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Old 09-02-2017, 10:07 AM
  #541  
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Default Speculation

Here is my speculation on the 'bean counter' range number for the CS100.
Delta: Messrs. Bombardier--We have an RFQ we want to present to you. We need to replace our MD88 fleet.
Bombardier: Mais, oui, we have a fantastic plane the CS100 and CS300 that has a range of 3000 miles.
Delta: Oh no, that is too much, our MD88 only fly routes of less than 1500 miles. We don't want to pay for a 3000 mile range aircraft.
Bombardier: Tell you what, we have a deal for you. If you give us an order for 75 of them, instead of our usual special to Delta price of $32mm for a CS100, we will give you a super duper discounted price of 26.9mm if you will only be operating the CS100 on MD88 replacements routes. ''It ees very important for Bombardier to get a major customer like Delta. If you then decide to operate the CS100 on routes longer than 1500 miles, you agree to pay us an extra 5.1mm per aircraft.''
Delta: But the CS100 is too small for our MD88 routes.
Bombardier: Tell you what, we have a deal for you. After the first 35 CS100 you can switch to CS300, for only an extra $3.5mm (!?! real speculation!) each, if you publicize an option agreement for an additional 50 aircraft. It will make Bombardier look good!
Delta bean counters: Sounds good, we won't have to disclose our ultimate capex commitment until and unless we decide to operate them on longer routes or switch to the larger version. (Delta bean counters thinking to themselves: ''Worse case if we we only operate them on shorter routes, and only stay with the CS100, we have 91 717's with an average age of 16 years, that start coming up on lease expiration's in a couple more years. If Southwest and Boeing don't give us killer terms on renewing those leases or on buyout values, we can dangle the CS100 alternative in front of them. Ok, meanwhile lets go ahead and increase our order for the A321 ceo's to 137 at that killer end of the line quote Airbus gave us, then we have flexibility.''

(Compared to other airlines, Delta seems to play chess with its fleet purchases, rather than checkers). BTW My analysis of the A321-200 capex commitments indicates a unit cost of between $42 and 44MM each- IMHO a heck of a deal for a 192pax aircraft)
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Old 09-02-2017, 01:35 PM
  #542  
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Originally Posted by Coronado
Here is my speculation on the 'bean counter' range number for the CS100.
Delta: Messrs. Bombardier--We have an RFQ we want to present to you. We need to replace our MD88 fleet.
Bombardier: Mais, oui, we have a fantastic plane the CS100 and CS300 that has a range of 3000 miles.
Delta: Oh no, that is too much, our MD88 only fly routes of less than 1500 miles. We don't want to pay for a 3000 mile range aircraft.
Bombardier: Tell you what, we have a deal for you. If you give us an order for 75 of them, instead of our usual special to Delta price of $32mm for a CS100, we will give you a super duper discounted price of 26.9mm if you will only be operating the CS100 on MD88 replacements routes. ''It ees very important for Bombardier to get a major customer like Delta. If you then decide to operate the CS100 on routes longer than 1500 miles, you agree to pay us an extra 5.1mm per aircraft.''
Delta: But the CS100 is too small for our MD88 routes.
Bombardier: Tell you what, we have a deal for you. After the first 35 CS100 you can switch to CS300, for only an extra $3.5mm (!?! real speculation!) each, if you publicize an option agreement for an additional 50 aircraft. It will make Bombardier look good!
Delta bean counters: Sounds good, we won't have to disclose our ultimate capex commitment until and unless we decide to operate them on longer routes or switch to the larger version. (Delta bean counters thinking to themselves: ''Worse case if we we only operate them on shorter routes, and only stay with the CS100, we have 91 717's with an average age of 16 years, that start coming up on lease expiration's in a couple more years. If Southwest and Boeing don't give us killer terms on renewing those leases or on buyout values, we can dangle the CS100 alternative in front of them. Ok, meanwhile lets go ahead and increase our order for the A321 ceo's to 137 at that killer end of the line quote Airbus gave us, then we have flexibility.''

(Compared to other airlines, Delta seems to play chess with its fleet purchases, rather than checkers). BTW My analysis of the A321-200 capex commitments indicates a unit cost of between $42 and 44MM each- IMHO a heck of a deal for a 192pax aircraft)
Bravo! Excellent narrative!! Quite likely true too, I'd say!
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Old 09-02-2017, 03:27 PM
  #543  
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I have never heard of a aircraft being sold with a range restriction in the contract. Generally you order a engine variant and gross weight which both impact range but are free to fly it as you choose. Range is a highly variable and subjective number. If you don't know the assumptions in a published range number they are useless for comparison.
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Old 09-02-2017, 05:23 PM
  #544  
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Why would they base it in slc if there are no routes out of slc? It will be based in NYC and lax because it there are routes there:
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Old 09-02-2017, 09:39 PM
  #545  
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Originally Posted by sailingfun
I have never heard of a aircraft being sold with a range restriction in the contract. Generally you order a engine variant and gross weight which both impact range but are free to fly it as you choose. Range is a highly variable and subjective number. If you don't know the assumptions in a published range number they are useless for comparison.
This ^^^^^^
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Old 09-03-2017, 07:40 AM
  #546  
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The CR newsletter ought to be out this week, and typically that's where the announcement is made about the upcoming AE. Unless the bid is going to be in November, I'd expect to hear something soon regarding the basing decision. Flight deck photos and range circles are nice, but what pilots really want to know is-- where is it based and what kind of flying does it do? Kind of important information to have before committing brain cells and time to a new fleet...
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Old 09-03-2017, 08:14 AM
  #547  
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Originally Posted by Coronado
Here is my speculation on the 'bean counter' range number for the CS100.
Delta: Messrs. Bombardier--We have an RFQ we want to present to you. We need to replace our MD88 fleet.
Bombardier: Mais, oui, we have a fantastic plane the CS100 and CS300 that has a range of 3000 miles.
Delta: Oh no, that is too much, our MD88 only fly routes of less than 1500 miles. We don't want to pay for a 3000 mile range aircraft.
Bombardier: Tell you what, we have a deal for you. If you give us an order for 75 of them, instead of our usual special to Delta price of $32mm for a CS100, we will give you a super duper discounted price of 26.9mm if you will only be operating the CS100 on MD88 replacements routes. ''It ees very important for Bombardier to get a major customer like Delta. If you then decide to operate the CS100 on routes longer than 1500 miles, you agree to pay us an extra 5.1mm per aircraft.''
Delta: But the CS100 is too small for our MD88 routes.
Bombardier: Tell you what, we have a deal for you. After the first 35 CS100 you can switch to CS300, for only an extra $3.5mm (!?! real speculation!) each, if you publicize an option agreement for an additional 50 aircraft. It will make Bombardier look good!
Delta bean counters: Sounds good, we won't have to disclose our ultimate capex commitment until and unless we decide to operate them on longer routes or switch to the larger version. (Delta bean counters thinking to themselves: ''Worse case if we we only operate them on shorter routes, and only stay with the CS100, we have 91 717's with an average age of 16 years, that start coming up on lease expiration's in a couple more years. If Southwest and Boeing don't give us killer terms on renewing those leases or on buyout values, we can dangle the CS100 alternative in front of them. Ok, meanwhile lets go ahead and increase our order for the A321 ceo's to 137 at that killer end of the line quote Airbus gave us, then we have flexibility.''

(Compared to other airlines, Delta seems to play chess with its fleet purchases, rather than checkers). BTW My analysis of the A321-200 capex commitments indicates a unit cost of between $42 and 44MM each- IMHO a heck of a deal for a 192pax aircraft)
That's funny. And probably accurate since thats EXACTLY how DAL bought 40 and 50 seat CRJs for Comair and ASA in the early 2000s. Except it was a seat limit (40) for a $10 million discount, and a promise to pay the difference if they were converted to 50 seats. This was to compete with the ERJ135/145 which was much cheaper.
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Old 09-03-2017, 08:41 AM
  #548  
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Originally Posted by flyallnite
The CR newsletter ought to be out this week, and typically that's where the announcement is made about the upcoming AE. Unless the bid is going to be in November, I'd expect to hear something soon regarding the basing decision. Flight deck photos and range circles are nice, but what pilots really want to know is-- where is it based and what kind of flying does it do? Kind of important information to have before committing brain cells and time to a new fleet...
I think if it goes to NYC, it goes very junior save those who will bid it to get the summer off. New hires to the right seat.
What is the delivery schedule i.e. How many/month?
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Old 09-03-2017, 08:58 AM
  #549  
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Originally Posted by sailingfun
I have never heard of a aircraft being sold with a range restriction in the contract. Generally you order a engine variant and gross weight which both impact range but are free to fly it as you choose. Range is a highly variable and subjective number. If you don't know the assumptions in a published range number they are useless for comparison.
It could be an optional range extension that wasn't purchased...at this time...

Who knows. When DCI was going supernova and they wanted a less than 50 seater option they looked at the ERJ. Canadair, not wanting to lose business, offered to sell 50's with only 40 or 44 installed, by contract, at a reduced price. Boeing and Airbus all the time dangle landing and/or takeoff weight increases at operators, you know, for a "reasonable fee".

As for the C series "assumptions" you mentioned, I don't think there's any theoretical at work WRT the huge disparity in question (if true). A differential that substantial doesn't come down to baseline assumptions like pax weight or the definition of a standard day. If the original poster's point is true, then either we bought a vastly inferior version that was offered, or we got a killer deal to contract limit it with the ability to flex up later for cash. Who knows.
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Old 09-03-2017, 09:10 AM
  #550  
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Originally Posted by gloopy
It could be an optional range extension that wasn't purchased...at this time...

Who knows. When DCI was going supernova and they wanted a less than 50 seater option they looked at the ERJ. Canadair, not wanting to lose business, offered to sell 50's with only 40 or 44 installed, by contract, at a reduced price. Boeing and Airbus all the time dangle landing and/or takeoff weight increases at operators, you know, for a "reasonable fee".

As for the C series "assumptions" you mentioned, I don't think there's any theoretical at work WRT the huge disparity in question (if true). A differential that substantial doesn't come down to baseline assumptions like pax weight or the definition of a standard day. If the original poster's point is true, then either we bought a vastly inferior version that was offered, or we got a killer deal to contract limit it with the ability to flex up later for cash. Who knows.
There are no range restrictions in the contract. I also don't know where the 1500 miles came from. The one chart shows the CS100 capable of NYC to SLC with every seat full against winter headwinds which is 1730 miles. SLC is the intermediate stop for fuel by JetBlues A320's often in the winter. That range line may also include fuel to a divert however it does not state either way. This puts the range right where Bombardier states for the standard aircraft. They offer a high gross weight version which is what they typically quote for range. We purchased the standard model.
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