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widebody
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Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:14 am

Take a look at www.airbus.com.

60 firm for Air Berlin, 10 firm for Niki, 40 options. All A320's.

[Edited 2004-11-04 16:16:47]
 
knoxibus
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:35 am

Great,

More work for me, A320 production rates are on a huge increasing path...

They plan to go from 20/month now to 30/month start of 2006...guess they are going to hire some more workforce for the A320 Final Assembly Lines.
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DTManiac
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:37 am

Wow, what do they need all these buses for? AB has quite a modern 738 fleet thus they cannot be renewing their fleet. Do they plan to expand their route map?

Frederik
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PanAm_DC10
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:46 am

That is a substantial order and EADS reported their results today. Deliveries of Airbus behind increase in earnings. This was one of the last big order contests of the year and I really gave Boeing a good chance. Anyway well done to all involved.

I guess Airbus production increases in the A320 Family are enabling them to provide earlier delivery schedules than Boeing can on the 73G's. 30 per month for Airbus. What is Boeing estimating for it's increase in 73G production and will that enable them to offer earlier delivery schedules in other sales campaigns?

Regards
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col
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:50 am

Will these 320's replace the 738's? This is a serious blow to Boeing, what is happening, is the 737 so overpriced against the Airbus. With the exchange rate you would think that Boeing would be in a better position. Anyone know what happend?
 
pelican
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:52 am

That sounds great. Big grin

Wow, what do they need all these buses for? AB has quite a modern 738 fleet thus they cannot be renewing their fleet. Do they plan to expand their route map?

Yes, they want to expand and they want a mixed fleet, because they want to be independent from Boeing and Airbus in the future.
Some of their 737-800 are more than 5 years old and AB used to have one of the youngest fleets in Germany. I guess they want to retire their 737-400 and F100 soon.

pelican
 
gkirk
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 12:57 am

Even more A320s in European skies?  Sad
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MEA-707
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 1:26 am

Unfortunately Boeing doesn't need to increase its 737ng production rate. As of a month ago, they "only" have about 784 to deliver and build 17 a month. With some of these only to be delivered by 2010 they are flexible enough to build whatever you want from 1-2 years from now and only increase their build rate when really more orders come in then projected now. If few orders come in the next year, you can actually see their production rate decrease to about 12-15.
Ryanair, Southwest, AirTran and from next year onwards All Nippon are the only airlines getting really substantial amounts in the future, other major operators like American, Delta, SAS and easyJet don't get any new ones, at least for the next few years, and also the BBJ lost momentum after sept. 11.
Airbus has more then 1000 outstanding orders for the A-320 family production line and I guess they expect more when they want to increase to 30 a month.
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PanAm_DC10
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 1:32 am

MEA-707

You have a good point and we can expect AA to defer future deliveries of outstanding orders for the 738 as well. That will be announced shortly along with their remaining plans for outstanding 777 orders.

It just feels like Boeing misses every order!

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clickhappy
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 1:53 am

Boeing was desperate for Air Berlin not to expand, as they feel it will lead to the airlines demise. I am not able to share my source(s) but they are from Boeing senior mananagment.
 
aviaction
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:05 am

Boeing was desperate for Air Berlin not to expand, as they feel it will lead to the airlines demise. I am not able to share my source(s) but they are from Boeing senior mananagment.

I really had no idea that Boeing had such an expertise in running an airline. And I am amazed of how truly compassionate they are. Life is full of surprises.
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TW741
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:10 am

Boeing was desperate for Air Berlin not to expand, as they feel it will lead to the airlines demise

... actually the firm order is a very small increase only over the present fleet ... AB needs at least 7 more aircraft to operate the 2005 schedule plus the charters for the tour operators. FlyNiki (HG) is right now short 1 A321 (A321-231 msn: 1438 D-ALAQ - one of the former YP aircraft) since this was phased out October 11th and also is in need for the expansion out of Austria.

Wonder why Boeing should fear a demise of AB and HG when they order Airbus since the same amount of aircraft was in question with talks to Boeing ... would Boeing also have those fears when the order would have gone to them?

Well done Mr Hunoldt and Mr Lauda !!
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clickhappy
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:17 am

Wonder why Boeing should fear a demise of AB and HG when they order Airbus since the same amount of aircraft was in question with talks to Boeing ... would Boeing also have those fears when the order would have gone to them?

Simple, over expansion. The reason Air Berlin bought Airbus was because Boeing didn't feel the need to be aggressive. Better to loose an order then to have dozens (more) planes parked up in the desert.

How many operators have failed in Europe the past 3 years? 10? 20?

Buying equipment is easy. It's also what kills businesses, not just airlines.
 
DeltaWings
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:26 am

Hasnt AB just installed this GPS Flight-tracker on their 737s?

DeltaWings
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Flying-Tiger
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:27 am

Clickhappy, you can put it into another account: Reducing sales to AB increases sales/protects sales to Ryanair, by far Boeing´s biggest customer on the continent. Nice try, but it didn´t pay of for Boeing.
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aviaction
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:33 am

Clickhappy, let me summarize: Boeing is reluctant to sell planes to Air Berlin, an established and profitable carrier - and (almost) simultaneously celebrates Primaris' choice. Sorry, I just fail to understand.

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fd728
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:43 am

They really plan on keeping the 738s alongside the 320s? Would sound good to me, and reminds me of easyjet's fleet, but taking 60+ a/c is a huge step indeed for AB. Their reputation is good, so let's hope they can fill the extra seats.

When the 320s arrive, they better get a new livery. There current one is ... urgh...horrible. Well, we'll see...

FD728
 
racko
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 5:15 am

"Boeing was desperate for Air Berlin not to expand, as they feel it will lead to the airlines demise"

Best excuse for not getting an aircraft deal ever.

"No, we won't sell airplanes to you, it's better for you if you buy less planes from us"

Either you have a good-working fantasy, or the Boeing management has serious mental problems. If you have a monopoly, you can play like this, but as long as there are competitors you should better make sure that you can get any sale possible, because any lost sale means a sale for your competitors.

And, please don't start the "airbus sells their planes without profit" bullshit again, Airbus reported an EBIT of €1,38 billion (US$ 1,78billion) in the first 9 months of 2004, which brings Airbus to a profit margin 9,6%, almost twice as much as Boeing's commercial airplanes division.
 
col
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 5:58 am

Looks like Boeing need to look at their sales technique and their costs. The 7E7 is a step in the right direction, but the US manufacturing costs must be hurting.
 
phollingsworth
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 6:02 am

"Boeing was desperate for Air Berlin not to expand, as they feel it will lead to the airlines demise"

Best excuse for not getting an aircraft deal ever.

"No, we won't sell airplanes to you, it's better for you if you buy less planes from us"

Either you have a good-working fantasy, or the Boeing management has serious mental problems. If you have a monopoly, you can play like this, but as long as there are competitors you should better make sure that you can get any sale possible, because any lost sale means a sale for your competitors.


I don't doubt that if AB was paying cash Boeing would have jumped all over the sale. However, I can almost guarantee that the airplanes are financed. If Boeing Capital was arranging the finance it might be better for them not sell the aircraft. Boeing will have to turn around and borrow money from other parties. Given the rates that Boeing would borrow money, the financing rates that Boeing would have to offer, and the risk of having AB run into a cash crunch, the finance people might have said no. Everything I have seen suggests that Airbus can borrow money at a lower rate than Boeing can, this is partly due to the guaranteed loans that Airbus gets for new program development.

Boeing is very conscious of the residual values for the airplanes that are out in the fleet. I believe that the residual values are higher for 737-800s vs. A320s of the same age. Further, if there is a catastrophe that significantly effects long term demand in Europe, e.g. 9/11 in the states. This could really hurt the leasing companies. The same thing will happen if US or UA were to shut down.
 
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scbriml
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 7:51 am

This was one of the last big order contests of the year and I really gave Boeing a good chance.

AirAsia's decision between A320 and 737 is expected soon (in the 40-50 aircraft range). This is an order that Boeing publicly stated was critical that they win. Will be interesting to see which way that one goes!

Boeing was desperate for Air Berlin not to expand, as they feel it will lead to the airlines demise.

That's a good one. We don't want to sell 737s to an established operator of the type, but we'll tell everyone that we're happy to sell 20 7E7s to an airline that hardly anyone had heard of.  Insane

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M27
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 8:46 am

When and were did Boeing state it was critical that they win the Air Asia order?

Regards
 
Aither
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 9:02 am

Phollingsworth,

The 1992 bilateral agreement on government loans only applies to new investments as far as i know. They're not use for sales financing.
Why is it so hard to believe Airbus has lower manufacturing costs ?
Never trust the obvious
 
Ruscoe
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 9:11 am

M27 I am not going looking for the source but I have also read this. If I come across it I will post the source.

The main downside I see for Airbus are the labour laws which make it difficult to remove people, should a slump come. If Boeing get aggressive or a couple of major Airbus operators in the USA go belly up, then Airbus have a serious problem.
But heh, who is going to turn down anorder for 70 aircraft.

Ruscoe
 
N1120A
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 9:17 am

One of the reasons it is so hard to believe Airbus has lower manufacturing costs is the willingness of the US government and US corporations to screw over their workers, to which recent events can attest

As far as Boeing's rate of production on 737s, they do need to increase production but cannot right now without possible sending 737 production back to LGB. WN has been screaming for Boeing to step up production because they need more aircraft in a bad way. They are actively looking for a source of used 733s as a stop gap measure, but have so far had no luck. This also means they have had to delay selling 733s to FX for freight conversion. If your best and most loyal customer (and we are talking in history here) cannot get their deliveries sped up, then your line is stretched. Several airlines have stated that one of their main reasons for selection of Airbus has been because of earlier deliveries.
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Aither
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 9:28 am

Don't forget Airbus deliveries have remained stable during quite some years, unlike Boeing. A right and stable dimension saves a lot of money. Also the "Dell computer" business model where you only design, make the assembly and sale has proved to be quite efficient nowadays.
Never trust the obvious
 
ua777222
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 10:56 am

Doesn't it seem a bit weird to add such a large amount of a new type to a fleet? Espically an entirely different a/c manufacture. Not an a vs. b. Just fleet commonality and the crews and if the a/c they have gotten will fit their needs....

Probably a simple question but would love to have it answered.

Thanks for any help

Thanks again.

Ua777222
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M27
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 11:21 am

Ua777222

Not an A vs B answer either. This link might give you some insights if you read it.

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh70487_2004-11-04_18-18-47_l04655459_newsml
 
roseflyer
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 1:43 pm

I thought with the closing of the 757 line that there is more space to increase 737 production in Renton. Boeing tried hard to keep the 757 line open, but still they are happy to shut a line producing 1 plane a month down so that they can increase 737 production more. The 757 was not pushed like the 717 has been for the last few years because Boeing can benefit from the new space for the 737 since Renton has no space to expand and build more buildings to house more production.
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TW741
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 2:49 pm

Phollingsowrth:
Given the rates that Boeing would borrow money, the financing rates that Boeing would have to offer, and the risk of having AB run into a cash crunch, the finance people might have said no


AB + HG's order is a split 50% purchasing and 50% leasing the aircraft.
Financing for the purchased aircraft is done via German banks according AB CEO Hunoldt.

Air Berlin and FlyNiki both negotiated with the manufacturers. Hunoldt was talking to Boeing, Lauda to Airbus (since he is already operating Airbus).

For me AB is more and more transforming to an established carrier over the previous "wild and lowfare rider against LH".
And it might be a very clever decision to expand rapidly. LH is on the way to hand over more and more routes to Germanwings out of cities which are no big money makers but Germanwings has a rather bad reputation in regard to service while AB has top service.

Altough "110 aircraft" sounds extreme - actually it is 60 aircraft for AB and 10 for Fly Niki (plus 40 on option) - over a 6 years period.
With the recent announcement of AB and HG for a big move towards the UK market they will need more aircraft. Thinking of the flight-time e.g. TXL-LON or VIE-LON plus the fact that these flights are operated with a morning/evening schedule means that an aircraft is already tied up more than 10 hours a day just for the 2 rotations. Also flights to the Canary Islands - a single rotation needs on average 9 hours....

I could see the A320 on the trunk routes and the 738 moved to PMI for the AB hub there. Also the A320 would be better for the huge charter contracts with TUI and other TO's especially for the long distance flights down to the Red Sea Resorts of Egypt.

Just my thoughts

=TW741=
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irishjohn
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 3:35 pm


Congratulations Air Berlin and Niki!! Bold move in an uncertain industry!!!

To CLICKHAPPY

Time to ask Boeing to provide you with more accurate, factual and, perhaps, unbiased information. There are just too many errors in your messages!!!!

Fact: Boeing has, at present, a 'hit' team in Europe offering 737's to anyone, and his mother, at unprecedented prices. Ask any one aircraft airline!!

Fact: Without Boeing Capital there would be a lot less Boeing aircraft in the air. When was the last time an American carrier purchased aircraft for cash?

Fact: I guess JetBlue does not count in your theory on low cost, no frills carriers having more than one aircraft type! Ask Easyjet - they seem to have been successful in factoring in the A319.

Fact: Check Airbus annual reports - you will see that repayments are made on development loans. Then check Boeing and note that no repayments are made but do review the notes - export relief is booming!!

Fact: Uncompetative companies loose jobs unless of course they have circular funding - government versus private!

I'm not bashing Boeing but I am trying to understand some of your 'unusual' comments! No aircraft manufacturer is going to turn away business - just not good business practice! Yes, they may try to alter the market with various 'gimmes' but a sale is a sale is a sale!!!!! And with the industry in a state of flux every sale has value!!

Over to you!

J
 
Beaucaire
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 8:09 pm

If I would be in charge of Germanwings I would start getting worried....
In my opinion AB will keep part of the Boeings even after deliveries of the Airbusses and hence reach a very critical mass in terms of competiton for LH,Austrian but also some eastern-european carriers will feel the heat.
They have barely started to serve Poland,Prague,Hungary and possibly Croatia should follow.Based on their current fleet of 46 aircraft ( plus three Fokker 100 ) and transporting more than 12 Million passengers,they could reach 15-16 Million Pax in two years and install ten to fifteen new destinations in their "Cityflight" network,going right after Germanwings and LH.
I see them also expanding into more Iberian business (more domestic routes ) not only ex PMI but possible ex Barcelona/Madrid. So far they have not targeted France ( exeption Flyniki to Paris) but it is not difficult to assume there will be more flights to France from German airports ( DUS,TXL,NUE ) and new french destinations ( Nice? )
They deserve the success since they do nearly everything they do in a very professional way !Teaming up with Niki Lauda was a very brillant move !
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scbriml
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 9:43 pm

When and were did Boeing state it was critical that they win the Air Asia order?

Flight International issue of 12 October, Page 10.

"That is a critical one, and we'll see where it lands." Randy Baseler (Commercial Airplanes VP Marketing) said it was critical that Boeing beat Airbus in the competition to supply Malaysia's AirAsia with least 40 new aircraft as it seeks to reverse the loss of several LCC competitions in the region.

Recently Japanese start up Star Flyer became the 8th LCC in Asia-Pacific to select the A320 over the 737. The others being Jetstar Asia, Tiger Airways, ValueAir, Air Deccan, Cebu Pacific, Jetstar of Australia and Kingfisher of India.

He also took the opportunity to diss Airbus' recent successes in selling A320s to LCCs saying "Airbus has been very aggressive about these start-up carriers, we'll see how long they stay in business. We feel very comfortable with who our customers are."

If I was working this sale for Airbus, I'd make damn sure an offer was made that AirAsia couldn't refuse. Then I'd ask Randy how comfortable he was feeling about his ex-customers!  Big grin
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fd728
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 9:47 pm

Same as easyjet, they could split their fleet with for example all the 737s going to Palma where they operate a hub and use them for the leisure flights and put the A320s on their other European low fare network.

IMO, FD728
 
phollingsworth
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 10:58 pm

Phollingsworth,

The 1992 bilateral agreement on government loans only applies to new investments as far as i know. They're not use for sales financing.
Why is it so hard to believe Airbus has lower manufacturing costs ?


That is why I made the statement in the broad. Airbus and others involved have to borrow financing capital at market rates. However, no-one here can honestly say that the rates for financing loans are not effected by the government guaranteed financing on R&D. If nothing else it reduces Airbus's debt risk. Now Boeing does have some advantages in the tax code, but their commercial debt is fully purchased on the open market.

hat's a good one. We don't want to sell 737s to an established operator of the type, but we'll tell everyone that we're happy to sell 20 7E7s to an airline that hardly anyone had heard of.

Again it all depends on the perceived risk to Boeing. If others are fully financing the 7E7 order, which is how the press releases have come across, then the risk:reward ratio may be much higher. I will pose a simple question, how many of you are credit risk analysts for either Boeing or Airbus or one of the other financing groups involved in these sales? If you are you will know the kind of information and uncertainty that is involved. You will also know that each corporation has different rules to follow, both internal and external.
 
F4N
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 10:58 pm

To all:

I think the notion that B did not want to sell 737's to AB because it threatens Ryanair is rubbish; that sort of mentality did not stop them from selling 73g's to AirTran, arguably a major threat to B's biggest customer...Southwest.
It is B's job to sell a/c, the airlines job to use them effectively.

I would suggest that this is another example of A being more willing to pursue business, take bigger risks and expand market share. We have seen this before. They are also able to use their lower costs to more aggressively price. This is an area where B still is at a disadvantage despite the massive cost cutting moves put in place. The 7e7 method of risk-sharing and out-sourcing is IMO only a semi-solution; B has got to get their US costs in line with global competition in order for the next series of B a/c to be more competitive.

If B had concerns that financing contained risks that BC would be unwilling to take, than that is a legitimate business concern. I believe that O'Leary from Ryanair and H-I of Easyjet both recently stated that the European LCC market will see a bloodbath in 2005 and that there will be failures, consolidation and only the "strongest" will survive.

We shall see...

regards,

F4N
 
Beaucaire
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Fri Nov 05, 2004 11:42 pm

Might be that the bloodbath will not become as virulently red as O'Leary predicted.The fact is there will be some restructuring going on but the model "Lowcost" has proven to become more popular from year to year. If Air Berlin is confident enough to invest in 110 planes they must have serious grounds to belive they will be arround the next ten to twenty years.US legacy carriers have much more to worry than european LowCost's,considering their low cost base and much better yield-situation in terms of passenger transported /employee.Air Berlin grows three times faster than - say Lufthansa or KLM- and their mix of charterflights and sheduled low-cost services from more than 15 airports in Germany is a winner.
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M27
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 12:21 am

Thanks Scbriml:

The following link, from this morning by the way, also mentions the word critical. It also covers some of the things you mentioned in your last post.
I don't think anyone thinks Boeing didn't want to sell the aircraft, its just that they have a limit of how low they will go and apparently Airbus does not.

Easyjet, Air Berlin, and yes I think Air Asia, probably are examples of competitions that Airbus was and is not going to loose no matter what. How they are able to do this, one has to make their own judgements.

I agree with F4N that Boeing may have higher production costs than Airbus, but I'm not sure of that. There is something in addition to production costs that allow this, and I'm not going to go into to any of that because it's been discused to death.

As I said, I expect they may win the Air Asia order as well. What blows me away is that they can still get Government loans (and I use the word loan loosely) to develope new commerical aircraft. I hope the WTO is taking note of some of these recent orders of Airbus.

The link I mentioned;http://seattlepi.nwsource.com/business/198375_airbus05.html



 
N79969
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 12:49 am

"Reducing sales to AB increases sales/protects sales to Ryanair, by far Boeing´s biggest customer on the continent. Nice try, but it didn´t pay of for Boeing. "

This is about the most convoluted and bogus logic that I can I imagine. Boeing sells its airplanes to anyone who will pay. Airbus does the same. What benefit will either Boeing or Ryanair enjoy now that Air Berlin is getting 70 more airplanes for Airbus?
 
Leskova
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RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 1:43 am

I don't think anyone thinks Boeing didn't want to sell the aircraft, its just that they have a limit of how low they will go and apparently Airbus does not.


Do we really need to get into that again???

Take a look at the numbers EADS released just days ago, and take a look at where the money came from - if Airbus keeps on selling planes at below their own costs, as you seem to be saying, then how on earth do they keep on making so much money?

People - get it into your heads: Airbus has a limit below which they will not sell planes, and the limit - quite obviously - seems to be the question "will his deal pay off for us"?

If yes, then why reject it?

I can only say that Boeing better come up with something better than "we're worried about the airline's future"...

Regards,
Frank
Smile - it confuses people!
 
F4N
Posts: 507
Joined: Fri Mar 17, 2000 11:37 pm

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 2:29 am

To all:

I have to admit that I am puzzled by some of the statements coming from BCAC regarding sales campaigns and orders. I'm not sure if Boeing is simply in denial or whether the on-going problems with scandals /ethics have produced a "damage-control" mentality to which everything is is secondary, however, they really seem to need to kick things in gear if the don't want to spend the forseeable future looking at Airbus' behind. The last few years have seen Airbus turn the A320 into the LCC a/c of choice against the 737, a stunning marketing coup if you ask me. Of course, we have also seen Airbus take the lead in orders AND deliveries, stripping away the facade of Boeing's last cherished threshold of market primacy.

IMO, the worst thing that happened to Boeing was the acquistion of MD. Not that it wasn't a good business move, but because it transformed a previously
market-driven, profit-oriented innovator into a defense contractor. Arguably, the 2 are mutually exclusive. Boeing has become an overwhelmingly defense-oriented company with the most money being derived from gov't programs. I'm not suggesting anything is wrong with that, only it seems to be at the expense of the commercial side. Let's face it, where is the talent and the resources going to go at Boeing? OTOH, EADS derives most of its' money from the sale of Airbii. The commercial side there seems to be far more entrepreneurial, innovative and aggresive when compared to B. Yes, they are accepting getter risks, but it seems to be paying off for them.

We can (and still do) argue the point of how A&B came to their current, competitive relationship. Everyone will re-state the same tired arguements about subsidies, tax-breaks, gov't grants, what's fair, who's wrong, blah-blah- blah. The fact of the matter is that B has let A take market leadership away from them. A series of weak, conservative management groups spent too much time with share-holder value & cutting-up the defense pie and not enough time on core-business values and keeping the commercial side competitive. If they can't get the ship righted soon, the will look back in 20 years on the commercial airplane business much like they back on their bonber business now: a cherished piece of history.

regards,

F4N
 
M27
Posts: 409
Joined: Mon Oct 04, 2004 11:25 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:08 am

So Leskova, you're saying that its just production costs and Superior aircraft that make Airbus so profitable as I understand it. If so, then they should have no problems if their government "loans" are removed now, don't you think?

What the crud you think got them in the position they are in? No, I don't agree that there is always a price below which Airbus won't sell aircraft. I think the three examples mentioned above are possible cases. No I can't prove it. I also can't prove Airbus's financial statement either. Hopefully we can all get a look at it and at Boeing's soon, but you know I doubt it.

When you have your governments build your factories for you and then you repay them 30yrs down the line if everything is going well; and they pay for development of every aircraft you make with the same conditions, you can rack up some pretty impressive numbers.

No, this does not need to be discussed again. As you say, and I don't think you are the only one that has, this has been disscussed to death. The reason Boeing has to worry about an airlines future is that if it doesn't get paid, it will be out of business pretty soon.

So yes, I stand by my statement that in some cases, making a profit is not the bottom line Airbus uses.

More power to Boeing in their search for tax breaks and every bit of government help they can acquire! Certainly I would say to Boeing, don't sell at a loss, cause you can't always make it up on parts and maintenance later.

Regards
 
clipperno1
Posts: 641
Joined: Tue Jun 01, 1999 12:47 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:12 am

It amazes me that everybody from the US is saying that the production costs in the US are so much higher than here in europe, while everybody here is going on a rampage about our high labour costs and all these "fancy" social services companies have to pay for their employees. Why don't we produce everything we need from shirts to aircrafts in China, Bangladesh or Sri Lanka? Nevermind. And no offense!

If delievery times are really a critical factor at Boeing's Order Fullfillment or Aquisition department, why don't they kill the 717 once at for all?! AirTran is hooked on 73Gs now, TW is gone, Hawaiian won't order Boein again ( after they pulled them more or less into bankcruptcy), QF ordered Airbus for their low-cost spin-off and potentials for new ordering airlines are minimal, as Embraer, with brazillian production costs, offers/will offer planes in the same category at lower prices.
Use the capacity at Long Beach to satisfy customers. They killed the MD11 in about a year and airlines were begging them to keep the production alive...while nobody will really shed a tear for the 717.

I like AB for taking a risk in a time, where everybody is pooping their pants to invest in anything. That is the way to go. Invest in bad times and enjoy the fruits when things take off. Cudos AB.
"I really don't know one plane from the other. To me they are just marginal costs with wings."� Alfred Kahn, 1977
 
User avatar
clickhappy
Posts: 9175
Joined: Thu Sep 13, 2001 12:10 pm

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:32 am

ClipperNo1.

You have no idea what you are talking about.

Hawaiian won't order Boein again ( after they pulled them more or less into bankcruptcy)

This couldn't be farther from the truth. Do some research and you will see this to be true.
 
clipperno1
Posts: 641
Joined: Tue Jun 01, 1999 12:47 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:40 am

Yeah clickhappy, maybe I was a bit fast on that one. I just still have those headlines "Boeing wants Hawaiian to file for Chapter 11" . If I'm wrong, please kindly dis-regard. Thank you!
"I really don't know one plane from the other. To me they are just marginal costs with wings."� Alfred Kahn, 1977
 
Beaucaire
Posts: 3888
Joined: Sun Sep 14, 2003 4:48 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:41 am

The thread deals with Air Berlin and not Boeing versus Airbus ....
Please try to re-focus on the topic and open another thread concerning the beloved A versus B arguments if you wish ( which will never result in any reasonable conclusion anyhow....!!)
Please respect animals - don't eat them...
 
M27
Posts: 409
Joined: Mon Oct 04, 2004 11:25 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:49 am

F4N:

I agree with most of what you have said in your last post, but, Airbus accepting more risks is not one of those.
 
Danny
Posts: 3752
Joined: Thu Apr 25, 2002 3:44 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 3:56 am

First Spirit didn't deserve Boeings, now Air Berlin is not good enough. Who do they want to sell to?

[Edited 2004-11-05 20:03:07]
 
F4N
Posts: 507
Joined: Fri Mar 17, 2000 11:37 pm

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 5:02 am

Beaucaire:

While the topic is indeed Air Berlin, the relative failure of Boeing to keep AB as a Boeing customer is symptomatic of greater and more far reaching problems at Boeing. It is not coincidental the A has convinced another to 737 operator to diversify their fleet to include A32X's. The intent was not to devolve the discussion into AvB.

Clipper1:

The observation of higher production costs was made relative to Boeing when compared to Airbus, not US v EU or anywhere else. Airbus assembles a plane in less time with fewer people than Boeing given that the Airbus factories are newer and utilize a greater degree of automation than Boeing's. This is one particular area where Boeing management has consistently failed to invest sufficiently given they were fully cognizant of what Airbus was doing, the production methods they planned to utilize and the cost implications therein.

M27:

I believe that anytime you sell anything to a customer who is not financially sound, you assume a greater degree of risk in what the potential failure of that customer does to your portfolio. Given that A seems to be more willing to extend or secure credit for startups or small carriers with big ambitions (Spirit and Indy Air come to mind but there are others) they assume a risk factor in what will happen to those jets if the carrier fails; lease rates, re-sale value, future orders.

regards,

F4N
 
M27
Posts: 409
Joined: Mon Oct 04, 2004 11:25 am

RE: Air Berlin/Niki To Acquire 110 Airbus Aircraft

Sat Nov 06, 2004 6:20 am

F4N

Certainly what you said in your reply to me is true. I do not disagree with what you said. Where I am referring to risks, is what has and does allow Airbus to take those risks, and why Boeing can not do this to the extent Airbus does.

I didn't intend to get into this today cause as everyone says, its not going to accomplish anything. I was only going to acknowledge to Scbriml that he was correct in saying that Boeing had said the Air Asia order was critical. He is correct, though I never said that had not been said. I wanted to read the article because I had not seen it.

I guess we will just agree to disagree about the risk factor.

Best regards

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