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Short Term Trading Weekend Lounge: 22-24 Mar, page-19

  1. 8,420 Posts.
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    Hi @48&34 & @peejayhercules while I sympathise with your point that it is Boeing that should be (morally?) compelled to include such safety features as standard and not as an optional extra that customer airlines should pay for, I see some problems with that point.

    First of all, why is the moral imperative not on the customer airlines to order them as optional extras? Why is the moral imperative with Boeing? Some airlines may have safety procedures that they themselves have developed which more perform the same functions as these safety features, so why would such airlines be forced to pay for them included as standard items if they don't need them (not saying this is the case with Ethiopian & Lion)?

    I have no idea what those safety features cost, but let's for arguments sake say they are very good features (and hence why they are considered essential) but the cost price to Boeing to include them is $5M. Either they absorb this cost and reduce their profit margin per plane by $5M and offer the planes at the same price of $100M, or they increase the price of the planes to $105M. They could do either of these but do we know that Airbus offers the same safety features and are they included in the equivalent planes? If Airbus don't include them and their planes are $100M, and Boeing do offer them also at $100M, then they are competing at the same profit margin level, but if Airbus don't include them and Boeing does so but offers the planes at $105M to reflect the cost, then some airlines will possibly choose to buy their planes from Airbus, so not only will Boeing will lose some business but those Airlines will still be buying planes without the safety features, but from another supplier.

    Finally, imagine if the same were true for airbags in cars. These were not always standard items, and some car manufacturers include 2, some more - how many should be standard and how many should be optional, and should the price be increased to reflect the cost, etc?

    Its never as simple as it seems, especially when it comes to where the moral boundary lies...

    Cheers, Sharks


 
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