Air Canada to add seats on existing 777s to drive down unit costs


Air Canada plans to spend $300 million to add seats and a premium economy section to its fleet of existing Boeing 777-300ER and 777-200LR aircraft, and expects a payback period on that investment of less than three years.

Beginning in late 2015 and continuing through 2016 Air Canada plans to reconfigure 12 of its 777-300ERs with an additional 51 seats and its six -200LRs with 31 additional seats. The carrier is extending its premium economy product to those aircraft and reconfiguring the business class section to mirror the business class cabin on its 787 featuring 180 degree full-flat seats.

Air Canada CEO Calin Rovinescu deemed the new configuration as more competitive, noting the business case for increasing the density on those aircraft is “highly compelling”.

Presently most of Air Canadaʼs 777-300ERs feature a two-class configuration with 42 international business class seats and 307 in economy. The additional 51 seats result in 400-seat configuration. The airlineʼs 777-200LRʼs currently feature 228 economy class seats and 42 in international business, and once the planned configurations are complete seating on those aircraft increases to 300.

Rovinescu stressed that the new configurations on the 777s will not reach the 458-seat density of five new 777-300ERs the carrier has added to its fleet during the last year. Those aircraft are tools “designed specifically for designated markets”, Rovincescu explained. Air Canada targets markets with those higher-density 777s featuring a higher number of leisure passengers and presently operates the aircraft on service from Montreal to Paris, Vancouver to Hong Kong and and London Heathrow and Toronto to Vancouver. Flights from Montreal to London Heathrow begin in June and continue through the end of September.

Previously, Air Canada estimated that the additional seats on the mission-specific 777s offer a 21% reduction in unit costs compared to the 777s in their current configuration. While it seems the planned new layout for the carrierʼs other 777s may create a tighter pitch in economy, the cost savings are likely too good for the carrier to pass up.

But Rovinescu also stressed Air Canada was aiming to make the product on those aircraft more consistent with the 787. The carrierʼs 787s feature three class seating – 20 in business, 21 in premium economy and 210 in economy. Business class seats on Air Canadaʼs 787s also fully recline. The delivery flight of Air Canadaʼs first 787 is scheduled for May 18.

Air Canada deems the planned new configurations a win win as CFO Michael Rousseau concluded the additional seats would harmonize the carrierʼs product offerings and create a unit cost improvement.