Qantas will lease Embraer E190s from Alliance Airlines from mid-2021, for up to 3 years.
Qantas will initially receive three of the mid-sized regional jets from Alliance under a wet lease arrangement, but Qantas says it has the flexbility to add up to 11 additional aircraft – or “switch off” all of the additional capacity if needed – depending on market conditions.
Under a wet lease agreement, the lessor provides both planes and crew to the marketing airline, which in this case is Qantas. This means these flights would be crewed by Alliance staff. However, Qantas has indicated that Alliance Airlines is willing to provide opportunities for stood down Qantas Group staff to work for Alliance in crewing these flights.
“Importantly, Alliance is keen to provide the opportunity for our international pilots and cabin crew to operate the E190s given it will be some time before overseas markets fully recover,” QantasLink CEO John Gissing said.
The flights would be marketed by Qantas, meaning you could still earn and redeem Qantas points & status credits on flights operated by Alliance Airlines.
The Embraer E190 is a small regional jet which seats 94 passengers, with 10 Business Class seats in a 1-2 layout and 84 Economy class seats in a 2-2 configuration. These planes have enough range to fly for around 5 hours, which is greater than the range of QantasLink’s 110-seat Boeing 717s. This makes them ideal for mid-length regional routes.
First three E190s to be based in Adelaide & Darwin
Qantas will base its first three Alliance Airlines E190s in Adelaide and Darwin, for use on the Adelaide-Alice Springs, Darwin-Alice Springs and Darwin-Adelaide routes. Qantas currently uses Boeing 737-800s on these routes, but says the smaller E190s are better suited to demand and would allow the airline to increase the frequency of services.
“The E190 is a perfect mid-size regional jet for routes like these ones in northern Australia. It has longer range than our 717s and it’s about half the size of our 737s, which means the economics work well on longer flights between cities and towns outside of the top five population centres,” Gissing said.
Qantas currently estimates that this arrangement would begin in June 2021, but this is subject to stability around state borders and a recovery in demand for domestic air travel.
The Boeing 737-800s currently used on routes like Adelaide-Darwin would be redeployed.
“The 737s that we currently use on these routes will move to other parts of our network. We’ve already opened up 20 new city pairs with our existing fleet as more people holiday at home, so there are a lot of possibilities once we get past this cycle of sudden border closures,” Gissing said.
ACCC scrutiny
The ACCC is keeping an eye on this latest development as part of a broader enforcement investigation into Qantas’ purchase of a 19.9% in Alliance Airlines in February 2019.
Alliance Airlines said that the Qantas wet lease agreement would account for around 5% of the airline’s revenue.
Alliance Airlines operates a range of charter and regular passenger services in its own right, as well as various codeshare services on behalf of Virgin Australia (including on the Brisbane-Gladstone and Brisbane-Emerald routes).
Alliance Airlines ordered 14 Embraer E190s in August 2020 from Azorra Aviation, a U.S. leasing company. In December 2020, it purchased an additional 16 ex-American Airlines Embraer jets, bringing the total order to 30. Alliance Airlines was one of few airlines in the world to make a profit last year.
Virgin Australia retired its own Embraer E190 fleet in 2016.
Join the discussion on the Australian Frequent Flyer forum: Qantas to wet-lease E190s from Alliance
