Re: UA A321 ?

Date:         26 Oct 98 02:59:30 
From:         kls@ohare.Chicago.COM (Karl Swartz)
Organization: Chicago Software Works, Menlo Park, California
References:   1 2 3 4 5
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[stuff about CO replacing 757s with 737-800s for EWR-SEA]

>I wonder how many other such routes exist, and what impact that will have on
>Boeing profits? Clearly, it's more cost-effective for the airline, which
>could translate into more aircraft purchased. OTOH, the 757 is a more
>expensive aircraft (is the profit higher, too?) than the 737, so if it
>*doesn't* translate into more total aircraft purchased, it would result in a
>reduction of revenues (and maybe profits) for Boeing.

The key here is that in most cases, the airlines already have built up
their 757 fleets, so Boeing isn't losing a 757 sale.  The economic
advantages of the 737-800 allow Boeing to sell a plane to replace the
757 when otherwise they might not have sold a plane at all.  No doubt
the 737-800 will cost Boeing some 757 sales, but I don't think the
impact will be that great.

The 737-800 isn't the first plane in this class, either.  The A320 fits
the same bill, efficiently flying transcon routes where the 757 is too
big.  UA, for example, has replaced the 757 with the A320 (and A319) on
some transcons, and opened up other transcons which they never would
have seriously considered with the 757.  They looked at the 737-400 but
found it too small and with too little range, and asked Boeing for what
would become 737-800, but at the time Boeing wasn't willing so UA went
to Airbus.  Those are sales which Boeing never could have won with the
757, and might have gotten had they had the 737-800.

--
Karl Swartz	|Home	kls@chicago.com		http://www.chicago.com/~kls/
		|Work	kls@netapp.com		http://www.netapp.com/
"The average dog is a nicer person than the average person."
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