Jetport wrote:I still think many folks on Anet don't fully understand the severity of the current COVID caused downturn and basic finance. Very short background:
• It does not matter how much an aircraft cost to develop in the past.
• The only thing that matters today is the cash cost to produce an aircraft at the planned rate and how much you can sell it for, essentially cash flow at planned post COVID rate reduction until you can ramp up again. Many programs from both A & B will have their margins reduced or even become negative due to production cuts. The only one I can't see any potential of becoming positive again after a recovery is the A330NEO. I really don't think the A330NEO was cash flow positive before COVID because of unexpected price pressure from the 787.
• The fact that the A330 was cheap to develop and the 787 was expensive to develop are totally irrelevant going forward, all that money is spent.
• The only reasons the A330NEO sold at all were lack of availability for 787’s and smoking hot deals from Airbus. The 787 is now available as fast as anyone wants one, so the only way Airbus can sell any future A330NEO’s is at very low or no margin.
• If you can buy them for essentially the same price with no wait time, why would anyone buy the inferior in almost every way A330NEO?
The only way the A330NEO is in production 2 years from now is if there is a much faster return to pre-COVID widebody demand faster than anyone, even optimists like me, expect.
Well since none of us really have access to all the actual deals both Boeing and Airbus had with every airlines that bought A330neo or B787. The question would be, is B787 really cheaper to purchase after all the discount compared to A330neo?
I mean think about it, it's a mid-size widebodies that are supposedly cheap to purchase and easy to fill. Supposedly, you see many airlines prefer to operate aircraft the size of both A330neo and B787 rather than A350 or B777X.
I'm sure Airbus wouldn't be stupid enough to sell A330neo if B787 is cheaper. Surely they would take a little bit of hit on their profit rather than losing the entire market share to Boeing.