Resuming Biman's flight to New York
Saturday, 1 December 2007
Abdullah Mohibuddin
LAST October Chief Advisor went for a short trip to New York to attend the UN session. During his stay in New York, Bangladeshi living in New York and New York State had approached and requested him to reopen Biman's flight to New York. Over 200,000 Bangladeshis are living in the USA and more are seeking to live there. After returning home, the Chief Advisor called Biman's Managing Director (present Chief Executive Officer or CEO) Dr. Momen and other high official of the Ministry of Civil Aviation and Tourism and had discussed this issue of resuming New York's flight.
Before the suspension of the flight, Biman was operating two weekly flights to New York by DC 10-30 aircraft.
In each flight, Biman was making an operating loss to the tune of Tk. 7.5 million(75 lakh) even with full load of passengers (274 passengers).
The cockpit crew takes special training when they operate New York routes. I was one of the luckiest one to be on the first flight to New York as operating crew.
Just imagine 250 aircrafts are flying over the Atlantic Ocean in the morning from Europe to America and the same number start returning in the evening from America to Europe -- almost like a formation flight in the same altitude (only one degree latitude difference, that is, 90 miles apart). It may happen that one aircraft is flying just 1000 feet below. If aircraft has any problem at that time, is it not that thrilling.
That is why, we need then a serviceable and reliable aircraft. If an airline can not meet those points, then they are downgraded by FAA (Federal Aviation Authority of America).
Many people have asked me (until now) the question why it is loss for Biman even with full load of passenger.
The answer is simple: the operating cost of DC 10 aircraft was higher than the revenue earned from passengers. The operating cost per Block hour of Biman's DC 10 was at that time US$ 10,000 and for a total 35 Block hours (JFK-DAC-JFK) the cost will be US$ 350,000.
The net revenue earning (passenger ticket price minus taxes) was US$ 900 per passenger. For 274 passengers (full load) the total revenue was US$ 246,600. The loss per flight was US$ 103,400.
Now the question will be raised who is going to bear this loss if Biman decides again to resume the flight to New York. Biman has been converted into a public limited company.
It should now operate a flight with commercial attitude. If Biman utilises these Block hour to other routes like Jeddah and Kuala Lumpur, then Biman makes more money (profit) and incurs no loss. At present Biman is doing that.
But please do not be disheartened that Biman will not be able to resume the flight. Yes, there is an alternative.
Since, the Chief Adviser has taken keen interest, then Biman and its Board Member must give proper thinking how to resume the flight without making any loss.
Everybody knows that Biman tried for a long time to modernise its fleet.
So many tenders were floated, but responses were not up to the satisfaction of Biman. In the present market, it is very difficult to choose a right airplane.
The fuel efficiency aircraft like Boeing B 777-200 and Airbus A 330-200/300 are rarely available in the market. Those airlines which have these aircraft, do not want to leave them.
Therefore, we have one option left to us, that is, a Jumbo Jet Boeing B 747 aircraft. Biman can get a B747-300 of 300 series with a reasonable price either on lease or purchase. B747-300 aircraft has around 500 seats.
The operating cost of B747-300 aircraft will be around US$ 15,000 per Block hour. As it flies at 0.84 Mach, the total Block time will be 32-hour.
The total operating cost (JFK-DAC-JFK) will be US$ 480,000. If Biman raises the fare, then Biman can receive net US$ 1200 per passenger (excluding taxes). For full load (500 seats), the revenue will be US$ 600,000.
The profit will be (600,000 minus 480,000) US$ 120,000 in each flight. Now again the question will be raised if Biman can not get full load of passengers, then it will be loss again.
The target of Biman's marketing department will be for 350 passengers per flight.
Then it will be a loss of (480,000 minus 420,000) US$ 60,000 per flight. If Biman targets for 400 passengers per flight, then there is no loss (just break-even).
Biman can operate with this B747 aircraft to Jeddah and Kuala Lumpur routes after operating weekly two flights to New York. The total operating cost of (Dac-KL-Dac) route will be US$105,000 and the revenue for 500 passengers will be US$190,000.
The profit will be US$85,000 per flight. Similarly, on Jeddah route, Biman will make also a good profit.
It may be mentioned here that both Malaysian Airlines and Saudia are operating flights to Dhaka (Dac) by their B747 aircraft. One can notice that they are carrying the full load of passengers.
For Biman it should not be a difficult task to fill up the aircraft with 500 passengers.
With these profit from the routes like Jeddah, Kuala Lumpur and Kuwait, Biman can balance the loss made on New York route in the beginning.
Another indirect benefit gained by operating right to New York is that many Bangladeshis had the chance to migrate to the USA and got the job opportunity to work at the JFK airport and New York municipality.
Many Bangladeshis were proud to speak about the landing of Biman's aircraft at JFK airport and also about the Bangladeshi readymade garments in the shops. Bangladesh is doing business here and not seeking charity.
When Biman launched flight with two DC 10 aircraft at a time, many people and media raised voices how Biman will fill up the aircraft when they can not fill up the Boeing 707.
But our people and our passengers proved those opinions wrong. The most of the flight operated by DC10 were full and sometimes overbooked.
The same thing will happen again when B747-300 aircraft will be introduced in these routes. Once our passengers find reliability and regularity, then passenger growth automatically will jump. Biman will get back its image.
Let us, we give Biman a strong backing by saying that it start a six-month trial with B747-300 aircraft and resume the flight to New York in order to respond to the request of the Bangladeshis residing in New York, to the Chief Advisor.
Biman should now announce that they will resume the flight to New York by Jumbo Jet from March, 2008 and see the peoples' reaction. Biman is going to be successful in this mission.
The author is a retired DC-10 Flight Engineer and former President of Flight Engineers and Navigators Association
LAST October Chief Advisor went for a short trip to New York to attend the UN session. During his stay in New York, Bangladeshi living in New York and New York State had approached and requested him to reopen Biman's flight to New York. Over 200,000 Bangladeshis are living in the USA and more are seeking to live there. After returning home, the Chief Advisor called Biman's Managing Director (present Chief Executive Officer or CEO) Dr. Momen and other high official of the Ministry of Civil Aviation and Tourism and had discussed this issue of resuming New York's flight.
Before the suspension of the flight, Biman was operating two weekly flights to New York by DC 10-30 aircraft.
In each flight, Biman was making an operating loss to the tune of Tk. 7.5 million(75 lakh) even with full load of passengers (274 passengers).
The cockpit crew takes special training when they operate New York routes. I was one of the luckiest one to be on the first flight to New York as operating crew.
Just imagine 250 aircrafts are flying over the Atlantic Ocean in the morning from Europe to America and the same number start returning in the evening from America to Europe -- almost like a formation flight in the same altitude (only one degree latitude difference, that is, 90 miles apart). It may happen that one aircraft is flying just 1000 feet below. If aircraft has any problem at that time, is it not that thrilling.
That is why, we need then a serviceable and reliable aircraft. If an airline can not meet those points, then they are downgraded by FAA (Federal Aviation Authority of America).
Many people have asked me (until now) the question why it is loss for Biman even with full load of passenger.
The answer is simple: the operating cost of DC 10 aircraft was higher than the revenue earned from passengers. The operating cost per Block hour of Biman's DC 10 was at that time US$ 10,000 and for a total 35 Block hours (JFK-DAC-JFK) the cost will be US$ 350,000.
The net revenue earning (passenger ticket price minus taxes) was US$ 900 per passenger. For 274 passengers (full load) the total revenue was US$ 246,600. The loss per flight was US$ 103,400.
Now the question will be raised who is going to bear this loss if Biman decides again to resume the flight to New York. Biman has been converted into a public limited company.
It should now operate a flight with commercial attitude. If Biman utilises these Block hour to other routes like Jeddah and Kuala Lumpur, then Biman makes more money (profit) and incurs no loss. At present Biman is doing that.
But please do not be disheartened that Biman will not be able to resume the flight. Yes, there is an alternative.
Since, the Chief Adviser has taken keen interest, then Biman and its Board Member must give proper thinking how to resume the flight without making any loss.
Everybody knows that Biman tried for a long time to modernise its fleet.
So many tenders were floated, but responses were not up to the satisfaction of Biman. In the present market, it is very difficult to choose a right airplane.
The fuel efficiency aircraft like Boeing B 777-200 and Airbus A 330-200/300 are rarely available in the market. Those airlines which have these aircraft, do not want to leave them.
Therefore, we have one option left to us, that is, a Jumbo Jet Boeing B 747 aircraft. Biman can get a B747-300 of 300 series with a reasonable price either on lease or purchase. B747-300 aircraft has around 500 seats.
The operating cost of B747-300 aircraft will be around US$ 15,000 per Block hour. As it flies at 0.84 Mach, the total Block time will be 32-hour.
The total operating cost (JFK-DAC-JFK) will be US$ 480,000. If Biman raises the fare, then Biman can receive net US$ 1200 per passenger (excluding taxes). For full load (500 seats), the revenue will be US$ 600,000.
The profit will be (600,000 minus 480,000) US$ 120,000 in each flight. Now again the question will be raised if Biman can not get full load of passengers, then it will be loss again.
The target of Biman's marketing department will be for 350 passengers per flight.
Then it will be a loss of (480,000 minus 420,000) US$ 60,000 per flight. If Biman targets for 400 passengers per flight, then there is no loss (just break-even).
Biman can operate with this B747 aircraft to Jeddah and Kuala Lumpur routes after operating weekly two flights to New York. The total operating cost of (Dac-KL-Dac) route will be US$105,000 and the revenue for 500 passengers will be US$190,000.
The profit will be US$85,000 per flight. Similarly, on Jeddah route, Biman will make also a good profit.
It may be mentioned here that both Malaysian Airlines and Saudia are operating flights to Dhaka (Dac) by their B747 aircraft. One can notice that they are carrying the full load of passengers.
For Biman it should not be a difficult task to fill up the aircraft with 500 passengers.
With these profit from the routes like Jeddah, Kuala Lumpur and Kuwait, Biman can balance the loss made on New York route in the beginning.
Another indirect benefit gained by operating right to New York is that many Bangladeshis had the chance to migrate to the USA and got the job opportunity to work at the JFK airport and New York municipality.
Many Bangladeshis were proud to speak about the landing of Biman's aircraft at JFK airport and also about the Bangladeshi readymade garments in the shops. Bangladesh is doing business here and not seeking charity.
When Biman launched flight with two DC 10 aircraft at a time, many people and media raised voices how Biman will fill up the aircraft when they can not fill up the Boeing 707.
But our people and our passengers proved those opinions wrong. The most of the flight operated by DC10 were full and sometimes overbooked.
The same thing will happen again when B747-300 aircraft will be introduced in these routes. Once our passengers find reliability and regularity, then passenger growth automatically will jump. Biman will get back its image.
Let us, we give Biman a strong backing by saying that it start a six-month trial with B747-300 aircraft and resume the flight to New York in order to respond to the request of the Bangladeshis residing in New York, to the Chief Advisor.
Biman should now announce that they will resume the flight to New York by Jumbo Jet from March, 2008 and see the peoples' reaction. Biman is going to be successful in this mission.
The author is a retired DC-10 Flight Engineer and former President of Flight Engineers and Navigators Association