You may have noticed that MetroAirâ€™s rate of growth has been increasing lately. Since March, weâ€™ve seen the introduction into service of our first A319s, placed an order for A330-200s, acquired 3 767-200ERs and two 747-200Bs. Most recently weâ€™ve also placed a small order for Dash 8-Q400s. Weâ€™ve also established Los Angeles Ontario as a hub and rapidly developed a semi-regional network on the west coast, all the while developing Washington Dulles as a focus city.
It is worth noting that this round of expansion follows on from a period of relative calm and anticipation since the autumn of 2006. During that time we racked up approximately $200m that was just sitting as cash in the bank and not being re-invested to fuel growth. Hence this recent period of expansion has been long-overdue and has been enabled by eating into those funds.
The reality of airline growth is that it is cyclical; in many respects it follows the economic cycle experienced by larger markets & economies as a whole. We undergo periods of growth, followed by periods of streamlining and consolidation. MetroAirâ€™s been growing as the airline has been leveraging its new A319 fleet as each airframe arrives to push existing aircraft out into new markets; itâ€™s the freeing up of 737-200s at DTW thatâ€™s enabled the new shuttle routes out of Ontario, for example. At the same time, excess cash in the bank has enabled the quick introduction of intercontinental services to the UK and Japan.
So where does that leave us for the future? As I say, growth is cyclical, and as such thereâ€™s no expectation that this growth will continue unabated. What will follow is consolidation. You may notice that our fleet isnâ€™t quite optimised; whilst our choice of the A319 for our core mainline operations was made on an economic basis, it doesnâ€™t mean that the decision was without its cons. We still have a small fleet of 737-700s (3) that donâ€™t quite fit our model. Theyâ€™re fantastic aircraft and outperform the 737-200 in most circumstances, but theyâ€™re extremely expensive when you consider that they require their own maintenance procedures and have nothing in common with their Airbus counterparts. For this reason we are planning to phase them out over the next year. In the same way, our long-haul fleet is far from uniform, and this issue will be addressed accordingly.
So in a nutshell, thatâ€™s our outlook in terms of fleet operations.