New server - new rules leasing restriction?

English Boards Suggestions and Ideas
1

SK I think is better to transfer my response here from General forum...

mmmh ... but that's not so unusual. If you would forbid to start leased aircraft in real life, the most aircraft would have to stay on ground. The most airlines in real life only lease their aircraft.

I can't agree with you anymore. The leasing over buying is a thing that has been criticized for a long long time

OK, we have lot of protest about fair play in last days, so everybody ask some fast solution, but its impossible in server who already run

My idea is to make restrictions on leasing, and with that you will manage fair play

Lets look what we have now in game

we have 99,5% leasing aircraft, so leasing is not option, its only way of play

So you can restrict numbers of leasing airplanes - let say up to 10 or make leasing expensive with raising week depreciation

With 10 aircraft you can make money for Buy or take credit

Why to do that?

Well if you look game today, you will see that is game very harsh and unfriendly to new players

but if you manage to survive 4 weeks game become very easy, or to easy

If you lease new aircraft and made mistake, simple you cancel leasing and you will get money back

But if you force players to buy aircraft, well then we must think, because if we made mistake its harder to sell aircraft

With restriction of leasing game will be harder in all game time, and you must think what you doing all time.

All players will must make strategy when expand airline, not simply work like BOT.

I know that this rule is impossible to introduce in old servers, but not hard for new one

2
Well if you look game today, you will see that is game very harsh and unfriendly to new players

But you are doing the same with the restriction. You may start with the first 10 aircraft on leasing base but afterwards you have to buy an aircraft. So if there is an airline with 80+ aircraft (70 bought) and you have to compete against this, it will be impossible due to the much lower cash flow of the existing airline.

And why 10 and why not 15 or 20 or 5? The problem with this random numbers is that they are not build by a logical reason. In my opinion we shall think about not allow leasing (and loan-purchase) for airlines below a specific value and/or if there is enough money to buy an aircraft. But these are also randomly set conditions.

3

But you are doing the same with the restriction. You may start with the first 10 aircraft on leasing base but afterwards you have to buy an aircraft. So if there is an airline with 80+ aircraft (70 bought) and you have to compete against this, it will be impossible due to the much lower cash flow of the existing airline.

And why 10 and why not 15 or 20 or 5? The problem with this random numbers is that they are not build by a logical reason. In my opinion we shall think about not allow leasing (and loan-purchase) for airlines below a specific value and/or if there is enough money to buy an aircraft. But these are also randomly set conditions.

well you got point

but if 99% game is leasing, something is wrong, we need more balance in game, and more challenge in later game phase

So can you make Credit line more friendly then leasing?

4

You can be sure that this changes... If I look to old server where the beginning was the same. I now own the most of my fleet. And this will happen in Aspern too.

5

well you can risk with one new server.

if rules is not good, server will be empty,

and you can close or restart with old rules and say we try but its not work ;)

6

In order to move from leasing new aircraft purchases must be made more financially friendly, not such exorbitant interest as posted here

http://community.airlinesim.aero/topic/3691-question-about-new-aircraft-purchase/#entry27862

You overpay the aircraft too much with loan.

As we can see here http://www.afm.aero/magazine/trading-legal-and-finance/item/556-operating-leases-their-role-in-today%E2%80%99s-market today almost 40% of all commercial airline fleet is leased. Leasing is becoming more and more popular, as the aircraft financing companies (mostly European banks) are slowly distancing themselves from this line of business. http://www.pwc.com/en_GX/gx/aerospace-defence/publications/assets/pwc-aviation-finance-fastern-your-seat-belts-pdf.pdf and http://www.flightglobal.com/airspace/media/reports_pdf/emptys/102389/aircraft-finance-2013.pdf

A large portion of aircraft currently on order with Boeing and Airbus do not yet have the "financial backer" yet. This all points out to operating lease becoming even more widespread in years to come, and it will be both Boeing and Airbus incurring in operating lease market (they themselves will buy their own aircraft and lease them out to airlines).

To this regard, AS is no different, financing aircraft for direct purchase is more difficult in AS (and it is becoming more difficult in RL). Having a 1-2% finance rate in older worlds, and 6% rate in Aspern, makes DP of aircraft via financing really really impossible. In RL, maybe 1 out of 100 purchased aircraft is financed with direct cash 100% (and 40% of aircraft are leased, this makes it 0.6 aircraft out of 100 produced aircraft bought with cash up front). So going the purchase route (direct purchase, no financing) is an illusion and absolutely unrealistic.

But making financing more feasible, that would be a step in right direction. That would need adjustment of interest rates. No airline in RL overpays financed aircraft 3 times as is the case in AS when loan purchasing (see thread listed above). It would require finding an equilibrium point. Let's say 1 year AS playtime is equal to 7 years of real airline time (based on average 30%profit  margin in AS, 4-4.5% margin in RL). Assume real airline finances aircraft for 10 year term. So the loan-financed aircraft should be feasible to finance and pay off in AS in approximately 78 weeks.

If this can be achieved we will see more financed aircraft vs leased aircraft.

7

As a silly question. How many real airlines own the aircraft rather than leasing? I work for a major airline which everyone assumes that the aircraft is owned outright, but if you check the plaque in the aircraft states the aircraft is leased.

8

hey this is game, you don't have have everything like RL ...

In RL you can use new or used aircrafts

on servers Aspren and Idlewild you have only new aircrafts

So why one new server with leasing restriction and only new airplanes?

so it will bi more challenging server for better players

Or even better

start new server with

  1. DASH 8 - or ATR 72  and 2 mill A$
  2. no leasing at all, only Cash or Credit for new airplanes

This is virtual world we can make experiments :lol:

edit:

 

every player will start with

  1. DASH 8 - or ATR 72  and 2 mill A$
  2. no leasing at all, only Cash or Credit for new airplanes
9

As a silly question. How many real airlines own the aircraft rather than leasing? I work for a major airline which everyone assumes that the aircraft is owned outright, but if you check the plaque in the aircraft states the aircraft is leased.

There is a lot of reading one can find about the topic... I do not have current stats, but right now, about 35% of manufacturers' order backlog is by leasing companies. It is expected to increase to over 50% by 2020 as per Boeing.

10

Or even better

start new server with

  1. DASH 8 - or ATR 72  and 2 mill A$
  2. no leasing at all, only Cash or Credit for new airplanes

This is virtual world we can make experiments :lol:

That would be even less realistic and less playable than the current setup. How many ATR72s or DASH 8 could you loan finance with 2 million starting capital, and 6% interest rate as it currently stands on Aspern?

11

Darky007 - I appreciate it is a game but it is a game based on some real facts. My point is if in real life leasing is more favorable than purchasing then should that not be reflected in the game?

Rubiohiguey2000 - This 35%-50% are the usual leasing companies, such as GECAS, CIT Leasing etc. How many of those airlines that are listed (I'm looking at Boeings order book)  as American Airlines, Ryanair, Westjet, will actually be owned by AA,FR or WJ when they enter service? I'd say the vast majority of those orders will actually be owned by a bank such as Wells Fargo and then leased to AA, FR or WJ

12

Rubiohiguey2000 - This 35%-50% are the usual leasing companies, such as GECAS, CIT Leasing etc. How many of those airlines that are listed (I'm looking at Boeings order book)  as American Airlines, Ryanair, Westjet, will actually be owned by AA,FR or WJ when they enter service? I'd say the vast majority of those orders will actually be owned by a bank such as Wells Fargo and then leased to AA, FR or WJ

That is right... but instead of Wells Fargo make it RBS, Barclays, ING, Credit Suise... and in the future All Arabian Bank* and First Beijing *

* Fictious names

European banks were traditional aircraft financiers (loan purchase) for the airlines. But since the banking crisis, European banks are distancing form this business. But new players are emerging and those are Middle Eastern and Chinese companies who are entering the market .... both as bank financiers and as lessors.

Also, about the current fleet composition, this image might tell something ,,, If 2011 was like 37%/63% leased vs owned fleet composition...we can well assume that in 2013 the leased fleet would account for 40-42% of the total.

20120121_WOC445.gif

13

sorry i forget to say

every player will be start with

  1. DASH 8 - or ATR 72  and 2 mill A$
  2. no leasing at all, only Cash or Credit for new airplanes

with 2 mil A$ you can equip airplane and start business

Edit:

@ianmanson

this is game, and virtual world

we have 8 servers with 200-300 players with old rules

what is problem make new server with little change in rules?

we need some dinamics

14

The chart may be correct - I don't know - but if you make a research for <15 year old aircraft the number of lease aircraft is much higher.

15

Darky007 -  That doesn't really answer my point. A server is something quite expensive and time consuming to do. It must make a profit, if you introduce a server purely with this rule is there going to be enough demand? Would there not be more demand for a server with a small change such as unlimited cash, unlimited slots, or the more popular one older time period server.

Rubiohiguey2000 - Thanks for finding the chart, but does that take into account Wells Fargo etc.

16

Darky007 -  That doesn't really answer my point. A server is something quite expensive and time consuming to do. It must make a profit, if you introduce a server purely with this rule is there going to be enough demand? Would there not be more demand for a server with a small change such as unlimited cash, unlimited slots, or the more popular one older time period server

1. this is not free game, you must pay credit for every day....

2. well about demand, look on Aspern - 1200/1200 and players still looking for empty slot.

17

Rubiohiguey2000 - Thanks for finding the chart, but does that take into account Wells Fargo etc.

No I do not think so ... simply because the banks do not take ownership possession of the aircraft... it's like a mortgage of the house. The "owner" (who carries the asset on the books) is the house owner and in this case the airline.The bank (e.g. Wells Fargo) would just provide a loan to the airline. Bank's asset would be the loan. Airline's asset would be the aircraft (and airline's liability would be the outstanding loan).

There are cases of sale and leaseback (e.g. Air France selling and leasing back some of its aircraft) http://airleasecorp.com/2010/07/27/air-lease-corporation-and-air-france-sign-a-sale-and-lease-back-agreement-for-six-aircraft/ but that is done with leasing companies such as the ones you mentioned, not with banks.

So in the graph (or the Boeing order book) it would be the airlines listed, not the banks. I do not think any airline right now has money to outright pay cash for the orders, maybe to outright pay for 1 or 2 narrowbodies, but not for orders of tens or hundreds of aircraft such as AirAsia or Ryanair.

Because the banks only finance the aircraft orders via loans, such aircraft would be listed as "owned" by the airline. They would have a "mortgage" (lien) on the aircraft. If the banks have to execute the lien, in that moment the aircraft would become their possession, but because banks do not have experience managing fleets, they would most likely just sell the plane to a leasing company.

18

Darky - 0.10 euro cents per day per player. 5222 active players across all game worlds = 522euro a day.  With that little money then once again a server has to make a profit and be desirable. One thing AS is very good at is making the game as real as possible, and this is what it makes to desirable to a lot of people. My opinion is that putting in an unrealistic control into a game removes a lot of desirability for a lot of players, and like I said there are plenty of other unrealistic controls that could be introduced that would be desirable to a lot of players.

Rubiohiguey2000 - Thanks for the explanation, it makes a lot more sense to me. You mentioned the right airline, I can tell you the 300 (with the 175 aircraft order) odd aircraft all have placards stating "Owned by xxx, leased to (the airline), blah blah" I shall check next time im in work for the correct wording. I think these were all sale and leasebacks. So I assume a lot more of the worlds fleet is similar?

Edit due my poor maths!

19

1. this is not free game, you must pay credit for every day....

2. well about demand, look on Aspern - 1200/1200 and players still looking for empty slot.

Well... I just did  a calculation yesterday. If everyone bought 500 credits at 13.80 Euro, the current players (considering one holding per server) would bring revenue to roughly about 16,800 Euro per month. Calculate credit card charges 3%, the result is about 16,400 Euro per month. From this they have to pay 12 servers and I am sure they are not using the cheapest server configs. Colocation or dedicated servers with 99.99% uptime guarantee are not cheap and they must have somebody in colo facility on standby 24/7 in case s*t happens. I am sure they also have at least one backup just in case, and run system backups off-servers. Also probably using various RAID configs which add up on hardware costs. They also have office and they have to live off something. When you calculate everything, it really is not much money these guys take home every month. So not being a  "free game and paying credit"... you are right but it's only half of the reality.

20

Darky - 0.10 euro cents per day = 1.2 euros a day with 1200 players. Thats under 500 euros per year to keep 1200 players happy.

 Ian  ... :) that would be 0.10 euro per day @1200 players = 120 Euro per day :)

But you are pointing in the right direction