Citibank acquiring a Falcon 7X.
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Citibank acquiring a Falcon 7X.
I saw a debate on another site about the choice of a French aircraft iso a Gulfstream or another US made plane. Any ideas why they made this choice ?
Citigroup Fumbles Response to Questions About New $50 Million Jet -- Daily Intel -- New York News Blog -- New York Magazine
Citigroup Fumbles Response to Questions About New $50 Million Jet -- Daily Intel -- New York News Blog -- New York Magazine
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Possibilities:
1. Maybe they have other financial entanglements with Dassault.
2. Maybe they have preference for Tri-Motors for long overwater frights to their far-flung operations.
Compared to the wasted time and security-induced humiliation of flying commercial, they should go private if they're worth even a fraction of their exhorbitant pay.
GB
1. Maybe they have other financial entanglements with Dassault.
2. Maybe they have preference for Tri-Motors for long overwater frights to their far-flung operations.
Compared to the wasted time and security-induced humiliation of flying commercial, they should go private if they're worth even a fraction of their exhorbitant pay.
GB
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Unless of course they've gotten 300 billion from the taxpayers.
Then of course we wonder why they can't fly commercial like the rest of us.
Or are they going to share the plane with the rest of us?
Somehow, I think no they won't.
Then of course we wonder why they can't fly commercial like the rest of us.
Or are they going to share the plane with the rest of us?
Somehow, I think no they won't.
Everything is under control.
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Not so simple.
A 7X could be a better investment than some Citigroup made in the last years...
And then they would worry about the cost of fuel 20-60% less...
I understand they operate 2 early model GLEX and a F900EX. No urgent need for replacement though.
A 7X could be a better investment than some Citigroup made in the last years...
And then they would worry about the cost of fuel 20-60% less...
I understand they operate 2 early model GLEX and a F900EX. No urgent need for replacement though.
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envy
this thing about corporate jets comes down to envy. The people in these jets are paid millions, and are responsible for making billion dollar decisions every day. Every minute of their day is valuable.
How many times have we been called by a friend/wife someplace else struggling with something like a broken mower, or which car to buy, or why won't the PC boot up etc. Sometimes rather than help over the phone it's far better to get over to their house and see the issue for ourselves.
Same with these corporate titans. Should they buy the factory in China or should they keep the US plant open? They can get all the reports and underlings feedback they want, but sometimes it's far better to go see for yourself. Maybe if you had an extra hour of quiet time to think things through you would have borrowed $2Bn from this bank rather than $3bn dollar. Maybe be in yen rather than dollar.
These are decisions worth billions! So it's silly to deny these people what is peanut money, at the end of the day, the tools they need.
G
How many times have we been called by a friend/wife someplace else struggling with something like a broken mower, or which car to buy, or why won't the PC boot up etc. Sometimes rather than help over the phone it's far better to get over to their house and see the issue for ourselves.
Same with these corporate titans. Should they buy the factory in China or should they keep the US plant open? They can get all the reports and underlings feedback they want, but sometimes it's far better to go see for yourself. Maybe if you had an extra hour of quiet time to think things through you would have borrowed $2Bn from this bank rather than $3bn dollar. Maybe be in yen rather than dollar.
These are decisions worth billions! So it's silly to deny these people what is peanut money, at the end of the day, the tools they need.
G
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Groundbum, that's all very true and no one seems to disagree. However, the point is they screwed up on those billion dollar decisions you mention and were bailed out with public money while other businesses in a similar predicament would have been allowed to fail. Stories like this are therefore understandably objectionable to people who have no choice but to foot the bill for such bailouts.
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It's quite a hysteria going on when it comes to bizjets... ever since those stupid idiots decided to fly their 3(!) G5's to that bailout hearing.
I do not question the need for this kind of transportation in general - its a money well spent; but those guys are paid the big bucks to have a feeling for the market, for what products the broad public might want. If they can't foresee that while they are asking for money, somebody might have an issue with them not sharing one G5 - or get a Learjet each - for the 70 minute flight, then they aren't worth the big bucks.
In the Citibank case, I guess some desperate reporter got his hands on future deliveries of Dassault Falcon (maybe some insider made a few $ at the side by tipping him of) and decided to make a story out of it. They where probably right the first time, it will cost the taxpayer more money NOW than if they would take delivery.
Why Falcon? Maybe, back in the day when Citibank still had european (german) subsidiaries, there was the need to convince lobbyists and politicians that the big US company would actually invest in the european industry in order to get approval for something... Like George W. ordered the new Marine One at Augusta Westland and not Sikorsky right around the time at the beginning of the Iraq war
I do not question the need for this kind of transportation in general - its a money well spent; but those guys are paid the big bucks to have a feeling for the market, for what products the broad public might want. If they can't foresee that while they are asking for money, somebody might have an issue with them not sharing one G5 - or get a Learjet each - for the 70 minute flight, then they aren't worth the big bucks.
In the Citibank case, I guess some desperate reporter got his hands on future deliveries of Dassault Falcon (maybe some insider made a few $ at the side by tipping him of) and decided to make a story out of it. They where probably right the first time, it will cost the taxpayer more money NOW than if they would take delivery.
Why Falcon? Maybe, back in the day when Citibank still had european (german) subsidiaries, there was the need to convince lobbyists and politicians that the big US company would actually invest in the european industry in order to get approval for something... Like George W. ordered the new Marine One at Augusta Westland and not Sikorsky right around the time at the beginning of the Iraq war
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Could be they need better short field performance than a GV can give and don't need that extra bit of range. As previously mentioned the fuel costs are also considerably lower...
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keep it simple
hopefully the big guys just told the chief pilot his budget and route parameters and told him to haggle hard. And kept politics out of it! There is such a thing as analysis paralysis.
G
G
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To reinforce Eboys' comment:
FROM AIN:
Under heavy political pressure, Citigroup today issued a statement saying that it would not take delivery of “any new airplane,” an oblique reference to a Dassault Falcon 7X the company ordered in 2005 and was scheduled to accept this year. A furor arose in Congress this week over the $50 million jet because Citigroup received $45 billion in government loans late last year to keep the bank from failing.
Under heavy political pressure, Citigroup today issued a statement saying that it would not take delivery of “any new airplane,” an oblique reference to a Dassault Falcon 7X the company ordered in 2005 and was scheduled to accept this year. A furor arose in Congress this week over the $50 million jet because Citigroup received $45 billion in government loans late last year to keep the bank from failing.
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If they can't foresee that while they are asking for money, somebody might have an issue with them not sharing one G5 - or get a Learjet each - for the 70 minute flight, then they aren't worth the big bucks.
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From AVweb today. Wonder if Air Force One and Marine One are in for the chop?
Obama Administration Opposes New Jet For Bailed-Out Bank
White House press secretary Robert Gibbs said Monday at a press briefing that President Barack Obama "doesn't believe" using private jets "is the best use of money"-- at least not if that money is from a federally financed bailout package. In response to a question about Citigroup spending $50 million for a Dassault Falcon 7X business jet, which was reported Monday in the New York Post, Gibbs said, "The president believes that great care should be used anytime the taxpayers' money is being used ... that money should be used to lend to consumers to get the economy moving again, to free up capital and credit, and help small businesses create jobs." Citigroup has received $45 billion from the TARP, or Troubled Asset Relief Program. According to Bloomberg News, an official from the Treasury Department called Citigroup this week to "express concern" about the company's planned purchase of the jet. A bank spokesperson told Bloomberg that their intent was to sell off older aircraft and buy new, more efficient ones and no TARP funds would be used for the purchase. The plan, however, drew an outcry. Sen. Carl Levin, of Michigan, where the auto industry has taken harsh criticism for use of corporate jets, said that Citigroup shouldn't be flying either. "To permit Citigroup to purchase a plush plane -- foreign-built no less -- while domestic auto companies are being required to sell off their jets is a ridiculous double standard," he said in a statement on his Web site. "The notion of Citigroup spending $50 million on a new corporate jet, even as it is depending on billions of taxpayer dollars to survive, does not fly." Citigroup later released a statement saying that the company has "no intent to take delivery of any new aircraft."
The three-engine 7X was certified in April 2007, and according to Dassault, offers up to 40 percent better fuel efficiency than other aircraft in its class. The airplane has a range of almost 6,000 nm and can carry up to 12 passengers.
Obama Administration Opposes New Jet For Bailed-Out Bank
White House press secretary Robert Gibbs said Monday at a press briefing that President Barack Obama "doesn't believe" using private jets "is the best use of money"-- at least not if that money is from a federally financed bailout package. In response to a question about Citigroup spending $50 million for a Dassault Falcon 7X business jet, which was reported Monday in the New York Post, Gibbs said, "The president believes that great care should be used anytime the taxpayers' money is being used ... that money should be used to lend to consumers to get the economy moving again, to free up capital and credit, and help small businesses create jobs." Citigroup has received $45 billion from the TARP, or Troubled Asset Relief Program. According to Bloomberg News, an official from the Treasury Department called Citigroup this week to "express concern" about the company's planned purchase of the jet. A bank spokesperson told Bloomberg that their intent was to sell off older aircraft and buy new, more efficient ones and no TARP funds would be used for the purchase. The plan, however, drew an outcry. Sen. Carl Levin, of Michigan, where the auto industry has taken harsh criticism for use of corporate jets, said that Citigroup shouldn't be flying either. "To permit Citigroup to purchase a plush plane -- foreign-built no less -- while domestic auto companies are being required to sell off their jets is a ridiculous double standard," he said in a statement on his Web site. "The notion of Citigroup spending $50 million on a new corporate jet, even as it is depending on billions of taxpayer dollars to survive, does not fly." Citigroup later released a statement saying that the company has "no intent to take delivery of any new aircraft."
The three-engine 7X was certified in April 2007, and according to Dassault, offers up to 40 percent better fuel efficiency than other aircraft in its class. The airplane has a range of almost 6,000 nm and can carry up to 12 passengers.
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What Penalty will be charged
For the canx / termination of the order.
I would think that the actual cost to CITI would be more substantial than the first two years depreciation.
But it is all about "image", as we all know.
SSA
I would think that the actual cost to CITI would be more substantial than the first two years depreciation.
But it is all about "image", as we all know.
SSA
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If they can't foresee that while they are asking for money, somebody might have an issue with them not sharing one G5 - or get a Learjet each - for the 70 minute flight, then they aren't worth the big bucks.
