4 ms·

Just for some context 787 cost $32billion dollars to develop.

sargun 11y ago
The Concorde was developed in £1.134 billion[1], in today's dollars that's about £7.37B[2]. [1] http://www.concordesst.com/faq.html http://www.concordesst.com/faq.html [2] http://inflation.stephenmorley.org/ http://inflation.stephenmorley.org/
- samfisher83 11y ago
  That is only development costs. That is about 10billion dollars. If the margin on the plane is 50% which is just to breakeven they would need to sell 20billion dollars worth. If they can sell each plane for 300 mil they would need to sell 67 to break even. There were 20 concordes that were ever made. Margins on aircraft are never 50%. For 787 its like 10-15%.
  - twistedpair 11y ago
    10% Margin? They wish. Boeing is losing $25 million for every 787 it delivers [1]. Boeing investors would be ecstatic to get a 1% margin right now. [1] http://www.seattletimes.com/business/boeing-aerospace/will-787-program-ever-show-an-overall-profit-analysts-grow-more-skeptical/ http://www.seattletimes.com/business/boeing-aerospace/will-7...
    - dredmorbius 11y ago
      How much of that is fixed-cost accounting loss? Aircraft have high design costs (figure for the '87 is above), but the actual manufacturing costs should be ... somewhat reasonable. I have a hard time imagining Boeing would be selling the aircraft if they weren't recovering their marginal costs.
      - mikeyouse 11y ago
        Coincidentally, Boeing's being investigated by the SEC for their bizarre program accounting to answer this exact question. http://www.seattletimes.com/business/boeing-aerospace/report-boeing-faces-sec-probe-of-dreamliner-747-accounting/ http://www.seattletimes.com/business/boeing-aerospace/report... The "never make a profit" line is probably a tax-deferral strategy which is reflected by their stock price increasing ~100% in the past 5 years. Not exactly the performance you'd expect of a floundering company.
jcfrei 11y ago
Most important figure here. How could a "startup" design and build a commercial airplane and still be considered a startup? Either they get acquired before launching the final version of their plane or the company goes bust. The margins for building airplanes are very slim, both Airbus and Boeing get massive subsidies from the EU and US respectively. Which investor would be crazy enough to pour billions into the development of such a plane? And don't even think about mentioning SpaceX - building a rocket is orders of magnitude less complex than building a commercial airliner that meets customer's standards, is commercially viable and safe. In contrast spending tax payer money on rockets (which are allowed to fail every now and then) is easy!
- deleted 11y ago
  [deleted]
- jessaustin 11y ago
  There isn't a chance in hell that after producing a supersonic prototype, these people wouldn't also get massive subsidies and investments. Still, right now they're a startup.
- stcredzero 11y ago
  Most important figure here. How could a "startup" design and build a commercial airplane and still be considered a startup? Either they get acquired before launching the final version of their plane or the company goes bust. The margins for building airplanes are very slim, both Airbus and Boeing get massive subsidies from the EU and US respectively. If the founding fathers were born in the 80's, they might have gone for restricting the establishment of brands not religions. (Which are also brands of a kind, really.)
tristanj 11y ago
The 787 had $15 billion in cost overruns though. If Boom plays their cards right they can absolutely get it done for less.
ant6n 11y ago
Bombardier, a multi-billion dollar transportation technology company that also builds private jets, almost went bankrupt trying to develop a small 2+2 passenger jet.
- MichaelGG 11y ago
  Bombardier also couldn't deliver streetcars on time.
deleted 11y ago
[deleted]
twistedpair 11y ago
To put that number in perspective, recall the huge engineering effort necessary, not to mention the flight test program needed to get a commercial airline EIS certification. The 787 was designed for 44,000 takeoff/landings [1], with mere minutes turn around time, while carrying 400+ people in comfort. Add to that target 99% dispatch availability (i.e. does not break down). To do that, you've got to think hard about every single nut and bolt and how that bolt will break in 30 years, and how hard it will be to detect the broken bolt, and how cheaply the bolt can be replaced (easy wrench access, need to pull out seats?). Extrapolate that to the millions of parts in the airframe. Add to that Billions for production tooling for mass production. Remember, 495 Boeing 737 were build last year[2]. That's one finished plane every 16 hours. [1] http://aviationweek.com/commercial-aviation/boeing-begins-analysis-787-fatigue-tests http://aviationweek.com/commercial-aviation/boeing-begins-an... [2] https://en.wikipedia.org/wiki/Boeing_737#Total_production https://en.wikipedia.org/wiki/Boeing_737#Total_production
kristianp 11y ago
Boom is going to be smaller, I wonder how much simpler (and cheaper) than a 787 one of their planes is going to be? It's still going to need all the same type of components. It won't be as hard to make the wings strong, given they will be smaller and delta-shaped. I also wonder if a business jet would be a better market for this type of thing. Netjets would buy a few, I bet.
silverdreamer 11y ago
It sounds like they've made some truly incredible progress and I can see demand. But how are they going to get to a fully developed and built aircraft for a fraction of that cost?

The Concorde was developed in £1.134 billion[1], in today's dollars that's about £7.37B[2]. [1] http://www.concordesst.com/faq.html http://www.concordesst.com/faq.html [2] http://inflation.stephenmorley.org/ http://inflation.stephenmorley.org/

samfisher83 11y ago
That is only development costs. That is about 10billion dollars. If the margin on the plane is 50% which is just to breakeven they would need to sell 20billion dollars worth. If they can sell each plane for 300 mil they would need to sell 67 to break even. There were 20 concordes that were ever made. Margins on aircraft are never 50%. For 787 its like 10-15%.
- twistedpair 11y ago
  10% Margin? They wish. Boeing is losing $25 million for every 787 it delivers [1]. Boeing investors would be ecstatic to get a 1% margin right now. [1] http://www.seattletimes.com/business/boeing-aerospace/will-787-program-ever-show-an-overall-profit-analysts-grow-more-skeptical/ http://www.seattletimes.com/business/boeing-aerospace/will-7...
  - dredmorbius 11y ago
    How much of that is fixed-cost accounting loss? Aircraft have high design costs (figure for the '87 is above), but the actual manufacturing costs should be ... somewhat reasonable. I have a hard time imagining Boeing would be selling the aircraft if they weren't recovering their marginal costs.
    - mikeyouse 11y ago
      Coincidentally, Boeing's being investigated by the SEC for their bizarre program accounting to answer this exact question. http://www.seattletimes.com/business/boeing-aerospace/report-boeing-faces-sec-probe-of-dreamliner-747-accounting/ http://www.seattletimes.com/business/boeing-aerospace/report... The "never make a profit" line is probably a tax-deferral strategy which is reflected by their stock price increasing ~100% in the past 5 years. Not exactly the performance you'd expect of a floundering company.

jcfrei 11y ago

Most important figure here. How could a "startup" design and build a commercial airplane and still be considered a startup? Either they get acquired before launching the final version of their plane or the company goes bust. The margins for building airplanes are very slim, both Airbus and Boeing get massive subsidies from the EU and US respectively. Which investor would be crazy enough to pour billions into the development of such a plane? And don't even think about mentioning SpaceX - building a rocket is orders of magnitude less complex than building a commercial airliner that meets customer's standards, is commercially viable and safe. In contrast spending tax payer money on rockets (which are allowed to fail every now and then) is easy!

deleted 11y ago
[deleted]
jessaustin 11y ago
There isn't a chance in hell that after producing a supersonic prototype, these people wouldn't also get massive subsidies and investments. Still, right now they're a startup.
stcredzero 11y ago
Most important figure here. How could a "startup" design and build a commercial airplane and still be considered a startup? Either they get acquired before launching the final version of their plane or the company goes bust. The margins for building airplanes are very slim, both Airbus and Boeing get massive subsidies from the EU and US respectively. If the founding fathers were born in the 80's, they might have gone for restricting the establishment of brands not religions. (Which are also brands of a kind, really.)

tristanj 11y ago

The 787 had $15 billion in cost overruns though. If Boom plays their cards right they can absolutely get it done for less.

ant6n 11y ago

Bombardier, a multi-billion dollar transportation technology company that also builds private jets, almost went bankrupt trying to develop a small 2+2 passenger jet.

MichaelGG 11y ago
Bombardier also couldn't deliver streetcars on time.

deleted 11y ago

[deleted]

twistedpair 11y ago

To put that number in perspective, recall the huge engineering effort necessary, not to mention the flight test program needed to get a commercial airline EIS certification. The 787 was designed for 44,000 takeoff/landings [1], with mere minutes turn around time, while carrying 400+ people in comfort. Add to that target 99% dispatch availability (i.e. does not break down). To do that, you've got to think hard about every single nut and bolt and how that bolt will break in 30 years, and how hard it will be to detect the broken bolt, and how cheaply the bolt can be replaced (easy wrench access, need to pull out seats?). Extrapolate that to the millions of parts in the airframe. Add to that Billions for production tooling for mass production. Remember, 495 Boeing 737 were build last year[2]. That's one finished plane every 16 hours. [1] http://aviationweek.com/commercial-aviation/boeing-begins-analysis-787-fatigue-tests http://aviationweek.com/commercial-aviation/boeing-begins-an... [2] https://en.wikipedia.org/wiki/Boeing_737#Total_production https://en.wikipedia.org/wiki/Boeing_737#Total_production

kristianp 11y ago

Boom is going to be smaller, I wonder how much simpler (and cheaper) than a 787 one of their planes is going to be? It's still going to need all the same type of components. It won't be as hard to make the wings strong, given they will be smaller and delta-shaped. I also wonder if a business jet would be a better market for this type of thing. Netjets would buy a few, I bet.

silverdreamer 11y ago

It sounds like they've made some truly incredible progress and I can see demand. But how are they going to get to a fully developed and built aircraft for a fraction of that cost?