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Anybody expect any announcements from AC at Farnborough?


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Usually, Farnborough order announcements involve significant purchase decisions. If AC picks up a couple of planes, that could be announced any time, or might even come out of a leasing company's existing portfolio or order book.

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C-Series would b interesting because it would allow AC's costs to come closer to WJ's. I would think that an order by AC would be followed by an order from WJ for competetive advantage.

The 319/320's need to be replaced sooner rather than later. The only possible replacements are a re-engined Airbus or possibly a new type. AC is already in pretty deep with Boeing in the widebody category and will want to keep Airbus honest in any competitive bidding process. AC has never shown any particular allegiance to 'made in Canada' product (the 25 CRJ100's excepted which had more to do with the terms of Open Skies with the US that existed at the time of the order).

If BBD sharpens its pencil to the finest point, it could quite possibly have AC as a customer. The time frame for delivery's would also fit well with projected lease expiries, and might also allow AC to begin to unwind the EMB experiment.

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The time frame for delivery's would also fit well with projected lease expiries, and might also allow AC to begin to unwind the EMB experiment.

The passengers really like the Embraer, why do you call it an experiment?

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My problem with the CSeries at AC is that it basically competes with AC's newest narrowbody fleet types, and doesn't offer a derivative large enough to replace the oldest fleet type, the A320. If BBD wants to remarket AC's E-175s and E-190s, AC might be tempted to buy CSeries, even replacing some 319s. But the real question is what Airbus and Boeing are willing to do to their narrowbody fleets. Do they re-engine or come up with something all new, and if it's the latter, when.

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The 319s are under 15 years old, too soon for fleet replacement.

Oldest airplanes are the first generation 320s ordered by AC in the 80s plus some of the 763s that were exCP.

Any order at Farnbourgh would likely look to replace the 333s with 772LR or more 773ER. Alternately if more 333s are available through lease, AC could punt some old 763s for a larger 333 fleet.

A long shot would be reduction in 787 order with a corresponding additional order for 777s, this would allow Ac to pull forward 763 replacement and not be dependant upon 787 delivery delays.

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....because it would allow AC's costs to come closer to WJ's. ....

AC's domestic costs are already equal with WJ domestic costs.

To get CASM costs equal all that AC needs to do is make the seating all economy like WS.

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If WJ offered a true frequent flyer program, lounges, and business class seating then their cost advantage to AC shrinks dramatically. Yes, AC's CASM is higher, but so is it's RASM, which is due to the business class product. A straight CASM comparison between AC and WJ is comparing apples and oranges.

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Isn't the A350 also a competitor to the 777. Look up the specs, it's can be a much bigger airplane then the 787, 100 extra passengers if I recall...

If you are going to get A350, might as well get rid of the 777?

Éric

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My sources tell me that upper management is getting really **bleep** at the 787 delays, and has been talking to Airbus about A350's...

Most of the airlines with 787 delivery dates are upset with this delayed aircraft. For some the delay has allowed them time to restructure parts of their business model before accepting the new Boeings.

I don't think talking to the competition about an aircraft with a three year plus delvery date is a solution.

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It's a risky venture comparing a paper airplane to a real one, even a one with a delay such as the 787. Remember the first attempt at the 350?

WRT the C series, this looks like a program long on promises. Customers who took the RJ 100 and 200 may, understandably, approach this new aircraft with a high degree of scepticism.

Vs

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Wow Bean - you are showing great restraint. You know something we don't? Like maybe WJ's 2Q numbers? Its is hard to believe that all of a sudden the domestic costs for WJ and AC are the same. Do people really believe that?

This isn't complicated. On a $229 fare from YYZ-YVR, do you believe that AC and WJ are making the exact same margin? Not likely. AC has and will continue to rely on premium yields associated with product and network in order to make money. Even Milton said that AC's recovery was directly tied to the return of premium travellers.

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Oh I thought someone said that WJ and AC;s domestic costs were the same.

Forget what you read in a newspaper. Figure out for yourself, where are WS costs 30% to 40% cheaper?

Fuel

Pilots

Landing fees

Nav fees

Airplane lease/purchase

anywhere?

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