Q: So how much does an airliner cost, exactly?
The prices of airplanes vary tremendously. Would you believe over $165 million for a single new Airbus A340 or Boeing 777? Or more than $25 million for a new 737? But an old 727 to be rebuilt as a freighter might run five million or less. It differs with age, systems upgrades, etc. A lot depends on the engines (how long before an overhaul is due?), which can sell for millions apiece. The little commuter planes none of you can stand also are multi million-dollar machines, and you can keep that in mind the next time you’re walking up the stairs and cracking a joke about rubber bands.
Airlines often do not own their planes, but rather lease them from banks and leasing companies, making regular payments not unlike the way you’d make payments on a car. How else could carriers operating hundreds of airplanes afford so many? In most cases, the overall value of an airline (say a billion dollars for a US major), is far, far less than the combined book value of its airplanes. A billion dollars might be enough to purchase a dozen airplanes, but the majors each operate several hundred.
This Q&A is part of a collection that originally appeared on Salon.com. Patrick Smith, 38, is an erstwhile airline pilot, retired punk rocker and air travel columnist. His book, Ask the Pilot (Riverhead) was voted “Best Travel Book of 2004” by Amazon.com. Patrick has traveled to more than 55 countries and always asks for a window seat. He lives near Boston.