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Another Bubble Pops: Used Boeing 777 Sells For 97% Off List Price

Tyler Durden's picture




 

While the US economy may have unofficially entered an industrial recession in recent months with the dip in the manufacturing ISM below the critical 50 level, one sector has continued to do surprisingly well: automotive manufacturing, as a result of vibrant car sales. The reason for this, as we have repeatedly demonstrated, has been the record surge in auto loans, which have long surpassed both total credit card debt (and the $1 trillion mark), and continue to fund an unprecedented auto buying spree as they rush to catch up to the $1.2 trillion in total student loans.

 

Furthermore, recent Experian data confirms what most have known: the only reason auto sales are as strong as they are is because for the second time in under a decade, there is a substantial car loan bubble. As noted pbefore, here are some of its key characteristics:

  • Average loan term for new cars is now 67 months — a record.
  • Average loan term for used cars is now 62 months — a record.
  • Loans with terms from 74 to 84 months made up 30%  of all new vehicle financing — a record.
  • Loans with terms from 74 to 84 months made up 16% of all used vehicle financing — a record.
  • The average amount financed for a new vehicle was $28,711 — a record.
  • The average payment for new vehicles was $488 — a record.
  • The percentage of all new vehicles financed accounted for by leases was 31.46% — a record.

 

Still, despite persistently record easy credit terms, the final days of the car loan bubble appear to be at hand: with US auto inventories already at their highest levels relative to sales since 2009 - suggesting US consumers can hardly absorb any incremental auto production - all it would take to pop the bubble, is a small exogenous event: like a rate hike by the Fed.

 

But while the car loan bubble has been extensively documented there is another mode of transportation where the bubble in prices may have easily eclipsed anything seen in the auto space, and which, pardon the pun, has flown right below the radar.

Airplanes.

According to Air Transport World, Delta recently signed a letter of intent to buy a used Boeing 777 for $7.7 million, according to CEO Richard Anderson.

The Delta CEO raised some eyebrows in October when he said there was a “huge bubble” in used widebody aircraft, pricing a 10-year-old 777-200 at $10 million. Anderson said that the market would be “ripe” for Delta to buy used 777s.

To be sure, Boeing president and CEO Dennis Muilenburg was among those who pushed back against Anderson, saying the Delta CEO was valuing used 777’s much too low.

It wasn't. Although, as it turns out, Anderson was indeed wrong when he said used 777s were on the market for $10 million. "It was actually $7.7 million. We just signed a letter of intent to buy one.

Anderson’s comments came during Delta’s investor day and, for added emphasis, were posted on Twitter by Delta. Just as happened when Anderson made the original remark about used 777 values, Boeing’s stock price immediately dropped.

Here is the punchline: Boeing’s list price for a new 777-200ER is $277.3 million, meaning Delta is buying a used 777 at a price 97.2% lower than the value of a new 777.

Delta did not give details on the 777 for which it signed the LOI, such as who the seller is and which airline previously operated the aircraft.

This stunning "price discovery" leaves a few key questions wide open:

  • Was this just a one off transaction in which Delta found a very "motivated" seller and took advantage of what was beyond a firesale price? If so, who was the seller and why liquidate in such a hurry?
  • Alternatively, if this deal is indicative of prevailing "used plane" market prices, and judging by Anderson's comment one can find more 777-200ERs for the low price of $10 million, this means that either the market for new plane widebody airplanes is indeed an unprecedented bubble funded by such government vehicles as the Ex-Im bank, or the used plane market is a ticking time bomb for all those billions in EETFs and various aircraft-backed pass through securities which are collateralized by planes such as the the Boeing 777. It explains the stink Boeing made when Ex-Im bank's charter was temporarily revoked by Congress.
  • At the micro level, if new plane prices are just a "huge bubble" as the Delta CEO alleges, that means that the valuation of Boeing is about as "credible" and sustainable as that of New Century just a few days before the subprime bubble burst.
  • Finally, if there is such a dramatic cliff between new and used airplanes, what does that mean for bank amortization assumptions on billions in airplane inventory which is still carried by banks on their books, and just how massive would be the valuation deficit once loans collateralized by airplane "assets" are marked to market.

Granted, while it is becoming increasingly difficult to track all of the bubbles and capital misallocations that have resulted from 7 years of ZIRP, NIRP and QE, we hope to present readers with some answers to these questions ideally before the serial, or parallel, and long overdue bursting of said bubbles takes place.

 

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Sun, 12/27/2015 - 16:47 | 6967635 researchfix
researchfix's picture

Now it makes sense about these three 747s at Kuala Lumpur.

Sun, 12/27/2015 - 16:51 | 6967650 Mr.Sono
Mr.Sono's picture

Shit I get me one of those.

Sun, 12/27/2015 - 18:09 | 6967895 Manthong
Manthong's picture

You might see the same pricing dynamics when the Air Farce tries to offload some air inferiority F-22’s, maybe to Admiral General Aladeen in the Republic of Wadiya.

Sun, 12/27/2015 - 20:05 | 6968318 philipat
philipat's picture

As opposed to the F-35's which are totally unsaleable?

Sun, 12/27/2015 - 21:25 | 6968598 Nexus789
Nexus789's picture

Not totally. Should get a few thousand Dollars in terms of their scrap value. 

Thu, 12/31/2015 - 18:40 | 6983688 DarkLordofSadNews
DarkLordofSadNews's picture

Seats Can be used  ina church. The entertainment system will came in handy during Sunday mass

Thu, 12/31/2015 - 18:40 | 6983689 DarkLordofSadNews
DarkLordofSadNews's picture

Seats Can be used  ina church. The entertainment system will came in handy during Sunday mass

Sun, 12/27/2015 - 16:52 | 6967656 Stackers
Stackers's picture

Condition is everything. That $7 million plane may need a pair of $25 million (each) engines...

Sun, 12/27/2015 - 17:57 | 6967826 Cognitive Dissonance
Cognitive Dissonance's picture

As well as an expensive "D" maintenance check that can run into several million more. Add a new interior with in-seat entertainment, upgraded avionics and equipment and suddenly this 'cheap' aircraft is cheap for a reason.

I can show you a five year old Camry that goes for less than $3,000....which is $18,000 off the list price of a new one. It only has 250,000 miles on the odometer and has been in two accidents. Instead of a little old lady as the owner it is a traveling salesman.

Sun, 12/27/2015 - 18:20 | 6967946 WillyGroper
WillyGroper's picture

Yea, but the real question is...

Is it old enough to be free of Zakhiem's RC?

May be a method to the "used" madness, eh?

Sun, 12/27/2015 - 18:23 | 6967955 sun tzu
sun tzu's picture

Even if it needs 2 new engines and another $10 million in repairs, that is still only $67 million vs $277 million for a new plane. That's a 76% discount.

Sun, 12/27/2015 - 18:34 | 6967994 Cognitive Dissonance
Cognitive Dissonance's picture

The age in years of a plane is much less important than the number of cycles, meaning pressurization cycles, it has experienced. A plane that does two short hops a day rather than one long haul is gonna wear out quicker. There are some components of an airplane, including its basic air-frame, that have a 'do-not-exceed' cycle lifetime that when reached effectively ends its useful life...at least as a commercial transport.

I do not doubt there is a glut in new and used planes. Boeing and Airbus have been pumping out new planes at a mad pace and recently Airbus has said it will increase production of its A320 series to 60 per MONTH. This must be driving down the cost of used aircraft, particularly those nearing their useful life.

Just trying to clear up some misconceptions about how to value used commercial aircraft. We will know the new auto business is rolling over when used car prices crater. It appears to be happening in the commercial aircraft market.

Sun, 12/27/2015 - 20:05 | 6968317 Stuck on Zero
Stuck on Zero's picture

The plane is probably at max cycles, will be barely restored and then used for passengers reclaiming flyer miles.

Sun, 12/27/2015 - 20:31 | 6968401 Canoe Driver
Canoe Driver's picture

The planes also have limited cycle-life. If an airframe has been through 40,000 take-offs and 40,000 landings, and is only useful through 60,000, it is clearly not worth much.

Sun, 12/27/2015 - 20:40 | 6968441 Milton Keynes
Milton Keynes's picture

If it starts there are a lot of 3rd world airlines that will take it.

South America, Africa, Indonesia, The former CIS....

If you really don't care much, a $10 Million near junker would probably make money

in kazakhistan or ethiopia.

 

If you Get it for 7 and spend 3 million doing minimum repairs, seat 250 at $100/head do two hops

a day, earn $150K per week or $7 million a year....Have a big sign that says "All Flights at passengers risk"...

Have pilots used to Soviet operations, as long as it can hold together a year and a half it can be profitable

Mon, 12/28/2015 - 05:03 | 6969581 mkkby
mkkby's picture

The real money is in air cargo.  Fuck all the expensive maintenance and regulations related to passenger traffic.  Move lettuce and tomatoes from mexico, and don't forget to include the cocaine, heroin and cash on the return flight.

Mon, 12/28/2015 - 11:32 | 6970260 glenlloyd
glenlloyd's picture

Yes yes yes, at this point however we know nothing about what maintenance was foregone or what other conditions are that might warrant additional money to make improvements.

What we do know is the price of a new one and the price of this used one Delta purchased. And I would find it hard to believe that Delta would purchase a plane needing the D maintenance service or anything significant for that matter. I think they could just walk away if it wasn't what they wanted.

Although I would like some more color on the plane they purchased and who sold it I think we can safely say that 1) Delta didn't 'need' to purchase this plane in a hurry and 2) that Delta checked it over to make sure that they knew what they were getting and it was what they wanted.

It's not as though Delta bought it on Ebay....come on people.

Mon, 12/28/2015 - 16:38 | 6967920 monk27
monk27's picture

Even if a lot of work is needed to make that plane ready, you still end up getting it for less than a quarter of his price. That's very un-bullish for certain stocks (starting with A and B)...

Sun, 12/27/2015 - 22:18 | 6968797 pitz
pitz's picture

Engines rarely need to be fully replaced (although an overhaul with clearances restored and LLPs replaced is likely).  Documentation might be an issue (bad documents = the parts can't be reused as nobody has a full history on them).  Agree that it probably isn't being bought to ever fly again, but rather, for parts.

Mon, 12/28/2015 - 01:14 | 6969330 turnoffthewater
Mon, 12/28/2015 - 01:15 | 6969334 Estrella
Estrella's picture

You don't "buy" the engines. You "lease" the engines. Not for sure on this deal, but, often with this type of a/c the engines are "leased" you pay a flat hourly rate and give them back to Pegasus, or Trent, or GE or Pratt (& his old buddy Whitney), etc.

 

Sun, 12/27/2015 - 16:48 | 6967636 gafgroocK
gafgroocK's picture

 

 

 

 

Does it come with wings?

Sun, 12/27/2015 - 16:50 | 6967644 JustObserving
JustObserving's picture

With oil prices at such lows, one would expect more air travel and higher plane prices.  How can planes be getting so cheap?

Sun, 12/27/2015 - 18:10 | 6967884 reload
reload's picture

i used to be a regular airline customer. Since the 'war on terror' and all the airport bullshit to remind me i am jusg a tax chattel /surf i avoid it at all costs. often manage to go years at a time without commercial air travel. i only nedd it if travelling outside europe / scandinavia. We are on the downwave from peak airlines! its a business with no pricing power on many routes. 

Sun, 12/27/2015 - 18:20 | 6967944 TuPhat
TuPhat's picture

My daughter is a flight attendant so I can fly standby for free.  In eight years I have only done it a couple of times for the same reasons.

Sun, 12/27/2015 - 22:50 | 6968911 lincolnsteffens
lincolnsteffens's picture

I'd rather drive anyplace in the continental USA than take a plane. When they take down the body scanners and the TSA goes away, then I consider flying again. Pretty soon they will be doing the same thing to the trains with sniffer dogs every where. Reminds me a little of all the WWII movies about the 3rd Reich.

Mon, 12/28/2015 - 18:50 | 6972077 oooBooo
oooBooo's picture

Indeed. The TSA won't go away, it will get bigger so people can't avoid it.There will also be a law prohibiting the reporting of a TSA checkpoint induced traffic jam.

 

 

 

Sun, 12/27/2015 - 19:39 | 6968230 Automatic Choke
Automatic Choke's picture

Not so sure....I fly cross country quite a bit, flights are usually packed.  (of course, I avoid the premium airlines and go for no-nonsense....southwest all the time.)

 

 

Mon, 12/28/2015 - 02:04 | 6969403 BarkingCat
BarkingCat's picture

You fly ShitWorst Airlines?? My condolences to you.

I would not fly those assholes unless I was absolutely desperate.

 

Sun, 12/27/2015 - 20:36 | 6968418 Canoe Driver
Canoe Driver's picture

True. Further, oil at $150/barrel, which seemed plausible just a few years ago, would end universally affordable commercial air travel in its current form, as would any significant restriction on consumer revolving credit.

Sun, 12/27/2015 - 18:10 | 6967900 sun tzu
sun tzu's picture

People need disposable income in order to take vacations. Wages are stagnant while expenses keep marching north. Any "savings" I had from lower gas prices is eaten up by insurance, ZeroCare, taxes etc. 

Sun, 12/27/2015 - 19:51 | 6968275 jungle dancing ...
jungle dancing silver's picture

Just returned to Costa Rica today, plane was Full, San Jose airport was crazy full of tourist. No one in the citizen line.

Sun, 12/27/2015 - 18:15 | 6967927 monk27
monk27's picture

It's a measure of the true recovery... /s

Sun, 12/27/2015 - 21:00 | 6968509 Milton Keynes
Milton Keynes's picture

slackening passenger demand.

 

even if gas is free if 30% of the passengers are sick of the TSA, and driving or taking the train.

 

Hey in DC, as sucky as the bus is it's cheap to get around the east coast on Mega-Bus,

and get an Uber around a lot of cities.

Sun, 12/27/2015 - 21:27 | 6968615 Nexus789
Nexus789's picture

The global economy is slowing and unemployment is rising  In those corcumstances it does not matter how cheap if people have reducing disposable income. Paradox of a contracting economy - deflation and cheaper products and services but also flatlining and declining incomes.

Sun, 12/27/2015 - 22:53 | 6968922 lincolnsteffens
lincolnsteffens's picture

Flights are crowded because of fewer flights, therefore fewer planes needed, therefore prices of used planes goes down.

Sun, 12/27/2015 - 16:51 | 6967647 Baby Eating Dingo22
Baby Eating Dingo22's picture

You get any kind or warranty or "road" side assistance with that?

Sun, 12/27/2015 - 16:53 | 6967659 ZeroPoint
ZeroPoint's picture

Well they all come with transponders, which interestingly, can be disabled by someone who knows how to while in flight, but yet, if I try to remove the OnStar unit from my Chevy, the car won't start. (I tried).

 

Sun, 12/27/2015 - 17:25 | 6967734 Ima anal sphincter
Ima anal sphincter's picture

It's called pulling two ATC circuit breakers. 

Mon, 12/28/2015 - 18:54 | 6972088 oooBooo
oooBooo's picture

Yeah, when GM integrated onstar the disabling method also changed. Just unplug the antenna and that will leave it unable to communicate and thus unable to tattle on you or take commands.

 

 

Sun, 12/27/2015 - 16:51 | 6967649 ZeroPoint
ZeroPoint's picture

2016 is going to be the year of panic & fear, if nothing else.

Sun, 12/27/2015 - 16:52 | 6967654 83_vf_1100_c
83_vf_1100_c's picture

  I wouldn't mind a new-ish 1 ton diesel long bed truck for 97% off new price. It's always the rich guys that get the deals.

  I checked eBay, no such deals ahappening. /s

Sun, 12/27/2015 - 16:55 | 6967666 bamawatson
bamawatson's picture

check tampa bay; you can buy a football team

Sun, 12/27/2015 - 17:06 | 6967700 Socratic Dog
Socratic Dog's picture

I had the same thought.  But if the price is being sustained by an auto-loan bubble, new and used, when that bubble pops cash will be king, and you and me are going to be riding in style.

Sun, 12/27/2015 - 17:36 | 6967763 tarabel
tarabel's picture

 

 

Try this.

www.govplanet.com

Sun, 12/27/2015 - 16:58 | 6967665 F em all but 6
F em all but 6's picture

Anybody have an aprox scrap value??

Sun, 12/27/2015 - 16:56 | 6967668 wisebastard
wisebastard's picture

MAX KEISER IS A TERRORIST THAT HAD SEX WITH BARACK OBAMA............YOUTUBE MAX KEISER LE FRIC AND YOU CAN SEE THE TRAILER THEY SHOWED ME THE WHOLE PORN WHEN I WAS A TEENAGER AND THEN MAX HIRED JEFF DENTIN TO MURDER ME WITH DIRECTED ENERGY WEAPONS BECAUSE I AM AGAINST THE BANKS...............MAX IS ONE SICK FAGGOT

Sun, 12/27/2015 - 18:25 | 6967961 motorollin
motorollin's picture

Never smoke crack, kids. 

Sun, 12/27/2015 - 18:57 | 6968074 Vendetta
Vendetta's picture

I thought Lawrence Taylor stopped posting on ZH a while ago...

Sun, 12/27/2015 - 16:58 | 6967677 flyonmywall
flyonmywall's picture

Well, that's another reason not to fly Delta. That thing is probably being "recertified" in Malaysia, by some guy making making 2 bucks a day. Do you feel lucky?

 

Sun, 12/27/2015 - 18:26 | 6967965 sun tzu
sun tzu's picture

All of the airlines have outsourced their R&M to third world countries. 

Sun, 12/27/2015 - 16:59 | 6967678 buzzsaw99
buzzsaw99's picture

10 years old. remind me not to fly delta.

Sun, 12/27/2015 - 18:30 | 6967976 sun tzu
sun tzu's picture

Do you realize almost all of the planes in the sky are 20-30 years old?

Sun, 12/27/2015 - 20:41 | 6968447 Iam_Silverman
Iam_Silverman's picture

"Do you realize almost all of the planes in the sky are 20-30 years old?"

<font.sarc/on> certainly NOT those wonderful MD-80's I have had the pleasure of flying on when using American or Delta!<font/off>

Sun, 12/27/2015 - 17:00 | 6967681 Sudden Debt
Sudden Debt's picture

THEY JUST NEED TO GO GET THE BOEING 777 IN MALASIA!

http://www.redstate.com/uploads/2014/07/mh17-wreckage-2.png

NEAR MINT CONDITION!

Sun, 12/27/2015 - 17:00 | 6967683 conspicio
conspicio's picture

Would've been great to see some auto price inflation charts as an auto listing new for $40K 10 years ago is now $60K+ in many cases. The average consumer is a monthly payment buyer or lessor and has little (as in none) clue about residual values or depreciation. Buying an $80K Escalade and financing for 72 months is a poor consumer decision and a socially pressured one. The economy is getting better, everything is great, right??? Psyops for autos. These are truly amazing times we live in.

Sun, 12/27/2015 - 19:01 | 6968089 Vendetta
Vendetta's picture

yep.  I saved about $34k buying a 10 year old, top of the line Jeep with all the bells and whistles.  By the time I feel like getting something else I'll probably put 100k miles on it with 15k put on it already after playing the chase-a-job game in a couple of states in our 'robust' economy.

Sun, 12/27/2015 - 17:02 | 6967689 commie
commie's picture

Yes, yes, we know from ZH how fucked up is the US economy, but what of Russia. All we have been told is how superior their weapons are. Are they the dominant economy? Will they rule the world

Sun, 12/27/2015 - 17:26 | 6967741 besnook
besnook's picture

no, russia will not rule the world but dumbasses like you will pollute the earth for as long as man is around.

Sun, 12/27/2015 - 17:34 | 6967757 tarabel
tarabel's picture

 

 

You are not permitted to question the validity of any Russian propaganda posted here at Zhukov Hedge.

It is all true and you are in serious need of intellectual adjustment. 

Sun, 12/27/2015 - 19:03 | 6968101 Vendetta
Vendetta's picture

"Will they rule the world" ... no, they just want to avoid WWIII for some reason

Mon, 12/28/2015 - 10:52 | 6970139 BarkingCat
BarkingCat's picture

No Russia will not rule the world. They have lots of their own problems.

Russia has a serious disadvantage. They cannot print magic paper or its digital representation, for which the entitre planet send them real goods and services.

 

Sun, 12/27/2015 - 17:10 | 6967705 Baby Eating Dingo22
Baby Eating Dingo22's picture

FLY Leasing Acquires New Boeing 777-200LRF


DUBLIN, Oct. 26, 2015 /PRNewswire/ -- FLY Leasing Limited (FLY) ("FLY"), a global leader in aircraft leasing, today announced that it has acquired a new Boeing 777-200LRF aircraft in a sale and 12-year leaseback transaction with a leading flag carrier.


 

View photo

.

"This is our second B777-200LRF acquisition in the past month as we continue to grow our portfolio with the most in-demand commercial aircraft," said Colm Barrington, CEO of FLY. "With a strong cash reserve, FLY is in an excellent position to take advantage of attractive growth opportunities. We continue to focus on deploying capital prudently, adding attractively-priced aircraft to improve our fleet metrics and increase FLY's earnings and ROE. In 2015, FLY has already invested $594 million in nine aircraft with an average age of approximately one year."

Sun, 12/27/2015 - 17:14 | 6967711 Dragon HAwk
Dragon HAwk's picture

maybe they were just desperate to get  a couple flying around so the mechanics and the baggage people know what they look like.

Sun, 12/27/2015 - 17:25 | 6967730 besnook
besnook's picture

it makes sense for poor prople to invest in a nice big van or suv. you can't drive a house but you can always live in your car.

Sun, 12/27/2015 - 19:08 | 6968117 Vendetta
Sun, 12/27/2015 - 21:27 | 6968612 Michigander
Michigander's picture

I just love the wings as the roof. The right wind from the right direction and...LIFTOFF.

Sun, 12/27/2015 - 17:25 | 6967733 Mayer Amschel R...
Mayer Amschel Rothschild's picture

Deflation you can believe in.

Sun, 12/27/2015 - 18:13 | 6967922 bugs_
bugs_'s picture

And ride in!

Sun, 12/27/2015 - 17:25 | 6967735 dearth vader
dearth vader's picture

Jeesh, a Boeing 7 something-200. For a short instant, I thought Air Force I had been auctioned by a repo man.

Sun, 12/27/2015 - 17:37 | 6967740 css1971
css1971's picture

Arent there 747s just lying around unused? I recall a very recent story saying an airport in Malaysia was trying to kick  three of them off of parking spaces.

http://edition.cnn.com/2015/12/08/aviation/malaysia-aviation-airport-aba...

Pretty sure the owners will sell them cheap.

Sun, 12/27/2015 - 19:12 | 6968130 Vendetta
Vendetta's picture

I guess it doesn't work according to 'the plan' when you pay people 10 cents an hour raising them up  into the 'middle class™'

Sun, 12/27/2015 - 17:38 | 6967767 Baby Eating Dingo22
Baby Eating Dingo22's picture
Have one to sell? Sell now Details about  Gemini Jets Lufthansa Cargo Boeing 777-200LRF Diecast Model 1:400   | Add to watch list   Seller information fl-center (606  ) 100% Positive feedback   Follow this seller Visit store:

fl-center See other items Item Information Item condition: New Time left: Time left: 26d 05h 1/22, 10:30PM Was: US $39.95 You save: $4.00 (10% off) Price: US $35.95 Buy It Now    

Add to cart       Add to watch list Add to collection Located in United States New condition

Sun, 12/27/2015 - 17:42 | 6967779 rsnoble
rsnoble's picture

And of course this dumbass thinks he's gona continue to be able to charge the same amount of money to fly on his bargain jet and keep the same amount of customers once this economy starts to really shit all over itself.

Sun, 12/27/2015 - 17:54 | 6967834 gregga777
gregga777's picture

During deep recessions reletively new narrow-body and wide-body passenger jet and large cargo jet pricing typically becomes greatly depressed because of a supply glut and lack of demand. This bargain basement priced 777 could be a leading indicator that we are entering a deep recession.

Sun, 12/27/2015 - 18:08 | 6967891 Oldrepublic
Oldrepublic's picture

Specialist aircraft trade publications indicate that the cost of the 777er  would be around 115 million in the year 2000. Apparently airlines like Emirates, Singapore and China Southern are getting rid of older aircraft and upgrading to new models. Seems cost of reconfiguration would run between 10-15 million per plane.

So this is another indication of the rise of Asia and the decline of the US, when US carriers buy second hand from Asian carriers. Any ZH reader who has traveled internationally in recent years will note the very poor condition of US aircraft versus those of the Middle East and Asia.

 

Sun, 12/27/2015 - 19:17 | 6968148 Vendetta
Vendetta's picture

never mind the missing fasteners inside the wing section in an aircraft (just the area joining the wing to the fuselage) from asia a field service guy told me about earlier this year ... hey but it looks great.

Sun, 12/27/2015 - 18:15 | 6967928 bugs_
bugs_'s picture

Used slightly banged up 777 for sale cheap.  may need a new flaperon and some electrical work.

Sun, 12/27/2015 - 18:20 | 6967941 gizmotron
gizmotron's picture

 

 

Snakes selling planes.

 

Sun, 12/27/2015 - 20:25 | 6968378 xizang777
xizang777's picture

You know of one?   Feel free to tell us all about your experience and how you know so much about it.

Sun, 12/27/2015 - 19:11 | 6968125 GhostOfDiogenes
GhostOfDiogenes's picture

Keep making MOAR airplanes you hungry ghosts who walk the earth devouring every mineral and element you can shove in your mouths/spreadsheets!

http://youtu.be/vb4SMpQ-Oj0

The demonic new agers are wrong.

The buddhists and others who talk of the afterlife are correct!

Most humans walking the earth are from the lower astral realms.

You see, if devils werent inhabiting the earth, things would be getting better!

They are not! Things get worse every day!

Sun, 12/27/2015 - 19:15 | 6968137 RogerMud
RogerMud's picture

airplanes are like inkjet printers. it's not the CAPEX that kills you, it's the OPEX

Sun, 12/27/2015 - 19:27 | 6968165 grunk
grunk's picture

Straight up trade with my 172,

but

it's gotta land on a 3,000 ft. grass strip.

Sun, 12/27/2015 - 19:47 | 6968266 GhostOfDiogenes
GhostOfDiogenes's picture

A 172 needs what...an annual and some oil added and spark plugs changed?

It doesn't have 1 million miles of wiring to go through, even the new Garmen is plug and play.

I remember when a cessna 172 cost cost 60k.

Now its 300k.

Talk about corruption.

Sun, 12/27/2015 - 19:54 | 6968286 grunk
Sun, 12/27/2015 - 20:22 | 6968362 xizang777
xizang777's picture

I sold good condition C-172s for $45k and C-210s for 100.   I screwed up and passed a deal on a super-low time Piper Turbo Dakota for $40k and am still kicking myself for not grabbing it.

Sun, 12/27/2015 - 19:30 | 6968195 mijev
mijev's picture

The best Smithsonian session I did was a visit to the air and space museum. The volunteer guide was an ex Vietnam fighter pilot and then commercial pilot. I got more of an education in that two hour session than a whole semester at college.

Sun, 12/27/2015 - 19:45 | 6968260 Last of the Mid...
Last of the Middle Class's picture

Comes own to 10 grand i'm gonna get one and live in it. Fuck yeah!

Sun, 12/27/2015 - 20:02 | 6968308 Government need...
Government needs you to pay taxes's picture

We saw this in the mining equipment auction in Australia a week or so ago on ZH.  Good-to-go cap equipment selling for 97% off new list price.  Prices are going to get ugly for long-lived cap equipment.

Sun, 12/27/2015 - 20:06 | 6968319 grunk
grunk's picture

Bulldozers need longer runways.

Sun, 12/27/2015 - 20:39 | 6968435 o r c k
o r c k's picture

And dozing Bulls

Sun, 12/27/2015 - 20:16 | 6968349 xizang777
xizang777's picture

Back in the early '90's I brokered aircraft including jets.   There are lots of things that can dramatically affect the value of a used airplane.  Accident history, corrosion, total time on the engines or airframe (very expensive maintenance programs) and maintenance history.   Some units may have title problems as well.  So yes, it is a market driven pricing system, but the particular aircraft may have a lot of deferred maintenance needs, and the price needs to reflect that.

Sun, 12/27/2015 - 20:35 | 6968414 SantaClaws
SantaClaws's picture

It would be helpful if they identified the 777 by tail number or registration number (assuming the numbers can't be changed).  I'd stay away from it.  Fortunately, I stopped flying Delta some ten years ago.

 

It would be interesting to track the previous owners and whether Delta really puts this jet into service, and where, after acquisition.

 

I also have to wonder -- what was this jet exposed to?  Ebola, nuclear radiation, something equally as attractive?  Perhaps Delta will hire Christine Todd Whitman to give the jet a clean bill of health, as she did for the air around lower Manhattan immediately after 911.

 

 

Sun, 12/27/2015 - 21:35 | 6968647 Lmo Mutton
Lmo Mutton's picture

"Does it come with wings?"

Yes sir it has wings.  The engines are missing, its out of inspection and the Malaysian paint will need to go.

Sun, 12/27/2015 - 21:55 | 6968716 rich1657
rich1657's picture

Life Imitates Aerobiz Super NES

Sun, 12/27/2015 - 22:49 | 6968905 Still Losing Money
Still Losing Money's picture

Amazing the amount of critical info that the author of this article left out. Oh, right, can't let facts get in the way of the narrative. And ZH talks aboout how faux news, cnn and the rest of the msm tell lies and hide the truth. and then publishes this piece of crap story.

Sun, 12/27/2015 - 23:46 | 6969079 Huckleberry Pie
Huckleberry Pie's picture

Delta adds another junker, to their aging fleet. Not much a news story, really.

7.7 mil for a triple 7.....yeah, there are a few major issues.

Mon, 12/28/2015 - 01:24 | 6969353 Estrella
Estrella's picture

Delta's fleet is pretty new. 120 737-900s (about 40 delivered, 80 on order) Jets so new that the wheel wells are clean, 80 73-700's & 800s, tons of Scarebus stuff. Including the new 350.

The MadDogs are seriously dated and of course the 75 76's are getting long of tooth. On the other hand, the 75 is still one of the most stunning jets in the world and had it not been for SouthWest's love of the 73, the 75 would still be in production.

The 76 is a truly amazing machine. At 375,000lbs on one engine, it can climb faster then a copilot can think.

So your statment that Delta's fleet is aging is not really accurate. And the 777 is one of the most capable planes ever built.

Still, this price is stunning and the article is right, a lot of people are banking on planes being worth a lot more then they are actually selling for.

Mon, 12/28/2015 - 00:24 | 6969204 803Mastiff
803Mastiff's picture

Its Malaysia flight 370 barn find.

Mon, 12/28/2015 - 08:00 | 6969725 XXL66
XXL66's picture

Still a better resale value then a 10 year old Tesla

Mon, 12/28/2015 - 18:03 | 6971935 Villageidiot777
Villageidiot777's picture

First Boeing then Tesla?

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