Airlines Need C SeriesImagne yourself the CEO of an airline in a cutthroat industry with everyone trying to undercut your fares. You can increase your profit if you only had more efficient aircraft. You've looked at every cost and tried to find areas where you can maximize profits without sacrificing too much service.
You need new airplanes but which ones make the most sense? You can choose between older 737s, 320s 190s or the cleaner, quieter, and more fuel efficient C Series with lower operational costs. You know some of your competitors have already purchased C Series and more seem likely to follow suit.
You might get some of those older aircraft cheaper because manufacturers of those aircraft can see the writing on the wall and they know they now need to hustle to get rid of as many of their older models as they can before everyone wants the new C Series.
You hesitate awhile to see what everyone else is doing. You see some airlines taking the bait and buying the older models to get the discount but you wonder if this isn't short term thinking on their part...
C Series is still more than three years away from production. It has another 3 1/2 years before the expected date deliveries will start and it already has 90 firm orders along with a lot yet-to-be-confirmed orders.
Why any rational mind would expect more is mysterious. Anyone who follows this industry should be aware of recent problems the airline industry has been struggling with and the fact that financing has been very tight.
We're only now starting to see some change in that direction, but as the economy recovers, passenger numbers rise, and airline prospects improve, we should start seeing some improvement in the financing situation and orders will pick up.
On top of this, Airbus 320, Boeing 737 and Embraer 190/195 orderbooks are already bulked up for a few years into the future.
We are now approaching an important inflection point where deliveries of CSeries will take about the same length of time as these competing, but much less clean, quiet, and fuel efficient older competing aircraft.
Of course, competitors selling older, less efficient aircraft know this and they're already discounting the prices of their older models in order to soak up as much marketshare as they can before we get to the point where everyone needs C Series.
Just how strong that need becomes will depend on the price of fuel, but even if fuel prices remain where they are, or fall from here there's always at least the potential for fuel costs to become a factor and C Series is your best option to protect airlines.
C Series will become the preferable option - by far - for airlines who are begining to realize that they won't be able to compete against it - without it.