Originally Posted by
tomh009
...The second wave could include moving the A319 and the smaller 737s to the new aircraft, for a potential purchase of 368 100-150 seat aircraft. Can you say "buying power"?
So ... if you were running DL, would you wait 10 years to do replace that part of the new fleet?
I would think they may wait. With fuel prices relatively low, the pressure to take on capital or lease costs to save on fuel costs is lessened. They should only replace those planes where the combined annual capital/lease, fuel, and maintenance costs of the existing planes would be greater than the planes they would buy, accounting for cash flow considerations, as well.
Aside from any cost savings, waiting also offers some flexibility. Demand is likely to soften to the point that DL may want to contract the fleet, at least temporarily, which would present a good opportunity to retire some of the least efficient planes, without any concern about immediate replacements. If demand doesn't lead DL to contract, then I would think the next jump in fuel costs might.
Regardless, I don't think the short-haul market is much of a growth market and margins, even in times of cheap fuel and high demand, are likely to be continually pressured by the competition. To that end, I would think they may not replace all of the retired aircraft and that the 368 number might be high by as much as 50%.