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deltadawg
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Airbus Worried About $ Vs €?

Tue Apr 17, 2007 4:55 am

After yet another tailspin this morning of the $USD, got me to wondering about how Eads & Airbus are handling the drop in the value of the dollar vs. the euro.

Considering that a new a/c (say 738 vs. 320) is somewhere in the neighborhood of around $40-45 million list price depending upon options a 1% drop in value could result in a $400,000 dollar advantage to certain markets. On widebodies it seems this disparagy could be even wider. Of course, all this depends upon the market sold into but considering the dollar is dropping against all currencies except the yen it would seem that Boeing is at a better price advantage these days.

Is Airbus worried about this trend (any insiders?) and what if anything can they or could they do about it other than offering lower prices and maybe more attractive service agreements?
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DLPMMM
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:11 am

It is a long term problem for Airbus WRT their manufacturing costs verses Boeing. In the shorter term, I would doubt it would be a large problem. Even with much of the pricing of aircraft being done in $USD, I am sure that Airbus maintains a long term financial hedging program to lock-in their profit margins, regardless of currency fluctuations.
 
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clickhappy
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:17 am

It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.
 
DLPMMM
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:34 am

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

Source please?
 
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deltadawg
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:40 am

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

Why would they buy in $USD? And if they do, how long have they done this? Did they start off buying everything in $USD?
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Arniepie
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:43 am

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

I don't think the purchasing part would be the problem, au contraire it would make it cheaper.
The sales part however is more problematic as all planes are usually sold in US$ ,certainly outside the EU.
Also wages/energy and other overhead costs are almost all paid in € which has a big influence on net profit because it will be very hard to get these costs down while they get less for each plane sold.
[edit post]
 
astuteman
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:45 am

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

If that's correct, then the price of said materials/equipments in $ will be nicely tied into the sale price of the aircraft, also in $.
No worries........  Smile

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clickhappy
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:46 am

Source please?

Here you go

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Assuming a 1 to 1 ratio, dollar to pound, 75% of the total cost of the A320 is in US Dollars, 70% for the A340.
 
ozglobal
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:51 am

Quoting Clickhappy (Reply 7):
Assuming a 1 to 1 ratio, dollar to pound, 75% of the total cost of the A320 is in US Dollars, 70% for the A340.

Ok. Good source. But why is that a 'worry' for them?? It should cancel out much of the pain of the strong Euro for sales, no?
When all's said and done, there'll be more said than done.
 
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semobeila
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:52 am

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

This would be an advantage if it would be the case. The problem is that a large junk of their materials and parts have to be paid in EUR and the final product is sold in USD. Therefore they plan to build over 50% of A350XWB parts in "dollar countries".

Quoting DeltaDAWG (Thread starter):
Is Airbus worried about this trend (any insiders?) and what if anything can they or could they do about it other than offering lower prices and maybe more attractive service agreements?

Airbus is definitely worried about this problem. Besides the A380 problems it was the main reason for the "Power8" restructuring program.
 
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clickhappy
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:54 am

Because while they are paying dollars for equipment, and materials, their manufacturing costs are booked in Euros.
 
abrelosojos
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 5:54 am

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

= Why would this be a "huge worry"? If its priced in dollars, wouldn't they now have cheaper access to supply?

-A.
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lvhgel
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 6:04 am

Labor in Euros
Taxes in Euros
Capital amortization in Euros
Sales costs in Euros
Other operating and manufacturing costs in Euros

It is obvious they should worry, but, also they should implement the necessary strategies to offset the issue.
Now Boeing is outsourcing parts of the 787 in the European Union and Japan, I do not know if their contract is in Euros or Dollars, in any case in this scenario, someone is worried also by the exchange rate fluctuation.
 
sacamojus
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 6:12 am

Quoting Clickhappy (Reply 10):
Because while they are paying dollars for equipment, and materials, their manufacturing costs are booked in Euros.

I am sure their European investors will want euros. Anyway, they can hedge, but yes currency risk is associated with international business.
 
sllevin
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 6:14 am

I recall several years ago (when the Euro and the USD were near parity) that Airbus said a Euro value of over $1.10 would be a potential issue. With the Euro now having been ove $1.25 for three years now (and little sign that the current rate of ~$1.30 isn't the "new parity"), this has to be a major issue for Airbus.

Steve
 
Poitin
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 6:18 am

Quoting Sllevin (Reply 14):
I recall several years ago (when the Euro and the USD were near parity) that Airbus said a Euro value of over $1.10 would be a potential issue. With the Euro now having been ove $1.25 for three years now (and little sign that the current rate of ~$1.30 isn't the "new parity"), this has to be a major issue for Airbus.

Steve

It certainly is as the hedges Airbus has had for several years to offset the overpriced Euro are running out.

The big issue is the cost of labor in the Euro zone. With a 35% differential, that has got to hurt.
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RedChili
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 10:29 am

Quoting LVHGEL (Reply 12):
Taxes in Euros

Taxes are paid in percentage. Whether your company has a profit of 100 million euros or 130 million dollars, the taxes will be exactly the same.
Top 10 airplanes: B737, T154, B747, IL96, T134, IL62, A320, MD80, B757, DC10
 
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clickhappy
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 10:34 am

I think you miss the point Chili.

If you have a contract for something that was sold for 100 US dollars, or 125 Euros, but by the time you received the 100 dollars it was now worth 135 Euros you would be paying taxes on the other 10 Euros, that is to say you are now paying taxes on the 135, not the 125.
 
RedChili
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 10:47 am

Quoting Clickhappy (Reply 17):
I think you miss the point Chili.

If you have a contract for something that was sold for 100 US dollars, or 125 Euros, but by the time you received the 100 dollars it was now worth 135 Euros you would be paying taxes on the other 10 Euros, that is to say you are now paying taxes on the 135, not the 125.

Well, this would apply if you're importing anything from abroad which is priced in US dollars, and which you have to pay import taxes for. I don't know how much Airbus is buying of that sort, so I cannot say whether this reaally is a problem for Airbus.

But your math is wrong. You're using the exchange rates the wrong way. If Airbus has a contract for something for 100 dollars, that means that the cost with a 1.25 exchange rate used to be 80 euros, but with today's exchange rate of 1.35 the cost is 74 euros.
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clickhappy
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 11:34 am

This thread is very interesting  Smile

I get the sense that some think a weak dollar is good for Airbus, yet it is probably the biggest challenge they face....if the dollar continues to drop Airbus will be in real trouble.

I miss quoted above..it is not the dollar makeup of the A320 family was not 75% US Dollars/25% British Pound, it was to the Euro.

So, in 2004, assuming a one to one exchange rate, that is to say a US Dollar was worth exactly the same as a Euro, 75% of the cost of an A320 was in US Dollars.

But we now know the exchange rate is 1.35 Euros for Every one dollar, which means that the breakdown for an A320 is now more along the line of a 50/50 split.

The A340 family has a slightly higher Euro to US Dollars cost, so it would suffer slightly more when compared to an airliner priced in all dollars.
 
astuteman
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 3:38 pm

Quoting Clickhappy (Reply 19):
I get the sense that some think a weak dollar is good for Airbus, yet it is probably the biggest challenge they face....if the dollar continues to drop Airbus will be in real trouble.

Nobody (sensible) disputes that, Clickhappy.
But in the situation of a weak dollar, it's the costs which are felt in euro's that hurt.
Costs that are felt in dollars, such as the material costs you described in post No.2 are actually what Airbus need most, in order to mitigate the weak dollar.
If they buy in dollars, and sell in dollars, then the value of those dollars doesn't actually matter. It's cancelled out.

Quoting Clickhappy (Reply 10):
their manufacturing costs are booked in Euros

 checkmark 
This is the main issue.
If you design/build in Euro's, but sell in dollars, as the dollar weakens, your design/build costs rise.

Quoting Semobeila (Reply 9):
Airbus is definitely worried about this problem. Besides the A380 problems it was the main reason for the "Power8" restructuring program

 checkmark 

Regards
 
baroque
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 3:56 pm

Quoting Clickhappy (Reply 7):
Assuming a 1 to 1 ratio, dollar to pound, 75% of the total cost of the A320 is in US Dollars, 70% for the A340.



Quoting Clickhappy (Reply 19):
I get the sense that some think a weak dollar is good for Airbus, yet it is probably the biggest challenge they face....if the dollar continues to drop Airbus will be in real trouble.

A weak dollar certainly benefits those parts that are buying in dollar denominated items. Perhaps a more interesting question is how does the effect of a weak dollar on the A32x compare with its effect on the B73x?
I think at one stage, there was more of the 32x made in the US (by value) than there was of the 73x. Of course currency realignments can change that overnight, but it could be a problem for both manufacturers. So far the Yen has been weakish, but if it becomes stronger, there might be some stresses in the 787 chain. Bouncy currencies can be a problem where companies are following the global world paradigm.

Quoting Astuteman (Reply 20):
If you design/build in Euro's, but sell in dollars, as the dollar weakens, your design/build costs rise.

 checkmark  And exchange rates will not remain immutable. Interesting too that nobody has mentioned the Pound Sterling, which is teetering towards heights not seen in a while - ~ 20% of Airbus, hope not!!  duck 
 
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deltadawg
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 9:36 pm

Quoting Baroque (Reply 21):
And exchange rates will not remain immutable. Interesting too that nobody has mentioned the Pound Sterling, which is teetering towards heights not seen in a while - ~ 20% of Airbus, hope not!!

Pound hit $2.00 today! Ouch!
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sebolino
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 9:42 pm

Quoting Clickhappy (Reply 2):
It is a huge worry for Airbus...100% of their materials, and 95% of their equipment, is priced in US Dollars.

This is not the problem.
The problem is the salaries, a part of the hardware and the energy paid in Euro and the competition by Boeing which pays (nearly) everything ni dollars.
 
georgiaame
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RE: Airbus Worried About $ Vs �?

Tue Apr 17, 2007 11:31 pm

Quoting DeltaDAWG (Reply 4):
Why would they buy in $USD?

The dollar just happens to be the international currency of choice. Preferred by terrorists, North Koreans, and a host of countries world wide for regular business, backed in full by the economic powerhouse called the USA. Perhaps one day the Euro will make it up there, but not too likely in the near future.

You have to realize that exchange rates float, and are not really backed by governments. And the US government really has no incentive to strengthen the US Dollar. Our economy is bursting at the seams, our national debt (which basically is the psychological driving force that weakens the dollar) though numerically high, is only a tiny percentage of our gross domestic product, we are at more than full employment, so we have plenty of cash sloshing around in our coffers and plenty of cheap, fun things to buy with that cash. That being said, it literally "pays" for us to be importing everything and anything which costs less to produce overseas (ie, countries with a "weak" currency). We can dump paper currency, and get real stuff in return, like toyotas, and Chinese made furniture, etc. Boeing I would guess is our biggest exporter of heavy equipment, and there is no shortage of demand for their products. Our farmers produce a hell of a lot of corn and wheat for export (or conversion into alcohol should we chose to do so). This keeps our workers employed, we pay them in dollars, and get some of those exported dollars back when we sell planes or grain. Because our economy is strong, and inflation low, productivity is high for what we do produce, those dollars go right back into circulation, improving the economic outlook of the local sellers. Now reverse the situation, and look at Europe and EADSs. Their Euro is "stronger" than our dollar. If I travel to Europe and want to eat, I get creamed. A hamburger I can get for lunch here costs $4, the same meal in London runs $10-15. So I don't go. On a larger scale, France is building a big airplane, that is delayed and delayed again, and with each passing month costs more to buy, (but not necessarily to build), because the contracts were in the international currency: the dollar. Who wants to buy a $500million aircraft (exaggeration, sorry) with limited functionality, when you can buy 2 787s for $250million, or half the price? Obviously I'm simplifying, but there is a reason that Airbus sales are going down, and Boeing can't keep up with the demand. This is very bad economic news for them, and it is not limited to aircraft. Having a "strong" currency may boost national ego, but it is not necessarily a good thing in the short run.
"Trust, but verify!" An old Russian proverb, quoted often by a modern American hero
 
Poitin
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 11:44 pm

Quoting Clickhappy (Reply 19):
I get the sense that some think a weak dollar is good for Airbus, yet it is probably the biggest challenge they face....if the dollar continues to drop Airbus will be in real trouble.

Yes and no. If the customer is let's say LH, and in the Euro zone, using the Euro as its base currency, the Boeing aircraft is 35% cheaper but the Airbus aircraft not more expensive.

If you are in either the USD zone or a a currency tied to the USD such as the Hong Kong dollar, the Boeing aircraft is not cheaper but the Airbus is 35% more expensive.

It is a question of whether the glass is 35% more empty or more filled. Follow?  Big grin

Airbus has some serious problems to overcome with the price of the Euro. Just how they do it will be interesting, but perhaps some of those French and German politicians who are so happy to tell Airbus how to run their business will do something about that.
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baroque
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RE: Airbus Worried About $ Vs €?

Tue Apr 17, 2007 11:51 pm

Quoting GeorgiaAME (Reply 24):
Our economy is bursting at the seams, our national debt (which basically is the psychological driving force that weakens the dollar) though numerically high, is only a tiny percentage of our gross domestic product, we are at more than full employment, so we have plenty of cash sloshing around in our coffers and plenty of cheap, fun things to buy with that cash.

Erm, well admittedly there are 34 other countries with higher debts as a percentage of GDP, but 4.9 trillion government debt and 64.7% of GDP (and up from about 58% in 2000) are not to be sniffed at.
http://en.wikipedia.org/wiki/U.S._public_debt
More interesting is the amount of interest paid which is now 376 billion a year and 9% of expenditures which is very close to that for health.
http://www.warresisters.org/piechart.htm
A high proportion of the debt is held overseas and should those interests decide that the US dollar is not a safe haven, woe betide us all. As it is, the Chinese and Japanese are probably even less happy about the decline in the US dollar than is Airbus. Watch out if their misery causes them to act.
 
Lumberton
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:21 am

Quoting Baroque (Reply 26):
woe betide us all.

Quite correct.

Quoting Baroque (Reply 26):
As it is, the Chinese and Japanese are probably even less happy about the decline in the US dollar than is Airbus.

And do what? Throw the international financial community into total disarray? Who will buy all their exports? Who owns who here?
"When all is said and done, more will be said than done".
 
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Buyantukhaa
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:32 am

Quoting Sllevin (Reply 14):
(and little sign that the current rate of ~$1.30 isn't the "new parity"),

It's actually at almost $1.36 today.

Quoting GeorgiaAME (Reply 24):
and with each passing month costs more to buy, (but not necessarily to build), because the contracts were in the international currency: the dollar.

Incorrect, Because if you are a US company and your contract was in USD, then you don't have to worry a second about currency fluctuations. Airbus will, you won't.
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ikramerica
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:34 am

Quoting Poitin (Reply 15):
The big issue is the cost of labor in the Euro zone. With a 35% differential, that has got to hurt.

But that assumes that at a 1:1 exchange rate, the cost of labor is equal. I think the cost of labor is already higher in the EU and the exchange rate only makes it worse.

Back when the exchange was 0.85 instead of 1.3, the cost of labor was likely about equal. That means EU labor is more like 50% higher than USA labor right now.

Quoting DeltaDAWG (Reply 22):
Pound hit $2.00 today! Ouch!

That's the level it was when it was fixed, way back when. 2:1, IIRC.

Quoting Baroque (Reply 26):
As it is, the Chinese and Japanese are probably even less happy about the decline in the US dollar than is Airbus. Watch out if their misery causes them to act.

We want them to act by floating their currency. It's killing us that they don't. But China would be idiotic to do anything that damages their best customer, the USA...
Of all the things to worry about... the Wookie has no pants.
 
baroque
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:43 am

Quoting Lumberton (Reply 27):
Quoting Baroque (Reply 26):
As it is, the Chinese and Japanese are probably even less happy about the decline in the US dollar than is Airbus.

And do what? Throw the international financial community into total disarray? Who will buy all their exports? Who owns who here?

Oh indeed, it is a tricky circle with not large amounts of inherent virtue in it!! I guess it is best thought of as commensalism. Presumably the closest analogue is mutualism, but that is the relationship between us and the beasties in our guts, and we all know that every now and again, catastrophe strikes in that system!!!  boggled   crackup   puckerup   sigh 

The most likely perturbation would be if one of the parties really gets serious with trade embargoes. Presumably this will be most likely in the early days of governments, not so much the Chinese as they do not really change, but the US when a new administration brings in a whole bunch of folk with bright ideas!!!
Each one owns the other, but in spite of trying to hold on tight, does not necessarily have complete control.

But indeed woe betide us all if someone decides to change the status quo, but that does not mean that the status quo is inherently stable. It might be, but there are reasons why it might not be.

For example, why is the Euro so high at present, not really interest rates, and their cost structures are not a cause for rising Euros, so could it be.........?
 
Poitin
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:47 am

Quoting Ikramerica (Reply 29):
But that assumes that at a 1:1 exchange rate, the cost of labor is equal. I think the cost of labor is already higher in the EU and the exchange rate only makes it worse.

Back when the exchange was 0.85 instead of 1.3, the cost of labor was likely about equal. That means EU labor is more like 50% higher than USA labor right now.

Probably more given that they work 30-35 hours a week, have dozens of holidays, and take the month of August off.

Power8, should it happen, which I doubt, will have to address that.

This all means that in the future our airplanes will be built in China. At this point, Boeing is just doing the final assembly work, but don't be too surprised if the Chinese take that over as well.
Now so, have ye time fer a pint?
 
n1786b
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:53 am

According to La Lettre de l'Expansion, Hans-Peter Ring  optimist  admitted that only 50% of their backlog is hedged.  Wow!

- n1786b
 
Poitin
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 1:03 am

Quoting N1786b (Reply 32):
According to La Lettre de l'Expansion, Hans-Peter Ring optimist admitted that only 50% of their backlog is hedged. Wow!

- n1786b

While I don't have a reference, I saw reports that much of their hedge money has gone to pay off the A380 claims. It would be interesting to read the Airbus balance sheet, but I suppose that is not likely to ever happen.
Now so, have ye time fer a pint?
 
ikramerica
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 1:12 am

Quoting Poitin (Reply 31):
Probably more given that they work 30-35 hours a week, have dozens of holidays, and take the month of August off.

Well, the reasons for why it's true doesn't matter, just the fact the cost of labor is higher. If you have to employ more people (jobs program) then you have to carry the extra expenses (benefits) of those employees. So even if both workforces work the same number of total hours at the same hourly wage, if one force is larger in manpower with more costly benefits, that force is more expensive.

That's one reason for "downsizing" here in the USA. They ask some people to work more, and actually pay more, then fire others, and even with overtime costs, the overall cost is lower. Of course, it wears out the people faster, and contributes to unhappiness and long term productivity drops, but that's a long term problem and everyone wants short term solutions...
Of all the things to worry about... the Wookie has no pants.
 
Lumberton
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 5:52 am

Quoting Baroque (Reply 30):
commensalism

Thank you for using this word! I haven't seen it since high school biology and that was quite a few years ago!  Wink
"When all is said and done, more will be said than done".
 
baroque
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:02 pm

Quoting Lumberton (Reply 35):
Quoting Baroque (Reply 30):
commensalism

Thank you for using this word! I haven't seen it since high school biology and that was quite a few years ago!

Not as long ago as me alas!!  old   old 

Apart from being close to a description of the relationship, commensalism also has a slightly sleazy sound to it which also could be appropriate - or perhaps it is just my mind. Mutualism sounds nicer until you remember what other partners in mutualism can do to you if you are not careful with what you eat!!

It is certainly going to be an interesting test to try to realign the USD with the Chinese currency, the latter are obviously not very keen to do it. The pound sterling seems to be going up even more than the Aus $. We have metal prices as our "excuse", what is the excuse for the UK? There seems little logic to it all, we had major commodity prices more than double over a period of about 15 months and still managed to run worse balance of trade figures. It defies logic, you just have to wonder what would have happened without the doubling of those commodities. And no, expansion of production does not explain the poor trade performance.
 
NAV20
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 12:29 pm

Quoting Baroque (Reply 36):
The pound sterling seems to be going up even more than the Aus $. We have metal prices as our "excuse", what is the excuse for the UK?

Until yesterday, Baroque, neither the $AUS nor the pound were 'going up' much at all, relative to world currencies other than the $US. Fact is, the $US has been going down, our currencies have not been going up, except for day-to-day fluctuations.

The $AUS went through a short period of being 'overbought' last month due to speculation about an interest rate rise. The speculators have now noted that British inflation is rising at a rapid rate, and are currently therefore speculating on Blair raising rates - that's why the pound has 'spiked' a little in the last few days.

In the medium term, speculation aside, there is no doubt that the $US is dropping 'structurally.' Bush is facing the same dilemma he faced three years ago - raise interest rates to slow the dollar slide, helping the balance of payments at the expense of the domestic economy; or 'do nothing.' On past form he'll again choose to 'do nothing' for quite a while.
"Once you have flown, you will walk the earth with your eyes turned skywards.." - Leonardo da Vinci
 
baroque
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 3:49 pm

Quoting NAV20 (Reply 37):
In the medium term, speculation aside, there is no doubt that the $US is dropping 'structurally.' Bush is facing the same dilemma he faced three years ago - raise interest rates to slow the dollar slide, helping the balance of payments at the expense of the domestic economy; or 'do nothing.' On past form he'll again choose to 'do nothing' for quite a while.

Yes, well if you look at his interest payments, you can see one reason why he is not keen to raise them. I suspect that part of the rise in the Aus $ is the likes of APA and their buyout/takeover efforts for QF, Coles and whatever else they have thought of, oh yes Orica, that should go like a bomb!
 
Lumberton
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 11:00 pm

Quoting Baroque (Reply 36):
The pound sterling seems to be going up even more than the Aus $.

I've opined in the past that this is one of the reasons for GE's success vis a vis RR lately and could explain why RR is looking to do more work in the U.S. (or so I've heard).
"When all is said and done, more will be said than done".
 
swissy
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RE: Airbus Worried About $ Vs €?

Wed Apr 18, 2007 11:18 pm

A "weak" US  dollarsign  will hurt even Boeing in the long run with the out sourced parts, work...... I guess Mr. GB got himself in a nice little mud hole and it is not like all other currency dropped like the US  dollarsign  and the EU$ gained.....

Cheers,
 
baroque
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RE: Airbus Worried About $ Vs €?

Thu Apr 19, 2007 12:04 am

Quoting Lumberton (Reply 39):
Quoting Baroque (Reply 36):
The pound sterling seems to be going up even more than the Aus $.

I've opined in the past that this is one of the reasons for GE's success vis a vis RR lately and could explain why RR is looking to do more work in the U.S. (or so I've heard).

Currency would be one reason, but I suspect that RR are also trying to have the best of both worlds and to use their holdings in the US to try to appear as US as UK. Might be a bit tricky, but could also be worth a bit if they could pull it off. The high pound will affect RR just as much as the high Euro will affect Airbus.

And Swissy is correct, it will be a while before the effects of the complex web of movements, non movements and whatever will become clear. Probably the best state would be to expect to be surprised!!
 
Lumberton
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RE: Airbus Worried About $ Vs €?

Thu Apr 19, 2007 12:50 am

Quoting Swissy (Reply 40):
A "weak" US dollarsign will hurt even Boeing in the long run with the out sourced parts, work.....

Only if the work is outsourced in the eurozone, or where the exchange rate is unfavorable.
"When all is said and done, more will be said than done".
 
swissy
Posts: 1481
Joined: Fri Jan 07, 2005 11:12 pm

RE: Airbus Worried About $ Vs €?

Thu Apr 19, 2007 2:49 am

Quoting Baroque (Reply 41):
it will be a while before the effects of the complex web of movements, non movements and whatever will become clear. Probably the best state would be to expect to be surprised!!

Agree 100%

Quoting Lumberton (Reply 42):
Only if the work is outsourced in the eurozone, or where the exchange rate is unfavorable.

Which will be the case "if" the US  dollarsign  will loose more ground to other currencies like the Yen (787 program) or just have a look at the "mighty" CAD, it was not to long ago it was hoovering around 0.66 and now it is up to almost 0.90....... with all the out sourcing in these days it can change the picture quite fast regardless which currency it will be, there is a very fine line.....  Wink

Cheers,
 
swissy
Posts: 1481
Joined: Fri Jan 07, 2005 11:12 pm

RE: Airbus Worried About $ Vs €?

Thu Apr 19, 2007 2:50 am

Quoting Baroque (Reply 41):
it will be a while before the effects of the complex web of movements, non movements and whatever will become clear. Probably the best state would be to expect to be surprised!!

Agree 100%

Quoting Lumberton (Reply 42):
Only if the work is outsourced in the eurozone, or where the exchange rate is unfavorable.

Which will be the case "if" the US  dollarsign  will loose more ground to other currencies like the Yen (787 program) or just have a look at the "mighty" CAD, it was not to long ago it was hoovering around 0.66 and now it is up to almost 0.90....... with all the out sourcing in these days it can change the picture quite fast regardless which currency it will be, there is a very fine line.....  Wink

Cheers,
 
swissy
Posts: 1481
Joined: Fri Jan 07, 2005 11:12 pm

RE: Airbus Worried About $ Vs €?

Thu Apr 19, 2007 2:51 am

Quoting Baroque (Reply 41):
it will be a while before the effects of the complex web of movements, non movements and whatever will become clear. Probably the best state would be to expect to be surprised!!

Agree 100%

Quoting Lumberton (Reply 42):
Only if the work is outsourced in the eurozone, or where the exchange rate is unfavorable.

Which will be the case "if" the US  dollarsign  will loose more ground to other currencies like the Yen (787 program) or just have a look at the "mighty" CAD, it was not to long ago it was hoovering around 0.66 and now it is up to almost 0.90....... with all the out sourcing in these days it can change the picture quite fast regardless which currency it will be, there is a very fine line.....  Wink

Cheers,
 
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Buyantukhaa
Posts: 2289
Joined: Thu May 13, 2004 5:33 am

RE: Airbus Worried About $ Vs €?

Thu Apr 19, 2007 4:21 am

Quoting Lumberton (Reply 42):
Only if the work is outsourced in the eurozone, or where the exchange rate is unfavorable.

Most places will have un unfavourable exchange rate. The fact that the dollar goes down against the euro does not say much about the euro; as the dollar goes down just as fast against the pound, the Swiss Franc etc.

Of course there are countries whose currencies can fall against the dollar, but I dare guess that there won't be many of those.

Finally there's the countries whose currencies are pegged with the dollar. Those won't fluctuate (much).
I scratch my head, therefore I am.

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