Ethiopian Airlines And It’s Widebody Diversification

On Sunday morning at Pearson International Airport in Toronto, Ethiopian Airlines celebrated the first arrival of its Airbus A350 to the city. Previous flights have utilized the Boeing 777 as well as the Boeing 787. At the event, Ethiopian Airlines’ Country Manager for Canada talked about the great features of this latest addition to the fleet. This includes an improvement in fuel consumption and a greater range. Interestingly, he also explained that the decision for leasing and purchasing the A350 was also in the interest of fleet diversification – and a move away from an all-Boeing fleet.

Ethiopian first welcomed the Airbus A350 in 2016 as leases from AerCap. Photo: John Taggart via Wikimedia Commons

Here’s what an Ethiopian Airlines representative had to say at the Toronto event:

“Back in 2016 it was a strategic decision to buy these technologically advanced airplanes…our expansion was requiring diversification…” -Samson Arega, Ethiopian Airlines Canada Country Manager

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Of course, a move away from Boeing was not the only reason for Ethiopian’s interest in the Airbus widebody. New efficiency advancements of the A350 allow an increase in range and capacity. In fact, Arega says the aircraft will save Ethiopian up to US$1.8 million per year per plane on fuel.

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The case against diversification

Having a fleet of only one model certainly allows for big gains in operating efficiency. Every mechanic, every flight attendant, and every pilot in the company can be shuffled around with far less complication. When it comes to having an entire fleet from one manufacturer, there would be fewer complications in training staff.

However, if the size of the airline is large enough, benefits can exist with loyalty to the manufacturer. It is common knowledge that list prices for large jets are rarely what airlines pay. Rather, aircraft sales executives make closed-door deals, offering significant discounts for significant orders.

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One would assume that manufacturer-loyalty also comes in to play. With the highly competitive environment Airbus and Boeing find themselves in, we can imagine that there would be some financial incentives thrown in to dissuade an airline from considering their archrival.

Ethiopian Airlines first placed an order for the Boeing 787 in 2005. Photo: Boeing

The case for diversification

The case for diversification is pretty clear – and in recent years, Ethiopian Airlines has discovered the reasons the hard way (we’ll get to those issues below). When a problem arises with a specific aircraft type, the airline can be left exposed to a significant loss of capacity in order to rectify the problem.

In fact, the problem isn’t just the aircraft manufacturers. We can see it clearly with engine options as well. British Airways, Norwegian, Air New Zealand, and many other airlines, were hit hard when there was an issue discovered with the Rolls Royce Trent 1000 engines powering their 787 Dreamliners. Airlines operating the 787 with the GEnx engine option went unscathed.

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Ethiopian Airlines has been hit hard with problems arising from the Boeing 737 MAX. Recently, problems were discovered with the Boeing 737NG (above) which is a potential problem for the airline if left unchecked. Image: Boeing

The impact on Ethiopian Airlines

Ethiopian having an all-Boeing fleet has exposed it to several Boeing-specific issues. Without going into extensive detail (we’ll link to articles below), these problems include:

  • A significant delay in the initial delivery of its 787 Dreamliners. Initially expected in 2008, the first delivery came in 2012.
  • A recent discovery of “pickle-fork” cracks in older 737NG aircraft leaves its older 737 fleet vulnerable to the issue – though nothing has been found in Ethiopian’s fleet yet.
  • And most significantly, it goes without saying that the 737MAX crisis has hit Ethiopian (and Lion Air) the hardest, with software problems leading to deadly crashes. Since then, 737MAX fleets all over the world have been grounded and await re-certification.

Conclusion

This article shouldn’t be seen as an attack on Boeing – rather, it is proving why Ethiopian Airlines made a good call to diversify its aircraft and move away from an all-Boeing fleet. In fact, Indian carrier IndiGo must replace the engines of its fleet of 98 A320neos. These 196 engines must be replaced by the end of January, otherwise those aircraft will be grounded.

Fleet diversification can be costly but it may just be the safer decision in order to fend off significant service disruption when issues arise.

Do you think Ethiopian Airlines made the right call in moving away from an all-Boeing fleet? Let us know by leaving a comment!

 

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Russ

“When it comes to having an entire fleet from one manufacturer, there would be more complications in training staff.”

“More complications” ???? I would think the exact opposite????

Moke

Airbus and Boeing are twins, they dont compete, they have duopoly.
Ethiopian Airlines is treated like favourite child in the western media despite theirs many safety problems.
I doubt they ever made a profit, every time I see their cabin it is half empty. They live from cheap loans and grants from western development banks.

Ian

First of all, they don’t have “many safety problems”. Secondly, they don’t live on cheap loans and grants from western development banks.

Seriously, you need to read more. You can start by reading their history on Wikipedia.

Charles Bolland

I take offence to your comments about Ethiopian Airlines, they have a newer fleet than american airlines and is most likely a better airline that AA.

samuel Ubani

I agree, They both started the auto pilot engine in Year 1916, marking 100 Years of excellent aircraft, therefore, fleet diversification is not a problem, and both manufactuter, already have proven records, In anycase, we should not over depend and rely on this premise that, Only after an airline crashes and the witness or the person responsible are ghosted, then we begin to come up with claim, a complete flight test and trip of any aircraft is not faulted on the manufacturer who have established a quality test, the pilots who records the flight time and trip have best knowledge… Read more »

Yen

That’s Southwest Airlines you’re talking about. And at times American Airlines. Read up about their maintenance issues.

It pains some to see an African, third world based airline do well when their own in the western world have bled money and only survived through government/law backed schemes such as bankruptcy protection.

Be happy for them for a change.

Armand2REP

The Indigo engine problem is because of Pratt & Whitney. The lesson here is to just buy French everything.

TheDude

lol you must have missed all the trent issues.

Richard Allison

Is Rolls Royce French now?

James Hayward

Your thinking CFM is 100% french

TheDude

No but the point is the problem is not just P&W. Do a search on AvHerald. It is a common issue with all engine types.

Moaz Abid

Yeah, what about Qantas flight 32? Rolls Trent 900?

Gerrie

A320 engine problems are from P&W engines – those are Ame4ican engines. Do you think Airbus should stop marketing American engines outside the USA ?

TheDude

Yes because Rolls has no issues lol…

John

so are the engines on the A220. P&W engines seem to be having an inordinate amount of problems

Norm

From the “Airline Fleet” could deduct that Ethiopian Airlines has an active fleet of 108 aircraft, of which Boeing is by far the largest supplier, except for the recent addition/order of A350’s.
The Boeing 737 MAX should be returned, and replaced by the A320/321 series which may still have some engine issues with the PW’s, but which are well covered by their Warrantees and are in the process of finalizing necessary updating of the issues. The B737 MAX should never again fly under the Ethiopian Flag, which bring very bad memories.

Moaz Abid

Yeah, but it costs a fortune to replace a fleet and I don’t think Ethiopian is going to spend that money just to replace their MAX fleet. I mean, who is going to buy the MAX? Even if they retire it it would probably go to the aircraft dumpster or something. But as Ethiopian don’t get their money back to buy another aircraft, thus a loss.

Laurie Johnston

Definitely the right thing , Boeing seems to have lost the plot

James Hayward

Plot? What does that mean?

Moaz Abid

Yes, I agree because of this:
Boeing 737- Pickle fork cracks and MCAS
Boeing 747-8 – Not popular or profitable
Boeing 757- Retired
Boeing 767- Only cargo aircraft avaliable now
Boeing 777- Not the latest and not so fuel-efficient but good in performance
Boeing 777x- Delayed- engine problems
But boeing is now relying on the 787, Which in my opinion is profitable and really good.

John

Well, Boeing deserves these moves when they have presented so many problems and tragedies to the airlines and humans who died in crashes. Callous behavior deserves rebuke.

OldestGrumpiest

You mention about the discounts that are given to keep a customer loyal, but you do not say anything about the discounts given to make a customer disloyal. I can pretty much guarantee you that Airbus ‘bought’ their way in to this deal. When it comes to economy, the A350 is much better than older generations, but is not a economical to operate as the 787 and it is yet to be known how it really compares to the new generation 777.

abe

Sure the right Strategy, Boeing has lost the game. It’s a WAKE UP CALL for Boeing after B737 MAX crash.

Naimah

Absolutely, an Airbus is the best right now, they care about the safety first and Boeing just greedy bastards who paid the price for its faulty business.