UTair revises fleet renewal plans

UTair Aviation has not chosen the aircraft type to replace its aging Boeing 737s The introduction of new flights resulted from changes to the carrier's network and higher fleet utilization efficiency, Budnik says (Russian Aviation Insider)

UTair Aviation, Russia’s fourth largest airline, is revising its fleet renewal plans. The primary focus of the carrier’s strategy is to find a replacement for its Boeing 737CLs.

Alexey Budnik, president of UTair – Passenger Airlines, told Russian Aviation Insider that the fleet renewal effort is likely to start next year.

“We are currently considering network expansion opportunities and ways to increase frequencies,” Budnik noted. “So far we have been doing that with our existing fleet. But we are certainly reviewing the [fleet expansion] issue in the long run. It would be right to say that corporate approval and creditor approval procedures need to be observed. And this is likely to happen next year. In fact, our business model calls for fleet expansion measures to be taken every year.”

He added that the airline’s priority is to find a replacement for its Boeing 737 Classic family aircraft, which comprise the core of the carrier’s fleet. UTair currently operates almost 40 Boeing 737-400s and -500s.

Budnik did not disclose the type the airline is eyeing as the replacement: “We are looking at the aircraft currently in operation, including the Boeing 737. We also receive offers from OEMs, including Russian ones. The final decision will be based on a set of parameters, not on what we are flying now. The replacement type will definitely be newer than our current ones, but everything will depend on the offer.”

Speaking of the widebody segment, Budnik said UTair has not yet received any proposals. The carrier is satisfied with its Boeing 767 fleet, which “has been demonstrating good results in the current market conditions.”

It is too early to speak of the launch of any fleet renewal program; whether the fleet is to be renewed or expanded will be decided later, once the ongoing negotiations with OEMs have been completed.

In August last year, Utair CEO Andrey Martirosov announced that the airline would start renovating its fleet by late 2018 or early 2019. Deliveries of new Airbus A321s and Boeing 737NGs were set to begin in 2016-18. Commenting on this timeline, Budnik said: “The contracts we have already placed are subject to trilateral agreements. It is standard practice that some parameters change over time.”

While the airline’s capacity expansion plans are still in the making, it has managed to boost its passenger traffic. UTair served 6.624 million passengers in 2016, up 20.1% year-on-year. Earlier the carrier forecast its 2017 traffic to exceed 7 million. So far it has been demonstrating a monthly growth of 10% to 15%. Budnik puts this down to the airline’s adherence to the strategy chosen, which calls for increasing the load factor and fleet utilization while cutting turnaround times.

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