We’ve heard over and over that many airlines will emerge from this pandemic smaller than in the past. That’s largely coming in the form of airlines retiring planes sooner than they were originally going to.
Well, Austrian Airlines has become the latest airline to outline how they’ll shrink.
In this post:
Austrian Airlines grounded, has pessimistic outlook
Austrian Airlines suspended regularly scheduled flights on March 18, 2020, and doesn’t yet know when they’ll resume operations, given the uncertainty.
Austrian Airlines is part of the Lufthansa Group, which has a pessimistic outlook on how demand will recover. The company expects significantly dampened demand in the medium term, and doesn’t expect demand to return to pre-crisis levels for several years.
As a result, Lufthansa Group airlines are taking drastic measures. For example, Lufthansa has made the immediate decision to retire some A340s, A380s, and 747s.
In the case of Austrian Airlines:
- For 2020, Austrian expects at least a 25-50% drop in demand
- For 2021, Austrian expects at most 75% of pre-COVID-19 demand
As Austrian Airlines’ Executive Board member Andreas Otto comments:
“The entire airline industry is pessimistic. We have to assume that we will reach the ‘pre-corona level’ again in 2023 at the earliest.”
Austrian doesn’t expect demand to rebound soon
Austrian Airlines plans future smaller fleet
Austrian Airlines has revealed how they plan to reduce the size of their fleet in the future, to better reflect demand. In total they will retire 28 aircraft by 2022, including the following:
- Austrian will retire all 18 of their Dash 8 turboprops, a process that was started in 2019
- Austrian will retire all seven Airbus A319s
- Austrian will retire three of six Boeing 767-300s
Once this is complete, Austrian’s average fleet age will decrease from 15.4 years to 14.6 years (which kind of reflects that Austrian doesn’t have a particularly modern fleet). Austrian is taking delivery of some used A320s, which will be replacing the phased out aircraft.
Looking at Austrian’s overall fleet:
- Currently Austrian has about 80 aircraft
- The plan was initially for Austrian to have about 70 aircraft in a couple of years, by phasing out the turboprops and acquiring used A320s
- Now with the airline retiring seven A319s and three 767s, the airline will have about 60 planes by 2022
Austrian is retiring about 25% of their fleet, though in all this will only represent a roughly 20% capacity cut, since many of the planes they’re retiring are small.
Austrian is retiring all Dash 8s
25% of Austrian long haul planes being cut
Of Austrian’s fleet updates, it’s the changes to the long haul fleet that I find most interesting:
- Austrian currently has 12 long haul aircraft, including six Boeing 767-300s and six Boeing 777-200s
- Austrian has no additional long haul aircraft on order
Austrian will be retiring three of their six 767s, meaning that they’re reducing the size of their longhaul fleet by 25%.
The three 767s that they’re retiring are an average of 28 years old, while the three remaining 767s are an average of 20 years old.
Austrian Airlines has done a great job with having excellent fleet utilization in order to increase the number of long haul routes they operate. As they reduce their 767 fleet by 50%, presumably this means that they’re going to have to cut at least three long haul routes. I’ll be curious to see which they choose.
Austrian is retiring three 767s
Bottom line
Lufthansa Group is expecting it to be several years before demand recovers, and that’s reflected in their fleet planning. Austrian will be reducing their fleet from roughly 80 to 60 aircraft, including retiring three 767s, which represents 75% of their long haul fleet.
I like Austrian’s long haul business class, so I’m sad to see that will be available on fewer routes.
While I know airlines are thinking about cutting costs rather than fleet renewal, I’ve long wondered what Austrian’s long term plan is for renewing their long haul fleet.
What do you make of Austrian’s fleet reductions?
They don't necessarily have to cut 3 long-haul routes, some destinations can be served less frequently.
Some B789 LH Group ordered will go to both OS and LX
I wouldn't be surprised to see more fleet simplification. Long-term, I see them operating E275s for regional network, A320neos for European network, B788s for lower demand long-hauls and B78Xs for LAX, JFK, NRT etc.
This is a good opportunity for airlines like Lufthansa to clean their route network from flights that might have had political influences in the past, just like its' a great opportunity to clean the fleet as well.
When the traffic restores, there's a lot of less legacy burden.
Austrian is one of the few Lufthansa group airlines that could be serviced by A321XLR almost exclusively their on long haul routes, if Airbus can deliver its 4,700nm range promise.
I expect Austrian AirRail and Austrian - OBB Rail & Fly to be expanded, so that they don't need to fly to Graz, Salzburg and Innsbruck; and in a few years, Munich, Zurich and other Lufthansa hubs.
Personally, I think Austrian would want to...
Austrian is one of the few Lufthansa group airlines that could be serviced by A321XLR almost exclusively their on long haul routes, if Airbus can deliver its 4,700nm range promise.
I expect Austrian AirRail and Austrian - OBB Rail & Fly to be expanded, so that they don't need to fly to Graz, Salzburg and Innsbruck; and in a few years, Munich, Zurich and other Lufthansa hubs.
Personally, I think Austrian would want to try to absorb Ryanair Group as it breaks up. I believe Ryanair's move to a holdings with subsidiary brands is a way to sell Ryanair Sun to LOT, Lauda to Austrian, Malta Air to Alitalia, Buzz to KLM etc.
Since Austrian has an all Boeing long haul fleet, I expected them to order some 787's in the future. That would fit in better with their 777's. But being apart of the LH group, perhaps they could exclusively use the A350 for their long haul operations.
Unfortunately, I'd assume that one of the routes they will cut was the planned BOS route. Unfortunate. Hopefully, Austrian will try it at some point in the future.
@Thomas: very true
@Simon - totally agree. But until the rail tunnels are done, getting to Kaernten is a pain. It already is!
So long as they don't eliminate the flying chef in the toque blanche. It's too precious.
@Thomas: GRZ and KLU would have been taken out of schedule anyways as soon as the Semmeringbasistunnel is finished; so maybe they now decide to cancel these routes together with the one to SBG even earlier. I think that only the flight to INN will survive.
Can't help but think that the days of any regularly scheduled service to KLU are numbered.
@Jordan: the E195 is basically adopting the DH8D's schedule. They already did fly to destinations such as Graz, Salzburg, Prague, Budapest, Zagreb, Leipzig and to all other Austrian airports and so on in the second half of 2019.
Nobody really knows how demand will return, although I think LH has the best prediction.
I suspect that in the medium turn OS will select to keep one daily flight the the NC area, either dropping JFK or EWR. Maintaining service to JFK is more prestigious although partner UAL has operations at EWR.
Was part of the Lufthansa Group 787 order not destined for Austrian as announced last year, possibly still not still on the cards?
I seem to remember Swiss and Austrian liveries used in promotional pictures.
@Mark G. Depending on who is flying where in August, if Austrian cancel the flight, they will normally rebook onto another Lufthansa Group flight that is operating.
With OS's fleet aging while LH having abundant new wide-bodies, I wonder if there be some re-shuffling, between LH, LX and OS to re-distribute the planes. (and also lower the fleet age and maintenance cost). Pure speculation tho
Rip turboprops. Vie-bud, plane flys over budapest verry low, lovely vieuw.
Interesting that ALL turboprops are being retired. Wonder how they’ll utilize E-195 and A320s for very short regional flights (Budapest, Zagreb, Belgrade, etc.)
I'm supposed to fly a leg with them on a return ticket from Cyprus in August. Should I be even more concerned now? I'm pretty much resigned to this trip not happening, but not wanting to give up hope completely. Stay safe everyone.