A380 Wars - QF vs SQ

[Flying Fox]

Now that SQ have released their A380 configuration and QF have previously released theirs, I started comparing their seat counts -

First - QF 14 vs SQ 12
Business - QF 72 vs SQ 60
Premium Economy - QF 32 vs SQ 0
Economy - QF 332 vs SQ 399

Totals - QF 450 vs SQ 471

So my points is, I have always thought of SQ as more premium to QF yet by their seating plans they are offering less premium pax in all classes, more Y pax and have managed to get more into thair A380.

So who will provide the better experience in each class and overall?

And why haven't SQ invested in a Premium Economy? Esp. with SQ always promoting themselves as a premium carrier, I would have thought that this would have been perfect for their product offerings.

 

[Dave Noble]

Now that SQ have released their A380 configuration and QF have previously released theirs, I started comparing their seat counts -

First - QF 14 vs SQ 12
Business - QF 72 vs SQ 60
Premium Economy - QF 32 vs SQ 0
Economy - QF 332 vs SQ 399

Totals - QF 450 vs SQ 471

So my points is, I have always thought of SQ as more premium to QF yet by their seating plans they are offering less premium pax in all classes, more Y pax and have managed to get more into thair A380.

So who will provide the better experience in each class and overall?

And why haven't SQ invested in a Premium Economy? Esp. with SQ always promoting themselves as a premium carrier, I would have thought that this would have been perfect for their product offerings.

I don't see that the numbers mean anything; what matters is what the specific seating is like.

SQ having less 1st class and Business class could actually mean that their cabins would be better if they use the same sector of the plane. If not and , say , the seats give the same space per passenger, then the reduction in premium numbers could be enough to make the economy cabim, although having more seats, could have more space per person

SQ may feel that having a Premium Economy could lead to a reduction in the number of people prepared to pay for business and that they would rather not have one

There are lots of variables and just numbers of seats means nothing , imo, on its own

Dave

 

[mileagemax]

SQ may feel that having a Premium Economy could lead to a reduction in the number of people prepared to pay for business and that they would rather not have one

Agreee. SQ's new Business is a bit over the top... the seats are so wide and are also so much more expensive. I think many companies would consider Premium Economy for their employees if SQ offered it, given how indulgent Business has become with SQ. So that may be why they don't offer Premium Economy.

 

[NM]

I think it has something to do with geography and intended operations. SQ is hubbed in Singapore (well, derr) and plan to operate SIN-LHR and SIN-SYD initially, and I am not sure form there. So max segment length is about 12 hours. They do hope to collect some through traffic SYD-LHR, but I expect that is not their big traffic pattern overall.

QF plan to operate MEL/SYD-LAX and MEL/SYD-LHR (via SIN most likely) and I expect selling a higher proportion of SYD-LHR through tickets that SQ does. So I expect they will be selling more 14/15 hour flights to LAX and 20+ hour flights to LHR.

I expect people are looking for W cabin and more J/F seats on the Aus-US and Aus-UK routes than on the Aus-Asia routes or even Asia-Europe.

I certainly expect each airline has spent a lot of time and effort (and money) to determine what cabin types, numbers and products will bring them the best return on their significant investment. The variation in product implies to me that each airline has different demographics as their expected targets.

And I would expect EK to have a very different perspective as well, with typically higher densities of Y on the thick Asia routes they currently thrive on.

I also think QF was very purposeful in delaying their W product anouncement until it was too late for SQ to change their plans with any matching product if they determined they were going to be impacted by QF's new products.

 

[ANstar]

Well when it comes to Y QF look like the will have a better product. They have announced 4 self serve bars (like is currently on the 744 in J) for economy. Havent seen anywhere on the SQ seatmap where you may get these?

Who knows, not long till we find out!

 

[simongr]

AS I understand it - the A380 SQ hard product in Y/J is the current 77W product yeah? It is only the new F that is as yet unseen?

I half expect that the new A380 fleets to be trying to not to compete directly with other A380 product. The aircraft in itself is a differentiator from other aircraft and all will have a dramatically different product to other carriers with non-A380 fleets. In terms of competing they can compete on product rather than price against the non-A380. If you start flying your new and highly expensive A380 against someone else's new and expensive A380 all you can do is compete on price - which would reduce your ROI.

The flying public don't really know much about fleet upgrades so competition from new product on the old fleet will take much longer to become a differentiator than the arrival of the A380.

 

[NM]

Well when it comes to Y QF look like the will have a better product. They have announced 4 self serve bars (like is currently on the 744 in J) for economy. Havent seen anywhere on the SQ seatmap where you may get these?

Who knows, not long till we find out!

Perhaps that is because SQ actually provide in-seat service in Y rather than expecting their Y passengers to do it themselves .

 

[Keith009]

AS I understand it - the A380 SQ hard product in Y/J is the current 77W product yeah? It is only the new F that is as yet unseen?

Yep - new A380 F will be unveiled on OCT15.

 

[NM]

I half expect that the new A380 fleets to be trying to not to compete directly with other A380 product. The aircraft in itself is a differentiator from other aircraft and all will have a dramatically different product to other carriers with non-A380 fleets. In terms of competing they can compete on product rather than price against the non-A380. If you start flying your new and highly expensive A380 against someone else's new and expensive A380 all you can do is compete on price - which would reduce your ROI.

I agree with your summation. Also note that the numbers bandied about by Airbus for operating efficiencies are based on a 3-class 555 seat loading. From memory, I think they are suggesting a 22% lower per-seat operating cost than a 744. Now that would be comparing a 555-seat A380 with say 400 seat 744. So I wonder how the operating compare between a 450 seat A380 and a 350 seat 744.

 

[simongr]

On a straight mathematical basis the improved efficiency is only 16%.

If you take the 400 pax and assume the 744 cost per pax is $100 that gives $40,000 total running costs - that is fixed irresprective of numbers on board. A 22% improvement in op per pax reduces the costs to 78 per pax on the 555 seat A380 at a total cost of $43,290.

Assuming the reduction in pax to 350 with a fixed cost of $40,000 that is $114 per pax. On the now 450 seat A380 the $43,290 is now $96.2 - being a 16% improvement rather than 22%.

 

[Flying Fox]

AS I understand it - the A380 SQ hard product in Y/J is the current 77W product yeah? It is only the new F that is as yet unseen?

Thats my understanding and I think that both the new SQ J & F seats are totally OTT (although I have yet to try them myself). Personally I find the QF J & F ample.

I also think QF was very purposeful in delaying their W product anouncement until it was too late for SQ to change their plans with any matching product if they determined they were going to be impacted by QF's new products.

Totally agree.

Well when it comes to Y QF look like the will have a better product. They have announced 4 self serve bars (like is currently on the 744 in J) for economy. Havent seen anywhere on the SQ seatmap where you may get these?

Agree here too. The thought of having less Y pax and the 4 self serve bars is better proposition to me on a long flight as you would have an excuse to go for a walk etc and have less pax around you. SQ seem to have alot more Y pax and no self serve facilities and hence the expectation is for pax to stay seated.

Whilst I love flying J & F, the majority would be flying Y. Hence with both airlines having upgrade their Y offerings, I would be inclined to say that QF would be a better proposition to the masses. Hence, I do believe that the number of seat do give some indication as to what can be expected on-board.

 

[NM]

On a straight mathematical basis the improved efficiency is only 16%.

If you take the 400 pax and assume the 744 cost per pax is $100 that gives $40,000 total running costs - that is fixed irresprective of numbers on board. A 22% improvement in op per pax reduces the costs to 78 per pax on the 555 seat A380 at a total cost of $43,290.

Assuming the reduction in pax to 350 with a fixed cost of $40,000 that is $114 per pax. On the now 450 seat A380 the $43,290 is now $96.2 - being a 16% improvement rather than 22%.

Yeah, I was waiting for an accountant/auditor to do the hard work for me .

 

[Starship]

On a straight mathematical basis the improved efficiency is only 16%.

If you take the 400 pax and assume the 744 cost per pax is $100 that gives $40,000 total running costs - that is fixed irresprective of numbers on board. A 22% improvement in op per pax reduces the costs to 78 per pax on the 555 seat A380 at a total cost of $43,290.

Assuming the reduction in pax to 350 with a fixed cost of $40,000 that is $114 per pax. On the now 450 seat A380 the $43,290 is now $96.2 - being a 16% improvement rather than 22%.

Simon - there appears to be another cost factor you have not taken into account which is detrimental to the A380 comparison - and the impact is still to be determined.

The A380 was originally marketed to airlines as more passengers landing in the same slot space and lower cost then a 747. However ICAO originally hit the A380 with a 10 nautical mile wake vortex separation for any heavy (747 or equiv) following aircraft, compared to a 747 following a 747 having a 4nm separation. To be able to get the planes certified, Airbus have reached a compromise of 6nm, albeit still trying to reduce this further.

Given the biggest constraint at virtually all A380 friendly airports ie LHR, Sin, LAX, JFK etc (except Melbourne out of peak) are landing slots, airlines may need to pay for 2 slots on departure and 2 on arrival. And the cost for these can only go up.

 

[simongr]

Oh there are many cost factors that I have not factored in

I was just doing a straight like for like comparison - there are a huge amount of factors that migfht have changed since conception that would affect the costing models comaring the original A380 ROI calculation. The delay alone and the compensation programs changes the fundamentals of the original investment plan.

This is why an accountant needs to work closely with the business to truly understand the multiple variables that could kick in and through off your "prefectly" designed spreadsheet.

 

[Starship]

Oh there are many cost factors that I have not factored in

I was just doing a straight like for like comparison - there are a huge amount of factors that migfht have changed since conception that would affect the costing models comaring the original A380 ROI calculation. The delay alone and the compensation programs changes the fundamentals of the original investment plan.

I believe numerous A380's are being given away (virtually) to disgruntled customers ie. Qantas over delays and other issues. My understanding is all of the pilot promotion / training delays has also meant some of the 'grey hairs' who were to be the first A380 pilots have retired and others are disgruntled.

This is why an accountant needs to work closely with the business to truly understand the multiple variables that could kick in and through off your "prefectly" designed spreadsheet.

As an ex Auditor and Chartered accountant [handed my membership back after their woeful advertising campaign] - i always work on the basis that 'A spreadsheet has a face only a mother could love!'

Gee - i better go and try to resolve that circular reference!

 

[Standby]

The cost benefit on a seat per seat basis may reduce due to QF having leass than the 500 quoted by Airbus , But the revenue per seat on the aircraft vs a 744 will increase dramatically due to the price premium
that a premium Y seat brings over a nomal Y seat (Most carriers with prem Y seem to charge at lease double the Y price) and as already mentioned SQ charging A380 premium over and above normal J/P fares ,if SQ have done it QF will certainly up the price.
On the product I was at SYD Dom yesterday and all the new product are on display in the Qantas heritage Museum upstairs above the rotunda gate lounges at the end of the concourse. It open Mon-Fri 8-4.
The new prem Y looks much better in the flesh than pictures and the skybed is completely flat with an interesting twist...when reclined the Armrest on the Aisle drops to just below seat cushion height making it easier to get in and out of...definiety worth a visit if the bar in the club hasnr opened...plus some of the great tarmac views

 

[pauly7]

On the product I was at SYD Dom yesterday and all the new product are on display in the Qantas heritage Museum upstairs above the rotunda gate lounges at the end of the concourse. It open Mon-Fri 8-4.
The new prem Y looks much better in the flesh than pictures and the skybed is completely flat with an interesting twist...when reclined the Armrest on the Aisle drops to just below seat cushion height making it easier to get in and out of...definiety worth a visit if the bar in the club hasnr opened...plus some of the great tarmac views

I remembered today to drop in and have a look. I have to agree with the above, all the seats in flesh look much much better! I was really suprised, will def look to trying out premium Y now.

Also I have been a little suprised with Singapores offering, in a way they have almost been a little disadvantaged being first cab off the rank as airlines following them can react / change....