Finally, I got to terms with economy and scheduling!

Started by Hotcliff, July 18, 2018, 11:16:22 AM

aschack

Quote from: Tha_Ape on July 18, 2018, 05:05:33 PM
Actually, the Il-18 might be a good choice. Also, it can last quite a long while (considering CZ salaries are relatively low). It's one of the best Soviet birds around, if not the best. Plus, slightly smaller capacity (good for Bratislava) and very nice range.
Gazzz, your opinion ?

@ashack: the 737-100 and -200 are quite lame, but the -200Adv is pretty good. Used it with great success in the range-needing USSR. Given competition is ok, you can push it to 2200 or 2250 nm and stay profitable (except maybe during the 2nd spike, but not by much).

About the IL-18, it is very good. It's just pretty expensive in terms of maintenance. But it's generally available early on where it can be difficult to get hold of DC-7s. And it's available in various models with varying ranges and capacities, which helps.

Maybe my spreadsheet's a bit old, but I have the 737-200Adv at 1460nm range. That's a pretty big capacity drop to go past 2000nm, I'd think. But maybe you're right. I'll certainly have a look when they're launched.

dmoose42

The higher MTOW 737-200A is slightly over 2000NM at standard configuration.

gazzz0x2z

Re-analyzing demand, 727 is indeed far too big. I agree that 737-200adv(and not the previous versions) or il18D are the best in this case. Though I've been told that il18 and TU114(not to be used in Bratislava) were hitting the "too small" limit in 1981,making their replacement in 1980 a strategic necessity. if it's not possible to buy 737-200adv, leasing IL18 for 7.5years can be a very wise choice.

Maintenance is overrated, at least as long as you don't reach the first D-check. Lease for less than 8 years, then replace. Should be enough given the small size of the market, as long as you can't afford to buy new.

for alliance, the hard part is to be accepted in an alliance with enough big players to play the brokering game. I played in small alliances where I was nearly the only one to be able to broker for others, and that was kind of a problem. I'm actually more ordering for others than being ordered for me, but 2 key orders from others for me were key in my success in Poland, where I did face a strong opponent - and could overwhelm him with fresh airframes supply.

Hotcliff

Quote from: aschack on July 18, 2018, 04:30:10 PM
Thank you for the kind words. No shame in sticking with the DC-7s. I'm running IL-18s until I get my 727s delivered, and that's only because I can actually afford to buy 727s.
About what others have said about F27, F28, 737 and DC-9 and indeed NAMC... it all depends on where you are. You're in a small airport where most <1000nm routes are ~50 pax a day, from what I can see, with some that are higher. So going from where you are now, with CV's and DC-7s, here are my thoughts.
The DC-9 can only carry bit more passengers a bit farther compared to the F28, but it's a large plane, so longer turnaround and higher costs. Eventually it'll rival the 737 for capacity. So it doesn't solve any problems you have. You don't need the capacity on the short routes.
The 737 is even bigger, not far from the early 727, but lacks the range. So it's even worse than the DC-9 in that respect.
The F27 and F28 have similar range (until the F28-4000), are both medium and the F28 is only slightly bigger than the F27. That's why in my case, where I am (because I have a bit more demand than you while also quite some competition), it's a good replacement for the F27. As for you, I'm not sure it's a good idea because capacity is too high.
The NAMC has nearly as much capacity as the F28 and the speed of the F27. But it doesn't quite have the range. So it might be a good option if you need the capacity, and not if you need the range.

In conclusion: If you plan on sticking to Bratislava for now, stick to turboprops with ~50 pax capacity.

And really: Keep expanding. That's where the money is. More planes, more routes. :)

Thanks for your thoughts, it sounds like a good plan this  :)

Hotcliff

Quote from: aschack on July 18, 2018, 07:30:02 PM
About the IL-18, it is very good. It's just pretty expensive in terms of maintenance. But it's generally available early on where it can be difficult to get hold of DC-7s. And it's available in various models with varying ranges and capacities, which helps.

Maybe my spreadsheet's a bit old, but I have the 737-200Adv at 1460nm range. That's a pretty big capacity drop to go past 2000nm, I'd think. But maybe you're right. I'll certainly have a look when they're launched.

Thanks, I will have a good time looking into IL18 now when I have "cleaned up" and optimized my fleet. It looks interesting.  :)

Hotcliff

Quote from: gazzz0x2z on July 18, 2018, 08:51:01 PM
Re-analyzing demand, 727 is indeed far too big. I agree that 737-200adv(and not the previous versions) or il18D are the best in this case. Though I've been told that il18 and TU114(not to be used in Bratislava) were hitting the "too small" limit in 1981,making their replacement in 1980 a strategic necessity. if it's not possible to buy 737-200adv, leasing IL18 for 7.5years can be a very wise choice.

Maintenance is overrated, at least as long as you don't reach the first D-check. Lease for less than 8 years, then replace. Should be enough given the small size of the market, as long as you can't afford to buy new.

for alliance, the hard part is to be accepted in an alliance with enough big players to play the brokering game. I played in small alliances where I was nearly the only one to be able to broker for others, and that was kind of a problem. I'm actually more ordering for others than being ordered for me, but 2 key orders from others for me were key in my success in Poland, where I did face a strong opponent - and could overwhelm him with fresh airframes supply.

It sounds like a good choice this IL18, even if the thought of flying "russkie" stuff makes me shiver  But this is after all a "game", not a real thing, so maybe I will try..
Spassjiba my friend  :D

Hotcliff

#26
Quote from: Tha_Ape on July 18, 2018, 05:05:33 PM
Actually, the Il-18 might be a good choice. Also, it can last quite a long while (considering CZ salaries are relatively low). It's one of the best Soviet birds around, if not the best. Plus, slightly smaller capacity (good for Bratislava) and very nice range.
Gazzz, your opinion ?

@ashack: the 737-100 and -200 are quite lame, but the -200Adv is pretty good. Used it with great success in the range-needing USSR. Given competition is ok, you can push it to 2200 or 2250 nm and stay profitable (except maybe during the 2nd spike, but not by much).

Thanks for your advice. I see now the benefits of the IL18, it is very cheap to buy , around 3M$ compared to the DC7 8M$. Turboprop is good and the 320 kts TAS is also very good. The seating capacity Y65-C2 and range above 2000 nm will be perfect for my Arabian flights  :)

So, I will go this way now, IL18's for my long range 60-70px flights and CV240's for the short and middle range.
I have bought one IL18 now and I will replace my most expensive,but also most profitable leased DC7B, serving Doha. It will be interesting this project.

Cheers,





Hotcliff

Quote from: aschack on July 18, 2018, 12:41:16 PM
You seem to be doing alright, assuming the massive loss in the last quarter are from cancelled leases.
I had a look at some of your routes, and it generally looks good. There are some situations where you go and compete on quite oversupplied routes, resulting in pretty low load factors, which I think is a bad idea until you have the financial muscle to enter into these very competitive markets. Examples are Amsterdam, where you supply 80 seats on a route with a demand of 70. Because you fly twice a day, you get 50% of the demand, but that's spread over your two flights. So that's just 18 people per flight. If you had only one flight, you'd only get 1/3rd of the route share, but that's still about 25 people - and you only pay landing fees and slow costs once. There are a couple more of those examples.

Conclusion: It's about profit over load factor. Especially early on. Later on you can start about thinking about load factors, but that'd be only to try to deny direct competitors that load at the cost of your own income.

About fleet plans early on: If you can, lease used and don't really care too much about the age of the airplane. Only the condition. And get the cheapest lease you can. I started a bit before you but also went for leasing CV-240/340/440. There are plenty of them and they're cheap. But I also had an exit strategy for them. That's why I never bought any CV's.
I gathered that within 10 years, I'd be replacing them with owned aircraft. I too did some research (well, I had a spreadsheet beforehand), and settled on the F.27 as they suited my needs for capacity and range, which is a bit similar to the CV's. But this is where the similarities stop. The F.27 requires just 2 pilots and 1 crew as opposed to the 3 pilots and 2 crew of the CV's. On top of that maintenance is quite a lot cheaper on the F.27. Incidentally, they have the same speed and turnaround as the CV's, which makes upgrading the fleet a breeze.
My plan to replace the CV's with F.27s started with me actually leasing new planes, but exclusively with the aim of buying them during the lease. It makes the planes a bit more expensive overall, and I'm not sure if I'd recommend it, but it worked for me. As I expanded to new bases, I kept taking on even more old, lease CV's, and then just kept ordering more and more F.27s as I was in a position to actually pay for them.
Bonus info: When you lease new and you think "Oh, I'll just say it'll be a 15 year lease because that makes lease price much lower and I'll buy it anyway"... don't. Yes, it's cheaper up front, but when you want to buy during a lease period, whatever time is left on the lease period is calculated into the price, and you can easily end up paying 8-9m for an F.27-200.
Also, my plan sort of went the way of the dodo as I started making a lot more money than I had anticipated, so my transitions have been sped up quite a lot, and I'm now operating with three different scenarios for where to go next.

Conclusion: Lease cheap, plan transition to owned airplanes. Remember to also look at personnel requirements and size.

About jets: Be careful. The earliest jets (turbojets) are horrible, cost an arm and a leg, drink fuel like no tomorrow and are expensive to maintain. That makes them very unsuitable for new/small airline.
Then there are the next generation (low bypass turbofans), which are slowly trickling into production now. They're much more efficient and could be worth it. The Caravelle is a sort of generation 1.5, in that it's now turbofans, but it still drinks 1.5x the fuel per passenger of a 727-100. The 2nd generation (727, 737, Lockheed Tristar, DC-9, Fokker F28 etc) are quite good for their time though.
But what do you need? A lot of the routes you fly have quite low demand or enough competition that your share of the demand isn't very high (25-50). The smallest decent jet here is the Fokker F28, which seats 70 people and is actually a medium aircraft (the first actual regional jet in game!), so it's cheaper to operate and has a pretty short turnaround time. You won't get paid more for the flights, but you'll be able to make more flights, because it's faster - especially on flights that aren't just 1-300nm. So if you have a CV doing 3 flights in a day for a total of 1150nm over 17 hours, the F28 will do 1550nm - or 4 flights at a shorter distance. And much longer when it's only two flights in a day.
From what I read, passengers will slowly start to favour jets over props, especially as range increases, so you might get a higher share.

But ultimately, is it the right thing for you? If you have to lease new F28's compared to dirt cheap, old, leased CV's... probably not. If you can buy them it might just be.

As for the DC-7s? I don't think you'll make more money by leasing 727's (if you could, which you likely can't because demand is insane), and it's the only one that can realistically replace it right now. The other jets are far too inefficient (DC-8, Comet etc) or doesn't have the range (Trident, DC-9, 737 etc).

So overall conclusion: You're doing it right in my book. Stick to what you do. Lease cheap (CV's and DC-7s) and fly away. Fill up whatever demand is left at Bratislava and then start looking at another base and do the same. When you have some financial muscle - both cash but definately also income - look at transitioning to an owned fleet and find what's right for you, or start competing with someone at a bigger airport.

Lesson learned, I had made such a mess with cancelled DC-9 orders, too expensive DC7's and a large bunch of old CV240's which were awfully expensive in maintenance. As I realized the IL-18 was superior on LH and F-27 on S/MH, it was too late to recover  :-\

So, as I am taking this as a "learning project" , I started all over, still am a bit fond of Bratislava, so here is my new plan:

1. Leasing F27's for the most profitable routes without competition.
2. Leasing a few IL-18's for a few good LH routes.
3. Build cash over time, no "price wars", then hope to buy my leased F27's and watch the future.
4. Keep an eye out for F-28's and maybe plan for a transition at about 1970.

I hope you agree  :)

Regards,
Hotcliff

gazzz0x2z

I'm not sure F28s are the way to go. Unless demand ends up much bigger than in GW2, you're gonna lose money. Jets are more dangerous than props, in the sense that the breakeven load factor is higher than for props. Your market is made of low demand destinations. You can still make money on a 28-demand destination with a F27. Noy much, but still. F28s are dangerous to fly below 50 demand, unless the distance is very short(and, in this case, their speed advantage against the F27 is moot).

Hotcliff

Quote from: gazzz0x2z on July 20, 2018, 08:13:55 AM
I'm not sure F28s are the way to go. Unless demand ends up much bigger than in GW2, you're gonna lose money. Jets are more dangerous than props, in the sense that the breakeven load factor is higher than for props. Your market is made of low demand destinations. You can still make money on a 28-demand destination with a F27. Noy much, but still. F28s are dangerous to fly below 50 demand, unless the distance is very short(and, in this case, their speed advantage against the F27 is moot).

Ok gazz, it was just a thought for the jet age, not a promise  :)
Afterall, there is a reason for Braathens still fly turboprops ESSB-ESGG in 2018!
I will take your warning seriously and stick with turboprops, they are good.
Maybe await the wonderful Saab 2000?  ;D

Thank's for your interest,
/Hotcliff

gazzz0x2z

S2000 & Q400 are both wonderful, though they don't cover the same niches. IMHO, in the 2000s, best for Bratislava would be either ATR, S2000, or A140. A140 is ideal for the cash-poor company, hopefully you'll have enough money to purchase your S2000(or ATR) then.

Tha_Ape

Yes, you have to take geography into account.
Bratislava is not in the heart of airport-rich Europe (would be something like Switzerland, maybe), but not very far either. You'll have only few very long routes, so no need for the range of the Q400. The ATR, which has 1°) two variants 2°) the lower cost per seat in terms of operational costs for a prop should be perfect.
As a comparison: the Q400 will shine in places like China, Russia, South America, etc, where distances are huge so both the range and the speed are needed (plus, the 2 variant of the Q400 is larger than the original, which might prove a problem for your low demand.

Hotcliff

Quote from: gazzz0x2z on July 20, 2018, 08:32:55 AM
S2000 & Q400 are both wonderful, though they don't cover the same niches. IMHO, in the 2000s, best for Bratislava would be either ATR, S2000, or A140. A140 is ideal for the cash-poor company, hopefully you'll have enough money to purchase your S2000(or ATR) then.
Yes, "It's a long way to Tipperary"..the 20th century, but good to have a long term plan.
Best take care of my old F27's until then  :)
What kind of crate is the A140? Doesn't sound familiar to me.

A nice thing about Saab 2000, last time back home from Stockholm to Gothenburg (50min flt). I sat next to a Braathen captain in the most rear seats and we chatted along. He said the time diff against the Bae146 was only 6 minutes! Later,I remarked that the landing was pretty hard, despite the good weather and he explained that the landing gear was taken from our fighter JA37 Viggen and it was almost impossible to make a "greaser" as in the Bae146 with "Land Rover coil springs"  ;D

Yesterday, I leased an old but healthy IL18A for Doha. There were one whole page full of 18A and B's, but today there were 0 left!  I wonder how all those could be sold overnight??? Is it because we promoted the IL18 so much in here yesterday?

/ Hotcliff

Hotcliff

Quote from: Tha_Ape on July 20, 2018, 10:57:20 AM
Yes, you have to take geography into account.
Bratislava is not in the heart of airport-rich Europe (would be something like Switzerland, maybe), but not very far either. You'll have only few very long routes, so no need for the range of the Q400. The ATR, which has 1°) two variants 2°) the lower cost per seat in terms of operational costs for a prop should be perfect.
As a comparison: the Q400 will shine in places like China, Russia, South America, etc, where distances are huge so both the range and the speed are needed (plus, the 2 variant of the Q400 is larger than the original, which might prove a problem for your low demand.

I think the Saab2000 came 1992 and ended production 1999 when Q400 was released. 7 years later and also the S2000 had better range, 1500nm.

27 yrs to think, calculate and plan for the next gen  :)



Hotcliff

Guess I will have to do more historical research tonight  ::)

Tha_Ape

By default, the Saab 2000 has HD seats (58), which gives a range of 860nm.
The Q400 has Std seats (68), and a range between 950 and 1500nm depending on sub-variants of the mtow.
ATR-42 has 48/50 HD seats, range depending on version.
ATR-72 has 64 Std seats, range depending on version.

ATR is probably the best for Bratislava (a 50 seater + an increased capacity variant for somewhat bigger routes but still regional), but the others would obviously work.

The F.27 can last up until the Saab and ATR, but would be quite old by the time the Q400 gets released.

But yeah, anyway, that's years ahead...

schro

Quote from: Hotcliff on July 20, 2018, 07:18:45 PM
Guess I will have to do more historical research tonight  ::)

If you can find The Sporty Game, it is a good read as well.

Tha_Ape

Quote from: Hotcliff on July 20, 2018, 07:18:45 PM
Guess I will have to do more historical research tonight  ::)

History is great, I like it, but beware, the game isn't history (I flew all the Brabazon committee in USSR during the 50s and 60s... :laugh:).
Don't try to put up something that looks nice, but something that works. Once you know all the tricks, then you can be adventurous, but not before. The game is quite different from real life (it is a game, with all the pros and cons), so history can be a real trap.

Hotcliff

Quote from: Tha_Ape on July 20, 2018, 07:19:24 PM
By default, the Saab 2000 has HD seats (58), which gives a range of 860nm.
The Q400 has Std seats (68), and a range between 950 and 1500nm depending on sub-variants of the mtow.
ATR-42 has 48/50 HD seats, range depending on version.
ATR-72 has 64 Std seats, range depending on version.

ATR is probably the best for Bratislava (a 50 seater + an increased capacity variant for somewhat bigger routes but still regional), but the others would obviously work.

The F.27 can last up until the Saab and ATR, but would be quite old by the time the Q400 gets released.

But yeah, anyway, that's years ahead...
Sorry, I was wrong..1500nm for the Saab was at long range cruise speed..not 370 kts  :-\
Yes, maybe I go for that, upgrading to F50 and wait for Saab or ATR, it sounds good.

Hotcliff

Quote from: schro on July 20, 2018, 07:23:22 PM
If you can find The Sporty Game, it is a good read as well.
Ok, will check  ;)
I also like Flight Radar24 in parallell with Live ATC, I can follow them from EKCH and up north as they pass  :)