3 Links I Love: IAG Orders (and Renames) the MAX, Giving Clarity to MH370, Major Merger Restrictions
This week’s featured link:
IAG signs letter of intent for 200 Boeing 737-8 and 737-10 – IAG Newsroom
There is so much to say about this that I don’t even know where to start.
- Note that the word MAX is not mentioned anywhere in the release. Get ready for a branding change, I’d say.
- Kudos to IAG for taking full advantage of Boeing’s weakness. I can’t imagine how little IAG will have to pay for these airplanes.
- Boeing was desperately in need of an order, and it had to be willing to pay even more to flip an established company that only operates Airbus narrowbodies. Boeing must have paid dearly for this, and IAG is the perfect company to take full advantage.
- The fact that this is only a letter of intent gives Boeing two bangs for the buck. It can announce it now and steal a little thunder from Airbus at this week’s Paris Air Show. Then the order can be finalized once the airplane is flying again safely and get more press for it then.
- The release says these airplanes are destined for LEVEL, Vueling, and BA’s Gatwick operation. That says these will be outfitted in a high density leisure configuration. It won’t be comfortable, but IAG doesn’t care. The economics will be outstanding.
- Even if the order is never finalized, I’m sure IAG will get a screaming deal on other Boeing airplanes as a “thank you” for helping.
Great job by IAG undoubtedly extracting massive value from Boeing here. I had pegged Delta to be the one to make the move, but it looks like IAG got there first.
I didn’t realize until this week that this is the last of the MD-80s delivered to American that’s still flying for the airline. (There are still 27 ex-TWA airplanes that are still going.)
The old Douglas birds are still scheduled to be retired in early September though American won’t officially confirm the details yet.
Two for the road:
What Really Happened to Malaysia’s Missing Airplane – The Atlantic
William Langewiesche has once again put together a masterpiece of a story. This time he focuses on the disappearance of Malaysia 370 so many years ago. After reading this lengthy article, it’s hard to imagine this happening any differently. The only question in my mind is… why would the captain have stayed alive and just continued to fly toward certain doom? Why not end things earlier? I suppose it’s futile to try to understand the rationale of someone who, if things actually played out as suggested, had serious mental problems.
Restrictions on the Merger of First Air and Canadian North – Government of Canada
Both of these airlines serve the far north of Canada, and I imagine much of the flying is government subsidized. So, what is the government requiring to approve the merger? It’s pretty crazy. Fares can’t increase more than costs, load factors can’t exceed a certain amount… read the rest for yourself.
