Airbus generates ~$2.7m more per single aisle aircraft delivery

In several articles, we have described how important the single-aisle middle of the market has become. Most recently, we described how the lynchpin of the duopoly's instability is the single-aisle MoM aircraft. We now want to take the idea one step further. We will estimate the financial value of this situation. This analysis focuses on single-aisle aircraft only. Our analysis suggests Airbus could generate $2.7m more value per aircraft in the single-aisle segment. We start by defining the data. We are looking at delivered aircraft beginning January 2021. The deliveries are current through the morning of October 31, 2023. We use an average Current Market Value for the models from ch-Aviation to derive aircraft values. The following table lays out the data. We summarize the above table like this. On average, Airbus deliveries are "worth" $46.5m compared to $43.8m for Boeing. Airbus generates ~$2.7m more value than Boeing per aircraft. This is a significant number. Overall, Airbus is over $27Bn ahead in value generation, which is a vast number. [caption id="attachment_78696" align="aligncenter" width="462"] 757-200[/caption] Implications Airbus A321s delivers more than the MAX9, the closest competitive model. This means Airbus has the model quality advantage. Airbus also has a quantitative advantage. Boeing's MAX 8 models saw 747 deliveries to Airbus A320 at 726. Boeing has a 3% value benefit over the A320. But it is pyrrhic because Airbus is focusing on the larger segment. Over the period, in absolute deliveries, Airbus is ahead by ~58%. This gap provides a number of the impacts from ongoing MAX delays from rework and the grounding backlog. These aircraft are commercial aviation "commodities." They sell in volume and on aggressive pricing. But Airbus' A321 is no longer a commodity and is priced appropriately. The data shows that Airbus can price aggressively on the A320 as it falls into the "commodity" segment and win back that value on the A321. Airlines buy both Airbus models or upsize from the smaller to the larger. This has been happening for years. Bottom Line We have reported before on the power of transfer pricing. Now we have a guide on how much Airbus has to work with. While $2.7m does not appear to be a significant number, this is per aircraft. Orders in the single-aisle segment are primarily in double digits. For example., in the recent Korean Air order for 20 A321s, Airbus could have seen $54m in value, which is conveniently equivalent to one A321. Airbus is winning in the single-aisle MoM segment because Boeing chose not to offer a genuine 757 replacement. The stretched MAX 9 has proven unequal to the task. Will the MAX 10 close the gap? Most probably, yes. But that isn't the question - the critical question is how much? Boeing's ongoing MAX tribulations are damaging. - here's Michael O'Leary being forthright about this issue. Even if Boeing had zero MAX hiccups, it would likely be far behind. The market has moved. By not offering a competitive product, Boeing has put itself in an awkward position. This is a "long game" business, and with each A321 delivery, Airbus moves further ahead. And that lead is already worth over $27Bn.

US Flight Planner - US DoT On-Time Data	Airbus vs Boeing - Official OEM Data
US Airline Schedule Performance - US DoT Data	Daily OEM Production & Deliveries -

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