More Odds and Ends: Aircraft list prices, airline break-even

Aircraft List Prices: It took some doing, but we’ve collected the list prices of all the major commercial airplanes. The comparisons are interesting. We’ve tabulated these into seat categories.

List prices, of course, have no relationship to what customers actually pay. Discounts of 25%-30% are common and really good customers–like Southwest Airlines for Boeing–have been known to get discounts of up to 60%.

There are several notables in this list:

  • Compare the pricing of the C919 and the MS-21 to the Airbus and Boeing products;
  • Compare the Q400NG to the ATR-72-600;
  • Compare Airbus to Boeing; and
  • Compare CSeries to 737-600/700 and there isn’t that much difference; the gap is wider compared with Airbus.

Is there any particular point to this? Not really–it’s just one of those facts that intrigue us and a host of aviation geeks.

List Price
Turbo Props (Millions) 150-200 Seats
ATR-42-600 19.5 A320 88.3
ATR-72-600 23.4 A320neo 96.7
Q400NG 30.3 A321 103.6
60-99 Seats Jets A321neo 113.3
CRJ-700NG 37.3 B737-8 MAX 95.2
CRJ-900NG 42.8 B737-800 84.4
E170 AR 36.4 B737-9 MAX 101.7
E170 LR 36.1 B737-900ER 89.6
E170 Std 35.8 C919 70.0
E175 AR 39.2 MS-21-200 69.0
E175 LR 38.9 MS-21-300 78.0
E175 Std 38.6   Mid-Twin Aisle
MRJ-70 38.0 A330-200 208.6
MRJ-90 40.0 A330-200F 211.5
100-149 Seats A330-300 231.1
A318 67.7 A350-1000 320.6
A319 80.7 A350-800 245.5
A319neo 88.8 A350-900 277.7
B737-600 59.4 B767-200ER 151.5
B737-7 MAX 77.7 B767-300ER 173.1
B737-700 70.9 B767-300ERF 175.4
CRJ1000NG 45.8 B767-400ER 190.2
CS100 58.3 B777-200ER 244.7
CS300 66.6 B777-200F 280.1
E190 AR 43.5 B777-200LR 275.8
E190 LR 43.2 B777-300ER 298.3
E190 Std 42.8 B787-8 193.5
E195 AR 45.9 B787-9 227.8
E195 LR 45.6 Very Large Aircraft
E195 Std 42.2 A380-800 389.9
SSJ 100 31.7 B747-8 332.9
B747-8F 333.5

Breaking even–or not: Scott McCartney at The Wall Street Journal had this recent article outlining that it takes more than an 86% load factor for US legacy airlines to break even, while the carriers he calls “value” carriers break even at 79.3%.

This helps explain why airlines are packing their flights will fees and some make money only with the ancillary revenue.

All this probably explains why Southwest Airlines is cramming more seats into its airplanes. This article explains why you won’t feel crammed.

32 Comments on “More Odds and Ends: Aircraft list prices, airline break-even

  1. Thanks for this effort, Scott.
    One more “notable” to add to your list.
    Look at the deltas between the basic and “Max” 737 variants and the basic and “NEO” A319/320/321 variants.
    The progression of the AI numbers make more sense to me than the Boeing numbers.
    For example, the B737-9MAX delta is almost twice that of the B737-7MAX.
    I would expect some difference in cost of a more powerful engine variant on the heavier aircraft, but not this large a figure.
    This difference would argue that there is more going on with the heavier aircraft in the MAX
    design.
    Pylon?

    • Aircraft pricing (at least in terms of what an airline pays) is based more on the value of the product to the airline, not the manufacturer’s production cost. In reality, there is very little production cost difference between the 737-700 and the 737-800, as every high-dollar item in the 737-800 also exists in the 737-700. The production cost differences are limited to a few extra meters of structure in the fuselage, some added wiring, ducts and tubing, a second overwing exit, some interior elements and ~40 seats. Certainly not $13.5M worth of additional items.

      This value approach drives the difference between 737-7 and 737-9 pricing as well.

      • Yes, the production cost is the key number. Since production is full and there is a backlog, it seems like it would be in the manufacturers interest to produce all units with a similar high profit margin. Selling -700s, or A319s at a low margin would take up line space that could be better used building something with a greater return.

  2. It is amazing that each of the B-737MAX models is more than $10M less than the competing A-320NEO models. In fact almost every Boeing product is significantly cheaper to buy then the competing Airbus model. Is Airbus trying to pull a fast one on customers to make them think they are getting a deeper discount from Airbus than from Boeing?

    Fred, the delta between the B-737-700 and the B-737-MAX is about $7M, while the delta between the B-737-900ER and the B-737-9MAX is about $12M. The -9MAX carries more pax, carries more cargo, and carries them further, then the -900ER. The is in addition to the the bigger engines, but other changes as well. The Pylons on all 3 models of the MAX will be approximately the same, just as they will be for the NEO models equipped the same engines. It also seems Boeing is eliminating one model in the -700 series, the B-737-700ER.

  3. as said list prices only give a slight indication of paid prices. So much plays a role.

    Eyecatching IMO Airbus seems to be asking asking a fat premium for the A350-1000.

    The gab between A380 and A350-1000 is smaller then between the A350-800 & A350-1000..

    • What I find interesting is the gap between the B-77W and the B-748 is less than that between the A-359 and A-3510 models, it is $34M for the Boeings vs. $43M for the `Buses.

  4. KC135TopBoom: “In fact almost every Boeing product is significantly cheaper to buy then the competing Airbus model. Is Airbus trying to pull a fast one on customers to make them think they are getting a deeper discount from Airbus than from Boeing?”

    Maybe this will put to rest this incessant complaint of the unfair “advantage” Airbus has over Boeing.

    Hah, hah, hah!!

  5. If Airbus can charge a premium over the Boeing equivalent then that would indicate an operating cost advantage for Airbus, wouldn’t it?

    • This can be true, but it can also be incorrect. Here’s why: Wherever you see a consistent price premium for one product over another, you can be sure the airlines are seeing more VALUE in that product. As you note, one of the factors in calculating value is an airplane’s operating cost, but that’s just one piece. Other key factors an airline will consider are:

      >>The cost of financing, (lenders may offer differing finance terms for different products).
      >>Revenue potential of each product (seat count may differ, and other factors may contribute to more revenue from one over the other – e.g. passenger preference for flying the A380)
      >>Productivity of each product (how fast can an aircraft be turned at the gate, how much downtime will each require for maintenance, etc)
      >>Projected residual value of the aircraft at the end of the evaluated term (how much can I sell it for when I’m done with it).

      All of these are factored together, along with operating cost, and calculated on a net-present value basis, over some expected period of operation (typically 10-20 years). After an airline understands the value of each product to their specific operation, they then have a good idea what they are willing to pay for each aircraft. It is never just about price. Airlines frequently buy the more expensive of two products. When they do, it is because they have been convinced the more expensive product will bring them more value.

      I think that’s probably what KC meant when he offered the not too informative “No Peter. it does not.” :)

    • I think the difficult part in that statement is finding a true “equivalent” at the competitor. Simply looking at seat count discounts payload range, both do not account for gate turn around, maintenance, economical cruise speed, residual value and pilot training.
      Then there´s percieved value, engine deals, legacy experience and ofcourse, discounts…

      even when two offerings are similar in one dimension, there´s usually a large gap in one or more of the others.
      So A asking more money for a plane does mean it has more value in the market place (whatever KCTB claims), but only if and when the airline can utilize the larger capacity of the airplane in some dimension.

      good example is the USAF tanker – they went for the smaller offering because the greater capacity wouldn’t have been usefull to them.

      • The current B-737NGs command higher lease rates than the competing A-320 model. Since the NEO enters airline service first (as currently scheduled), I would expect those first several leased A-320NEOs to command a premium that we have not seen before in the NB market. At least until the first of the MAX leased airplanes enter service.

        BTW, the USAF bought the smaller KC-46 not only because it could do the mission the USAF wants it to (the KC-45 could, too), but it is overall cheaper to own over the life time of the airplanes for fuel consumption, training, spares, infastructure, etc.

      • “So A asking more money for a plane does mean it has more value in the market place (whatever KCTB claims), but only if and when the airline can utilize the larger capacity of the airplane in some dimension.”

        The higher price already indicates that projection to be deemed true.

  6. No the Busboys build a better aircraft! I have flown on both and found the Airbus is better in fit and finish as well as comfort, just my opinion of course. Operating Cost, I could care less it’s all about where I set and how I feel during and after the flight.

    • Except the airlines feel pretty much exactly the opposite. They are all about costs. Pax comfort is a secondary or even tertiary consideration, depending on OEM.

      • Frequent Traveller :@ KC135 : in case you don’t know, 737 Series aircraft are bulk-loaded (manual handling, under extremely inergonomic (severe) conditions, entailing MSD etc) whereas A320 Series aircraft are equipped with CLS (Cargo Loading System, ie its holds are loaded automatically with the use of ULD : AKH containers, truncated LD3-45 containers, Pallets, etc), so actually there is a difference IMHO !

        Yes, I know it is bulk loaded. But many airlines also bulk load A-320s. LD3s and pallets are not used on the A-320 series as much as you think. Larger and longer range aircraft make better use of LD3s and pallets. It is actually more efficent and faster to bulk load baggage, small packages, mail, etc. on smaller aircraft, like the B-737 and A-320 than it is to load baggage and cargo into igloos, then load the igloos aboard the aircraft, unload them at the other end, then unlaod the igloos. It takes more time. But for larger aircraft, like the B-763 and A-330 and bigger, it is faster and more efficent to use the igloos.

    • Jay, I spent many years flying a Boeing product as a crew member when I was in the USAF. I assure you Boeing builds and outstanding airplane, one that I trusted my life on, on many occasions. Pretty does not mean good. You will probibly find the fit and finish of an airplane that has been in service for a while have more to do with the airline and its maintenance than the OEM.

      • I spent many years designing various electronic components, racks, and systems that went into the KC-135s and B-52s for Boeing and I am very aware of their ruggedness, however the fit and finish of commercial aircraft interiors are a whole different subject. As I said, Big B builds a very good aircraft but the interiors are a different matter. The problems I have experienced and observed are not so much maintenance issues as just lack of designing how the interiors go together. As you know aircraft shake a lot and if you do not design the various components properly they will come loose and even fall. Overhead stowage, lights, seat tracks and so on. Cheap is one thing and that goes to the airline, but poor design is another. MacDonnell-Douglas wasn’t any better if that is any conciliation.

  7. KC135TopBoom :
    No Peter. it does not.

    Sound proof, right there.

    In any case – list prices aren’t an indication of actual prices paid. So one manufacturer could have higher list prices, but discount more steeply to end up with the same effective price as the other. You could say that you’d be in a better position to make statements about operating cost advantages when you know the actual price an airline paid to a manufacturer, as well as the best offer they received from another manufacturer. Then again, you’d also need to know their mission profile and potentially enticing financing deals that were part of the offer they went with…

  8. Talking only about the SMR Feeder problematic, if I’m an operator with a fleet of 500+ 737-types and have to face daily – say – six times 500+ = 3000+ occasions for potential airport docker strikes blackmailing me for “hard work extras” or they lay off or damage my cargo “by accident” or go slow working-to-rule to make me miss the next flight plan departure airport slot, etc etc – all this because I’m operating with bulk-handled holds, one day I’ll accept A320 Series with its CLS and I’ll readily accept to pay a little bonus for the extra convenience, ODER ?

    • I see no relationship between a labor problem and the B-737 vs. the A-320. Labor strikes, work slow downs, “blue flu”, acedentail damage to cargo or aircraft, etc. are not related to the airplane type.

      • @ KC135 : in case you don’t know, 737 Series aircraft are bulk-loaded (manual handling, under extremely inergonomic (severe) conditions, entailing MSD etc) whereas A320 Series aircraft are equipped with CLS (Cargo Loading System, ie its holds are loaded automatically with the use of ULD : AKH containers, truncated LD3-45 containers, Pallets, etc), so actually there is a difference IMHO !

  9. It would be nice to have the same listing, but with an additional column showing the average market prices paid (well, ‘average’ at least if a considerable number of them have been leaking somehow).

  10. Pingback: Why A Boeing 777 Costs $320 Million | News In Marketing

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