Originally Posted by
Jack Bauer
Some thoughts that support the used 747 rumor.
1. An established pattern of Delta buying used airplanes that are no longer in vogue pennies on the dollar. (SWA owning airplanes the past few decades is one thing that gave them a leg up on the competition). Low or no monthly payments is a good thing in the airline business.
2. Delta management has touted the benefits of having low cost iron on the property. This allows:
a. Flexibility to quickly adjust to market conditions and route opportunities. You can park the planes with no real penalty (other than paying the aliens for ramp space in Roswell) when the economy declines and dust them off to ramp up when needed.
b. Having low acquisition cost airplanes allows for more spares ready in wait to clean things up after the shoot hits the fan. The 747 is large enough to do a lot of clean up after storms where the new MO is cancel a ton of flights in advance then shift into high gear to get people on their way. The 747 can step in to a given route where say 5 flights to that destination have been cancelled. Get all the backed up pax to that destination on one airplane is a good thing.
c. Extra 747's allows the ability to pick up more charter work (which the company has been upbeat on lately) on short notice without disrupting other routes.
d. The comparatively low operating cost if you fill em up.
e. Should the company decide to reverse the "there is no money in cargo even though Fedex/UPS are minting money" the 747 purchased at a low cost can fill this need. Asia (specifically China) could produce some great opportunities in freight as Delta looks to expand into this part of the world.
f. When Delta decided to spend the money on the lie flat seats and upgrade the current 747 fleet they committed to at least another decade of 747 use at Delta Air Lines. Adding more numbers to any existing fleet typically brings cost down.
777-300's will do a nice job and these I am sure will come to Delta as well but for pennies on the dollar the 747-400 could fill a lot of gaps for a relatively low acquisition cost.
Food for thought whether it happens or not.
well, we're supposed to buy into the time value of money argument. So while we didn't get a delivery schedule from Carls original post, it seems as if the 77W has a long waiting line and those in line seem to be Boeing's HVC. I bet its harder to cut in line.It also seemed as if the 744s could be acquired relatively soon and start making money sooner. So as the song says, if you can't be with the one you want, be with the one your with. Advantage 744?
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Also, I can see where Boeing would offer us 744s to, imho, help another customer move into those 748s slots they're not filling. After all didn't Boeing buy A330s from SQ to help them into 777s? I'd bet those Airbus came at a good price to whoever bought them from Boeing.
World's Biggest Trade-In? Boeing buys 5 A346s from China Eastern in order to sell them 20 new 777s
Boeing has agreed to buy five Airbus A340 jets from China Eastern Airlines as part of a deal that will send 20 new Boeing 777s to China.
China Eastern announced last week that it had reached a deal to purchase 20 Boeing 777-300ERs worth just under $6 billion at list prices. A portion of the purchase price will be offset by essentially trading in all five of their A340-600 airliners to Boeing, who will in turn try to unload them on other buyers.
The A340-600s were delivered between 2003 and 2004, but are much less efficient than the 777s that will replace them on long-haul routes. Five A340-300s will remain in the China Eastern fleet.
While unusual, it is not the first time Boeing has purchased rival Airbus jets in order to smooth over a sale. In the early 2000s, for example, Boeing bought two 17 A340s from Singapore Airlines as part of a 777 deal.