All right. BA is losing money right now due to over capacity. They need planes they can fill to the rafters with business travelers that are low cost to operate. Generating revenue is the bottom line. In this scenario, the 717 makes sense. The deal also fits squarely with Boeing moves to offer buy backs to carriers, something Airbus now says it will do as well. (Remember the statement they made after the SQ deal.) Yesterday Boeing announced a reorganization of its Capital Services unit, a move intended to position the company in the leasing, retrofitting , and servicing businesses. This will be a difficult balancing act, one that Airbus says it will not get into. The market is estimated at $400 billion per annum and generates enormous profits for players such as Pegasus, ILFC, and Boullion(sp?). The actual sale of new aircraft will contunue to have diminishing returns over time as Boeing and Airbus slash prices to the bone to gain orders. So entering new markets is the only solution. Airbus will learn this quickly when they become a public corporation and are forced to pay taxes, shareholders, and open the books to public accountants. It is now too easy for them to hide any losses they may have and since they never talk about it, I must assume they are losing money. If you make money, you say it. If you lose money, you don't like to talk about it. My personal opinion is that BA will choose the 717 as a sign of faith with Boeing over the DHL deal, because it is a good solution to the problem, and because RR/BMW are exerting pressure on them for the purchase.
Like Navion, I have no problem with Airbus products. I fly them regularly and find them to be comfortable and quiet. They also smell great. My problem is with the way Airbus does business. It is protected from real competition by the French government, something the German and British governments are agaisnt, as is BAe and DASA. I respect Volkswagen when they beat Ford or GM for marketshare because they do it on their own. I will never respect Airbus the Consortium until they prove themselves under the same conditions.