Transat A.T. Inc., a travel company which is the parent of Canadian carrier Air Transat, has agreed eight-year leases on four Boeing 737-800s from U.S.-based leasing company International Lease Finance Corporation (ILFC).
Air Transat will introduce the Boeing 737-800 single-aisle jets in summer 2014 and the four aircraft will become the core of Air Transat’s narrowbody fleet. They will be used on sun-destination routes from Canada to Mexico, the Caribbean and Florida.
Transat A.T. says it plans to add additional narrowbody aircraft, mainly on a seasonal basis in winter, to meet demand on its sun destination routes.
The parent company’s agreement with ILFC also includes the renewal through 2020 and 2021 of leases on six Airbus A330s ‒ three A330-200s and three A330-300s ‒ on improved terms.
Air Transat had originally planned to phase out the three long-range Airbus A330-200 widebodies from its fleet. However, Transat A.T. and ILFC reached an agreement that the Canadian company says will enable Air Transat to achieve its objective of reducing costs, and which, in the case of the three aircraft, will prove more advantageous than the seasonal subcontracting arrangement originally envisioned.
Transat A.T. says the agreement is in keeping with its previously announced plan to bring in-house its medium-haul flight operations using narrowbody aircraft (it has relied on chartering aircraft from other carriers since 2003).
The agreement will also allow Air Transat to deploy a so-called accordion fleet which will enable it to adjust the number of narrowbody and widebody jets at its disposal according to seasonal tourism market needs.
Transat A.T. says that, generally speaking, it has a greater need for narrowbody aircraft in winter, when Canadian travelers favor medium-haul sun destinations; and a greater need for widebody jets in summer, when the transatlantic market is busiest.
“This is an important step in the implementation of a fleet that is adaptable to seasonal needs,” says Jean-Marc Eustache, president and chief executive officer of Transat A. T. “This deal gives us greater flexibility and a significantly enhanced cost structure. This strategy is key to our future success and to a return to profitability in winter, and will also ensure that we maintain the high quality of our products and our customer experience.”
Air Transat’s fleet currently consists of nine Airbus A310-300s and 12 A330s ‒ eight A330-200s and four Airbus A330-300 jets.
Transat A.T.s new fleet measures are part of a plan announced in December 2011 and updated in June 2013, which calls for improvements of C$75 million to Transat’s cost structure by 2015.
The company says the plan is unfolding as anticipated, but adds that it is planning additional fleet changes, notably the replacement of some Airbus A310s.