MAX gets cheaper for airlines and the cost for Boeing rises

The IAG order for 100+100 MAXs at the Paris show caught everyone by surprise, even though the news was telegraphed.  The IAG order has implications that make it more expensive than it initially seems.

There are two sources we are aware of that whisper IAG got a discount in excess of 70%. This may be a circular rumor going around the industry. Boeing’s list prices are found here.  Take a look at what a 70% discount means if the concessions were all cash.  It is likely that certain services might be included in the deal that generates more up front cash to Boeing but is discounted over time, resulting in a higher price for the aircraft and lower future costs from Boeing Global Services.  Deals have gotten more complicated with the inclusion of services, and low transparency has turned even more opaque.