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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (31180)	6/16/2008 11:10:22 AM
From: Wallace Rivers	Read Replies (1) \| Respond to of 78690

I haven't heard too much about demand shifting to smaller planes, if you lump regional jets in there. I've heard RJs are not particularly fuel efficient per seat mile, and these are targets for reduction. I thought one of the selling points for BA is that airlines may be forced to retire older gas guzzlers for newer technology which consumes less fuel. I see the Dreamliner is projected to consume 20% less fuel than a prior generation jet carrying the same amount of passengers. The workhorse of the industry is still the 737, and BA is rolling out more fuel efficient versions of that, I would suspect, without performing any DD on that matter.

To: Paul Senior who wrote (31180)	6/16/2008 11:24:05 AM
From: E_K_S	Respond to of 78690

GE may be another play on this theme. It looks like GE Aviation does the retrofit (RNP) on the legacy 737 models that provides operating efficiencies that save fuel and reduce in air flight delays. Next-Gen Pace Picks Up Jan 25, 2008 By Henry Canaday/Overhaul & Maintenance aviationnow.com From the article:"...Southwest Airlines will be adding the dual flight management systems (FMS) required for RNP, along with other equipment, to all of its classic Boeing 737s in a special modification line in 2008 and 2009. The carrier's 737-700s already are equipped for RNP. The classic upgrades are being provided by GE Aviation Systems. The market for these and similar upgrades is "starting to heat up," according to Jack Befus, acting director of civil flight systems. "We are seeing requests for proposals, pricing and technical information." Befus attributes increased interest to both RNP's short-term savings and the fact that dual FMSs eventually will be necessary to deliver the capabilities for full next-gen. RNP already has been bringing significant short-term benefits, in time saved and timely arrivals, to GE customers in the U.S., Canada and Europe. GE is involved in next-gen trials in Europe, where Scandinavian Airlines estimates that its RNP approaches at Stockholm Arlanda could save $12 million a year, including $6 million in fuel savings, and reduce annual emissions by 23,000 metric tons of carbon dioxide. The same tools have proven the safety and fuel savings of RNP at Linzhi Airport..." ======================================================== With a forward PE of 10, BA may be a better pure play but GE should also benefit from this upgrade/retrofit cycle. finance.yahoo.com^gspc;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined EKS