Moderators: jsumali2, richierich, ua900, PanAm_DC10, hOMSaR

 
RalXWB
Posts: 499
Joined: Sun Oct 25, 2015 9:36 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 11:50 am

lightsaber wrote:
kevin5345179 wrote:
lightsaber wrote:
If Boeing discounts and Airbus doesn't, then volume shifts to Boeing and Airbus starts seeing more contentious customer relations.

Aircraft are building up, 60 per prior link. If too pricey, airlines will find any excuse to not accept and delay deposits.

Both are reducing production.

The A320NEO has more pricing power, but the A350 and A330NEO just lost that. If AirAsia is not accepting A320NEO, than the A330NEO won't be picked up either.


Lightsaber


I guess my previous point was no one wants widebodies today and the problem for Boeing is that's the sole source of cash flow. I disagree the volume shift will happen as majority of airlines just don't want widebodies and the remaining ones hardly make much difference.

Today no airlines want widebodies and for a few months of the restart. The MAX will eventually be certified and Boeing will find a price they sell at.

This is bad, but not the end for either company.

Boeing found a small discount would move the 787s. More will be required (not amount of discount, but everyone now expects it). This means the A350 will have to match as will the A330NEO.

When the MAX is recertified, the NEO must compete. While 2020 is very tough for Boeing, this makes 2021 very tough for Airbus. This is not a one way street.

Considering we are losing 500+ jobs per death, a decision is past due to restart. But that quickly goes off topic.

Lightsaber


Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.
 
User avatar
cougar15
Posts: 1442
Joined: Thu Sep 05, 2013 6:10 pm

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 11:51 am

This thread has gone really weird. From who is getting 78´s on a fire sale to the potential of the whale being the ultimate bathtub ! I might buy a hull, it would be a great garage for a classic car collection. All spending too much time at home fellas, time to get this world back to work.

Curious on the initial subject, QR or what do we know today?
some you lose, others you can´t win!
 
User avatar
lightsaber
Moderator
Posts: 20001
Joined: Wed Jan 19, 2005 10:55 pm

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 12:42 pm

RalXWB wrote:
lightsaber wrote:
kevin5345179 wrote:

I guess my previous point was no one wants widebodies today and the problem for Boeing is that's the sole source of cash flow. I disagree the volume shift will happen as majority of airlines just don't want widebodies and the remaining ones hardly make much difference.

Today no airlines want widebodies and for a few months of the restart. The MAX will eventually be certified and Boeing will find a price they sell at.

This is bad, but not the end for either company.

Boeing found a small discount would move the 787s. More will be required (not amount of discount, but everyone now expects it). This means the A350 will have to match as will the A330NEO.

When the MAX is recertified, the NEO must compete. While 2020 is very tough for Boeing, this makes 2021 very tough for Airbus. This is not a one way street.

Considering we are losing 500+ jobs per death, a decision is past due to restart. But that quickly goes off topic.

Lightsaber


Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber
Flu+Covid19 is bad. Consider a flu vaccine, if not for yourself, to protect someone you care about.
 
A380MSN004
Posts: 737
Joined: Sat Jun 03, 2017 9:07 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 12:47 pm

I'm curious to know what's gonna be the real selling price of the MAX once certified over 2021.?
 
RalXWB
Posts: 499
Joined: Sun Oct 25, 2015 9:36 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 1:35 pm

lightsaber wrote:
RalXWB wrote:
lightsaber wrote:
Today no airlines want widebodies and for a few months of the restart. The MAX will eventually be certified and Boeing will find a price they sell at.

This is bad, but not the end for either company.

Boeing found a small discount would move the 787s. More will be required (not amount of discount, but everyone now expects it). This means the A350 will have to match as will the A330NEO.

When the MAX is recertified, the NEO must compete. While 2020 is very tough for Boeing, this makes 2021 very tough for Airbus. This is not a one way street.

Considering we are losing 500+ jobs per death, a decision is past due to restart. But that quickly goes off topic.

Lightsaber


Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber


Sorry, but your posts always read B is good and A is bad. Why should A not rely on their A320 series profit? The 321XLR alone sold more than the biggest 737 version. There is just no competition in that segment. In turn, B also relies too much on the 737 but they are bleeding heavily in financial terms so I disagree with your comment that they can discount more. Airbus could even discount more since the 321 is selling like hotcakes. Right now nobody can estimate the effects on the whole industry but IMO there will be a lot of condolidation across all segments.
 
frmrCapCadet
Posts: 4231
Joined: Thu May 29, 2008 8:24 pm

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 2:10 pm

The continued existence of all aviation related passenger companies (and individuals) is at risk. The successful survivors will be making mutual accommodations for one another. It is not and cannot be pretty.
Buffet: the airline business...has eaten up capital...like..no other (business)
 
kevin5345179
Posts: 111
Joined: Sat Feb 10, 2018 4:08 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 4:56 pm

lightsaber wrote:
RalXWB wrote:
lightsaber wrote:
Today no airlines want widebodies and for a few months of the restart. The MAX will eventually be certified and Boeing will find a price they sell at.

This is bad, but not the end for either company.

Boeing found a small discount would move the 787s. More will be required (not amount of discount, but everyone now expects it). This means the A350 will have to match as will the A330NEO.

When the MAX is recertified, the NEO must compete. While 2020 is very tough for Boeing, this makes 2021 very tough for Airbus. This is not a one way street.

Considering we are losing 500+ jobs per death, a decision is past due to restart. But that quickly goes off topic.

Lightsaber


Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber


Strictly speaking, most profit from both A & B is coming from narrowbody (of course pre MAX grounding). I'm not going to deny that Airbus' share is larger, but I don't necessarily see it as a down side. Routes are just getting more fragment and airlines just prefer small widebodies or large narrowbodies.
 
User avatar
Revelation
Posts: 24323
Joined: Wed Feb 09, 2005 9:37 pm

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 6:30 pm

stl07 wrote:
Revelation wrote:
I'm not seeing the issue. If you strip the interior and seal all the openings, you could store a LOT of oil in its pressure hull. The wasted space due to the curved hull now gets utilized. No after market emerged for the A380 before COVID-19 and it'll be even worse post-COVID-19. There will be dozens if not hundreds of hulls to choose from. Seems to me to be a great engineering adaptation. We need to think outside the box in these troubled times.

Good grief you got me actually considering that for a split second

I'm considering making an illustration in Photoshop. Such illustrations, along with text berating the readers for not having the ability to understand a true visionary, seem to enhance acceptance of new ideas here on a.net. Maybe a catchy name tying it to a popular cause like "Eco-Tub" will enhance its acceptance. It's a struggle. Geniuses are often not appreciated in their time.
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
rbavfan
Posts: 3619
Joined: Fri Apr 17, 2015 5:53 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 7:19 pm

airportugal310 wrote:
Based on some of the posts here, I wouldn't trust you to negotiate the price of a candy bar, let alone a plane. It's almost like some of you believe that paying full market rate on something is the "right" thing to do. Yeeesh!


Well by basing the announced sale on fake over the top price that no one pays is LYING year round as a way to boost stock price.

Note I was responding to the inflated prices. Not to the extortion after signing a contract.
 
rbavfan
Posts: 3619
Joined: Fri Apr 17, 2015 5:53 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 7:37 pm

RalXWB wrote:
Yet we have heard on this forum for years that Airbus is giving their planes away but when Boeing does it...#doublestandard. The above poster is right, every business has its list prices but no customer ever is paying them.


Really? the easiest response to that comment is do you negotiate the price at a restaurant? The price at a quick mart? The price at a gas station? So no not every business has their list price that people don't pay.
 
smartplane
Posts: 1507
Joined: Fri Aug 03, 2018 9:23 pm

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 7:40 pm

lightsaber wrote:
RalXWB wrote:

Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

Where the air frame OEM prices the air frame and engines, still the NB norm, Airbus and Boeing earn retrospective credits from the engine OEM's. That won't be working out too well for Boeing at the moment. In fact air frame OEM's bid out volumes 3 years in advance, getting firmer year by year, so Boeing likely has negative credits with GE, creating adverse unit pricing disparity between A & B in favour of A.

Not all smiles at Airbus either, as the volume cuts announced, and larger still pending, will impact net engine costs, but at least they are still buying.
 
User avatar
NeBaNi
Posts: 477
Joined: Sun Dec 20, 2009 10:45 am

Re: Boeing is being forced to give larger discounts

Fri Apr 24, 2020 11:02 pm

Revelation wrote:
stl07 wrote:
Revelation wrote:
I'm not seeing the issue. If you strip the interior and seal all the openings, you could store a LOT of oil in its pressure hull. The wasted space due to the curved hull now gets utilized. No after market emerged for the A380 before COVID-19 and it'll be even worse post-COVID-19. There will be dozens if not hundreds of hulls to choose from. Seems to me to be a great engineering adaptation. We need to think outside the box in these troubled times.

Good grief you got me actually considering that for a split second

I'm considering making an illustration in Photoshop. Such illustrations, along with text berating the readers for not having the ability to understand a true visionary, seem to enhance acceptance of new ideas here on a.net. Maybe a catchy name tying it to a popular cause like "Eco-Tub" will enhance its acceptance. It's a struggle. Geniuses are often not appreciated in their time.

Be sure to slap a dragonfly on it when you do. I'd have suggested a fly, but that's already taken, so....
 
astuteman
Posts: 7146
Joined: Mon Jan 24, 2005 7:50 pm

Re: Boeing is being forced to give larger discounts

Sun Apr 26, 2020 8:37 am

lightsaber wrote:
RalXWB wrote:
lightsaber wrote:
Today no airlines want widebodies and for a few months of the restart. The MAX will eventually be certified and Boeing will find a price they sell at.

This is bad, but not the end for either company.

Boeing found a small discount would move the 787s. More will be required (not amount of discount, but everyone now expects it). This means the A350 will have to match as will the A330NEO.

When the MAX is recertified, the NEO must compete. While 2020 is very tough for Boeing, this makes 2021 very tough for Airbus. This is not a one way street.

Considering we are losing 500+ jobs per death, a decision is past due to restart. But that quickly goes off topic.

Lightsaber


Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber


The huge delays to the MAX due to MCAS, exacerbated by COVID-19 will have utterly tanked any profitability that was built into the MAX contracts in the existing backlog.
Both narrowbody backlogs are going to take huge hits in terms of cancellations, but Boeing are clearly going to be way more vulnerable in this respect due to just about every contract being in breach.
I could see both lines experiencing up to 2,000 cancellations.
But that will leave Airbus with 4,000 very healthy, profitable A320NEO orders.
And Boeing with 2,000 very marginal MAX orders.
Widebodys across the board are going to struggle in my view, with only the 787 and A350 having any real resilience.
But production rates will be shot for a while.

Of all the major programmes, I can only really see the A320NEO as being sensibly profitable in 2021.
That, and perhaps the 767...

There are plenty of ways that Airbus can cut costs.
Boeing may be able to shed costs faster.
But that's just as well. They're going to have to.

Rgds
 
A380MSN004
Posts: 737
Joined: Sat Jun 03, 2017 9:07 am

Re: Boeing is being forced to give larger discounts

Sun Apr 26, 2020 11:05 am

astuteman wrote:
lightsaber wrote:
RalXWB wrote:

Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber


The huge delays to the MAX due to MCAS, exacerbated by COVID-19 will have utterly tanked any profitability that was built into the MAX contracts in the existing backlog.
Both narrowbody backlogs are going to take huge hits in terms of cancellations, but Boeing are clearly going to be way more vulnerable in this respect due to just about every contract being in breach.
I could see both lines experiencing up to 2,000 cancellations.
But that will leave Airbus with 4,000 very healthy, profitable A320NEO orders.
And Boeing with 2,000 very marginal MAX orders.
Widebodys across the board are going to struggle in my view, with only the 787 and A350 having any real resilience.
But production rates will be shot for a while.

Of all the major programmes, I can only really see the A320NEO as being sensibly profitable in 2021.
That, and perhaps the 767...

There are plenty of ways that Airbus can cut costs.
Boeing may be able to shed costs faster.
But that's just as well. They're going to have to.

Rgds


Why the 767 ?
 
astuteman
Posts: 7146
Joined: Mon Jan 24, 2005 7:50 pm

Re: Boeing is being forced to give larger discounts

Sun Apr 26, 2020 11:13 am

A380MSN004 wrote:
astuteman wrote:
lightsaber wrote:
Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber


The huge delays to the MAX due to MCAS, exacerbated by COVID-19 will have utterly tanked any profitability that was built into the MAX contracts in the existing backlog.
Both narrowbody backlogs are going to take huge hits in terms of cancellations, but Boeing are clearly going to be way more vulnerable in this respect due to just about every contract being in breach.
I could see both lines experiencing up to 2,000 cancellations.
But that will leave Airbus with 4,000 very healthy, profitable A320NEO orders.
And Boeing with 2,000 very marginal MAX orders.
Widebodys across the board are going to struggle in my view, with only the 787 and A350 having any real resilience.
But production rates will be shot for a while.

Of all the major programmes, I can only really see the A320NEO as being sensibly profitable in 2021.
That, and perhaps the 767...

There are plenty of ways that Airbus can cut costs.
Boeing may be able to shed costs faster.
But that's just as well. They're going to have to.

Rgds


Why the 767 ?


It has been at steady state production for decades now, and Boeing have had lots of time to adjust the cost base to make that production rate profitable.
And if anything, the market seems to be moving towards small, agile freighters like the 767 - especially in these trying times.

It wasn't meant as a troll. I hope it didn't come across like that.
To be fair, the 787 is likely to make money even if the rate halves, only not very much (as I don't think Boeing would even now be looking for long term 787 rates to be at 5-6 per month, so won't want to de-commission a lot of the cost drivers in the short term).

Rgds
 
dstblj52
Posts: 455
Joined: Tue Nov 19, 2019 8:38 pm

Re: Boeing is being forced to give larger discounts

Sat May 09, 2020 8:26 pm

lightsaber wrote:
RalXWB wrote:
lightsaber wrote:
Today no airlines want widebodies and for a few months of the restart. The MAX will eventually be certified and Boeing will find a price they sell at.

This is bad, but not the end for either company.

Boeing found a small discount would move the 787s. More will be required (not amount of discount, but everyone now expects it). This means the A350 will have to match as will the A330NEO.

When the MAX is recertified, the NEO must compete. While 2020 is very tough for Boeing, this makes 2021 very tough for Airbus. This is not a one way street.

Considering we are losing 500+ jobs per death, a decision is past due to restart. But that quickly goes off topic.

Lightsaber


Can you please provide any proof why 2021 will be VERY tough for Airbus and not Boeing? It may not be a one way street but it works both ways.

Airbus relies too much on NEO profits and it just isn't plausible the MAX isn't shipping in 2021. Oh, Boeing won't have a great 2021, but Boeing has had a higher profit margin, so they can discount more.

Boeing can shed staff and vendors faster. While not great for the workers, it makes the company more resilient.

How do you see Airbus cutting costs for 2021. For engines, at least from GE, any penny saved Airbus will have the same discount for Boeing.

We'll have decades of A vs. B. But as 2021 will be a brutal price war, the most hurt is my specialty, aerospace R&D. So it is with no joy I discuss this pain.

Lightsaber

This is going to be further compounded by the availability of lightly used aircraft cheaply, who have the advantage of not needing to be bought months or years in advance and where there are even more players to negotiate with to find the most desperate
 
BravoOne
Posts: 4094
Joined: Fri Apr 12, 2013 2:27 pm

Re: Boeing is being forced to give larger discounts

Sat May 09, 2020 8:31 pm

PepeTheFrog wrote:
At least one Middle East airline is taking abuse of the pandemic to get steep discounts:

At the end of March, just days before Boeing was set to hand over a new 787 Dreamliner to one of its most valued customers in the Middle East, the airline’s head of procurement picked up the phone to the US aircraft maker. The deal was off, unless Boeing was willing to increase the 55 per cent discount it had already agreed on the $338m list price. 

In normal times, an airline would hesitate before threatening to cancel an order at such a late stage. Cancellation would normally mean heavy penalties and forfeiting the downpayments, which for Boeing’s state of the art twin-aisle model amounted to close to $100m of the agreed $150m price tag. 

But these are not normal times. Boeing caved in and cut the price by a further 15 per cent, according to people involved in the deal.


FT https://www.ft.com/content/3fe8a876-7d7 ... pe=blocked

This would undermine Boeing's cash flow, isn't?



I wouldn't put to much stock in this report. In the recent past people dishing out information regarding aircraft pricing were quickly terminated.

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos