Originally Posted by
Jungle Rat
Indigo inherited the A/C order from Republic, who received very favorable terms as an early NEO supporter.
I've heard dollars per airframe thrown around, but can't substantiate them, and it doesn't really matter.
Bottom line, every NEO we take delivery of is turned around and sold to a leasing company at immense profit. It's a page right out of Crandall's playbook with the MD80s at American. He ordered 400 odd aircraft from Mcdonall Douglas, got insane terms per airframe for the largest single order ever, and then sold them off to leasing companies at retail.
Frankie might not be our friend (labor), but he isn't stupid. This place is a gold mine any way you cut it.
I agree with what you say. In fact, several pages back I stated the very same thing. I was worried that there wasn't really any growth, but only the illusion of growth, as the net aircraft and block hours were way down in January, compared to years past.
I speculated that Indigo may just be pocketing a bunch of cash with each aircraft delivery (as they transferred ownership to the leasing company), and a fairly new 320 was returned to a leaser, with no net growth airframe wise. I do realize there was available seat growth, even though airframe numbers were down.
My worry is that with each of the new aircraft deliveries that Indigo is the only one that is benefiting, and not Frontier per se.
I was told there is a clause in the Airbus purchase order that the aircraft could not be sold for profit to another airline, but do not know that to be fact? That clause wouldn't prevent F9 from taking the new delivery and Indigo subsequently transferring an existing aircraft to one of their other airlines.
The fact remains that my worry and speculation will change nothing, so I choose to stay positive and hope somehow it all works out.