Delta's Retaliation Against Boeing

Hello Forum Goers…

So basically I made this topic to discuss this topic, and go a bit in-depth regarding Delta ordering Boeing, then Boeing wasn’t happy, nor was Trump so they imposed taxes on the planes, Then Canada wasn’t very happy about this either, so they canceled there orders with Boeing for fighters, and instead they are getting them second hand. Then the cherry on top of all of this was Delta ordering 100 A321NEO’s.

My Opinions

I think I’m taking Delta’s side on this, Trump sided with Boeing on this, and I don’t think what he did was right. Imposing (I believe it was import taxes) Taxes of such magnitude isn’t ethical, I’d say it even comes close to ruining relations with other countries, (although I wouldn’t know for sure). Delta is a huge airline, with an expanding fleet and route network, so they will need more planes to operate to the area’s where the demand isn’t sufficient for A320’s and 737’s, and they will need a plane that is more suitable to these circumstances. So they ordered the Bombardier’s.

Delta is refusing to pay these Taxes, and I would do the same. It’s clear that Delta isn’t to chapped about this, and it did probably play a part in which manufacture they will order new aircraft’s with.

I think that ordering Airbus was actually smart, simply due to the fact that they are showing that there are work arounds to these taxes, and that they aren’t afraid of this issue. Airbus has a factory in Mobile, Alabama so that could be a work around to these taxes.

I think that Canada was also upset about this, so they canceled there orders for the fighter jets, and instead getting second hand ones. So I think this actually impacted Boeing, so hopefully those import taxes will be taken away.

Regarding those CSeries’s, it looks like AeroMexico will be getting a few of Delta’s.

That’s My Opinion

Resources

http://onemileatatime.boardingarea.com/2017/12/14/delta-a321neo-order/
http://onemileatatime.boardingarea.com/2017/12/05/aeromexico-cseries-delta/
http://onemileatatime.boardingarea.com/2017/10/16/delta-bombardier-dispute/
http://onemileatatime.boardingarea.com/2017/10/16/bombardier-cseries-airbus/

Yes I know it’s just OneMileAtATime, but thats what I only care to read, and Ben is usually honest. There is more but I’m not bothered to find the links.

Disclaimer
  • I may be wrong on some facts, but thats how I understand this whole situations.
  • This is my opinion on things, you may have different opinions.
  • I’m neutral on Trump, and my opinion isn’t based on me liking or not liking him.
  • I understand that I am more than likely wrong on facts.

I’d like to hear you opinion on this, I know it’s a lot to ask bit can we keep this chat away from an Airbus vs Boeing argument, and people saying i take Boeing’s side just because I like them more.

Merry Christmas! 🎄

-Josh

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I don’t think delta intentionally “retaliated”. They wouldn’t intentionally make a decision just to spite Boeing if it hurt their own business. My opinion on this is that their decision to go with the NEOs has nothing to do with the dispute.

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I actually forgot to include that the only thing that comes close to a competitor to the 321NEO as there isn’t an actual direct competitor is the 757, but I think that it did play a part in the final decision.

It’s obviously a big hit to Boeing. I see the upset caused by the new tax laws but as a large company like Boeing, you have to put your customers first. They better make changes. Airbus will be happy to replace Boeing aircraft in the field. Merry Christmas

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Merry Christmas to you too 🎄! agree with you on that.

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I think calling it “retaliation” is a bit of an exaggeration. Losing 100 sales on a low-margin product is hardly a blow to Boeing, not to mention they had an inferior product for Delta’s mission requirements.

The Canadian government will go crawling back to Boeing when they realize the F-18 is the only way to go for fighter aircraft replacement. The strategic advantage of a common strike fleet with other militaries far outweighed any petty dispute they may have with Boeing. Give me a change in Prime Minister and they will probably order the F-35.

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That’s how I see it, would you see this issue impacting Boeing even more with other airlines ‘following’ in Delta’s footsteps?

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The F35 is made by Lockheed not
Boeing.

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Oops, I meant the F-18’s. Evidently, I’ve had a little too much eggnog.

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If you want to have your facts to be credible; You should always use more than one source, no matter how honest and unbiased you think that source is. This is especially important in our society today with all of the “fake news” (misleading, poorly researched, or actual fake news) on the internet today.

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Alright, thank you for your advice. I will do this in my next RWA post.

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No problem! I’m always here to help. Especially when it comes to fake news! ;)

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To declare the Delta order a watershed for other airlines to follow suit is a little hyperbolic. Each airline will make their own decision, they do not go and copy what everyone else is doing.

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What I meant by that is stating that other airlines who are in the same position may do the same as Delta, that is my opinion. I understand where you are coming from, I’ll go more in depth next time, thank you!

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What airline would be in the same position as Delta? All airlines have their own unique needs and requirements. To compare their decision to Delta’s just because they ordered the same aircraft may not be wise. While goodwill is always a good thing to have, airlines generally make sure they have the aircraft best for their operations, at the right price, and delivered at the right time. Of course, airlines are willing to make tradeoffs on factors to get more favourable attributes in the other factors.

We can speculate all we want about if airlines are vindicative organizations trying to “get back” at their supplier all day long by making points and counter-points, but airlines are first and foremost a profit-seeking organization. As an investor, I would be very upset if Delta picked an aircraft just to be vindictive, that would reflect very badly on Delta’s leadership team if they put their emotions before money.

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I wouldn’t call it retaliating per se. The A321neo is the only plane that has similar performance with the 757. Delta saw a good plane and bought it.

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Send Delta to Canada, they can compete with Air Canada and Westjet, but I don’t think Air Canada and Westjet should be left to deal with Delta.

I’m stuck on this one on what to do with Delta about breaking the law

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Free trade is the greatest tool of peace that exists on Earth. If there are any other neo-Austrian economists around here they may agree with me.

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I think that Delta should have thought about buying does CS100 for such a price and Bombairdier should have never sold it for that much money.

I doubt it. Unless, Boeing offers favorable terms. They always have Lockheed to turn to which probably will offer lucrative offers to the Canadian government on their fighters.