|Quoting tortugamon (Reply 118):|
If a new engine plus $2B worth of wing work (etc) can make a 30-year old frame (with continuous improvements) can compete with a $30B+ family on every route then we are hopeless to expect major innovation in this industry again in the near future
Unfortunately, as much as we might crave geekery, reality says that in the period of highest oil prices ever, the following programmes have been launched.
and we discuss A380NEO.
The business case for all-new airframes has been marginal with oil over $100 per barrel.
At $30 per barrel it is even more marginal.
One of your colleagues suggested that the A330CEO was a stronger competitor to the 787 than the A330NEO is.
Whilst I don't agree, the sentiment is clearly there.
The full monty cutting edge technology has its advantage blunted by a) the huge outlay, b) the risk, and c) the long wait.
It is what it is
|Quoting jacobin777 (Reply 140):|
I don't disagree with you but again, my point being that IMHO capital costs is secondary to operating costs
I don't think it's that simple, my friend.
I'll virtually guarantee that Capital
decisions made by airlines are driven by a NPV calculation modified by a risk profile.
The relative weighting of capital vs operating cost will be heavily dependent on the Weighted Average Cost of Capital employed in the NPV calculation.
Therefore it is highly likely that lower operating costs beyond c. 5-6 years of acquisition will have very little influence on the decision.