Last week Delta announced it was adding 10 Airbus 330-900neo aircraft to its fleet. Simultaneously, Delta reduced its near-term A350-900 purchase commitment to a total of 15 aircraft from 25. The 10 previously on order A350 aircraft have been deferred to 2025-26 with certain flexibility rights including the right to convert these orders to A330-900s.
This has caused industry watchers to conflate these two deals. A moment of reflection is necessary to consider what happened.
Neither Delta Air Lines nor Airbus offered a comment to our information requests.
Consider this public information from Delta:
“Expanding our A330 order book not only ensures that Delta’s near-to-medium-term widebody needs are taken care of, but also drives our strategic, measured international growth,” said Gil West, Delta’s Senior Executive Vice President and Chief Operating Officer. “The next-generation engine technology from Rolls-Royce which powers the A330neo provides compelling operating economics, superior fuel performance and the range and coverage for our transoceanic needs going forward.”
“The A350 has been a great success for our customers and our business,” West said. “A fleet of 15 of these world-class aircraft is the right current fit for Delta’s industry-leading global network, operational reliability and award-winning products and services.”
Delta currently operates 11 A350-900 aircraft and expects to take delivery of two A350s in 2019 and two in 2020.
In addition, Delta plans to retire older Boeing 767-300ERs in the years ahead as the aircraft reach the end of their serviceable life cycle.
It would be helpful to understand what is at play here. Delta has a consistent fleet approach – it is cautious. Delta has not followed the industry’s decisions flow on fleet updates. It has consistently run counter to what everyone else has been doing.
However, a spate of engine troubles (here, here) on their aging A330 fleet have impacted operations. These aircraft are former Northwest Airlines are aging fast. Delta’s 58 767-300s average over 22 years old.
Here is a comparison of Delta’s widebody fleet costs per hour per seat.
The A330-200 is the most expensive model Delta flies in the widebody segment. These are the oldest A330s Delta operates at nearly 14 years old, the A330-300s are 10 years old. As fuel prices rise the older aircraft should see costs rise faster than newer, more fuel-efficient models. Since fuel is a large variable that Delta has control over, its focus on moving to greater fuel efficiency is appropriate. This fits with Gil West’s quote above.
Looking at the FAA’s SDRs on this fleet, we get an idea why Delta might be focusing on the A330neo before the A350.
We included the 717 and 757 to point out that these aircraft have also gotten attention at Delta, with A220 and A321 respectively acting as replacements. Similarly, we left in the 747 numbers as a yardstick to see how many SDRs Delta had among recent widebodies. Delta is focusing on the areas where the need is greatest.
Given the reliability of its 777-fleet, there is not a need to move the A350s forward yet. But moving into A330neos is likely to solve a problem that is impacting now. The 767 and A330 fleets show the greatest need for attention and the A330neo solves that. The 777-fleet is not a current priority.
Consequently, don’t conflate the A330neo news with the A350 news at Delta. They are quite different decisions when looks at the fleet. The news suggests that Delta still intends to get the A350, just not yet. The A330neo need is clearer and gets priority.
Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.