Flying Economy – The Economic Impact of New Propulsion Technology: A Cost-Benefit Analysis of the Geared Turbo Fan Engine on the London Heathrow and Frankfurt Route

The outcomes of the aircraft appraisal model indicate that switching to A320neos on lease (Option 2) might be beneficial. The fuel consumption of the A320neo aircraft is lower than that of the current A320-200 aircraft (2,234 kg vs 2,988 kg per sector). As a result, this option could offer a large benefit (NPV of USD 31 million) through lower fuel consumption and thus lower fuel costs. At the same time, a fuel reduction means a lower emissions impact (about USD 2 million benefit). It can be concluded that keeping the current A320-200 (NPV of USD 8.9 million) is less profitable than replacing it with a leased A320neo (NPV of USD 31 million) for Airline A, but better than a B737-800 (NPV USD 4.3 million). The option to lease the A320neos appears to be preferred in most cases, considering the impact of noise and NOx cost, due to the large benefit of NPV USD 25 million compared to the A320 and an approximately 29 million difference compared with the B737-800.