Boeing - Embraer deal is dead

gotWXdagain said:
A fleet of parked planes as a result of your failures combined with all your customers parking their fleets of airplanes is really going to eat into your market cap when your main source of revenue is selling airplanes.
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With all those unwanted aircraft mouldering on ramps... Methinks it time for Norwegian to make just one more giant Hail Mary bet! But wait! Buy ‘em now and somebody will pay Norwegian to fill ‘em with fuel!
 
With a boom in smaller aircraft to serve lighter loads coming, I'd rather be an Embraer salesperson than a Boeing. The Chinese & Japanese might gain market share by setting a low pricing point, but the damn things need to fly and be certified quickly. No bet today's FAA will expedite certification for anyone. Airbus sales force will be pushing the A-220 hard. Should talk to Delta before they trade the 717s in on Maxes.

Meanwhile, the Trumpster is threatening higher tarrifs against European-made Airbii in a Hail-Mary for Boeing. Watch his potential Alabama votes climb.
 
thepotato232 said:
Of course, with the benefit of hindsight we now know that these were the years Boeing was slashing development and operating costs in the name of stock price, at the expense of their future pipeline. I would not necessarily expect the stock to perform the same way again post-recovery. You can only kill the goose that lays the golden eggs once.
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We aren't going to see a ten year run like that again but despite setbacks they turned a profit in 2019. The other divisions are more profitable than BCA and the future looks promising for those divisions.

The future of Boeing Commercial Aircraft is the question. Airbus may not survive as we know it, nobody is saying that about BCA.

If Boeing drops to below $100 again, I'm betting (with my money) that it could represent a buying opportunity. If a company's survival is not in question, buying stock at a ten year low is an opportunity that needs to be explored.
 
FloridaLarry said:
With a boom in smaller aircraft to serve lighter loads coming, I'd rather be an Embraer salesperson than a Boeing. The Chinese & Japanese might gain market share by setting a low pricing point, but the damn things need to fly and be certified quickly. No bet today's FAA will expedite certification for anyone. Airbus sales force will be pushing the A-220 hard. Should talk to Delta before they trade the 717s in on Maxes.

Meanwhile, the Trumpster is threatening higher tarrifs against European-made Airbii in a Hail-Mary for Boeing. Watch his potential Alabama votes climb.
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Not sure that'll actually happen.

The only carriers who have managed to operate the E-Jet family successfully has been FFD regional carriers who are able to offset the high operational costs of the ERJ by knowing they'll make X dollars for every departure they make. Flight is full? Regional makes money. Flight is empty? Regional makes money.

Mainline carriers don't have this luxury, and as such you've never seen the aircraft take off at those airlines.

Now listen, I love the ERJ, best airplane I've ever operated, but I accept that the economic case isn't necessarily compelling.
 
Cherokee_Cruiser said:
Now I don't know how the Brazilian government feels about bailing out their own defense/commercial operator but I hope ERJ doesn't go bankrupt.
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Brazil has a history of being very political about bailouts – as most bailouts probably are...

When VARIG shut down in 2006, the government at the time said it was none of its business to throw taxpayer money into private companies and wasn't gonna bail them out. VARIG started in a state that historically was pro-separation and so, even almost 80 years later, it wasn't easy becoming friends with politicians of other states if you were a Gaúcho (people who are born in Rio Grande do Sul, where VARIG started).

The other player in the game though, TAM (today LATAM, from LAN Chile and TAM), started in the state of São Paulo and its board of executives had plenty friends in the government – yes, a few years later TAM needed a bailout and they got it.

Now, about Embraer... Although the current president is a nationalist, and would be happy to give Embraer money, he just got caught by his former minister of justice for trying to interfere with the Federal Police to protect his sons (who are being investigated by the Federal Police LOL), so it's likely he'll be impeached.

Anyhow, I hope that paints a picture for you. I wrote a lot bc I was bored.
 
jtrain609 said:
... Now listen, I love the ERJ, best airplane I've ever operated, but I accept that the economic case isn't necessarily compelling.
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Hasn't been exactly compelling, but it certainly looks as if the 'rules' may be changing. Damn near everything else in our world(s) may have a new reality. My point: this may be one of them.
 
Cherokee_Cruiser said:
Now full disclosure, I created a big position with Embraer on the assumption the Boeing deal would go through. Monday the ERJ stock is going to tank. My goal of holding it until the venture buyout was finalized is now toast. Now I don't know how the Brazilian government feels about bailing out their own defense/commercial operator but I hope ERJ doesn't go bankrupt. At this point, I think I'll hold onto these shares for the long term, post-COVID recovery and see what happens. I just hope Embraer shares don't become the next Bombardier shares :aghast:
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Are we sure Boeing wasn't factoring in the Everett rate for lost tools, or the normal?

Was Boeing gravely offended by their old-fashioned practice of having a software QA team?
 
Cherokee_Cruiser said:
A Motley Fool quote:

"In recent years Boeing has tried to convince airlines to go with the smaller versions of its 737 instead of a plane the size of the A220, in part because it has no real alternative. Embraer's new generation E2 jets would have slotted in below the 737, giving Boeing an attractive offering for customers looking for a plane that size.

Unfortunately for Boeing, smaller-sized jets seem likely to be big sellers in the years to come. Prior to the pandemic, global airlines were already shifting away from larger jets and toward smaller planes. That trend is likely to accelerate if air traffic demand remains below pre-pandemic levels for an extended period. "


So true. IMO Boeing shot itself in the foot.


Now full disclosure, I created a big position with Embraer on the assumption the Boeing deal would go through. Monday the ERJ stock is going to tank. My goal of holding it until the venture buyout was finalized is now toast. Now I don't know how the Brazilian government feels about bailing out their own defense/commercial operator but I hope ERJ doesn't go bankrupt. At this point, I think I'll hold onto these shares for the long term, post-COVID recovery and see what happens. I just hope Embraer shares don't become the next Bombardier shares :aghast:
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I would love to see the data for the bolded claim, because I don’t believe it’s true, at least on the narrowbody side. Upgauging had been the trend for the last decade.

Widebodies, on the other hand, had certainly started trending smaller before the pandemic.
 
Ecl!pse said:
I would love to see the data for the bolded claim, because I don’t believe it’s true, at least on the narrowbody side. Upgauging had been the trend for the last decade.

Widebodies, on the other hand, had certainly started trending smaller before the pandemic.
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I think the context is for mainline airlines to operate smaller aircraft; so upgauging routes, but in the smallest mainline plane in the fleet, as opposed to the largest RJ.
 
jtrain609 said:
I think the context is for mainline airlines to operate smaller aircraft; so upgauging routes, but in the smallest mainline plane in the fleet, as opposed to the largest RJ.
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Right, I agree but that proves my point further, and that's not what he wrote - if that's what he meant, then he probably need to revise the sentence. Airlines were not "moving away from larger planes" as the article states, rather they were still moving toward larger planes, away from smaller planes. In the case you cite, they were upgauging from regional jets to small mainline jets - still an increase in gauge.

The jury is still very much out on the small narrowbodies - United/American/Spirit have chosen to pass, whereas Delta pulled the trigger long ago and JetBlue has really just kept "status quo" by moving from one small narrowbody to another.
 
Ecl!pse said:
Right, I agree but that proves my point further, and that's not what he wrote - if that's what he meant, then he probably need to revise the sentence. Airlines were not "moving away from larger planes" as the article states, rather they were still moving toward larger planes, away from smaller planes. In the case you cite, they were upgauging from regional jets to small mainline jets - still an increase in gauge.

The jury is still very much out on the small narrowbodies - United/American/Spirit have chosen to pass, whereas Delta pulled the trigger long ago and JetBlue has really just kept "status quo" by moving from one small narrowbody to another.
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Even in the JetBlue example, the smallest plane in the fleet is still getting larger. I think the A220-300 will seat 135.
 
Sold it. $4400 loss. But made $3000 on Carnival Cruise earlier this month. And with the Alaska ESPP I’ll make +2,200 or so. All said and done I should still be green. Still, sucks.

I’m now done with the stock market. That is until Boeing goes below $90 again. If it does, I’m all in. o_O
 
Cherokee_Cruiser said:
Sold it. $4400 loss. But made $3000 on Carnival Cruise earlier this month. And with the Alaska ESPP I’ll make +2,200 or so. All said and done I should still be green. Still, sucks.

I’m now done with the stock market. That is until Boeing goes below $90 again. If it does, I’m all in. o_O
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$100 is the new $90.
 
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