"The market pays less for jumbos, " says Timothy Dawson, chief financial officer of Cal-Maine Inc.
WSJ: Big Chocolate Eggs May Be Big, but Big Hen's Eggs Not So Much
Mortgage interest rates on jumbos are about 1.5% higher now than for regular conforming loans.
They don't want to do as many jumbos, they certainly don't want to do any subprime lending any more.
Interest rates on jumbos are 1.5 points higher than those on conventional loans.
Asia is a big market for jumbos and more than 20 orders have been postponed, if not exactly cancelled.
Impoverished airlines in the region are also putting existing jumbos up for sale, which weakens the worldwide market for new aircraft.
The reaction of Singapore Airlines, the first to place a large order for super-jumbos, is a reflection of the crisis facing Airbus.
ECONOMIST: Airbus��s jumbo-sized problem threatens the firm��s future
The idea is to lure back business travellers by having more frequent, point-to-point flights, rather than filling huge jumbos with lots of back-packers.
Faced with a big fall in Asian business, many airlines switched their jumbos to the Atlantic, where previously they might have used smaller wide-bodies.
Boeing thinks that there will be a market for barely 400 very large aircraft (ie, bigger than today's jumbos) over the next 20 years.
ECONOMIST: Airbus unveils its double-decker for a new era in aviation
The deal means 22 orders have been placed so far for the super jumbos after Air France and Emirates Airlines placed orders on Monday.
Boeing has always believed that the market (especially in Asia) will want big long-range aircraft to fly point-to-point rather than super-jumbos using hub airports.
Still, Mr. Berinson says his firm has sold roughly 30% more in private jumbos so far this year than it had at this point last year.
Rates on 30-year jumbos now average 4.22%, down from 4.82% a year ago and 5.27% two years ago, according to HSH.com, a website that tracks mortgage data.
These super jumbos were designed with the anticipation that rapid and sustained economic growth, coupled with constraints in airport infrastructure will force airlines to increase airplane capacities on several routes.
FORBES: Boeing, Airbus' Super Jumbos Are Failing To Take-Off In Turbulent Economy
Fixed rates on 30-year private jumbos average 3.92% for the week ending Dec. 21, down from 4.61% a year prior, and 5.58% for the same week in December 2010, according to mortgage-info website HSH.com.
While rates on jumbos are way down from a high of about 7.9% in October 2008, they remain well above the 5.1% found on conventional loans guaranteed by Fannie or Freddie, according to HSH Associates.
Air France signed a letter of intent to buy 10 super jumbos, with options for four more, while Emirates Airlines said it planned to buy five A3XX, had the option to buy five more, and ordered two freighter versions of the aircraft.
And, in the current economic environment with slowdown in Europe, weak macro economic environment in the U.S. and slowing growth in emerging markets like China and India, many in the airline industry anticipate low sales for these super jumbos to continue over the near term.
FORBES: Boeing, Airbus' Super Jumbos Are Failing To Take-Off In Turbulent Economy
Boeing is still sounding out customers about a 747 big enough to carry 500 passengers (about 100 more than the jumbos that fly on long-haul routes today), but has already reworked the 747's electronics and digitised the original fuselage drawings, which date back to the 1960s.
During the mortgage crisis, the vast majority of jumbos were adjustable-rate mortgages and hybrid adjustable-rate mortgages, which started at low fixed rates and switched to adjustable interest rates at the end of a set time period typically of five, seven or 10 years, said Keith Gumbinger, vice president at HSH.com, a mortgage-information website.
应用推荐