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BMI701EGCC

15th June 2005 14:30

What does Options mean when airlines order new a/c

BMI701EGCC
Scott Waterworth

Rollingthunder

15th June 2005 17:56

They are provisional orders, usually at a pre-agreed price. Once exercised the now confirmed orders slot into the production line.

Re-Heat

17th June 2005 08:35

They also have an agreed delivery date in many cases - a right for which the airline will pay, therefore being very valuable to that airline such that they can sell them on to another party if they wish to do so.

If there is no agreed delivery date, then there is a further level of commitment of additional aircraft for which no delivery date is agreed and no payment has been made for that right.

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