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Spirit Airlines to purchase Airbus jets



 
 
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  #1  
Old March 19th, 2004, 12:38 PM
taqai
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Default Spirit Airlines to purchase Airbus jets

March 19, 2004
FREE PRESS BUSINESS WRITER

Spirit Airlines said it will place an order today for 35 jets from
Airbus Industrie for about $2 billion with an option to buy 60 more.
The total deal is valued at about $5 billion.

The deal could have major implications for Detroit travelers. New
planes would allow Spirit to add domestic and international routes,
including some from Metro Airport.

This is the single-biggest plane order placed by Spirit, Detroit
Metro's biggest low-fare carrier.

The 124-passenger Airbus A319 and 220-passenger A321 would replace
Spirit's entire fleet of 32 Boeing 150-passenger MD-80s.

Spirit will buy an equal number of A319 and A321 planes, spokeswoman
Laura Bennett said. The first plane is expected to arrive in March
2005 with the remaining spread through the next five years.

The order comes less than a month after Spirit raised $125 million
from Los Angeles-based private equity fund Oaktree Capital Management
LLC to expand its flights and routes and to update its fleet.

"Spirit already has one of the lowest costs of operation in the
airline industry, and the new Airbus aircraft, which are
technologically advanced and fuel-efficient, will assure our continued
leadership," Jacob Schorr, chief executive officer of Miramar,
Fla.-based Spirit, said in a statement.

Spirit has 115 daily flights, 20 to 25 of them from Detroit. Spirit
had said earlier it wants to have at least 200 daily flights within
five years with 40 to 50 from Detroit.

"Clearly, this has been in the works for many months," said Kevin
Mitchell, chairman of Business Travel Coalition, a lobby for business
travelers. "There is a very determined and thought-out strategy to
expand and grow."

The new planes give Spirit the ammunition to fight larger airlines
like Northwest Airlines, Mitchell said.

Spirit recently got approval to fly to 11 countries: Aruba, the
Bahamas, Canada, Costa Rica, Dominican Republic, El Salvador,
Guatemala, Honduras, Jamaica, Nicaragua and Panama.Metro Airport is
expected to get some of those international flights.

Bennett said the planes would have two-class seating: Spirit Plus and
regular economy class.

The Airbus 320 family of aircraft is popular with low-fare carriers
like Spirit. JetBlue Airways flies the A320s and its costs are among
the lowest in the industry.

The new planes would help Spirit lower its costs further, Mitchell
said.
  #2  
Old March 19th, 2004, 07:03 PM
nobody
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Default Spirit Airlines to purchase Airbus jets

taqai wrote:
Spirit Airlines said it will place an order today for 35 jets from
Airbus Industrie for about $2 billion with an option to buy 60 more.
The total deal is valued at about $5 billion.


What is happening at Boeing ? Are they asleep at the switch ? With the
devalued US dollar, one would think that Boeing would have had a big advantage
over Airbus especially for domestic USA sales.
  #3  
Old March 20th, 2004, 02:11 AM
Quantum Foam Guy
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Default Spirit Airlines to purchase Airbus jets


"nobody" wrote in message
...
taqai wrote:
Spirit Airlines said it will place an order today for 35 jets from
Airbus Industrie for about $2 billion with an option to buy 60 more.
The total deal is valued at about $5 billion.


What is happening at Boeing ? Are they asleep at the switch ? With the
devalued US dollar, one would think that Boeing would have had a big

advantage
over Airbus especially for domestic USA sales.


Boeing management has been asleep at the switch a long time, JF. Just like
your buddies at Bombardier.


  #4  
Old March 20th, 2004, 02:14 AM
mtravelkay
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Default Spirit Airlines to purchase Airbus jets

nobody wrote:

taqai wrote:

Spirit Airlines said it will place an order today for 35 jets from
Airbus Industrie for about $2 billion with an option to buy 60 more.
The total deal is valued at about $5 billion.



What is happening at Boeing ? Are they asleep at the switch ? With the
devalued US dollar, one would think that Boeing would have had a big advantage
over Airbus especially for domestic USA sales.


American consumers used to be able to buy Yugos too, but very few did.


  #5  
Old March 20th, 2004, 02:32 AM
Quantum Foam Guy
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Default Spirit Airlines to purchase Airbus jets


"nobody" wrote in message
...
taqai wrote:
Spirit Airlines said it will place an order today for 35 jets from
Airbus Industrie for about $2 billion with an option to buy 60 more.
The total deal is valued at about $5 billion.


What is happening at Boeing ? Are they asleep at the switch ? With the
devalued US dollar, one would think that Boeing would have had a big

advantage
over Airbus especially for domestic USA sales.


Actually, JF, it won't have much of an effect for another year or so because
they hedged their contracts. Beginning at some point in 2005, if the Euro is
still markedly stronger than the dollar, Airbus will begin feeling the pain.
What they'll likely do at that point is outsource far more than they're
currently doing.

This explains the situation:
http://quote.bloomberg.com/apps/news...w&refer=europe


  #6  
Old March 20th, 2004, 05:59 AM
Clark W. Griswold, Jr.
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Default Spirit Airlines to purchase Airbus jets

"Quantum Foam Guy" wrote:

Boeing management has been asleep at the switch a long time



Was Spirit looking at 717s? If so, this decision combined with Star Alliance
rejecting the 717 may finally kill the 717 off.
  #7  
Old March 20th, 2004, 02:04 PM
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Default Spirit Airlines to purchase Airbus jets

"Clark W. Griswold, Jr."wrote

Was Spirit looking at 717s? If so, this decision combined with
Star Alliance rejecting the 717 may finally kill the 717 off.


The DC9 is an old design. Name changes cannot hide that.
  #8  
Old March 20th, 2004, 03:40 PM
James Robinson
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Default Spirit Airlines to purchase Airbus jets

" wrote:

"Clark W. Griswold, Jr."wrote

Was Spirit looking at 717s? If so, this decision combined with
Star Alliance rejecting the 717 may finally kill the 717 off.


The DC9 is an old design. Name changes cannot hide that.


The 717 is a result of more than just name changes. About the only
similarity between it and an original DC-9 is the shape of the
fuselage. Pretty well everything else, from the engines to the cockpit
avionics and the shape of the wing have been altered from the original.
The 737 is about as old, and is still selling reasonably well as
derivatives of its original design.
  #10  
Old March 20th, 2004, 08:07 PM
nobody
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Default Spirit Airlines to purchase Airbus jets

" wrote:
Was Spirit looking at 717s? If so, this decision combined with
Star Alliance rejecting the 717 may finally kill the 717 off.


The DC9 is an old design. Name changes cannot hide that.


The 737 is also an old design. However, the MD95 (aka 717) was different
enough from DC-9 that it finally got its onw certification. And operators seem
quite pleased with it. The problem is that it is a orphan child that does not
fit well in large fleets, especially since its future isn't very sure.

The 717 is also just above a limit where unions would never allow regional
operators to fly it.
It is interesting that the embraer 100 pax jets is, in many ways, just as
orphan as the 717 in large airline fleets. But being just enough smaller, it
probably fits better into their plans.

It could also have to do with all the subsidies jungle jets and flying skidoos
get when exported.
 




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