UPDATE JULY 13 –  Air France-KLM is in negotiations with and Boeing about an aircraft order for potentially more than 160 aircraft for KLM Royal Dutch Airlines, its leisure subsidiary Transavia, and Transavia France. Group CEO Ben Smith confirmed this on July 12 in Dutch newspaper Financieele Dagblad, with the news subsequently picked up by Bloomberg. What is a KLM/Transavia order all about?

The airline group has issued a request for proposal with both OEMs. This means a deal hasn’t been done yet, but Smith expressed his optimism that the biggest order in the history of the group will be completed in due course. The order is for fleet renewal within the next five years and has been in the pipeline for a number of years.
Back in January 2019, then-acting CEO of Dutch Transavia Mattijs ten Brink told Airinsight that an order for likely over 100 aircraft was to be expected at that year’s Paris Airshow for both his airline and KLM.

Thirteen months later at the presentation of the 2019 results in February 2020, Smith said there were no immediate plans for any aircraft deals to replace the short- and medium-haul fleet: “You’ll know our capital expenditure (Capex) is restricted, we can’t replace our fleet at once”, he said, referring to orders for the and A350 for Air France and Boeing 777 and 787 for KLM that had been approved by the board.

Then, of course, Covid has struck. Without billions of state aid from the French and Dutch governments, the future of Air France-KLM and its subsidiaries would have been at stake. While this might not seem the right moment to buy new aircraft, Smith indicated recently that it is actually a good time to renew the fleet now. OEM’s are most willing to sell and this offers the airline group the option to buy at a competitive (reduced) price. And renewal offers the airline the possibility to introduce newer-generation aircraft, which are more fuel-efficient and produce fewer emissions.

Can get a foot in the door?

So what is a KLM/Transavia order all about? In one sentence: Airbus getting its foot in the door at KLM and both Transavia’s. For decades, the Dutch airlines’ fleets have been dominated by Boeing. KLM’s European fleet has operated Boeing 737s since the -300 replaced the McDonnell-Douglas DC-9 in the eighties. This excludes KLM Cityhopper, of course, which operated Fokkers until becoming a full Embraer customer. The 25 E195-E2s that are now joining Cityhopper are for additional growth as well as for partly replacement of KLM’s 737-700s on some routes. The only type operated by KLM is the A330, while in the eighties it used to have a fleet of A310s.

The fleet currently consists of 12 737-700s, 31 -800s, and five -900s. While the newest -800 was delivered last December, there are also four aircraft that joined KLM two decades earlier between February and August 1999. Nine arrived in 2000 and the other -800s from 2006. The -900s (main picture) were delivered between June and October 2001, plus one in 2004. The -700s have been delivered between December 2008 and October 2011.

Transavia Boeing 737-800 PH-HZJ is one of the newer in the fleet. She was delivered in April 2017.
The oldest arrived in 2006. (Richard Schuurman)

The situation with Dutch Transavia isn’t much different. Only once, in the late seventies, did Transavia Holland operated an A300B4. The current fleet includes four 737-700s, of which three were delivered between January-March 2003 and one in 2010. There are 35 -800s, the oldest from March 2006, plus two each delivered in 2010, 2011, 2012, 2013, and 2014 and the rest in later years. But there are also eight -800s that joined Transavia in March and April 2020.

MAX 10 order was favorite to win the deal in 2019

This makes replacement rather difficult. For cost and operational reasons, no airline is willingly adding additional types to its fleet. On the contrary, part of Air France-KLM’s strategy has been to reduce the number of types in the fleet. This seems to make it unlikely that KLM and Transavia will go for anything else but Boeing. As Mattijs ten Brink said in 2019, the Boeing MAX and specifically the MAX 10 was the favored airplane. This has been confirmed since to the author on other occasions. The MAX10 would complement the -800s in size on routes that need extra capacity.

Adding the MAX to the fleet would offer both airlines numerous advantages on fleet commonality and cockpit training, although criteria for crew training for the MAX have been tightened by regulators as a pre-condition to approving the type’s return to service since the two fatal accidents.

While a win for Boeing at KLM seems like a foregone conclusion, all should not be lost for Airbus. That’s if you take Air France into account. The carrier is expecting the first of sixty Airbus A220-300s this September. They are intended as replacements for the aging A319 and A320 fleet, which includes 31 and 44 aircraft respectively. The oldest A319s are from 1999, the oldest A320 from 2001.

What about a stretched A220?

However, there are also nineteen A321s out there, with eight of them delivered between 1997 and 1999. No decision has been taken about their future, but at the same moment when Ten Brink was vocal about the chances of the MAX10, news reports in France had it that an Air France order for A321neo’s was a done deal.

This was later denied by the airline, while Ben Smith gave an intriguing comment to Airinsight when discussing the option of Air France wanting a stretched version of the A220.  ”Let’s wait and see how the A220s perform and maybe there will be a bigger version…”, he said. Indeed, Air France seems to be one of the airlines that has a key interest in an A220-500, although Chief Commercial Officer Christian Scherer told media recently that he thought a further stretch of the -300 to be unlikely.

Air France will get its first A220-300 in September. But is there any substance that
the carrier is interested in a stretched -500? (Richard Schuurman)

What about Transavia France then, which is also part of the request for proposal? It seems most unlikely that will be successful here, although the French leisure and domestic airline did operate four A320ceo’s in 2014 and 2015. Since the carrier received approval from its staff and unions to grow the fleet beyond the previous limit of forty aircraft, Transavia France has been vigorously adding Boeing 737-800s to its fleet. Since January, ten aircraft have joined the fleet. It has taken advantage of the abundance of 737-800s on the market and sourced six of them directly or via lessors from Norwegian. This makes the carrier a Boeing operator for at least some years to come.

If Dutch Transavia opts for the MAX 10, it would be a logical choice to add the type to Transavia France as well. This would facilitate the exchanging of aircraft between fleets when needed as well as have all kinds of benefits on maintenance and spare inventories. 

What is a KLM/Transavia order all about? Never count out. It would be a masterstroke by Christian Scherer and his team if he succeeds in breaking the Boeing monopoly here.

(This story has been updated with some additional information from KLM)

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