Hacker News Reader

> American has paid a non-refundable deposit on the initial 20 aircraft.

Pretty glad I don't own American stock right now, because they're apparently led by madmen.

It's phrased in such a way to give the idea that they've made a significant commitment, but it's entirely possible it was something like a 1% down payment.

This is almost certainly how it was done - and even the "fully refundable" deposits airlines make with Boeing, et al are going to have "fixed non-refundable costs" even just to handle the paperwork.

Right. If you're going to place a deposit for aircraft with a startup airplane manufacturer, "refundable" only makes sense if you're willing to take warrants or something that will grant you IP when the company folds. If Boom doesn't deliver the aircraft, the company folds and goes bankrupt, it's not like the deposit funds are just held in escrow. Might as well make it "nonrefundable" to get the PR value.

The free publicity alone will pay for that.

"Non-refundable deposit" could be $1. In exchange they get their name mentioned in a load of press as being associated with new technology etc., so massively worth it for them. Also worth it for Boom as having "orders" from credible airlines makes them look more credible.

Reply on news.ycombinator.com