Aircalin fleet renewal to drive new phase of growth

20 October, 2017

New Caledonia's Aircalin is preparing to renew its entire jet fleet following orders for A330-900neos and A320neos. The small Pacific island carrier will use the new generation aircraft to improve its product and add capacity across its network, which includes Australia, New Zealand, Japan and other Pacific islands.

Aircalin currently operates two A320s and two A330-200s. The A330-200s are 14 years old while the A320s are nine and 13 years old, according to the CAPA Fleet Database. The A320s are configured with eight business class seats and 138 economy seats while the A330-200s both have 24 lie-flat business class seats and 242 economy seats.

Aircalin signed an MoU in Nov-2016 with Airbus for two A320neos and two A330-900neos. Aircalin and Airbus announced on 11-Oct-2017 that the MoU was converted in Sep-2017 to a firm order.

Aircalin stated the A320neos will be delivered with 168 seats - a breakdown was not provided but most likely this includes eight business class seats and 160 economy seats. Aircalin has selected a 291 seat three class configuration for its new A330-900neo fleet including 26 in business, 21 in premium economy and 244 in economy.

The new fleet will therefore result in a 9% increase in capacity on flights operated by widebody aircraft and a 15% increase in capacity on flights operated by narrowbody aircraft. All four of the new aircraft are expected to be delivered within the next few years, resulting in at least a 12% increase in annual capacity for Aircalin by early next decade.

A capacity increase of 15% to 20% is possible as Aircalin will be able to utilise the new aircraft more than its current fleet. Higher utilisation will enable more frequencies on the airline's best performing routes and/or the launch of new routes. Aircalin has previously indicated that it was looking to launch services to China using the new A330-900neo fleet.

Aircalin currently uses its A330-200s to operate five weekly flights to Tokyo Narita, two weekly flights to Sydney, two weekly flights to Osaka Kansai and one weekly flight to Papeete in Tahiti (based on OAG schedule data for the week commencing 16-Oct-2017). The A320s are currently used to operate one weekly flight to Sydney (for a total of four when including the Sydney A330 flights), three to Auckland, three to Melbourne, three to Nadi in Fiji, two to Brisbane and two to Port Villa in Vanuatu. Some of the Nadi flights stop in Wallis Island. One or two additional frequencies are operated on several routes during the peak southern summer season, which runs from early December to early February.

Aircalin also operates 16 seat Twin Otter turboprops, which are used to operate a high frequency service between Wallis and Futuna islands. Wallis and Fatuna is a separate much smaller French territory, with a population of approximately 15,000, that does have its own flag carrier. Aircalin is the only airline operating scheduled services to and within Wallis and Futuna.

New Caledonia has a population of nearly 300,000. It is a large island chain with more than 10 airports but Aircalin does not operate any domestic flights within New Caledonia. Air Caledonie is the main domestic carrier, operating four ATR 72 turboprops to 10 domestic destinations. Air Caledonie is based at a secondary domestic airport in Noumea and does not have any international services.

All of Aircalin's jet flights originate at Noumea's international airport. New Caledonia relies heavily on tourism, reporting 116,000 visitors in 2016. However, visitor numbers have increased by less than 20% since 2003.

Aircalin capacity expansion is necessary to support faster growth in New Caledonia's tourism sector as the airline accounts for approximately three quarters of total international seat capacity.

France is its largest source market, accounting for 32% of total visitors. Most French visitors fly to New Caledonia via Osaka or Tokyo, using Air France on the Paris-Japan sector and Aircalin from Japan to Noumea. Aircalin has a codeshare partnership with Air France as well as with Air New Zealand, Air Tahiti Nui and Qantas.

Australia is New Caledonia's second largest source market, accounting for 20% of all visitors followed closely by Japan with 18%. Total visitor numbers grew 1.5% in 2016, driven by a 9% increase from Australia and a 5.5% increase for Japan while French visitor numbers declined by 1.4%. New Zealand visitor numbers were also up 7.2% but on a much smaller base to only 9,000.

Aircalin capacity expansion is necessary to support faster growth in New Caledonia's tourism sector as the airline accounts for approximately three quarters of total international seat capacity. Qantas, Air New Zealand and Air Vanuatu are the only foreign airlines currently operating scheduled flights to New Caledonia. Qantas operates three weekly 737-800 flights from Sydney and one weekly 737-800 flight from Brisbane. Air New Zealand operates three weekly A320 flights from Auckland. Air Vanuatu competes on Port Villa-Noumea route with four weekly ATR 72 frequencies.

Aircalin coordinates its schedules with Air New Zealand and Qantas, offering flights to Auckland, Brisbane and Sydney on different days of the week than its partners. Combined there are flights to the main markets of Auckland and Sydney six days each week.