[-] Connect the pricing of new and old aircraft

[JumboShrimp]

There is a complete disconnect between new and old aircraft pricing.  The day the new aircraft is delivered, its pricing is unrelated its price a day before, as if it was a different aircraft.

Example:  MD-90-30ER
- New: 75 million
- One day old: 67 million

Would it be possible create a firm connection at this point?  Meaning price of new = price of 1 day old.

[Tha_Ape]

Actually I'm not so sure this is unrealistic / illogic.
Most things you buy and want or have to resell on day 1, even unused, even with the blister still on, you take a loss. Values goes down as soon as it's delivered to the customer.
A car, a toy, a disc, a computer, anything. Don't see why it should be different with planes.

[JumboShrimp]

Actually I'm not so sure this is unrealistic / illogic.
Most things you buy and want or have to resell on day 1, even unused, even with the blister still on, you take a loss.

If the system consistently knocked 10% of price of new aircraft in first day, that would be one thing.

The problem is that the system has 2, unrelated pricing models.  One for old, one for new aircraft.

The feature request is to create a firm connection between these 2 pricing models, so that they are no longer unrelated.  They will be related.  Connected at the point of the aircraft delivery.

[Zobelle]

Can’t you sell for whatever you want?

[JumboShrimp]

Can’t you sell for whatever you want?

No you can't.  Not to your alliance members.

The range of prices is based on "Recommended Price", which is one pricing model (which also controls the alliance price range).
Dynamic pricing of new aircraft is a different pricing model.

These 2 models are independent on one another.  I don't think they should be independent.  They should be constraining one another.

It doesn't mean that either one of the models (used and new) are flawed.  They are fine, they have been fine tuned.  We just need this last piece of puzzle added so that these models are connected.

For example
- UM full of aircraft selling at discount should be pushing down the pricing of new aircraft.
- production line sold out for several years should be pushing up the Used "Recommended" price

BTW, there was a time in AWS, before a number of pricing enhancements were added, when the this disparity did not exist.  I am thinking 2-3 years ago.  At that time, freshly delivered aircraft had a recommended price of new aircraft.

So this is not a "New" request.  Just a fix to something that used to work in the past.

[gazzz0x2z]

Hell is gonna freeze, but I agree with the current system(and with zobelle).

If no one wants new airplanes, and everyone wants used but very young airframes, then the disconnect makes perfect sense. What fellow alliance members pay for is availability now. Manufacturer can't provide. Broker can provide.

Plus it fits the offer/demand principle. What people want is more costly.

[JumboShrimp]

If no one wants new airplanes, and everyone wants used but very young airframes, then the disconnect makes perfect sense.

You mean the disconnect would be premium on Used aircraft over New in this scenario - if people wanted Used Aircraft so much that they would be sold out.  So Recommended Used price would be higher than New price.

OTOH, if UM was full of young unsold aircraft selling at low prices, there would be a discount. of Used over New.

So taking my example, MD-90-30ER, there is exactly zero of them listed publically on the UM.  Based on the supply/demand, used MD-90-30ER should have a substantial premium on UM vs. price of new.  What would be your guess the premium should be for aircraft with zero UM availability?  10%? 20%? More?

Well, the system does the opposite.  An aircraft with zero availability (everything is sold out) has a recommended price of 10% discount.

My ambition in this feature request is modest.  I am not asking for any AI to govern the disconnect, to fix it from being wrong majority of time.  I am just asking for something a lot simpler: Eliminate this disconnect that is wrong most of the time.

[Tha_Ape]

I get your point, however the span between absolute min and absolute max price (or within alliance range) allows you to go well beyond this recommended price, bypassing your request. So yes, it's disconnected, you're right. But I don't see it as a problem.

For an almost new bird, the UM is usually filled only with aircrafts ordered long ago (at low price) with prices well above the actual factory price.
-> in GW#2 I'm currently making 30% profit by selling 733 to my alliance mates at min AP.
Following your path, higher recommended price would mean higher min AP. I'd then make 50% on my alliance mates, even on the "poor" ones. And more than 100% profit when selling at absolute max.

This is just absurd. The consequence would be that large brokers with fat banks accounts would get even more money, and smaller players obliged to rely on brokers would be penalized even more...

So you want them to be connected, fine. But we need to find a way that doesn't make prices higher on resell.
Because your last example is interesting for low-asked for birds, but makes things ridiculous for highly wanted birds.

[JumboShrimp]

PS:

It is amazing how the Recommended price is susceptible to manipulation.  I see a player in GW3 listing 10s of aircraft that no one (in their right mind) would want.  He is listing them at about 200+ % of new price.

Going through these models, it seems there are 2 scenarios:
1. no one buys a single one, and the recommended price remains within realm of reason
2. one of the overpriced aircraft ever gets sold at the super inflated price, the recommended price jumps like 50%.

Here is an example of brand new Twin Otter (facepalm)

We estimate the fair price to be between 6 340 000 USD - 8 220 000 USD. The list price of a similar new aircraft is currently 5 257 000 USD.
(10s listed no buyers)

So highly desirable MD-90-30ER with no public availability is at -10%, and Twin Otter is at +50%.

Can we conclude that the Recommended price is useless, that the best thing to do is to dispose of that calculation method, and instead start from "Dynamic" new pricing and use aircraft age to arrive at the recommended price?

[JumboShrimp]

For an almost new bird, the UM is usually filled only with aircrafts ordered long ago (at low price) with prices well above the actual factory price.
-> in GW#2 I'm currently making 30% profit by selling 733 to my alliance mates at min AP.

You are describing a unique situation of placing the order near launch, before the Dynamic Pricing fully kicks in.  Plus, inflation, if the delivery takes years.  The profit margin reported does not take into account the opportunity cost of money sunk into the order for years.

But yours is a completely different, unrelated point.  The point is, there is no telling where the Recommended price will end up.  See my post above.

Again, making the "Recommended" price act within reason is not something new.  There was a time when pricing on UM made sense, was predictable and everyone understood it.

[Johan87]

Yeah,just like in real life,let the market do there work indeed.
Always price flux with ask and demand.

This is how it goes and recomended prices should be calculated over what is available and how many years there is a backlog in the newly produced.

We all know and for example the B762-200 start at high prices,just to gett new frames in,but once ER versions are available +B767-300/300ER,nobody buy the used B767-200 any more for 90mln because they will have an over price at purchase (of the seller) and cannot resell any more because of the minimum bar set too high while noby is actually buying the old version.
B727-100 have same with B727-200ADV beeing well available and B737PG/MD-80's and A320's beeing released on us etc.etc wth all planes.

You are describing a unique situation of placing the order near launch, before the Dynamic Pricing fully kicks in.  Plus, inflation, if the delivery takes years.  The profit margin reported does not take into account the opportunity cost of money sunk into the order for years.

But yours is a completely different, unrelated point.  The point is, there is no telling where the Recommended price will end up.  See my post above.

Again, making the "Recommended" price act within reason is not something new.  There was a time when pricing on UM made sense, was predictable and everyone understood it.

[Tha_Ape]

  The profit margin reported does not take into account the opportunity cost of money sunk into the order for years.

Really? And do you know a better way to use my money than to invest it? Otherwise it would just sleep and get proportionally depreciated over time.

You are describing a unique situation of placing the order near launch, before the Dynamic Pricing fully kicks in.

Right and wrong. Right on the principle (before dynamic pricing), but wrong on the occurrence: this is one of the most common investment situation.

----------

But yours is a completely different, unrelated point.  The point is, there is no telling where the Recommended price will end up.  See my post above.

For example
- UM full of aircraft selling at discount should be pushing down the pricing of new aircraft.
- production line sold out for several years should be pushing up the Used "Recommended" price

"The point is, there is no telling where the Recommended price will end up": this is the problem. Recommended is one thing, alliance max / absolute max another one tied to the former.
If recommended goes higher because of demand, absolute max will go higher and UM prices for wanted models will just get crazy and only a handful of players will be able to afford such planes (if it was not already the case). So, as I said earlier, only the real Big Boys will be able to afford the most wanted birds from the UM, even more than today. Big Boys will be even more competitive and smaller players will end up using old planes for decades / forever.

Example: absolute max for a 733 in current GW#2 is around 52M. Demand is crazily high and as per your system, recommended should get from 38.5M to "more", and absolute max from 52 to... to what? Where does it stops? How much are you willing to pay for a 733? 70M? 100M?

-> not telling the intention is not good, but if the current proposal has some nice aspects (for unwanted birds), it also has a serious flaw (for most wanted aircrafts).

[Sami]

Going through these models, it seems there are 2 scenarios:
1. no one buys a single one, and the recommended price remains within realm of reason
2. one of the overpriced aircraft ever gets sold at the super inflated price, the recommended price jumps like 50%.

Recommended price / price advisor has nothing to do with the prices players are listing their aircraft, or have been selling them. It was deemed too unreliable.

That calculation is based purely on the specifications of the model: system calculated internal value (model/engines/other specs), age, condition, maintenance status and also the price status of similar new aircraft (which is the only way players could affect them, but not by any shenanigans in the used market for sure!).


As for the request. There never has been any "locked" / full connection with new and used aircraft pricing. The new aircraft pricing has been dynamic for ages, and the valuation of aircraft in use has been based on the 35yr life calculation math of the model and its specifications. Currently the book value determines the value shown to players but the used a/c valuation and recommended pricing baseline model is still based on this previously mentioned math (call it for example "true value"). But the used a/c price level IS augmented by the price level of the respective new aircraft also.

So, the used a/c valuation system is already smart enough taking into account the new a/c pricing too. ==> No changes.

[Zombie Slayer]

Sami....you are missing the point. All that is really being asked for is the ability to offer for sale a newly delivered plane to an alliance partener at cost. If there is deflation or a big dynamic shift from order to delivery the alliance min/max function blocks this. Prime example, 747SP for an alliance partner in GW3. I paid 102m each, bybdelivery alliance max was 96m. Why can I not sell at book? That is what we want added.

[Zobelle]

Isn’t this what a different thread was about?

[JumboShrimp]

Really? And do you know a better way to use my money than to invest it? Otherwise it would just sleep and get proportionally depreciated over time.

The best investment is in you own aircraft to fly (profitably).

"The point is, there is no telling where the Recommended price will end up": this is the problem. Recommended is one thing, alliance max / absolute max another one tied to the former.
If recommended goes higher because of demand, absolute max will go higher and UM prices for wanted models will just get crazy and only a handful of players will be able to afford such planes (if it was not already the case). So, as I said earlier, only the real Big Boys will be able to afford the most wanted birds from the UM, even more than today. Big Boys will be even more competitive and smaller players will end up using old planes for decades / forever.

"Recommended" used price would be related to dynamic pricing of new aircraft, as opposed to unrelated.  That's all.  I am not sure why you are trying to insert some Social Justice Warrior stuff into this.

Example: absolute max for a 733 in current GW#2 is around 52M. Demand is crazily high and as per your system, recommended should get from 38.5M to "more", and absolute max from 52 to... to what? Where does it stops? How much are you willing to pay for a 733? 70M? 100M?

My question would be the current price of new 733.  Recommended price would be derived from that and so would the Min / Max ranges.

[Tha_Ape]

The best investment is in you own aircraft to fly (profitably).

And once that's done already?

"Recommended" used price would be related to dynamic pricing of new aircraft, as opposed to unrelated.  That's all.  I am not sure why you are trying to insert some Social Justice Warrior stuff into this.

Because I sometimes got the feeling you tend to be the Big Boy's Injustice Warrior
More seriously, because I'm heavily involved in helping smaller airlines (advices of all kinds and cheap planes), and from this I have opportunities to learn in which part of the game they struggle (talking of the airlines / players with potential, not of the "dumb newbie").
So when I see gigantic airlines trying to get more money when they already have golden mattresses, yes, I find it a little surprising.

My question would be the current price of new 733.  Recommended price would be derived from that and so would the Min / Max ranges.

Nothing to say about it (it's a little too vague for me to make up my mind).

Anyway, I don't find your basic idea ridiculous or else, I'm just trying to point out what would be problematic in its current form. So that there could be an opportunity to make it better.

[Zobelle]

More seriously, because I'm heavily involved in helping smaller airlines (advices of all kinds and cheap planes)

Those max price 762ER for lease only say otherwise, lol.

[Tha_Ape]

Those max price 762ER for lease only say otherwise, lol.

Absolutely

Seriously, do you think I'd put discounted planes out in the open so everybody can grab them?

[JumboShrimp]

Recommended price / price advisor has nothing to do with the prices players are listing their aircraft, or have been selling them. It was deemed too unreliable.

That calculation is based purely on the specifications of the model: system calculated internal value (model/engines/other specs), age, condition, maintenance status and also the price status of similar new aircraft (which is the only way players could affect them, but not by any shenanigans in the used market for sure!).


As for the request. There never has been any "locked" / full connection with new and used aircraft pricing. The new aircraft pricing has been dynamic for ages, and the valuation of aircraft in use has been based on the 35yr life calculation math of the model and its specifications. Currently the book value determines the value shown to players but the used a/c valuation and recommended pricing baseline model is still based on this previously mentioned math (call it for example "true value"). But the used a/c price level IS augmented by the price level of the respective new aircraft also.

So, the used a/c valuation system is already smart enough taking into account the new a/c pricing too. ==> No changes.

Looking at the symptoms, the explanation makes some sense to me.  The way I understand the explanation:
- New Aircraft pricing is very dynamic, with some wild swings
- Used aircraft pricing is far less dynamic, using new pricing as just one of the inputs.

In the old system, since the new pricing was less dynamic, this disconnect (between New and Used) either did not exist or was a lot smaller.

Setting aside the terminology (locked connected), why is the current situation with potentially large disconnect any better than the old system without any disconnect?