A publicly listed company has an obligation to it's board and shareholders to follow due process when committing to any major expenditure.
And nobody has offered any direct proof that IAG has not done so. The vast majority of those arguing against this LoI has done so on the basis that "due diligence" only means getting the lowest price possible. I argue that IAG was looking at factors other than just price.
Frankly, if I went into the A321XLR thread and claimed Airbus sold every one of those 14 frames to IAG at just above production cost because IAG's shareholders demanded the lowest price possible, I'd be torn into like a pack of dogs on a fox. People would counter with how the XLR had capabilities that no other OEM narrobody airframe offered and how they directly matched the needs of Aer Lingus and Iberia. How IAG's significant Airbus fleet and support infrastructure meant that the integration and crew training costs would be minimal. And how all these factors (and more) would mean that Airbus could charge a higher price and IAG agreeing to that price meant that they had met their "due diligence".
What is good for the goose is good for the gander. And for someone to claim otherwise, they are, IMO, just showing their partisan colors and are upset that IAG ordered Boeing instead of Airbus (yet again) and are trying to rationalize their discomfort at that.
........thats all correct and fine Stitch, but whatever side of the fence you sit on here, you have to be a little puzzled as to why the IAG board would sanction WW to issue this LOI evidently without any competitive quotes; in probable contravention to IAG's own procurement procedures.
If IAG has options and/or purchase rights on A320 family frames, they already have a competitive quote from Airbus. And if IAG ever exercised any of those without first issuing an RFP to Boeing, they would be in contravention of these supposed procurement procedures. So, IMO, said procurement procedures don't require it.
There is a rather silly dichotomy going on here where we have people arguing that by not involving Airbus directly, IAG paid too much for these frames while also arguing that IAG received these frames for well-below commercial rates because Boeing is desperate for any MAX order.
Its also a little bizarre that there was absolutely no hint of this investment requirement at the IAG Capital Markets Day. If IAG are going to undertake this sort of investment without warning investors, then why would they pay any attention to future events?
As many love to keep pointing out any chance they get, no serious investment has been made as of yet because this is a Letter of Intent. And IAG did inform the London Markets (whom I imagine is the Exchange of Record for their stock) that they were entering into this LoI.
That's why IAG shareholders are upset; (and I know some); and I wonder if there is some kind of deeper 'power-play' going on here at IAG board level, and/or IAG has A32x prices fixed some time into the future, so Boeing knew or got insider information on what price to beat.
As I noted above (and multiple times in this thread), I am assuming IAG has options and/or purchase rights for A320 family frames and those will include pricing. So IAG knew what they would pay from Airbus should they have decided to convert them to firm orders.
People are also assuming IAG wanted 200 more A320 family frames (see below for comments about the A321XLR). If they did, why talk to Boeing, much less sign an LoI? They had options and purchase rights they could have converted at a known price. Some are arguing that IAG entered into this LoI to get Airbus to lower their price on said options/PRs, but if that was the goal, then why exclude Airbus from the RFP? And why wait until now to play Boeing off against Airbus to get a lower price when they have been buying Airbus planes exclusively for decades?
Whatever partisan views may be, there is something unusual to this.
To me, the only thing I find unusual is IAG waited this long to diversify their narrowbody fleet.
Lets not forget that IAG also placed 28 x A321XLR orders/options at PAS19; and it must have been a bizarre meeting for WW & IAG negotiating a XLR deal, and NOT mentioning the small matter of a 200 unit order that they were evidently 'hiding' from Airbus. I suspect if IAG had offered Airbus the opportunity to bid for 200 x A220/32x, they would have given them 28 x XLR's for free!
This only reinforces my belief that IAG was not interested in adding 200 more A320s to the fleet if they could get a similar (or better) deal on 200 MAX.
The A321XLR will fill a specific niche in their fleet operations that nothing else currently available can. They ordered 14 explicitly to allow Aer Lingus and Iberia to open new TATL routes and they have 14 options to allow for future expansion. I wonder if Aer Lingus will even take their A321-200LR or convert them to different models.
Perhaps of more interest to me is what the XLR can do that the MAX10 can't.........?
Cross the Atlantic Ocean, for one.