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How Little Does American Airlines Pay For 737s?
Wells Fargo has this item about what American Airlines actually paid for the Boeing 737-800, as opposed to the list price: more than a 50% discount from $84.4m. Note that AerCap (AER) appears to have paid $40m per aircraft in a purchase-leaseback. One assumes American didn’t resell the aircraft for the price paid from Boeing but marked them up at least a little bit. We’ve heard AA’s cost was in the range of $35m but this is unconfirmed. (leehamnews.wordpress.com) Más...Sort type: [Top] [Newest]
50% discount? I want to buy my next car from Boeing.
Now I understand why the seats are so big and the fares so low...LMAO
Well played sir - HAHAHA
Open this article and at the bottom of the piece click on the 30 minute interview with Bob Crandall, former CEO of AA, and Peter Greenberg, Travel Editor at CBS, with Charlie Rose. A great discussion of airline issues. A lot of "food for thought" in the interview.
Bottom line is that the Aircraft are all LEASES! The Major Airlines do not own the fleet of aircraft. Look at the Registration Certificates located in the cockpit of the aircraft. You will see the Major Bank or Leasing Corp listed as the owner.
Apologies up front for the long post... I didn't mean to write this much when I started... @_@
But does anyone truly believe that any ultra high-profile, multi-million dollar airline like AA is 'sneaking' past the IRS and evading taxes illegally? Or that they are exploiting loopholes that the government has missed? The IRS can dig into any one of our pockets and look for loose change, and they can do it with a frightening level of impunity. I don't believe for a second that our government isn't intimately aware of what he airlines are up to.
That having been said, it probably IS completely accurate that AA (and all of the other airlines) are getting huge discounts from manufacturers and huge tax breaks from the government. The reasons why?
1) Capitalism. Aircraft manufacturers need to move their product... if they don't, they tend to go out of business. Makes sense, no? ^_^ So it really does not surprise me that an aircraft builder is willing to cut huge lease deals with airlines to get their products out in the marketplace. We don't know what their real margins are anyway and I'm sure there is more to it than what I have said... but even my grossly simplified view of it makes sense to me.
2) Infrastructure. Our country MUST transport vast numbers of people and goods in order for our economy to operate. It has always been this way. This is why railroads were built to span the country as it grew, it's why the interstate system was built, and it's why airlines have become what they are. It is also why states get HUGE financial incentives to update/maintain their roads/highways/freeways. Well, if the government uses federal tax dollars to maintain the road infrastructure, why is it surprising that they also give huge tax breaks to airlines and other carrier services? Imagine if they DID tax the crap out of the airlines? Who would end up paying for those increased cost burdens? WE would! And if air travel became too expensive for us to use it (it almost is anyway!), then what would happen to that industry? It would implode! Have we forgotten how bad it was after 9-11 when the skies were closed for only a few days? What a mess that was! ...No, it is completely logical to think that our government is all about giving the airlines a pass when it comes to sales tax on aircraft purchases. And whether or not it's fair is irrelevant... we all still benefit from it.
Again, sorry about the long post/soapbox thing. ;)
But does anyone truly believe that any ultra high-profile, multi-million dollar airline like AA is 'sneaking' past the IRS and evading taxes illegally? Or that they are exploiting loopholes that the government has missed? The IRS can dig into any one of our pockets and look for loose change, and they can do it with a frightening level of impunity. I don't believe for a second that our government isn't intimately aware of what he airlines are up to.
That having been said, it probably IS completely accurate that AA (and all of the other airlines) are getting huge discounts from manufacturers and huge tax breaks from the government. The reasons why?
1) Capitalism. Aircraft manufacturers need to move their product... if they don't, they tend to go out of business. Makes sense, no? ^_^ So it really does not surprise me that an aircraft builder is willing to cut huge lease deals with airlines to get their products out in the marketplace. We don't know what their real margins are anyway and I'm sure there is more to it than what I have said... but even my grossly simplified view of it makes sense to me.
2) Infrastructure. Our country MUST transport vast numbers of people and goods in order for our economy to operate. It has always been this way. This is why railroads were built to span the country as it grew, it's why the interstate system was built, and it's why airlines have become what they are. It is also why states get HUGE financial incentives to update/maintain their roads/highways/freeways. Well, if the government uses federal tax dollars to maintain the road infrastructure, why is it surprising that they also give huge tax breaks to airlines and other carrier services? Imagine if they DID tax the crap out of the airlines? Who would end up paying for those increased cost burdens? WE would! And if air travel became too expensive for us to use it (it almost is anyway!), then what would happen to that industry? It would implode! Have we forgotten how bad it was after 9-11 when the skies were closed for only a few days? What a mess that was! ...No, it is completely logical to think that our government is all about giving the airlines a pass when it comes to sales tax on aircraft purchases. And whether or not it's fair is irrelevant... we all still benefit from it.
Again, sorry about the long post/soapbox thing. ;)
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If your reply was even remotely rational I would be appalled by what you just said. It is expected and acceptable to disagree with my perspective of this issue, but there is no excuse for your vitriolic personal attack. Are you a member of this forum only so you can troll the threads looking for reasons to spout hate? You have issues sir...
What in the world are you talking about?