It’s not explicitly clear in articles but Spirit received mostly credits and not just plain cash. And if they did receive cash it didn’t cover the cost of the airplanes down. It’s certainly not a blessing in any shape or form.

 

Terrible. Hopefully they can start cycling back to active status soon. That’s at least 6 planes that should have been well back into active status.

 

How do you know what the cost of having an airplane down is? We do know apparently Spirit loses money on operating planes.

 

Sue them for what? When you buy a fleet of cars for your business and there's a recall that takes it out of service. The manufacturer has an obligation to fix the product, they're not liable for loss of use, unless specifically stated in the purchase contract. That insurance is typically an additional option either offered by the manufacturer or 3rd party.

I guess you can try and see if there's negligence or willfully misrepresenting a known faulty product. Or is 400 days turnaround reasonable.

Obviously NK management and their lawyers thought whatever it is they're got from this is fair or it's all they're likely to get considering the risk/reward of litigation.

 

This is a pile of horse****. When it became known that all of our NEO engines were affected, I was following RTX VERY closely. Their next quarterly report, they announced a $10 BILLION stock buyback. How the **** is that legal?!

 

Interesting, JetBlue has said the PW issues are tracking under a year now.

 

Jetblue has said a lot of stuff in the past...

 

Filler…………

 

At the time, RTX estimated a turnaround time (TAT) of around 250 to 300 days for an engine to be removed and then reinstalled on the wing, meaning that airlines would have to ground an A320neo family aircraft for the better part of the year unless they receive spare engines.

if spirits aircraft are being grounded for more than a year something else is going on.

 

I don’t but I can make an educated guess.

-if it’s leased lease rates are between 300-400k. Size and age of lease change the variable but a safe guess is 350k a month for the 320s.

-if it’s owned then there are finance charges and depreciation. Who knows what those combined are but again a safe bet is 200-300k per month. Of course depreciation probably isnt realized until the asset leaves the property so not a direct operating cost yet but it will be eventually.

-Maintenance costs. That will vary wildly but will not be cheap and the longer the airplane is down the more expensive it will be to get it back to active status

-Insurance. No idea there but certainly not free.

-Staff. Pilots, FAs, and every other support staff that wasn’t being used to their full potential are going to be at least half a million per plane. Under utilized captains alone probably cost a half million per plane. (Pre furlough) sorry Spirit team…it is a raw deal.

So a very conservative estimate is 500k per month per plane down and probably even substantially more. The credits (cash?) would have the potential to offset that amount but I highly doubt they covered the whole cost of the airplanes being down. Especially if they are down for 400 days longer than anticipated.