KLM and their earlier Airbus problems part II

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A318
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KLM and their earlier Airbus problems part II

Post by A318 » 26 Apr 2004, 22:32

As we were discussing in another topic which was about SNBA we made a huge side step and end up with the history from the A310 with KLM.
I mentioned the trouble KLM had with those Airbusses and they got rid of them to turn into a all Boeing fleet.
I also said the reason KLM is choosing now for the A330-200 is done with political reasons, I was almost virtually shot for this info.

However V-Bird confirmed that KLM got rid of those A310's due to the problems and related costs KLM got with them.

Only one comment V-Bird, Martinair is owned for 50% by KLM (not 49%) and for 50% by Nedloyd.
Nedloyd agreed during the time they took 50% that KLM would have the last word when important decisions had to be taken so they didn't need more then those 50% shares since KLM had the last word already.

Once again Frederic, the cargo space from the A330-200 was never mentioned by KLM management during the selection period, in that time I was still working with KLM and followed it from the inside!
The A330-200 is going to be used on router where the MD-11 is flying now, one of them is Lima and they never need that much cargo space as the A330-200 is offering since does destinations are all served by Martinair Cargo.

Greetz,

Erwin
A Whole Different Animal

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re

Post by V-Bird » 26 Apr 2004, 23:09

I think that i will shot down now, but in my books i can clearly read that nedloyd has 51% en KLM 49% participation in Martinair.......

It`s true that the a332 will fly the md-11 flights because of the fact that the md-11 and the b772 will fly the flights from the "old " 747-200 and 747-300, so as you know, klm doesnt use this classic 747 anymore.
but as i mentioned before, also a lot off the africa flights from the 763 are changing in the md-11. By the way, i love the md-11 in the new colours!!

Thanks for reading,

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Post by blackhawk » 26 Apr 2004, 23:13

Nedloyd, Kon.
40 Boompjes tel: +31 (0)10 400 7111
3011 XB Rotterdam fax: +31 (0)10 400 68 28
www.nedlloyd.com

Profiel
Koninklijke Nedlloyd N.V.(ROYAL NEDLLOYD GROUP N.V.). De hoofdactiviteit van het concern is containerlogistiek via het netwerk van wereldwijde verschepingslinks met P&O Nedlloyd, waarin he teen 50% deelneming heft. Het concern is tevens 50% aandeelhouder in Martinair.

-------

EU to investigate KLM / Martinair merger

02 February 1999
The European Commission is to open a full investigation into the proposed acquisition by Koninklijke Luchtvaart Maatschaapij NV (KLM), the Dutch national airline, of the 50% of the shares in Martinair Holland NV (Martinair), one of the main Dutch charter airlines, that it does not already own.
In its initial examination of the proposal, the Commission found that there were grounds for serious doubts about its compatibility with the common market as regards its effect on competition.

The main area of concern identified was the supply of flights from Dutch airports (notably Amsterdam/Schiphol) to tour operators and individual 'leisure' customers for destinations around the Mediterranean.

KLM currently owns 50% of Martinair. The other 50% is currently held by Koninklijke Nedlloyd NV (Nedlloyd), a Dutch company with principal interests in land and sea transport. Both KLM (principally through its subsidiary Transavia, of which it owns 80%) and Martinair operate charter flights from Amsterdam for tour operators offering 'package tours', and serving many popular Mediterranean destinations.

Together, the two airlines would become the largest single carrier from Amsterdam to these destinations. Martinair also operates regular services on some routes to major North American cities to which KLM also operates scheduled flights, and on several of these, KLM and Martinair are the principal, if not the only, carriers.

The Commission considers that the notified operation, which gives rise to a change in the structure of Martinair from being jointly controlled by KLM and Nedlloyd to being controlled by KLM alone, could create or reinforce dominant positions in some or all of these markets. Accordingly it has decided to undertake a full, detailed investigation within a four-month deadline.


<-- So each 50% -->

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re

Post by V-Bird » 26 Apr 2004, 23:17

However, KLM has 100% participation in NV Transavia, nut 80%

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Post by LJ » 27 Apr 2004, 17:51

A318, I missed the previous discussion but saying that KLM opted for the A330 for political reason is entirely incorrect. To understand the purchase (or better lease) of the A330 you should know first why KLM purchased the A310, how KLM developped over the years and thus why the A310's role changed, why they opted for the B767.

Let me begin with the A310 story. It all began when KLM needed a plane to fill the gap between the DC-10 and the B737. At the time KLM had two alternatives: the A310-200 and the B767-200ER (the B767-300ER wasn't on the drawing board). The reason why KLM opted for the A310 was because Airbus could deliver the aircraft quickly (the production line of the B767 was aready full). Second the LD3 container issue which you already have dicussed.

At the time the A310 entered the KLM fleet its role was to serve high density European routes (London, Milan, Copenhagen, Paris, Barcelona and Madrid) and destinations on the border of Europe (Athens, Lisbon) and nearby Middle East (Tel Aviv, Beirut and Amman). These routes were ideal for the medium ranged A310-200.

However in 1990 an Iraqi president called S. Hussein decided that his country was too small and invaded Kuwait. This was followed by the 1st Gulf War. The impact this war had on KLM's operations in the Middle East was huge. Before the war all of KLM's flights to the Far East made a stop in the Middle East (for example Abu Dhabi, Doha, Dubai). However during the war the B747s started to fly nonstop, moreover as the new B747-400 (which were delivered from 1990) didn't need the stop in the Middle East. The result: KLM didn't serve the Middle East. this wasn't a problem at first beacuse traffic (due to the war) was almost zero, but as time went by the Middle East became quiet and thus attractive again.

At the same time KLM started to operate nonstop to the Far East another development took place. KLM decided to make AMS a more effeciont hub like the one we have today. Frequencies on many European destinations were very low (for example AMS-CPH three times daily) and aircraft utilisation wasn't great either. This was about to change when KLM did its first project (called Blokkensysteem") to make its operations more effeicient (and provide the customer higher frequencies). The result was that fdrequencies to the high density EU destinations went up. However at the same time the A310 became usueless on almost all EU flights (apart from LHR off course but LHR is, and will always be, an exception). Fortunatly KLM could use these A310 as traffic to the Middle East increased (and they wanted to serve the Far East nonstop).

However the A310-200 isn't agreat aircraft for flights to for example Dubai or Doha. Its range is too low and the payload on the A310s was restricted. However this alone wasn't the reason for the demise of the A310. The main reason why the A310 became entirely useless was beacuse KLM needed a widebody smaller than the MD-11 to do long haul flights with medium/low demand (where they could fill daily a B767 wheras only three flights weekly a MD11 or B747). This new aircraft became the B767. Why? becasue ILFC had some on order and KLM could get them quickly. You may wonder why not buying/leasing the B777 or A330 at the time. this is a valid question and I don't have a clear answer for this. However if you look at the agreement between KLM and ILFC one has to conclude that at the time KLM saw the B767-300ER as a temporary aircraft (the lease agreement of the B767-300ER stipulates that at the end of the 10 year lease KLm has the oiption a) to lease the B767 again, b) to buy them or c) to lease another type which KLM selects. From the moment the A330 arrived the replacement discussion started because everybody could see that this construction wasn't definite.

Finally the A330 lease/procurement. I'm fortunate to had a guest lecture at my university from soemone who was (or still is) the head KLM procurement. We discussed procurement strategies we learned with him. To my suprise he also discussed the procurement of aircraft and said that KLM faces a dilemma. Should it go all Boeing (the sole supplier at the time) and ggo for the relationship with or opt for sourcing aircraft from trwo suppliers and rely less on one supplier which can be dangerous. It was a very interesting discussion moreover as there was the complication that shouldn't KLM do a deal with Boeing they may end up losing a joint venture KLM and Boeing were starting (Boeing would set up a distribution center at AMS for parts, which off course would mean traffic for KLM Cargo).

However KLM postponed many times the decision on both the replacement of the B747 Classic, MD11 and the final decision on what to do with the B767s. When the decision came to buy/lease both Airbus and Boeing products I wasn't really suprised. Moreover as Boeing didn't have a competitor for the A330 (the 7E7 was on the drawing board but couldn't be delivered in time). The fact the A340 lost the battle with the B777 shows how less KLM is influenced by politics as some (want to) believe.

In short, all of KLM's procurement have been the result of market developments and strategy changes within KLM.

Edit: Just want to note that KLM had also the opotion to replace the A310-200 with the A310-300. However the payload wasn't attractive, thus despite the problem with the LD2 containers they opted for the B767-300ER).
Last edited by LJ on 27 Apr 2004, 18:06, edited 1 time in total.

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Post by Avro » 27 Apr 2004, 18:01

That's a very interesting message you wrote LJ :P
LJ wrote:A318, I missed the previous discussion
Here's the link to the topic, where the discussion started. ;) https://www.aviation24.be/modules.php?name ... 7&start=20

Chris

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Post by sn26567 » 28 Apr 2004, 10:17

Nice analysis, LJ. It's great to have people like you in this forum.
André
ex Sabena #26567

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Post by Sabena_690 » 28 Apr 2004, 12:32

Thanks a lot Laurens...

You took the words right out of my mouth!

Erwin: although I understand you (it is hard to see your pride go away), please do take note that the number of false rumours will be huge the coming years. Only look at all the rumours during the last years of Sabena (and most of them were false).

You and a lot of others have one big enemy: AF, and in your case, the French in general too. Although you probably like to believe everything anti-French these days, try to be as neutral as possible!

I made the same mistake when Sabena went bust (believing too much of those false rumours, because we had two big enemy's: the government with Daems etc, and Swissair).

Frederic
Brussels Airlines - Flying Your Way

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