Airline News
China Airlines reconsidering B737 order, Far Eastern Air Transport plans fleet renewal
October 30th 2015
The ruling, and pro-Beijing, KMT party is expected to lose the January 2016 elections in Taiwan. Under the KMT's leadership, Beijing and Taipei have forged closer ties, including the launch of charter and scheduled cross-strait flights. Read More » However, until now, both parties have not reached consensus on allowing Mainland passengers transfer in Taiwan en route to and from foreign destinations, particularly to North America and Australia. Should the KMT indeed lose, the incoming Taiwanese government is likely to halt any relaxation talks, leaving Taiwan’s carriers, and their significant order commitments, in limbo. Hong Kong could once again be the benefactor of sour cross-strait relations, reasserting its position as the five-decade-old transfer hub between Taiwan and the Mainland.
China Airlines (CAL) chairman, Huang-Hsiang Sun, told Orient Aviation in February he was confident a major breakthrough on this issue was on the horizon. “The official dialogue has begun. I am quite optimistic. I think both sides will find a solution and make the transfer point in Taiwan feasible. CAL is ready,” Sun said. Eight months later, Sun has gone on record to say CAL was reconsidering its planned order for up to 50 B737s because of drastic market changes. He added that a decision has been postponed to 2016.
Rival EVA Airways, which rolled out the first B777-300ER in its new livery this week, has ordered 24 B787-10s and two additional -300ERs, valued at $8.03 billion at list prices. After discounts, the EVA’s invoice is estimated to be $4.24 billion according to AeroAnalysis. After phasing out its A330-200s and B747-400s, EVA’s wide body fleet will expand from 36 to 76 by 2020. Analysts are questioning if this significant fleet expansion will be viable without cross strait passenger feed.
Taipei Songshan-based Far Eastern Air Transport (FAT) plans to acquire 20 B737-800s to replace its eight ageing MD82/83s over the next five years, which will expand its network and hopefully boost competitiveness after the airline successfully completed a financial restructuring this month.
The fleet expansion is aimed at increasing FAT's cross strait operations, said its COO, Tseng Chin-chih, who added the carrier intends to use the B737s to fly to Yinchuan and Lanzhou from 2016. FAT has arranged to lease a new B737-800 from Air Lease Corporation, to be delivered in May, but the carrier did not say if it would buy or lease the other 19 aircraft. To prepare for the aircraft upgrade, FAT is sending its future B737 pilots to the U.S. for training, Tseng added.
In other Taiwanese aviation news, V Air, the Taoyuan-based low-cost carrier, will soon receive its third and fourth aircraft, A320s, on dry leases from parent TransAsia Airways, which will launch flights to Nagoya in December, Fukuoka and Osaka in January and Tokyo and Manila from April. V Air operates services between Taoyuan, Busan, Bangkok and Chiang Mai.
