PREDICTION MARKETS: Airbus A380 vs. Boeing 787

Chris F. Masse May 30th, 2007

QUESTION: Airbus has bet on big airplanes — the A-380 can seat 550 passengers. Boeing has bet on efficient airplanes. What makes you confident that you’re right?

BOEING CFO: It’s not just efficient airplanes. We’re also looking at smaller airplanes that can fly farther and join city pairs. Early on you built bigger planes because bigger planes could fly longer distances. With the advances in engine technology, that’s no longer necessary. We think most people would like to fly point to point. When you build a large airplane, you have to employ the hub system because the large airplane can’t access most of the airports. So you have to fly somewhere you don’t really want to go to finally get on the airplane you want to get on. That’s what has differentiated us on strategy and product offerings. The 787 can fly longer and has the same per-seat economics as large airplanes, so it’s affordable. It’s a good value proposition for our customers.

Hmmm… Airline companies employing the A380 can be more cost efficient.

–> I’d like to see some (mid-term?) prediction markets on this.