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Is There "Brand Loyalty" When Purchasing Aircraft?  
User currently offlineB737900 From United States of America, joined Aug 2010, 178 posts, RR: 0
Posted (1 year 11 months 4 weeks 13 hours ago) and read 3069 times:
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I know that when an airline sets out to purchase new aircraft there are a lot of factors that are considered; not least of which is fuel economy. Parts interchangability and crew training are also important factors. It is a huge advantage for an airline to have all one type. Price is also a factor of course. I am a longtime patron of Alaska Airlines and have enjoyed flying Boeing 737's for decades. I cannot imagine AS purchasing any other type. What, for example, would loyal customers of Alaska Airlines think if AS started purchasing the A300? I personally would be upset but of course we as passangers have no input in that. Or do we? Would there be mass complaints and demonstrations? Does AS have a "sweet heart" arraingement with Boeing. I look forward to hearing opinions on the matter.

[Edited 2012-09-25 11:25:59]


Sounds like a Beaver on floats..........we're saved!!
16 replies: All unread, jump to last
 
User currently offlineJetmatt777 From United States of America, joined Jun 2005, 2788 posts, RR: 32
Reply 1, posted (1 year 11 months 4 weeks 13 hours ago) and read 3062 times:

Quoting B737900 (Thread starter):
What, for example, would loyal customers of Alaska Airlines think if AS started purchasing the A300?

It would be very strange for Alaska to pick up some A300's!   



No info
User currently offlineBraniff747SP From United States of America, joined Oct 2008, 2984 posts, RR: 1
Reply 2, posted (1 year 11 months 4 weeks 13 hours ago) and read 3033 times:

It is widely known that some airlines have 'Gentlemen's Agreements' with some manufacturers. AA is an example, as was PMDL.


The 747 will always be the TRUE queen of the skies!
User currently offlinemickey90 From Sweden, joined Nov 2011, 65 posts, RR: 0
Reply 3, posted (1 year 11 months 4 weeks 13 hours ago) and read 2995 times:

Quoting B737900 (Thread starter):
What, for example, would loyal customers of Alaska Airlines think if AS started purchasing the A300?

Most of them wouldn't probably notice.



It's better to be in the air wishing you were on the ground than being on the ground wishing you were in the air
User currently offlineBurkhard From Germany, joined Nov 2006, 4397 posts, RR: 2
Reply 4, posted (1 year 11 months 4 weeks 13 hours ago) and read 2960 times:

Wasn't Alaska a big MD80 operator? While there are airlines which just get better conditions from A or from B - if management of the airline does not conduct a formal bidding competition and choose the better offer every shareholder will sue them for the damage. There is no loyality in any business above 10 000$ - if there is this is called corruption.

User currently offlineRoseflyer From United States of America, joined Feb 2004, 9641 posts, RR: 52
Reply 5, posted (1 year 11 months 4 weeks 13 hours ago) and read 2941 times:

Of any single manufacturer airline, Alaska is the least likely to switch in my opinion. They proudly market that they operate exclusively Boeing aircraft and have it painted on every airplane (Proudly All Boeing) and even have billboards advertising it. I think that is an example of extreme loyalty. It isn't much of a surprise since they are based in Seattle.

Comments of sweetheart deals are exaggerated in my opinion. Airlines negotiate certain benefits such as better maintenance support, spares support, etc. You can also assume that VPs of airlines like Southwest and ANA who have launched airplanes with Boeing have VPs direct phone numbers and can get what they want when they are looking for support. The same is not going to be true for smaller tier operators.

The airlines making the larger orders get price consolidations. They get better prices because each airplane is highly customized from the design and maintenance manuals. By spreading the price across many airplanes, purchase price goes down.

A.net loves talking about deep discounts and loss making sales, and that airplane only sold based on price. In reality, the purchase price of an airplane once you factor the discounts for large orders in is relatively stable. If you read both Boeing and Airbus’ financial reports, you can see that they have relatively stable margins. With the huge backlogs we see today, no one is getting steep discounts unless they are willing to take some of the last production 737NGs or A320 OEOs.

Customers sometimes care about airplane model, but it isn’t a huge factor. The size of the first class cabin is much more important to frequent travelers. There’s a reason why United’s elite customers rank the 757 as their favorite airplane. It has 24 first class seats compared to far fewer on other airplanes. Contrary to A.net opinion, most elite flyers can tell the difference between airplanes, but a large first class cabin and a refreshed interior with the latest technology features outrank any preference for A vs B.

That’s my opinion.

[Edited 2012-09-25 11:52:16]


If you have never designed an airplane part before, let the real designers do the work!
User currently offlineDocLightning From United States of America, joined Nov 2005, 19708 posts, RR: 58
Reply 6, posted (1 year 11 months 4 weeks 13 hours ago) and read 2921 times:

Quoting Braniff747SP (Reply 2):
It is widely known that some airlines have 'Gentlemen's Agreements' with some manufacturers. AA is an example, as was PMDL.

Except AA just ordered the A321NEO.

In the end, decisions are made not by any individual, but by an entire team of analysts who pore over spreadsheets comparing this benefit to that drawback and double, triple, and quadruple-checking their numbers. For example: Airbus's plane burns more fuel, but Boeing's has higher maintenance costs. Airbus's carries more payload but Boeing's flies farther. They run these sorts of comparisons on the sorts of routes that they can predict for these types and make the decision that gives the best numbers.

It's obvious that there is some brand loyalty with certain operators, of course. It's apparent to anyone with eyes that US favors Airbus, while PMCO favors Boeing. Other carriers have been completely opportunistic, such as PMUA and PMNW, both of whom ordered and operated mixed fleets.

As for AS and WN, they are 737 operators exclusively. When it comes to the 737 vs. A320, the two families are equivalent in almost every way and my guess is that neither family tends to win orders based on merit, but rather on pricing from the OEM and also on commonality. For WN, their entire business model revolves around the idea that their fleet is almost completely interchangable and that any WN pilot can fly any of their a/c. Even taking new 738's was a pretty big deal for them, since it means that their aircraft scheduling just got a bit more complicated. For WN to order the A320 would be a massive investment of time, labor, and training on their part, so Airbus would have to offer them a very sweet deal indeed. Probably so sweet that Airbus would lose money on it; which is why that hasn't happened.

AS also has political considerations, what with being located in Seattle...and stuff.  


User currently offlineHooverman From Netherlands, joined Oct 2011, 110 posts, RR: 0
Reply 7, posted (1 year 11 months 4 weeks 13 hours ago) and read 2901 times:

Quoting mickey90 (Reply 3):

I agree. The most passengers don't care about the aircraft they fly. They care about the ticket price.


User currently offlineTWA772LR From United States of America, joined Nov 2011, 2055 posts, RR: 1
Reply 8, posted (1 year 11 months 4 weeks 11 hours ago) and read 2666 times:

Quoting Braniff747SP (Reply 2):

It is widely known that some airlines have 'Gentlemen's Agreements' with some manufacturers. AA is an example, as was PMDL.

I thought that was between CO, DL, and AA and Boeing? It was because they were huge MD-80 operators and the agreement came about when Boeing took over MD and it said that Boeing would still provide parts and maintenance. Correct?



Go coogs! \n//
User currently offlineBMI727 From United States of America, joined Feb 2009, 15744 posts, RR: 27
Reply 9, posted (1 year 11 months 4 weeks 10 hours ago) and read 2512 times:

Quoting TWA772LR (Reply 8):

Nope. The original agreement was for planes and loyalty: the airlines would only buy Boeings and in return got preferential pricing and terms that was laid out in the agreement. When Boeing moved to buy McDonnell Douglas, the Europeans forced them to sign a separate agreement with the EU (or EC or whatever it was at the time) stating that Boeing would not enforce the exclusivity clause in their agreements with the airlines. The portions governing the price and terms remained intact, and for that reason none of the airlines defected until American last year, despite getting the milk without buying the cow ever since the merger.

As far as I know, support for McDonnell Douglas types was never part of the agreements.



Why do Aerospace Engineering students have to turn things in on time?
User currently offlineRoseflyer From United States of America, joined Feb 2004, 9641 posts, RR: 52
Reply 10, posted (1 year 11 months 4 weeks 9 hours ago) and read 2402 times:

Quoting BMI727 (Reply 9):

As far as I know, support for McDonnell Douglas types was never part of the agreements.

Support for McDonnell Douglas equipment is required by the production certificate owner. Boeing still owns that production certificate and responsibility to provide maintenance support under FAA and IATA requirements. Boeing even still has a few 707s that they support.



If you have never designed an airplane part before, let the real designers do the work!
User currently offlineAWACSooner From United States of America, joined Jan 2008, 1914 posts, RR: 1
Reply 11, posted (1 year 11 months 4 weeks 8 hours ago) and read 2300 times:

Quoting Roseflyer (Reply 10):
Boeing even still has a few 707s that they support.

Yah...MINE!


User currently offlineViscount724 From Switzerland, joined Oct 2006, 25332 posts, RR: 22
Reply 12, posted (1 year 11 months 4 weeks 7 hours ago) and read 2193 times:

Quoting Roseflyer (Reply 5):
Of any single manufacturer airline, Alaska is the least likely to switch in my opinion. They proudly market that they operate exclusively Boeing aircraft and have it painted on every airplane (Proudly All Boeing) and even have billboards advertising it. I think that is an example of extreme loyalty. It isn't much of a surprise since they are based in Seattle.

AS of course operated a large MD-80 fleet for many years, long before Boeing acquired McDonnell-Douglas.

At least by operating 737s they must save a lot on delivery flight expenses (BFI-SEA 5 nm). The only shorter delivery trips I can think of would have been AC's 26 original CRJ-100s (when they were part of the AC mainline fleet). They didn't even have to take off, just taxi from the factory to the AC hangar at YUL.


User currently offlineImperialEagle From United States of America, joined Jan 2006, 2601 posts, RR: 22
Reply 13, posted (1 year 11 months 4 weeks 6 hours ago) and read 2120 times:
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In the "old days" it was very prevalent. Now, not so much, plus there is less choice than there used to be with Convair, Lockheed, McD and assorted other players either gone or no longer in the commercial marketplace.

Its all about the money.



"If everything seems under control, you're just not going fast enough!"
User currently offlineB737900 From United States of America, joined Aug 2010, 178 posts, RR: 0
Reply 14, posted (1 year 11 months 4 weeks 6 hours ago) and read 2090 times:
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Quoting ImperialEagle (Reply 13):
Its all about the money.

Yes, true. But there must be a corporate mind-set that continues to be present. AS and WN I am sure can pick up the phone and talk directly to there people at Boeing and get some answers. Also, what about the continental proclivity to "buy locally"? Boeing is in the US of course and Airbus is a European show.



Sounds like a Beaver on floats..........we're saved!!
User currently offlinezeke From Hong Kong, joined Dec 2006, 9102 posts, RR: 75
Reply 15, posted (1 year 11 months 4 weeks 5 hours ago) and read 2043 times:

Quoting B737900 (Thread starter):
What, for example, would loyal customers of Alaska Airlines think if AS started purchasing the A300?

They cannot, the A300 has not be available for sale for years.

Quoting B737900 (Thread starter):
I personally would be upset but of course we as passangers have no input in that. Or do we?

You can buy a ticket with another carrier.

Quoting B737900 (Reply 14):
Boeing is in the US of course and Airbus is a European show.

EADS/Airbus is the largest export customer of the US Aerospace industry, tens of thousands of Americans are involved in making Airbus aircraft.

Where a FAL is says nothing about where the individual components are made. The 787 for example, I would suggest is majority made overseas, it is just assembled in the USA.



We are addicted to our thoughts. We cannot change anything if we cannot change our thinking – Santosh Kalwar
User currently offlinetdscanuck From Canada, joined Jan 2006, 12709 posts, RR: 79
Reply 16, posted (1 year 11 months 4 weeks 5 hours ago) and read 1989 times:

Quoting B737900 (Thread starter):
What, for example, would loyal customers of Alaska Airlines think if AS started purchasing the A300?

Not much...the vast majority of customers wouldn't notice (they'd notice it was wider, not that it was an Airbus).

Quoting B737900 (Thread starter):
I personally would be upset but of course we as passangers have no input in that. Or do we? Would there be mass complaints and demonstrations?

Unlikely, based on past precident. However, *if* there were protests or complaints, the airlines would notice. Airlines take action directly in proportion to what their customers actually do (not necessarily what they say). As zeke said, if customers actually started buying tickets on other carriers, AS would react very quickly.

Quoting B737900 (Thread starter):
Does AS have a "sweet heart" arraingement with Boeing.

No. As an existing Boeing customer they have better access but, as an existing Boeing customer, they're a target for Airbus. When it all balances out, no OEM enjoys much of an advantage.

Quoting Braniff747SP (Reply 2):
It is widely known that some airlines have 'Gentlemen's Agreements' with some manufacturers.

This has been dead for quite a while.

Quoting Roseflyer (Reply 5):
Of any single manufacturer airline, Alaska is the least likely to switch in my opinion.

I'd put Southwest ahead of Alaska.

Quoting B737900 (Reply 14):
Yes, true. But there must be a corporate mind-set that continues to be present. AS and WN I am sure can pick up the phone and talk directly to there people at Boeing and get some answers.

Any airline of any size can pick up the phone and talk directly to either OEM...the one that has their business wants to keep it and the ones that don't want to get it.

Tom.


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