new vs. used airplanes

Started by meiru, April 26, 2010, 04:54:35 PM

meiru

little question... is there any reason, why I should order (lease) new airplanes over used airplanes? ... let's say an MD-83 or 88 for 360-440k a month vs. a new MD-88 or MD-90-30 er for 580k a month... I can't imagine, that I can save those 140k a month only using a newer airplane... but, maybe I'm overlooking some CI effects? ...

swiftus27

lets start:

1.  Older planes are harder to maintain.  Every check costs more.
2.  There is a smaller impact on your CI when you use old planes.
3.  Older planes usually have longer turnaround times (the MD80-88 series is not one of the groups but the MD90 and B717 are diff groups)
4.  Older planes need more fuel to fly from a to b.

alexgv1

In my experience, the higher leasing costs were always worth paying for newer planes. You might get old planes on a dirt cheap lease (allowing you to buy in bulk) but the heavy maintenance checks will cost so much more.
CEO of South Where Airlines (SWA|WH)

MattDell

Look at the maintenance costs on a 20 y/o plane vs. a brand new one.  It'll make sense immediately. ;)

meiru

Well, that's what I did and... replacing MD-80s between 5 and 12 years old with MD-90s doesn't seem to be a good idea... :-) so for now I continue leasing used MD-80s ...

alexgv1

Well aircraft with age under 10 years shouldn't give you too much trouble. Seems feasible to me. Problems only start when they're 15+ yrs old in terms of costs. If you keep your fleet age in single figures even with used aircraft you will eventually be able to replace them with new/newer ones as the leases expire.
CEO of South Where Airlines (SWA|WH)