solnabo From Sweden, joined Jan 2008, 785 posts, RR: 2 Posted (12 months 4 days 3 hours ago) and read 5934 times:
Great news!
MUMBAI (Dow Jones)--Jet Airways (India) Ltd. (532617.BY) may order up to 100 Airbus planes as early as this year to partly replace its old aircraft and to strengthen its fleet in a market where some of its rivals are fast shrinking in size, according to a top airline consultant.
In its latest report on India's airlines, Sydney-based Centre for Asia Pacific Aviation said Jet is evaluating the purchase of Airbus A320 neo planes. The order will likely cost more than $3.75 billion at list price, said the
Quote: Jet Airways (JET.NS) is expected to order more than 100 narrow-body aircraft for up to $3.75 billion in 2012/13 as the largest Indian carrier grabs market share from its troubled rivals, a leading consultancy said.
Without getting too excited, there's are a lot of "likely", "may" and "expected" in the report.
Given their large 737NG fleet, it would be somewhat surprising if they weren't at least looking at the MAX as well.
slinky09 From United Kingdom, joined Jun 2009, 592 posts, RR: 0 Reply 6, posted (12 months 4 days 3 hours ago) and read 5763 times:
Folk in my company are moving away from Jet over concerns about its longevity, so this, if true, represents quite a shot in the arm. India remains low cost competitive, does Jet have the structure, and the growth potential for this?
Stitch From United States of America, joined Jul 2005, 26700 posts, RR: 83 Reply 7, posted (12 months 4 days 3 hours ago) and read 5753 times:
Quoting scbriml (Reply 4): Given their large 737NG fleet, it would be somewhat surprising if they weren't at least looking at the MAX as well.
Wikipedia notes a good part of their 737NG fleet is leased. As such, switching OEMs for their next generation narrowbodies likely would not be too much of a hardship. And should this new fleet also be leased, that could impact which family is chosen based on terms and availability.
Stitch From United States of America, joined Jul 2005, 26700 posts, RR: 83 Reply 9, posted (12 months 4 days 2 hours ago) and read 5627 times:
Quoting scbriml (Reply 8): Boeing shows Jet as having purchased 67 737s directly, but I guess they could have sold and leased back any number of those.
I cross-checked with Airfleets and it shows 17 of 60 leased, whereas Wiki shows 42 of 58 leased.
Wiki also shows most of their A330-200s leased, yet Airfleets doesn't show any as being leased and according to a 9W press release from 28 May 2008 on the delivery of their 7th states they are all direct-buys from Airbus.
aeroblogger From India, joined Dec 2011, 1363 posts, RR: 0 Reply 11, posted (12 months 2 days 3 hours ago) and read 5540 times:
Quoting BlueSky1976 (Reply 35):
Jet Airways is buying them, not me. They're the ones that should be asked this question.
I would ask 9W if they had suggested that the A320neo is superior for them. However, they did not suggest this - you suggested this, so I'm asking you.
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BlueSky1976 From Poland, joined Jul 2004, 1708 posts, RR: 4 Reply 12, posted (12 months 2 days 3 hours ago) and read 5501 times:
If it wasn't superior, 9W would buy MAX. Instead, they want to buy NEO. So for 9W, NEO is superior to MAX. Just as MAX was superior to NEO for UA. Simple as that.
Now WHY was it superior? That's something you have to find out from 9W.
aeroblogger From India, joined Dec 2011, 1363 posts, RR: 0 Reply 13, posted (12 months 2 days 3 hours ago) and read 5484 times:
Quoting BlueSky1976 (Reply 37): If it wasn't superior, 9W would buy MAX. Instead, they want to buy NEO. So for 9W, NEO is superior to MAX. Just as MAX was superior to NEO for UA. Simple as that.
When did they say that they want to buy the NEO? That's news to me.
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gr8circle From Canada, joined Dec 2005, 2987 posts, RR: 4 Reply 14, posted (12 months 1 day 1 hour ago) and read 5042 times:
Quoting BlueSky1976 (Reply 37): If it wasn't superior, 9W would buy MAX. Instead, they want to buy NEO. So for 9W, NEO is superior to MAX. Just as MAX was superior to NEO for UA. Simple as that.
That logic doesn't sound right.....quite often, a decision is made based on other criteria when the two choices available are so closely comparable.....
lightsaber From United States of America, joined Jan 2005, 10676 posts, RR: 100 Reply 15, posted (12 months 23 hours ago) and read 4894 times:
Quoting scbriml (Reply 4): Given their large 737NG fleet, it would be somewhat surprising if they weren't at least looking at the MAX as well.
Quoting astuteman (Reply 12): Hey, and if and when it happens, we get to have another great debate about the merits or otherwise of the discount offered...
Quoting mffoda (Reply 16): They have already factored in the discount... So that would be about a 62-64% off list
Oh, they had better go for 64%+!
Because we all know that is the only way planes sell.
Being serious, I would be surprised if 9W didn't look into Airbus. How serious? I do not know. But the reality is the NEO is looking to have a greater efficiency gain than the MAX. That doesn't mean the MAX won't sell. It is which length? (738 or 739 vs. A320/A321).
Quoting gr8circle (Reply 39): That logic doesn't sound right.....quite often, a decision is made based on other criteria when the two choices available are so closely comparable.....
Including delivery slots. Which neither seem to have in the near term. Note: I'm 'shooting from the hip.' I haven't calculated NEO or MAX positions, it is based on my opinions of the backlog.
- That the production capacity is not a limiting factor for the ongoing Airbus' sales efforts.
- This is consistent with their predicted market share lead in that segment.
- They just seem to be in a "selling first"-mode and adjust the production capacity to the required rate afterwards.
I also wonder whether Jet Airways is under some pressure, because their direct competitors will be the first receivers of large batches of NEO's.
From Jet Airways's viewpoint the situation could look like that:
- There could be the competition factor. Once Indigo and Goair can reduce their seat-mile cost significantly, they could be left out in the rain without decent and comparable metal.
- There could be the safe-bet-factor. As the MAX is less defined and the promised gains are less, the NEO could be seen as the less risky option, facing the armada of their NEO-equipped competitors.
- There could be the time-factor. The MAX may simply be too late.
columba From Germany, joined Dec 2004, 6798 posts, RR: 5 Reply 17, posted (11 months 3 weeks 6 days 10 hours ago) and read 4035 times:
Jetairways might no want become dependant on one manufacturer they have the 77W and I believe 787 on order. The A330 will likely go as soon as the 787 will be delivered.
It will forever be a McDonnell Douglas MD 80 , Boeing MD 80 sounds so wrong
something From United Kingdom, joined May 2011, 1633 posts, RR: 24 Reply 19, posted (11 months 3 weeks 6 days 9 hours ago) and read 3772 times:
Could the notorious pilot shortage be a factor in this? As most operators ''in the region'' (India, South East Asia and the Gulf) are A320 operators, it might be easier for them to source Airbus type-rated pilots. It should also be easier to cross-train pilots for A320/A330.
Discounts and availability are obviously of greater importance, and it's reasonable to assume that Airbus is going for marketshare (and following ancillary revenues) over high profit margins on the sale. But where would they get those early slots from?
By the by, Airbus' seemingly aggressive strategy to conquer whole markets speaks volumes about the 737MAX's performance. The NEO's advantage must be negligibly slim.
aeroblogger From India, joined Dec 2011, 1363 posts, RR: 0 Reply 20, posted (11 months 3 weeks 6 days 9 hours ago) and read 3731 times:
Quoting something (Reply 44): Could the notorious pilot shortage be a factor in this? As most operators ''in the region'' (India, South East Asia and the Gulf) are A320 operators, it might be easier for them to source Airbus type-rated pilots. It should also be easier to cross-train pilots for A320/A330.
There is a surplus of both A320 and 737 pilots in India right now. The availability of pilots is not likely to be a concern.
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anfromme From Ireland, joined Feb 2012, 284 posts, RR: 10 Reply 21, posted (11 months 3 weeks 6 days 7 hours ago) and read 3500 times:
Quoting something (Reply 19): Discounts and availability are obviously of greater importance, and it's reasonable to assume that Airbus is going for marketshare (and following ancillary revenues) over high profit margins on the sale. But where would they get those early slots from?
By the by, Airbus' seemingly aggressive strategy to conquer whole markets speaks volumes about the 737MAX's performance. The NEO's advantage must be negligibly slim.
By now there have been numerous reports stating that Boeing underbid Airbus in the DL RFP by about 10%, and also won UA chiefly on price (sample source). What does that say about the 737MAX's performance? Also, I am still to understand Boeing's rhetoric about Airbus going for market share. I mean I understand what they try to imply (that Airbus go for market share over profit, a long-standing claim from Boeing against Airbus), but I just don't think it holds much water given Boeing's own aggressive sales strategy. (Note that I am talking about narrow body airplanes here.)
To me it seems that both players are quite aggressive with regard to market share - and with regard to performance, of course both manufacturers will claim their product is better. They have for a while, and the market was still split very evenly and I believe it will continue to be.
On the same subject - NEO vs MAX (and CEO vs NG) performance - Leehamnews have this piece compiling the latest message from both OEMs. Their summary:
Quoting Leehamnews: The bouncing around is enough to make one airsick. This is why we remain skeptical of data from both OEMs and prefer to listen to the airlines, who tell use the two airplanes are very close.
something From United Kingdom, joined May 2011, 1633 posts, RR: 24 Reply 22, posted (11 months 3 weeks 6 days 6 hours ago) and read 3388 times:
Quoting anfromme (Reply 21): By now there have been numerous reports stating that Boeing underbid Airbus in the DL RFP by about 10%, and also won UA chiefly on price (sample source). What does that say about the 737MAX's performance?
If an airplane is vastly superior to another, like the 77W to the A346, then that's selling point enough.
Quoting anfromme (Reply 21): To me it seems that both players are quite aggressive with regard to market share
But this is unprecendented. 200 to Air Asia, 180 to Indigo, American 130, now 100 to Jet Airways. If the NEO was that superior, then Boeing wouldn't be able to match these numbers (200x Lion, 100x Norwegian etc.).
scbriml From United Kingdom, joined Jul 2003, 11360 posts, RR: 50 Reply 23, posted (11 months 3 weeks 6 days 6 hours ago) and read 3369 times:
Quoting something (Reply 22): If the NEO was that superior, then Boeing wouldn't be able to match these numbers (200x Lion, 100x Norwegian etc.).
They would. Even if the neo was significantly better than MAX, Airbus couldn't meet demand if everyone wanted neo instead of MAX. The (allegedly inferior) MAX would still be attractive based on price (Boeing could reduce it) and earlier availability.
In that scenario, I would still see Beoing being able to maintain a 40-45% market share. Not bad for a dog.
lightsaber From United States of America, joined Jan 2005, 10676 posts, RR: 100 Reply 24, posted (11 months 3 weeks 5 days 19 hours ago) and read 3000 times:
Quoting something (Reply 22): If an airplane is vastly superior to another, like the 77W to the A346, then that's selling point enough.
But the 737 has a weight advantage. In effect it is being optimized for a shorter mission.
Quoting scbriml (Reply 23): I would still see Beoing being able to maintain a 40-45% market share. Not bad for a dog.
If the MAX were a dog, with the C-series and increased production would drop its share further.
Quoting rheinwaldner (Reply 16): According to this new article, Jet Airways would get early NEO slots:
Wow. I need to eat a little crow... Airbus surprised me.
- That the production capacity is not a limiting factor for the ongoing Airbus' sales efforts.
I'm getting the idea that Airbus is ready to ramp up production further.
Quoting rheinwaldner (Reply 16): - They just seem to be in a "selling first"-mode and adjust the production capacity to the required rate afterwards.
While you are accurate, the reality is Airbus has time to further ramp up production. I just didn't think they would... (Oops...)
Quoting rheinwaldner (Reply 16): - There could be the competition factor. Once Indigo and Goair can reduce their seat-mile cost significantly, they could be left out in the rain without decent and comparable metal.
Now that I 100% agree with. 9W must keep costs in line with their local competition. Due to the earlier EIS of the A320NEO, if they were promised early slots, they might have no choice. The margins are too low in the Indian market to go a few years of further growth on the old engines. Part of my opinion is based on the need in the Indian market for growth for PR. An airline that 'holds still' for a few years is going to be so far down in market share that they would have lost out on signing business contracts.
Which begs the question, what will AI and IT do? Most of the Indian airlines order on relatively short leases, so the fleet turnover will be rapid and thus the competitive landscape will change quickly.
Lightsaber
Life is short, Live it!
25 art: Is that right - $37.5+ million list price for A320NEO? With a steep discount that would drop to less than $20 million per a/c. Or are engines not inc
26 Stitch: An A320-200neo lists for $97 million. $37.5 million is probably the sales contract price.
27 rheinwaldner: True, I have argued several times that there is sufficient time to adjust the NEO production rate to any warranted size. This is my usual response to
28 Stitch: On the flip side, as Boeing's NB business is more lucrative (on a margin basis) than Airbus', one could say that they can "afford" to lower prices to
29 flipdewaf: Sorry Stitch, not trying to sound like a fanboy here but where does that come from? how do we know the margins? Thanks, Fred
30 Stitch: Review of financial analysis of both companies for the past decade or so. Airbus is going to be naturally bullish on their prospects, just as Boeing
31 cmf: What amounts have you used for deferred production cost each year?
32 Stitch: I don't do my own analysis. I read analysis performed by major financial institutions (banks, investment houses, etc.) Frankly, as an investor in bot
33 mffoda: As Stitch said, you can look at the companies annual reports. They are available on their websites. Even Tom Enders will tell you as much.... Quote:
34 cmf: Anything you can share? I have spent a fair amount of time looking at both companies annual reports and I have to say that they are extremely careful
35 astuteman: I'm on your side here. This isn't safe territory really. The whole thing is a can of worms best left unopened. The A320 has virtually carried Airbus
36 Stitch: And to those who have fixated on pricing - maybe, just maybe, Boeing can still make money on the MAX even with huge percentage discounts off list by
37 cmf: I've been told I like to look for worms Often the story of the numbers are much more telling than the numbers. And this is not a complaint about any
38 astuteman: Like making them in large quantities The MAX is going to make Boeing a lot of money Rgds
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