Julian Bray comments: As I revealed on Share Radio earlier today: In a move that has clearly infuriated Boeing and caused the plane maker to totally rethink future aviation payloads, Boeing is to rejig versions of its 737 max as the 737 max 7X. The cause of the upset is an unusually smart move by Bombardier, signing up Delta Air Lines, a firm agreement they say, for the sale and purchase of 75 CS100 aircraft, with options for an additional 50 CS100 aircraft.
Just pause there for a moment. Delta, a major US airline (and United is also said to be looking at the Bombardier offer especially as huge discounts are being dangled before the United directors ...) turning its back on the Boeing Company? Why?
This is the clue. Flexibility! Delta Air Lines may elect to convert a number of these aircraft into CS300 at a later date. Based on the list price of the CS100 aircraft, the firm order is valued at approximately $5.6 billion US.
“As we reshape our fleet for the future, the innovative onboard experience of the C Series is a perfect complement for the top-notch service provided every day by Delta people,” said Ed Bastian, Delta’s incoming CEO.
So was Boeing caught napping or are they about to launch a major assault on the smaller Bombardier product range? Is it too late? Consider this, the new beefed up version of the 737 [MAX 7X] single aisle would boast 150 seats against 110 to 135 on the Bombardier CSeries100 and the Bombardier CSeries 300.
Boeing currently offer 126 seats on the smaller variant of the 737 Max. The only problem is that Boeing will not have the new variants ready until 2019. Boeing also seem to be adopting the General Motors style of operation, rationalising parts and systems, it may be badged Vauxhall or Opel on the outside but lift the bonnet (Hood) and all the components are all badged GM. The new MAX7X will utilise existing components and pre developed systems taken from the 737 Max 8 (162 seats). A smart move that will clearly cut development costs and speed delivery. It also means customer already held inventory can in future be used on several Boeing products. Why on earth did they not think of this before? Recent management hires with automotive experience may be the answer but no one is telling...
Meanwhile Airbus is steaming ahead with profits up 15%, breaking even for the first time on its superjumbos. 12 Airbus A380's are part of a £17.4 billion (US$25billion) brokered deal with Iran who are to take some 45 A330 jets . The knock on effect for the UK is good as the wings are UK manufactured then flown to France for bolting onto the fuselage....
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