trip costs than the A319. On trips of around 900km (Malta-Athens), the E170/175 flies even around 35 per cent cheaper. Again, sure, with fewer seats but an equal revenue/load – and empty seats help nobody.
Undoubtedly, seasonality has to be considered as well. But maybe it would be better for Air Malta to be profitable all year round, instead of for just eight weeks or so. Because one wonders whether, with the few extra seats of summer sold above the capacity of an E195, from which then, after all, has to be subtracted the extra cost, such high profits (fares) are made that an airline can afford to fly around the way it does for the rest of the year. If extra flights are needed during peaks, extra capacity can be chartered or leased which, on the whole, should still be cheaper. For example, at weekends sourcing from the Star Alliance pool of jets that are occupied during the week but are more lazy at weekends and holidays, or even just giving a bit of the cake to others, when, on the whole, so much more would be saved.
At least now, with revenue management, one can influence the shifting of demand a bit between days if customers are flexible. The MTA is also promoting tourism more oriented to the off-peak period, by emphasising Malta’s diversity in a compact area. The two combined show that one could bring just the same number of arrivals, with more appropriately sized jets, if not even more, because the right size jets help maintain frequencies/routes for a longer period and lowers the risk bar for opening additional frequencies/new routes.
The Embraer, through its cabin design, has no space disadvantage and has additional value by offering passengers either a window or aisle seat due to the 2+2 seating plan (there is no middle seat).
The fuel saving gap between the E195 and the A319 is significantly larger than that between the A319 and the B737-300. If one were to put the B737-300 and the E195 side-by-side, one would have 5t vs 3.9t on a one-way Stuttgart or Prague run, so 2.2t of fuel saved on just such a return run, let alone on the many longer routes across the UK to Benelux, or all the more northern airports of Germany. Any airport linked is well within range.
So, over a year, there is a lot of fuel that could be saved coming together, meaning money and, furthermore, the same number of arrivals, if not better. Again, from the Air Malta perspective, the A319s do not even fly with E195 loads but E175 loads, just as the larger A320s on average fly slightly below E195 loads.
Part 2 will be published next week