Costs involved in Purchasing a B737 or similar aircraft

[EI-MAY]

Hi there,

This is a great Site, well done Mark! This is my first post so I hope it might start an interesting topic of debate.
I am doing a research assignment into the acquisition costs involved with purchasing a B737 or similar type aircraft. Fixed and variable costs etc.
I am just wondering if anybody could help to point me in the right direction please? Any good web links??
I know some airlines might receive great discounts depending on the number of aircraft they order etc.
I'm also interested in the daily running costs of these aircraft, fuel prices, crew training, maintenance, insurance, landing fees, airport operator charges the list goes on and I understand they greatly differ depending on what airport they operate from, but I'd like to get a picture of these prices in Dublin and Shannon airports.
So thanks again and apologies if I've posted this in the wrong forum!

[Lambada Crazy]

As far as i know, I dont know if im right or wrong but Ryanair have bought the whole produvtion line of the latest 737 and you will have to see them if you want to buy new

[DivX]

Where do you gey your information ?

"As far as i know, I dont know if im right or wrong but Ryanair have bought the whole produvtion line of the latest 737 and you will have to see them if you want to buy new"

Complete crap - Ryanair have put in orders for new aircraft, like any ordering system they have joined the queue as do any other airlines purchasing after them.

Boeing own the prodction line and anyone who wants a B737 have to contact Boeing not Ryanair... then again maybe the "lads" in the club are right !


EI-MAY

You are asking questions that are hard to answer due to so may factors and there is some real research to be done, especially if you want to narrow it down to costs for operating for Ireland or Europe.

The important to note is the cost for operating aircraft can vary a great deal. A common measurement is cost per passenger mile flown. The difference between FR and EI is substantial.

1. Find the fuel economoy of the aircraft involved. I suspect this would
be found on the manufacturers web site.

2. Determine the average price of Jet A1 for the desired airports.

3. Determine the average passenger load for flights between those
airports (this might be difficult but some airports have this information freely available - CAA website for example of Ireland UK routes.

4. Determine landing and other airport fees for the aircraft again some airports have this information on their websites or a quick phone call.

5. Determine crew salaries for the staffing of the aircraft. This could vary widely depending on the current market saleries.

A good read is http://icat-server.mit.edu/Library/Down ... thesis.pdf

Although this is based on regional jet operations in the US there is alot of comparision with the B737 including operating costs and turboprops, market shares and growth and various calculations etc

It will give you a good in sight into the general market but maybe not exactly ehat you were looking for.

[EI-MAY]

Hi DivX,

Thanks for your reply. I've taken note of some of your interesting points.
The main area of my research is in the Acquisition costs, sorry I should have made this point clear.
I'm interested in the daily running costs(from Dublin+Shannon) too, but just as some added background information.
Yes, I'm sure Airlines intending to purchase a B737 don't have to contact Ryanair for one.

Anyone got any inside info on what Ryanair paid for the B737-800's ? and what does Jet A1 cost in dublin??

Thanks,

[Dutch Roll]

here have a look at the ryanair site,

http://www.ryanair.com/site/EN/news.php ... -en-041005

http://www.ryanair.com/site/EN/news.php ... -en-130605

http://www.ryanair.com/site/EN/news.php ... -en-240205

just keep searching through their news.

[flighty]

Also to bear (this the right kinda bear?) in mind, list price from boeing and the price paid by Ryanair et al could differ significantly owing to size of order or the order book of Boeing at the time.

You could also look into wet and dry lease options.

[Dutch Roll]

errr english spelling lessons again,err count me in !!

[flighty]

Ill try and use words I can spell this time....
Just spoke to a friend of mine who works for a travel agents and they are of to Scandinavia this afternoon. They have chartered a 737-200, fuel, crew, landing charges, catering etc=?80K.
Aircraft is on the ground until Sunday when they return.

[EI-MAY]

Thanks Guys for the usefull info.
Also, The following link is a great website about the B737, also has some good articles about what the airlines are paying for them.

http://www.b737.org.uk/sales.htm

It tells you practically everything you need to know about this aircraft.

[exRigger]

Hi,

I only joined today as well (please see my Vulcan XH558 posting).

Have you tried Googling "Boeing 737 for sale"? There are nearly a quarter of a million hits.

I don't see too many prices in evidence; I imagine that if you need to ask, you can't afford it.

If you are thinking of setting up a DUB-SNN service, you might want to do what most start-ups do and dry lease to see if it is both practical and profitable.

By the way, flighty and Dutch Roll, I am something of a pedant when it comes to the English language. I noticed no misuse of spelling or grammatical or syntactical structure in flighty's first posting and his concerns over the use of the homophone "bear" are unfounded.

flighty?s second posting, however, does use the word ?agents? where ?agent? should have been used and ?of? where ?off? would have been correct.

[Dutch Roll]

i was unsure of the spelling too,i wasnt having a go!! thanks for the lesson anyhow!!

[stovepipe]

Hi there
The price of an aircraft also varies because of the equipment fit; how close is your model to the generic model? How many seats? What size of galley? What extras such as IFE, satfone, winglets, jumpseats,etc? what variation to the instrument panel will you require? Ryanair's per-unit price was way below normal cost because of their huge order and their standardisation.They didn't get winglets(which is now a bone of contention between them and Boeing) and also cut out the free pilot training normally included in the cost. Their 800s are as close to generic as you can get, so no in-fleet differences like EIs A-320s. Also, they sold the aircraft to the Bank of Scotland and have leased them back. They also cut a deal for the provision of Simulators....Another factor to consider is the leasing of engines and the operating system of "power-by-the-hour"....Crews? F/Os can be had for peanuts and will work for minimum wage and will pay for their Type. Skippers will be expensive, especially contractors, but not as much as those used by legacy carriers. Mechs are cheap and so are cabin crew and less-skilled ground staff. IT and senior maintenance/engineering people are not so cheap, but cheaper than skippers....caterers and cleaners will cut each other to the bone for your business.....fuel companies will do the same........fixed costs, such as landing, navigation, leasing(!!!), aircrew recurrency, ground staff compulsory training and Jeppies,etc and a thousand other costs are a pain but have to be borne and are not easy to reduce. You also have to have a back-up fund for when a baggage truck dents your 737 and your insurance argues the toss!......I wish you luck!
regards
Stovepipe

[EI-MAY]

Ex-Rigger

"Have you tried Googling "Boeing 737 for sale"? There are nearly a quarter of a million hits.

Yes, I have, that's just a bit obvious don't you think!

I don't see too many prices in evidence; I imagine that if you need to ask, you can't afford it.

No, thanks I don't want to buy one, I haven't got a spare $60 million in loose change. My research is in assessing the acquisition costs and the many variables involved for a research assignment.

If you are thinking of setting up a DUB-SNN service, you might want to do what most start-ups do and dry lease to see if it is both practical and profitable. "

No you seem to have got it wrong again, I don't want to set up a Dub-SNN service and I am not a start up.

Stovepipe,

Thanks, you have given some great advice that I will certainly take on board.

Some interesting points you made were; the lease back from Bank of Scotland, the Leasing of engines etc.

I heard that Ryanair saved a substantial amount of money by eliminating the window blinds, reclining seats, table tops etc.

I also heard that Ryanair will be retro fitting the Winglets at some point in the future. I wonder who will pay?

Once again thanks for all the constructive comments

[stovepipe]

Hi there
I heard that Ryanair tried to get Boeing to pay for the retrofit, but Boeing had cut their price enough and said so. Ryanair had to get an STC to retrofit the winglets and had some fun with the IAA, as a result. The recent oil price hikes spurred them to take the hit and buy the winglets and do the IAA's bidding.
regards
Stovepipe.