Things are getting exciting between Airbus and AirAsia, hopefully AirAsia will just stick to the A330neo.
If AirAsia were to stick to the A330neo, Malaysia Airlines may even consider the A330neo more seriously and their neighbours, ThaiAirways may even order the A330neos.

jeffrey0032j wrote:

I think this is a period when Boeing is becoming more Airbus and Airbus is becoming more Boeing (or McDonnell Douglas if the rumor that the MD culture was the one which survived the merger).

People would be laughing at you 5 years ago if you said Boeing was more innovative and aggressive on sales than Airbus.

There seems to be this need in aviation - and in life - to say one or the other is "dead" - no hope, never gonna recover, put a fork in 'em they're done. Then boom - they're baaaccckk. Reviewing the US Airways news articles from when they placed their huge 400 frame order with Airbus over 20 years ago, it was considered critical to Airbus since they had low penetration in the US market. That was just 20 years ago. Since then we've had this back and forth going on. Airbus' A340 can't compete - they screwed the pooch. The A330 started eating the 767's lunch. Boeing was going to squash Airbus with the 787 in 2008, the NSA in 2012, and a new VLA in 2016. The 787 program was crumbling and Boeing was doomed. The A380 had yet another massive delay and was killing Airbus. The A350 mk 22 was still not gaining traction. The A330/A350 will squeeze Boeing dry. Boeing didn't have a response to the A320neo and was screwed. The A380 was draining Airbus. The 777 was in a spiral. The A330neo can't sell, leaving Airbus vulnerable. The A321neo has solved cancer in laboratory animals - Boeing has nothing.

There's this ebb and flow to it all that we seem to get so caught up in that sometimes we can't see the forest for the trees. Same with politics. Same with life. Keeps it spicy, though.

jbs2886 wrote:

PlanesNTrains wrote:

The A321neo has solved cancer in laboratory animals - Boeing has nothing.

This is amazing.

IKR

PlanesNTrains wrote:

Slug71 wrote:

My guess is, they just ordered an additional 10 A339s.

So your thought is that in June they ordered 10 A339s as undisclosed, then turned around and complained about an existing deal? I'm just trying to follow, because there's a thread where he has just been quoted as saying he's unhappy with the terms of his existing A330neo order. I just can't see him ordering more if he's unhappy with the current numbers.

He said they needed more. By ordering more, he probably wants better pricing/terms. If he wasn't happy with the pricing of the initial 66 order, maybe he shouldn't have signed the deal.
I highly doubt they agreed to buy 66 while the purchase costs/terms are still under negotiation.

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

Slug71 wrote:

PlanesNTrains wrote:

Slug71 wrote:

My guess is, they just ordered an additional 10 A339s.

So your thought is that in June they ordered 10 A339s as undisclosed, then turned around and complained about an existing deal? I'm just trying to follow, because there's a thread where he has just been quoted as saying he's unhappy with the terms of his existing A330neo order. I just can't see him ordering more if he's unhappy with the current numbers.

He said they needed more. By ordering more, he probably wants better pricing/terms. If he wasn't happy with the pricing of the initial 66 order, maybe he shouldn't have signed the deal.
I highly doubt they agreed to buy 66 while the purchase costs/terms are still under negotiation.

The impression I get - and could be wrong - is that the AirAsia A330neo order, while firm, is somehow shaky, perhaps due to delivery delays. For whatever reason, TF keeps going on about it, making it sound questionable. Maybe he just means that he won't take more without a better deal? Not sure. However, if that undisclosed order for 10 was made in June, and in July he is commenting that he is unhappy with his negotiations with Airbus over his order for 66, I'm at a loss at how it could be them? Guess we'll see soon enough.

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

Many people may not know how much more is behind a sale than purchase price. Financing is a huge part of it. Air Asia X needs billions in financing and doesnt necessarily have the credit or equity to support attractive terms. Airbus can help and i suspect this is where the negotiations are complex. A320neos are much easier to finance since there is a robust used market and lease transfer costs are low. The same is not true for 66 A330neos.

Which lendor is confident that Air Asia will take delivery and operate all 66 A330neos the full duration of the financing terms? Given how fluid their route network and history has been, banks may be charging a premium for the risk that airplanes need to be resold. I would not be surprised if Air Asia is asking for help from Airbus to secure financing

Regardless of the medium Fernandes used to communicate news worthy information, it’s appalling to see such poor use of the English language by someone at that level in management.

tgharabegian wrote:

Regardless of the medium Fernandes used to communicate news worthy information, it’s appalling to see such poor use of the English language by someone at that level in management.

I won't say its a poor use of English, it is twitter after all, 280 char max, you really have to go through some thought before squeezing in what you want to say in one tweet.

Poorly worded, maybe, But seems like he really wants the A330neo to happen at his terms, or that he knows the Airbus now is not as close as his good friend, JL, thus the "or else".

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

I'm often ignored.

It should all be numbers driven. DL has such a blue Chip credit rating, they will not have an issue financing their A330NEOs, but AirAsia will.

The market has stalled for financing A330NEOs. AirAsia needs help. Tony's tweets are... abrasive but screen of a customer having financing issues.

As I posted before, AirAsia has there needs and Airbus opposing needs. Something will give. At this time, the A330NEO is in Abad spot. In particular with Iran deliveries halted (I believe 12 in 2019). For a CEO not to take advantage of the negotiating opportunity A330NEO delays have oppened would not be meeting fiducial duty. In particular with the current horrid widebody leasing market for non blue Chip airlines.

Lightsaber

Newbiepilot wrote:

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

Many people may not know how much more is behind a sale than purchase price. Financing is a huge part of it. Air Asia X needs billions in financing and doesnt necessarily have the credit or equity to support attractive terms. Airbus can help and i suspect this is where the negotiations are complex. A320neos are much easier to finance since there is a robust used market and lease transfer costs are low. The same is not true for 66 A330neos.

Which lendor is confident that Air Asia will take delivery and operate all 66 A330neos the full duration of the financing terms? Given how fluid their route network and history has been, banks may be charging a premium for the risk that airplanes need to be resold. I would not be surprised if Air Asia is asking for help from Airbus to secure financing

Interesting about the A330NEO and the lease/buy back scenario (how else does one buy large amounts of aircraft and show no debt on the books.....Looking at you Spirit), That explains the trip to Boeing. I am guessing because the 787 has been on the market a while and operating as promised its easier to get banks to do a lease/ buy back on it. Again, just guessing, Air Asia took the parameters of the Boeing deal to Airbus (NDAs and all that) and Airbus is not able to financially or unwilling (not profitable) to do a similar deal.

No one should criticize Airbus if the deal is not profitable for them long term and exposes them to uncertain liabilities.

lightsaber wrote:

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

I'm often ignored.

It should all be numbers driven. DL has such a blue Chip credit rating, they will not have an issue financing their A330NEOs, but AirAsia will.

The market has stalled for financing A330NEOs. AirAsia needs help. Tony's tweets are... abrasive but screen of a customer having financing issues.

As I posted before, AirAsia has there needs and Airbus opposing needs. Something will give. At this time, the A330NEO is in Abad spot. In particular with Iran deliveries halted (I believe 12 in 2019). For a CEO not to take advantage of the negotiating opportunity A330NEO delays have oppened would not be meeting fiducial duty. In particular with the current horrid widebody leasing market for non blue Chip airlines.

Lightsaber

Plus, DL currently uses their planes till they are old and beaten, and most likely owns their planes outright after some time, so the resale market doesn't really matter to them.

Air Asia on the other hand leases most of their fleet, with some A320s being retired and released to other carriers. So the resale value plays a huge part for Air Asia. Nobody wants to be stuck with a bunch of planes that they can't lease out after Air Asia returns them, think of the A340s and early 777s.

lightsaber wrote:

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

I'm often ignored.

It should all be numbers driven. DL has such a blue Chip credit rating, they will not have an issue financing their A330NEOs, but AirAsia will.

The market has stalled for financing A330NEOs. AirAsia needs help. Tony's tweets are... abrasive but screen of a customer having financing issues.

As I posted before, AirAsia has there needs and Airbus opposing needs. Something will give. At this time, the A330NEO is in Abad spot. In particular with Iran deliveries halted (I believe 12 in 2019). For a CEO not to take advantage of the negotiating opportunity A330NEO delays have oppened would not be meeting fiducial duty. In particular with the current horrid widebody leasing market for non blue Chip airlines.

Lightsaber

Even if he had financing for the 66 330NEO order tied up with ribbon and a neat little bow, he'd be mad not to renegotiate if given the opportunity and given Boeing's recent apparent determination to undercut Airbus pricing. We're talking about saving potentially hundreds of millions of dollars here.

lightsaber wrote:

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

I'm often ignored.

It should all be numbers driven. DL has such a blue Chip credit rating, they will not have an issue financing their A330NEOs, but AirAsia will.

The market has stalled for financing A330NEOs. AirAsia needs help. Tony's tweets are... abrasive but screen of a customer having financing issues.

As I posted before, AirAsia has there needs and Airbus opposing needs. Something will give. At this time, the A330NEO is in Abad spot. In particular with Iran deliveries halted (I believe 12 in 2019). For a CEO not to take advantage of the negotiating opportunity A330NEO delays have oppened would not be meeting fiducial duty. In particular with the current horrid widebody leasing market for non blue Chip airlines.

Lightsaber

Lightsaber is on it (per usual). When AirAsiaX is 1/3 of the order book and needs to have financing in place for upcoming deliveries these conversations happen. The current financing situation is not the same as it was when they originally ordered the aircraft hence the new conversations. I am sure Boeing smelled blood in the water and did their best to play spoiler as well.

We are not even talking about the 50+ aircraft from CIT/Air Lease/Avolon have on firm order where airlines don't seem to be lining up to lease those units. AirAsiaX could probably get aircraft and financing from them at better terms than anything they could find on the open market in a sale/leaseback situation (if even possible). As with a lot of Asian airlines right now, there are multiple aircraft on order that are due to fly the exact same customer. Something has to give.

tortugamon

lightsaber wrote:

I'm often ignored.

Oh for pity's sake!


One of the least-ignored posters out there IMO.

I think it's mostly that the rest of us poor mortals spend so much time figuring-out "High-spools" and whatever that the opportunity has passed to respond!



cheers!

I'm thinking a lot of it has to do with JL not being around any more.

Previously JL could just find a way to make the deal work, often against all the odds; and TF (understandably) came to rely on it.

Not any more.

cheers

(PS - a prompt to this was a photo at Farnborough a few years showing JL & TF. The body-language was unmistakable IMO.

- a very strong personal bond, however
- JL was clearly "Numero Uno" => the Alpha male.

tortugamon wrote:

lightsaber wrote:

Revelation wrote:

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

I'm often ignored.

It should all be numbers driven. DL has such a blue Chip credit rating, they will not have an issue financing their A330NEOs, but AirAsia will.

The market has stalled for financing A330NEOs. AirAsia needs help. Tony's tweets are... abrasive but screen of a customer having financing issues.

As I posted before, AirAsia has there needs and Airbus opposing needs. Something will give. At this time, the A330NEO is in Abad spot. In particular with Iran deliveries halted (I believe 12 in 2019). For a CEO not to take advantage of the negotiating opportunity A330NEO delays have oppened would not be meeting fiducial duty. In particular with the current horrid widebody leasing market for non blue Chip airlines.

Lightsaber

Lightsaber is on it (per usual). When AirAsiaX is 1/3 of the order book and needs to have financing in place for upcoming deliveries these conversations happen. The current financing situation is not the same as it was when they originally ordered the aircraft hence the new conversations. I am sure Boeing smelled blood in the water and did their best to play spoiler as well.

We are not even talking about the 50+ aircraft from CIT/Air Lease/Avolon have on firm order where airlines don't seem to be lining up to lease those units. AirAsiaX could probably get aircraft and financing from them at better terms than anything they could find on the open market in a sale/leaseback situation (if even possible). As with a lot of Asian airlines right now, there are multiple aircraft on order that are due to fly the exact same customer. Something has to give.

tortugamon

I know exact terms would typically have NDA covering the, up, but is it possible that AAX had cancellation clauses in their original 66 plane contract regarding financing (ie ability to back out without or with reduced penalties if they couldn’t get the planes financed on the terms they needed)? Wasnt sure if language like that could be expected to be found in a aircraft sales contract.

Is this whole issue not about cancelling an order for 10 A350 and getting a number of A330neo's in return at reasonable terms to both Air Asia and Airbus?

Something to consider here is financing for the purchase. As US interest rate have increased there has been a reduction funds available to European lenders. As private money prefers the higher rates that US provides. This loss in available fund by private European lenders put more pressure on airbus and governments to finance loans in this sector. Where as last years they could count on private/public entities to provide X% of financing for sales. This year that X% is ether absent entirely are reduced in scope.

The loss in fund will be particular felt in emerging markets like Malaysia. As available funds go to supports core of Euro areas and are no longer can support emerging markets.

jeffrey0032j wrote:

I think this is a period when Boeing is becoming more Airbus and Airbus is becoming more Boeing (or McDonnell Douglas if the rumor that the MD culture was the one which survived the merger).

People would be laughing at you 5 years ago if you said Boeing was more innovative and aggressive on sales than Airbus.

Sorry to ask this, but may I know more about the McDonnell Douglas part? I wasn't into aviation back then when McD-Boeing merger took place. Thanks in advance.

juliuswong wrote:

jeffrey0032j wrote:

I think this is a period when Boeing is becoming more Airbus and Airbus is becoming more Boeing (or McDonnell Douglas if the rumor that the MD culture was the one which survived the merger).

People would be laughing at you 5 years ago if you said Boeing was more innovative and aggressive on sales than Airbus.

Sorry to ask this, but may I know more about the McDonnell Douglas part? I wasn't into aviation back then when McD-Boeing merger took place. Thanks in advance.

To make it simple, MD in its final 20 years was making the same exact airplanes. Absolutely no brand new aircraft in that time period on the civil side of things.
DC-9 > MD-80 > MD-90 > MD-95.
DC-10 > MD-11

They lacked innovation. All they did was take their same old aircraft and change some things to compete. Failed.
Sure the DC-9 and MD-80 were hits (I guess you could call the DC-10 a hit since it beat out the L-1011) but the rest were misses. I mean take a look at what those aircraft were competing against, they stood no chance. I mean come on, the Boeing 717 is marked as a DC-9 subtype for crying out loud.

You could see some of this in Boeing after the merger but I think the after getting through the 787 and with some changes in corporate, the MD days are behind us.


Anyways, enough late night rambling. Back on topic.

https://www.bloomberg.com/news/articles ... to-airasia

Looks like the AirAsia Group is gonna be topping up another
100 A321neos + 34 A330neos for its total number order of aircrafts.

Might be announced at Fanborough AirShow, keeping my fingers crossed on this one:/

all that tweeting was making this so obvious, great to see it when it's confirmed

junlinwong94 wrote:

https://www.bloomberg.com/news/articles/2018-07-14/airbus-is-said-near-blockbuster-23-billion-jet-sale-to-airasia

Looks like the AirAsia Group is gonna be topping up another
100 A321neos + 34 A330neos for its total number order of aircrafts.

Might be announced at Fanborough AirShow, keeping my fingers crossed on this one:/

Quoting from the Bloomberg article:

AirAsia is simultaneously close to agreeing to order an additional 34 A330neo widebodies, which would bring its total backlog for that aircraft to 100.

100 in total, quite interesting.

I have fallen over in shock! Can someone help me up?

Bricktop wrote:

I have fallen over in shock! Can someone help me up?

Lets wait and see. So far nothing is signed.

SQ22 wrote:

Bricktop wrote:

I have fallen over in shock! Can someone help me up?

Lets wait and see. So far nothing is signed.

If signed at Farnborough, AirAsia will be getting the deal of the decade. If this happens, the entire viability of the A330NEO has shifted for the better.

Honestly, I thought Boeing & GE were being agressive enough to steal most if not all of the order over to the 787-10. It would be a huge deal for Airbus to expand the order.

Wow.. I wasn't even considering the possibility yesterday. For the sake of aerospace competition, I would be happy to be proven wrong.

Lightsaber

lightsaber wrote:

SQ22 wrote:

Bricktop wrote:

I have fallen over in shock! Can someone help me up?

Lets wait and see. So far nothing is signed.

If signed at Farnborough, AirAsia will be getting the deal of the decade. If this happens, the entire viability of the A330NEO has shifted for the better.

Honestly, I thought Boeing & GE were being agressive enough to steal most if not all of the order over to the 787-10. It would be a huge deal for Airbus to expand the order.

Wow.. I wasn't even considering the possibility yesterday. For the sake of aerospace competition, I would be happy to be proven wrong.

Lightsaber

At some point Boeing is going to run out of delivery slots. If not sooner than later. Same applies of course to Airbus, depending on the product.

If the AirAsia Group orders more A330neos, more carriers around the region(Thai Airways, Malaysia Airlines, PAL etc etc) will consider the A330neo even more srsly for their future needs. Let's hope that Airbus understands the pricing that AirAsia wants

SQ22 wrote:

At some point Boeing is going to run out of delivery slots.

There is a pronounced limit on staying power for dumping frames below cost.
IMU all the arguments offered why Boeing can now make bargain offers are so much colourful fiction.

WIederling wrote:

SQ22 wrote:

At some point Boeing is going to run out of delivery slots.

There is a pronounced limit on staying power for dumping frames below cost.
IMU all the arguments offered why Boeing can now make bargain offers are so much colourful fiction.

Boeing is not selling below costs per my estimates. Per my estimates, they could offer a 789 for less than an A339NEO. Boeing is further cutting the cost of making 787s by, if memory serves right, $3 million per Airframe in 2019.

Or were you referring to Airbus selling A330NEOs below cost?

Yes, AirAsia would probably want 787-10s. Those cost more to make, but are priced higher...

There are several negotiations going on that will be most brutal I'm aware of since 2001... AirAsia cannot loose. If they do order more A330NEOs, it will be at pricing that requires production cost reductions (e.g., more 3D printed parts, including making some larger assemblies as monolithic parts.

Sorry, I'm obsessed with 3D printing ever since $100k of my parts in Aluminum became $12k of 3D printed titanium. Lighter and cheaper...

Lightsaber

Just read this news in Malaysia (it's 2:06am here). Total of 200 321neo and 100 A330neo! That is shocking. Something really worth celebrating if confirmed, since there have been a lot naysayers here in a.net regarding the latter. They can now shove their argument up where sun doesn't shine.

I'm pretty sure some of the new order is for their leasing arm. I really can't see how AirAsia Group can absorb 100 A330neo! Current they have around 30, previous order 66 A330neo doubled the fleet, with additional 34 it is tripling! Can this be a compromise for A350 cancellation?

Not a surprising order at all, but big nonetheless.

juliuswong wrote:

Just read this news in Malaysia (it's 2:06am here). Total of 200 321neo and 100 A330neo! That is shocking. Something really worth celebrating if confirmed, since there have been a lot naysayers here in a.net regarding the latter. They can now shove their argument up where sun doesn't shine.

I'm pretty sure some of the new order is for their leasing arm. I really can't see how AirAsia Group can absorb 100 A330neo! Current they have around 30, previous order 66 A330neo doubled the fleet, with additional 34 it is tripling! Can this be a compromise for A350 cancellation?

I believe the terms were hard fought (very adventageous to AirAsia). Due to delays, I'm fairly certain AirAsia was able to negotiate brutally.

If the hundred A330NEO order is confirmed, that is a step change up in both the fate of the program and the widebody fleet of AirAsia.

Lightsaber

If this is confirmed, its huge news for both parties. I wonder if this will use slots previously assigned to Iran Air.

juliuswong wrote:

I'm pretty sure some of the new order is for their leasing arm. I really can't see how AirAsia Group can absorb 100 A330neo! Current they have around 30, previous order 66 A330neo doubled the fleet, with additional 34 it is tripling! Can this be a compromise for A350 cancellation?

Comfortably, I'm sure. There are multiple potential new bases for long haul operations, plus expansion at existing sites.

PlymSpotter wrote:

If this is confirmed, its huge news for both parties. I wonder if this will use slots previously assigned to Iran Air.

juliuswong wrote:

I'm pretty sure some of the new order is for their leasing arm. I really can't see how AirAsia Group can absorb 100 A330neo! Current they have around 30, previous order 66 A330neo doubled the fleet, with additional 34 it is tripling! Can this be a compromise for A350 cancellation?

Comfortably, I'm sure. There are multiple potential new bases for long haul operations, plus expansion at existing sites.

Exactly. If what he's saying about Europe is true then there's a whole new market which could easily use up 15 of those 100 A330neos. And seeing their fares on the HNL flights, I doubt they'll have a hard time selling seats

junlinwong94 wrote:

https://www.bloomberg.com/news/articles/2018-07-14/airbus-is-said-near-blockbuster-23-billion-jet-sale-to-airasia

Looks like the AirAsia Group is gonna be topping up another
100 A321neos + 34 A330neos for its total number order of aircrafts.

Might be announced at Fanborough AirShow, keeping my fingers crossed on this one:/

I expect this all contingent upon European financial institutions providing the financing for the deal. Airbus wants to sale Air Asia wants to buy now if they can find someone to loan then the money for deal. This deal sound like the recent a380 sale in that it will decided by the financiers.

carlokiii wrote:

From purely a passenger point of view, I do wish D7 orders the 787 instead. I already feel bad for those that would be stuck in an unpleasant 13.5hr flight on a 9-abreast A339. 9-abreast on a 787 is suddenly a dream.

But as an aviation enthusiast, I hope Airbus and AirAsia settles on a deal that benefits both. Purchase price, financing, specifications, etc.

I want to see the A339 be successful... it’s still a magnificent airliner.

Have you ever sat in a 10 across 787.

You might be eating your words if AirAsia order the 787.

Newbiepilot wrote:

Revelation wrote:

lightsaber wrote:

A CEO must be unemotional and only think of profit and risk. Price, delivery times, and financing will determine the A330NEO's fate at AirAsia. Money isn't a bias. It isn't a want for price, it is negotiations and if Boeing made the offer they should have, Airbus is in a bind.

There is no sale leaseback on the A330NEO in today's market. If Airbus doesn't help with financing, there cannot be a deal. At this time the A330NEO is an orphan aircraft, the best analogy is the 717. If Airbus does finance, it could be like the 717 where the vendor (Boeing) has to finance the aircraft for the entire service life tying up capital.

So there is a limit to what AirAsia will pay and a limit to how much Airbus will discount and finance. There should be a middle ground, but it is possible that the current 787 pricing and ability to finance forces AirAsia's hand.

Farnborough will be facinating.

Kinda funny how your post is being largely ignored. We have many posts are saying this is all about negotiating postures and brinksmanship when the inconvenient truth is that this is all numbers driven, and as of right now the numbers are adding up to "no sale". Personally I doubt wanting to make a splash at an air show is going to be a decisive factor. I think the players are disciplined enough to know that they're going to have to live with the deal for many years to come and the short term buzz from a splash at an airshow will wear off quickly.

Many people may not know how much more is behind a sale than purchase price. Financing is a huge part of it. Air Asia X needs billions in financing and doesnt necessarily have the credit or equity to support attractive terms. Airbus can help and i suspect this is where the negotiations are complex. A320neos are much easier to finance since there is a robust used market and lease transfer costs are low. The same is not true for 66 A330neos.

Which lendor is confident that Air Asia will take delivery and operate all 66 A330neos the full duration of the financing terms? Given how fluid their route network and history has been, banks may be charging a premium for the risk that airplanes need to be resold. I would not be surprised if Air Asia is asking for help from Airbus to secure financing

If this is a financing issue the alternative "buzz" would revolve around why AirAsia can't finance their aircraft. TF would probably find himself on a social media slippery slope where the wrong type of "buzz" would ultimately control his conversation.

I suspect there could be a whole lot of bluff in the AirAsia/Boeing talks. It could still be the case, the A330NEO from a cash operating perspective is still the preferred option.......but from a financing perspective has quite a few liquidity headwinds that may be a little difficult to overcome. For AirAsia, delaying / rescheduling progress payments or Airbus finance or guarantees may be required to get his deal over the line.

From a OEM / Airlines perspective, other airlines in the region will be looking at this closely. I would hate to be the OEM representative knocking on the airlines door, if my employer had just sold the same plane to the guy next door at a substantial discount and finance terms to boot.

From a markets perspective (and I haven't looked at this for a number of years), Asian countries lending very secure excess US dollars at favorable terms may be coming to an end. With the the US needing their $US cash to use domestically, the financing options once available to bit players like AirAsia may not be as abundant as they once were.

Interesting times. We could be seeing quite a few patterns / trends in how airlines order aircraft at the Farnborough airshow.

travelhound wrote:

carlokiii wrote:

From purely a passenger point of view, I do wish D7 orders the 787 instead. I already feel bad for those that would be stuck in an unpleasant 13.5hr flight on a 9-abreast A339. 9-abreast on a 787 is suddenly a dream.

But as an aviation enthusiast, I hope Airbus and AirAsia settles on a deal that benefits both. Purchase price, financing, specifications, etc.

I want to see the A339 be successful... it’s still a magnificent airliner.

Have you ever sat in a 10 across 787.

You might be eating your words if AirAsia order the 787.

There isn't a 10 across 787 around, though, I don't even think it is possible to go beyond the absurdity of the A330 9 abreast, and thats coming from a person who has sat in one such Airbus.

jeffrey0032j wrote:

There isn't a 10 across 787 around, though, I don't even think it is possible to go beyond the absurdity of the A330 9 abreast, and thats coming from a person who has sat in one such Airbus.

Thing is - while you still can avoid the few carriers that use 9-abreast A330, you CAN'T avoid the uncomfortable 9-abreast 787 - and that's coming from a person who sat in one.

Unless you have possibility to fly on Japan Airlines

BlueSky1976 wrote:

jeffrey0032j wrote:

There isn't a 10 across 787 around, though, I don't even think it is possible to go beyond the absurdity of the A330 9 abreast, and thats coming from a person who has sat in one such Airbus.

Thing is - while you still can avoid the few carriers that use 9-abreast A330, you CAN'T avoid the uncomfortable 9-abreast 787 - and that's coming from a person who sat in one.

Unless you have possibility to fly on Japan Airlines

But anybody flying on Air Asia (an increasing amount of people given how much growth they project) is, and would be flying on 9-abreast A330s instead of 9-abreast 787s had a Boeing order materialised....

lightsaber wrote:

WIederling wrote:

SQ22 wrote:

At some point Boeing is going to run out of delivery slots.

There is a pronounced limit on staying power for dumping frames below cost.
IMU all the arguments offered why Boeing can now make bargain offers are so much colourful fiction.

Boeing is not selling below costs per my estimates. Per my estimates, they could offer a 789 for less than an A339NEO. Boeing is further cutting the cost of making 787s by, if memory serves right, $3 million per Airframe in 2019.

I have difficulty fitting your assessment together with the exploded initial cost of manufacturing and assembling 787 frames
and any reasonable value of % Learningcurve. ( and it would not support this massive step change in pricing
we seem to have watched.)

Sorry, I'm obsessed with 3D printing ever since $100k of my parts in Aluminum became $12k of 3D printed titanium. Lighter and cheaper...

I've only progressed into Nylon printed parts ( like replacements for nonstandard gears ) but that already is quite the eye opener.

JustSomeDood wrote:

But anybody flying on Air Asia (an increasing amount of people given how much growth they project) is, and would be flying on 9-abreast A330s instead of 9-abreast 787s had a Boeing order materialised....

You do realize there are other A330 operators in Asia who use normal, 8-abreast, comfortable layout, right? Point is, while there's a choice between other carrier with 8-abreast A330 and AirAsia's 9-abreast one, there ISN"T ANY when it comes to the 9-abreast 787.

BlueSky1976 wrote:

JustSomeDood wrote:

But anybody flying on Air Asia (an increasing amount of people given how much growth they project) is, and would be flying on 9-abreast A330s instead of 9-abreast 787s had a Boeing order materialised....

You do realize there are other A330 operators in Asia who use normal, 8-abreast, comfortable layout, right? Point is, while there's a choice between other carrier with 8-abreast A330 and AirAsia's 9-abreast one, there ISN"T ANY when it comes to the 9-abreast 787.

I fail to see how you try t compare tha 9 abreast 787 to a 9 abreast A330? I wouldn’t mind flying again onboard a 9 abreast 787. But I will never, ever fly again onboard an A330 with 9 seats across. I have spent 11 hours onboard flight with a nine abreast A330, and I have spent 13 hours onboard a flight with a nine abreast 787. It it’s not comparable. The 787 I would not hesitate fly 13 hours on again, but i will never fly onboard a nine across A330 for a longer flight.

I think an issue for Air Asia with long haul is that other full service airlines offer economy specials at very attractive prices to fill the plane, all the time. These are readily available through a raft of online booking sites and offer significantly better comfort and travel experience. Air Asia can't compete with that with 9 abreast A330s which everybody now knows about. Just perhaps Air Asia will offer a long haul sub-fleet with 8 abreast economy or a split cabin 8 abreast / 9 abreast to attract more travelers to long haul routes that haven't worked in the past. If not, I don't personally rate their chances of getting much traction in long haul. However, there's plenty of medium haul and short haul routes for which the A330 will be ideal and passengers won't mind putting up with tight seating for 3-7 hours on a flight. Frankly, I think they need to find the sweet spot with the market and judging by previous forays they won't be successful if they don't position themselves for long haul with a more viable product. Will indeed be interesting to see how this deal unfolds and to see more info from Air Asia about their plans for Europe flights.

Please keep this thread on topic. This thread is not about 10 vs. 9 vs. 8 abreast seating layouts.

SQ22 wrote:

Please keep thios thread on topic. This thread is not about 10 vs. 9 vs. 8 abreast seating layouts.

I would say discussing the comfort of 8 / 9 / 10 abreast is actually irrelevant for Air Asia. Their average passenger is significantly more 'petite' than a Western build, and their customers are highly price focused.

Oykie wrote:

BlueSky1976 wrote:

JustSomeDood wrote:

But anybody flying on Air Asia (an increasing amount of people given how much growth they project) is, and would be flying on 9-abreast A330s instead of 9-abreast 787s had a Boeing order materialised....

You do realize there are other A330 operators in Asia who use normal, 8-abreast, comfortable layout, right? Point is, while there's a choice between other carrier with 8-abreast A330 and AirAsia's 9-abreast one, there ISN"T ANY when it comes to the 9-abreast 787.

I fail to see how you try t compare tha 9 abreast 787 to a 9 abreast A330? I wouldn’t mind flying again onboard a 9 abreast 787. But I will never, ever fly again onboard an A330 with 9 seats across. I have spent 11 hours onboard flight with a nine abreast A330, and I have spent 13 hours onboard a flight with a nine abreast 787. It it’s not comparable. The 787 I would not hesitate fly 13 hours on again, but i will never fly onboard a nine across A330 for a longer flight.

You can opt for their premium cabin which come with host of privilege and benefit. You also get angled lie flat seat. They often run "buy one get one free" promo! I got it myself few times! Few weeks ago they ran same promo for HNL! All in fares less than Y in certain premium airlines like JAL or ANA. What a steal!