American press conference on huge order

Running comments from the American Airlines press conference:

Tom Horton

  • Today is a transformational day for American.
  • American’s order presentation, 19 page PDF: AMR Aircraft
  • With this plan we are jumping to the front of the line and will be ahead of our peers.
  • We will have the youngest fleet of our peers.
  • We will lower our costs with this modern fleet.
  • With six variants in two families, American will have great fleet flexibility.
  • Increasing fuel efficiency 35% over MD80s, plus lower maintenance and operating economics.
  • As we replace fleet, plan gives us flexibility to replace 757s and 767-200s with US trans-con capability of A320 and 737 families.
  • Can fly 737-700 and A319neo at small end, thin markets, replacing CRJs. More service, better service for customers.
  • $13bn in lease financing provided by partners for first five years. Maximizes fleet flexibility and reduces risk.
  • $3.3m NPV savings per aircraft.
  • Manufacturers were so keen to do these deals they brought forward $13bn in financing. There’s not much not to like about this deal.
  • These are operating leases with minimal or no capital expenditures (that would have been required for a purchase).

Separately, American was advised by SkyWorks Capital.

9 Comments on “American press conference on huge order

  1. It would be interesting to see a head to head comparison between the 737-9 RE and the A321 neo with regards to AA’s transcons.

  2. So, AA is leasing all of these airplanes? That may be a smart move as they could return the B-737NGs and A-320OEOs when the A-320NEOs and B-737NEs become avaiable. It is great that AA is now the launch customer for the B-737NE.

  3. One thing that strikes me about this deal is that American will end up with considerably more planes than they have at the moment. The replacements will carry more seats on average compared with the planes they replace. And that’s without exercising any options.

    What are your thoughts? Is AA pushing for a big expansion? Will they get the new but unre-engined planes out of their fleet as the NEOs and REs come on stream?

    • I expect AA is planning to walk right over the then uncompetitive other legacies in the US.

      They try to break the wheel of low profits due to expensive fleets due to no liquidity due to no profit and low future expectations.

      • It sort of looks like Airbus offered AA what they needed. And then Boeing came along and said, “Here’s a bunch more and a deal you can’t refuse”. It does mean that AA gets its replacements earlier than if they had gone all Airbus.

    • I think it’s only 90 planes more, or 15%? And I doubt that the seat count is so much higher on average.

      • I reckon it’s 150 or so planes more. AA has a number of 737s on order that haven’t yet been delivered. Seat counts will go down as AA replaces the 767s and 757s by A321s and up as it it replaces the MD-80s by 737s and A320s. It has more MD80s than 757s and 767-200s

  4. FF :I reckon it’s 150 or so planes more. AA has a number of 737s on order that haven’t yet been delivered. Seat counts will go down as AA replaces the 767s and 757s by A321s and up as it it replaces the MD-80s by 737s and A320s. It has more MD80s than 757s and 767-200s

    I’d wait to see the final agreement with Boeing before making predictions on the state of current and future orders from them.

    The agreement with Airbus at least allows them to choose the A319NEO if they wanted to. I presume the agreement with Boeing is equally flexible. So it’s too early to tell what the actual seat-count addition will be.

Leave a Reply

Your email address will not be published.