Delta Wants To Be 797 Launch Customer
Feb 14, 2018, 11:23 am
#31
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I don't think current Delta management will order the 797 since they have made clear they prefer Airbus. I agree with the OP on Delta mentioning Boeing as a negotiation technique to keep Airbus honest on price. Delta may also want to push Airbus into launching a competitor to the 797.
Feb 14, 2018, 11:31 am
#32
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Feb 14, 2018, 12:25 pm
#33
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DL is an airline that tries rather hard to curate aircraft to route to demand so I can see a play for the 797, particularly on transcons where DL wants to increase capacity and, as was discussed earlier, slot-restricted airports where it could free up some slots. Also opens up the possibility to consider TATL routes where there a need for more seats than a 757 and fewer than a 767, in a plane that is more efficient operate.
As for DL's relationship with Boeing, let's remember, Boeing is a business and DL is a customer. It's not a friendship, it's a business relationship. DL will go with Boeing when it makes sense and will go others when it makes more sense.
As for DL's relationship with Boeing, let's remember, Boeing is a business and DL is a customer. It's not a friendship, it's a business relationship. DL will go with Boeing when it makes sense and will go others when it makes more sense.
Feb 14, 2018, 12:26 pm
#34
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Aircraft shrinks almost never succeed commercially. You can’t structurally reduce the weight enough. Airbus does offer a smaller version called the A330-800. They have sold 6 to Hawaiian and they want to cancel leaving sales at zero. By designing to 225 seats from a clean sheet Boeing is projecting a 25% per trip fuel burn reduction from the 787. There is no way to economical build a 225 seat A330.
Feb 14, 2018, 1:32 pm
#35
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Originally Posted by [b
readywhenyouare;29415546]I can guarantee that seat comfort is the last thing on Delta's mind when selecting an aircraft.
Feb 14, 2018, 1:47 pm
#37
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The narrow-body order, the A320 family is just more comfortable than the 739, even though DL has a ton of those as well...there are entire threads to hating the 739. The A321 is wider than the 739 so regardless of how the 739 is configured the Airbus can offer more seat width..
Feb 14, 2018, 1:51 pm
#38
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) factor.edit: just looked for a reference to this on Google but can't find one. I feel for sure I read that somewhere but may have made up this statistic/factoid...
Feb 14, 2018, 1:59 pm
#41
Join Date: Dec 2017
Posts: 1,107
That was the rationale for American to ask for the DC-10 fifty years ago.
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Nice article. I can't recall seeing it before, and it has some wonderful photos along with the story. ^
Feb 14, 2018, 2:25 pm
#42
Join Date: Apr 2016
Posts: 1,885
No reason to let facts get in the way of an emotion-driven agenda
I generally believe that the primary factor in Delta's decision making is margin. Margin has two components: revenue and expense. Although I don't think they always factor corrected (domestic F meals being a prime example), I think DL does carefully consider if additional expense will actually lead to higher revenue that would produce a higher margin. They do consider pax comfort because there are many people that are willing to pay more for it, proven by the existence of PE and C+, but it is one of many factors they will consider as part of a holistic analysis. If the 797 provides an attractive money making opportunity, DL will buy the plane, but its going to be a long time before the 797 is finalized and before the first delivery is made. A lot can happen between now and then, including the intro of new aircraft from other manufacturers that have better metrics and changes in the economy, global and domestic travel and oil prices that might make other options more attractive. There is going to be enough global demand from carriers around the world that Boeing will not provide enough of a discount to make it financially attractive for DL to be the launch customer, but I do expect that DL would purchase a significant number of the aircraft to fill the gaps of 767/757 (if the 797 really is a comp to those models - no guarantee) retirements assuming the world is not materially different when the 797 launches from its current state today. In the meantime, it doesn't hurt to say they are interested.
I generally believe that the primary factor in Delta's decision making is margin. Margin has two components: revenue and expense. Although I don't think they always factor corrected (domestic F meals being a prime example), I think DL does carefully consider if additional expense will actually lead to higher revenue that would produce a higher margin. They do consider pax comfort because there are many people that are willing to pay more for it, proven by the existence of PE and C+, but it is one of many factors they will consider as part of a holistic analysis. If the 797 provides an attractive money making opportunity, DL will buy the plane, but its going to be a long time before the 797 is finalized and before the first delivery is made. A lot can happen between now and then, including the intro of new aircraft from other manufacturers that have better metrics and changes in the economy, global and domestic travel and oil prices that might make other options more attractive. There is going to be enough global demand from carriers around the world that Boeing will not provide enough of a discount to make it financially attractive for DL to be the launch customer, but I do expect that DL would purchase a significant number of the aircraft to fill the gaps of 767/757 (if the 797 really is a comp to those models - no guarantee) retirements assuming the world is not materially different when the 797 launches from its current state today. In the meantime, it doesn't hurt to say they are interested.
Feb 14, 2018, 2:49 pm
#43
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There is going to be enough global demand from carriers around the world that Boeing will not provide enough of a discount to make it financially attractive for DL to be the launch customer, but I do expect that DL would purchase a significant number of the aircraft to fill the gaps of 767/757 (if the 797 really is a comp to those models - no guarantee) retirements assuming the world is not materially different when the 797 launches from its current state today. In the meantime, it doesn't hurt to say they are interested.
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Feb 14, 2018, 4:24 pm
#44
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https://www.bloomberg.com/news/artic...ine&yptr=yahoo
Yeah, no. There is no way Boeing is going to fall for that. We've seen it time and time again. Delta hasn't had any interest in Boeing in nearly a decade. They only use Boeing to get a better price from Airbus. With a fleet of 300 A321's this just isn't going to happen. Delta is firmly in the hands of Airbus and it will remain that way.
Yeah, no. There is no way Boeing is going to fall for that. We've seen it time and time again. Delta hasn't had any interest in Boeing in nearly a decade. They only use Boeing to get a better price from Airbus. With a fleet of 300 A321's this just isn't going to happen. Delta is firmly in the hands of Airbus and it will remain that way.
Delta has bought 100+ 737s and also worked a deal to get nearly 100 717s (plus additional 738s and 757s on the used market).
The A321 isn't a 767 replacement. It has absolutely nothing to do with what Ed is talking about.
They haven't lost every bid. They have lost two.
Delta is the only major US airline to not operate the 787 or 737Max. They can't be as bad as Delta claims or the other airlines wouldn't have ordered thousands of them. I just don't see this as anything other than trying to get a lower price from Airbus. If I were Boeing I'd send Delta the MSRP pricing list and say that is the lowest they will go. There is no need for their sales team to waste their time on a dead end like Delta.
When GE/CFM are willing to play ball they will get orders. Delta has just started its orders for next generation narrow bodies.
As for the 787, Boeing didn't have the slots. It works out that way at times. Also, Rolls was willing to offer a much better engine package if Delta got the Trent XWB.
People are ridiculous. The notion that Delta is never going to buy a Boeing plane because of a couple of supposed spats doesn't understand the industry whatsoever.
- Delta runs the third-largest MRO in the world with over a hundred third party customers. This helps them achieve both direct profit as well as indirect profit (increasing scale of MX ops reduces internal MX costs which can have high fixed costs related to spare parts inventory, etc). They have no intention to stop servicing Boeing jets - which means they will still want to own a mix of them in their fleets.
- Any airline that runs a complex global route network like Delta would be disadvantaged from running a single airplane because even within-class Airbus and Boeing planes have different pros and cons
- Negotiating power matters. While the benefits of a single plane outweighs the loss of negotiating power for, e.g., Southwest, the fact is that Delta is still going to run a complex mixed fleet - so they lose the benefits of a single airliner without a commiserate increase in negotiating power.
Feb 14, 2018, 4:36 pm
#45
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Delta has bought 100+ 737s and also worked a deal to get nearly 100 717s (plus additional 738s and 757s on the used market).
The A321 isn't a 767 replacement. It has absolutely nothing to do with what Ed is talking about.
They haven't lost every bid. They have lost two.
You were told pretty clearly why Delta didn't order the 737MAX, you just happen to think a company should turn down billions on profit for a Boeing deal because.....well I'm not sure anyone knows why.
When GE/CFM are willing to play ball they will get orders. Delta has just started its orders for next generation narrow bodies.
As for the 787, Boeing didn't have the slots. It works out that way at times. Also, Rolls was willing to offer a much better engine package if Delta got the Trent XWB.
readywhenyouare doesn't believe in any of this. The maintenance side and the profit it brings to the table is stupid.