Aircraft Costs
B-747-200's WITH engines, run anywhere from $4.0 mil to $7.0 mil, depending on a lot of things. Without engines, the fuselage is worth from $100K to $500K depending....
Awesome post eyeforthedeal, excellent info, thanks for sharing your expertise. The paragraph above tells me a lot.
First, a fuselage can go any where from $100K to $500K. Baltia paid $475,000, so we bought a top of the line fuselage. They did not buy a piece of junk that would be expensive to put into service. Rather Baltia did buy a fuselage that is in very good condition and should not be too capital intensive to refurbish.
Second, Baltia might be able to put an aircraft in service for $1 Million (preparation, NOT including First Class upgrade) + $475,000 (fuselage purchase price) = $1.5 Million. Of course there are Engine Lease payments to be incurred in the future.
The more I think about leasing engines by the hour, the more sense it makes. Baltia a Development Stage Airline, can launch their Inaugural Flight craft requiring funds around $1.5 Million instead of buying an aircraft outright at an average of $5.5 Million. A prudent and more productive use of limited funds.
Taking that further, Baltia states they intend to put 3 aircraft in service during their first year. Their approach of leasing (power by the hour) might cost around $4.5 Million, instead of buying 3 aircrafts outright at about $16.5 Million.
To date, Baltia Air Lines has no debt, and they intend to expand our fleet using revenues generated once they start flight operations." When Baltia becomes more cash flow positive, they can purchase engines outright and eliminate their lease payments.
