Odds and Ends: LEAP vs GTF; CSeries flight testing; MRJ FAL

LEAP vs GTF: Reuters has a story looking at the intense competition between CFM and Pratt & Whitney for the market dominance of the LEAP vs Geared Turbo Fan engines.

The only airplane where there is competition is on the Airbus A320neo family; CFM is exclusive on the Boeing 737 MAX and COMAC C919 and PW is exclusive on the Bombardier CSeries, Embraer E-Jet E2 and Mitsubishi MRJ. PW shares the platform of the Irkut MC-21 with a Russian engine. PW says it has sold more than 5,000 GTFs across the platforms. CFM has sold more than 6,000 across the three models it powers.

On the A320neo family, the competition is 50-50 at this point, with a large number of customers yet to decide on an engine choice. However, 60 A320neos (120 engines) ordered by lessor GECAS never were in contested (GECAS buys exclusively from CFM) and 80 A319/320neos from Republic Airways Holdings (160 engines) were part of a financial rescue package for then-ailing Frontier Airlines.

PW’s joint venture partner, International Aero Engines, shares the A320ceo family platform with CFM. Late to the market, IAE caught up to CFM in recent years.

On platforms where they compete, the sales figures so far show a neck-and-neck competition between CFM and PW.

Update, 12:30: The link has been fixed. Update, 9:30 am PST: Flight Global has this story reporting that PW plans a Performance Improvement Package on the GTF that will further cut fuel consumption by 3%.

CSeries flight testing: Bombardier’s CSeries flight testing has been slow to this point, but it’s beginning to ramp up. Aviation Week reports that FTV 3 should be in the air by the end of this month and FTV 4 should follow in April. FTV 3 is the avionics airplane and FTV 4 focuses on GTF engine testing.

Mitsubishi MRJ: Aviation Week also reports that the Mitsubishi MRJ airplane #1 is nearing final assembly.

Guest column: envisioning the next round of airplanes

By James N. Krebs

Leeham News recently forecast that the next all new Boeing airplane will be a 757 successor with an entry-into-service around 2025, followed by a smaller NSA (New Small Airplane), a 737 MAX/A320 neo successor, in maybe 2027. I believe it will be clear in the next few years that the technology is and can be available here to build a reasonable-risk NSA with 20% fuel savings over the MAXes/ neos (at same seats) for initial service by 2025 (which will demand perhaps 40 more than 162 seats for even better economics). Its production would ramp up over ~5 years or so.

I hope this would be mainly a “Made in the USA” Boeing NSA: American engineering, American manufacturing, American jobs and American competitive edge. If that takes some helpful brainpower and/or investments from NASA, Northrop Grumman, Lockheed Martin, etc, good.

Boeing and Airbus might love to build a combined 100/mo. MAXes and neos “forever,” but technology and market forces aren’t likely to permit this. The companies won’t want to whet any appetites soon but I hope Boeing’s advanced design people are already at work–I’d be disappointed if they aren’t.

Airbus could certainly put an A320neo successor in service 10 years after their 2015 neo. A reengined A330 and a possible A350-1100 aren’t the only new projects they are capable of in the next decade.  The market response to their A320neo family completely surprised Boeing a couple years ago. What’s next?

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The implications of the American-US Airways merger for OEMs

The agreement between American Airlines, US Airways, the US Department of Justice and the states suing to block the merger to settle their lawsuits clears the way for AA-US to merge.

This has implications for the Big Four airframe and the engine manufacturers who have been living in some uncertainty. Here’s the rundown:

Airbus

American and US Airways have large orders with Airbus: American for the A320ceo and neo family and US Airways for the A320ceo family and A350-800/900.

American is taking delivery of the A319ceo and A321ceo. The neo comes several years into the future. American has been taking a large number of A319s, while US Airways have been up-gauging its Airbus single aisle orders, passing on the A319 in favor of the A320ceo or A321ceo. US Airways management, which will take over the New American Airlines, may elect to change the mix within the 18 month lead time limitations.

The more interesting question is what US Airways will do with its A350-800 order. US Airways, along with Hawaiian Airlines, is now the largest customer for the -800. Airbus has been shifting customers from the -800 to the -900 and the -1000, in part to de-risk the program and in part because the larger models are more profitable for Airbus. But some customers elected to switch because the economics of the larger capacity -900 are better than the smaller -800 while operating costs are about the same.

Now that AA and US will combined, the -800 seems surplus when the large order held by American for the Boeing 787-8/9 is considered. The US Airways management could elect to drop the -800 in favor of the 787. Such would unlikely be a total loss for Airbus, however: New American would likely up-gauge to the A350-900 or even the A350-1000, or order more A320neos to keep Airbus “whole.”

Boeing

US Airways hasn’t ordered a Boeing airplane since the days of the 737 Classic or 757/767, and the current management has been retiring all of them as fast as they could. Now they’re solidly back in Boeing territory. “Old” American has a large order of 737NGs and 737 MAXes in addition to the 787 orders. Old American is only taking the 737-800 and the New American will continue this type and probably select only the 737-8 MAX to fulfill that commitment. But we don’t look for any burst of new orders.

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Odds and Ends: Picking up an A380; testing the 787; VLA backlogs

Picking up an A380: No, it’s not about lifting one. It’s taking delivery of one. CNN International Travel has this story about the delivery process. It’s not what you’d think would be your usual story from a travel section.

Testing the 787: Since we started off with delivery of an Airbus, let’s continue with testing about the 787 with this piece from All Things 787.

A380, 747-8 backlogs soften: Well, Aviation Week says they are under siege. We wouldn’t quite go that far, but the article is more balancedthan the headline.

A320 GTF testing begins: Aviation Week has this story.

A350 first flight ‘not easy’: Fox News has this story in which Airbus acknowledges the first flight of the A350 by mid-2013 won’t be easy. Airbus is trying very hard, though: there’s a lot of pressure to have the airplane at the Paris Air Show.

A320neo vs 737 MAX: This story has a good summary of the battle between the two giant OEMs.

Airbus, Boeing under price pressure

The Wall Street Journal has two articles about Airbus and Boeing being under price pressure. There is a third article by the WSJ about Airbus wanting its suppliers to consolidate.

The two companies have accused each other of engaging in a price was in the single-aisle category. Airbus also is dropping prices on the A330 vis-a-vis the 787, as we reported following an Airbus presentation last May at its Innovation Days in which it illustrated a $900,000 lease rate for the A330-300 vs a $1.2m rate for the 787-9. The A330 had a slightly higher list price than the 787-9 and the time (Boeing since has raised its list price and is now higher).

 

Odds and Ends: Designing 737 MAX; RR & PW; CFM

737 MAX: Boeing Frontiers Magazine has a long article with lots of pictures describing the designing process of the Advanced Technology Winglets.

RR-PW on big engines: Aviation Week has this article speculating on the prospect of Rolls-Royce and Pratt & Whitney teaming to offer an engine for the Boeing 777X.

CFM says the use of advanced materials will reduce fuel consumption in the LEAP-1A (Airbus) engine by 1.5%, which happens to be the amount John Leahy of Airbus said that PW’s GTF has an advantage over LEAP.

Future materials: aluminum lithium, standard metals or composities

The Farnborough Air Show isn’t just about orders, though these get all the sex and headlines.

While we weren’t at the show, we had a telephone interview with a company called Constellium, previously known as Alcan. Constellium spoke at the February conference of the Pacific Northwest Aerospace Alliance, with which we are involved. We were particularly interested in talking with Constellium because it is a major supplier of Aluminum-Lithium, an alternative material to standard aluminum and a competing material to composites.

Constellium’s Al-Li combines other processes, including a design for recycling, and is named AirWare. Airbus, Boeing and Bombardier are among their key customers, and it is Constellium that is providing the materials for the CSeries. It’s also a supplier on the Airbus A350 (internal components, not the fuselage).

As Airbus and Boeing looked at the A320neo and 737 MAX, and as Boeing is looking at the 777X, we asked them about the prospect of using Al-Li. This is lighter than standard aluminum, more durable, less susceptible to corrosion and enabled 12 years between major maintenance overhauls compared with the 6-8 years now.

But Al-Li is more difficult to work with than standard aluminum. Boeing’s Mike Bair told us in an interview that Boeing considered Al-Li back in the 1990s when designing the 777 but it was too difficult and costly to manufacture. Since then, he praised the producers for strides. There are mixed reports what material will be used for the 777X fuselage: standard metal or Al-Li. The Seattle Times reported the airplane will have Al-Li. We’ve been told it won’t. But with the airplane still months and perhaps a year from launch, there is plenty of time to decide.

Airbus, in an interview at the Paris Air Show last year, said it was evaluating Al-Li for the A320neo. The A320ceo is heavier than the competing Boeing 737 and the re-engine adds about 4,000 lbs. Using Al-Li would mitigate some of this weight. We haven’t heard if Airbus might go ahead with Al-Li, but we’re leaning toward concluding that it won’t.

Boeing told us it will not switch to Al-Li for the MAX because the manufacturing process is just enough different that it would add complexity and cost to the current tooling and procedures.

Al-Li vs composites is a competition that will likely be fierce when it comes time for Airbus and Boeing to design the next clean-sheet airplanes, presumed to be the New Small Airplane, or replacement for the current 737/A320 class. (Boeing may have a new clean-sheet for the 757 class; it has a New Airplane Study underway for this, but the market may be too narrow when one considers the 737-9 MAX and A321neo will do 95% of what a 757 can do.)

Composites, selected for the 787 and A350 XWB fuselages and wings, offer advantages over standard metal fuselages that have been well documented and need not be repeated here. But Airbus and Boeing question the efficiency and benefits of down-scaling composites to 737/A320 category airplanes. Boeing apparently became convinced: Jim Albaugh, former CEO of Boeing Commercial Airplanes, said the New Small Airplane would have been composite, but the ability to produce it at a rate of 60 per month remained a challenge. Boeing went with the MAX instead.

Vistagy, a composite manufacturer near Boston, told us nearly two years ago, that the down-scaling challenges were met and that production rates were the issue. Autoclaves are very costly and so is the manufacturing process. There is actually less industrial waste than traditional aluminum manufacturing, but the materials are generally more hazardous—though there have been strides on this score.

This is the background that intrigued us when we had the opportunity to speak with Constellium’s Simon Laddychuk, VP of Manufacturing Global Aerospace and Director of Technology. Continue reading

No plateau on 737NG: Boeing

“There is no plateau in interest on the 737NG,” says Boeing’s Beverly Wyse, VP and GM of the stalwart program.

“Even though there are a lot of challenges in the industry, the growth, particularly in the single aisle market in emerging markets and Low Cost Carriers, continues to give us a lot of confidence the demand is out there. Even with the struggles in Europe, there seems to be a little tension between replacement demand and growth demand. We don’t see any pullback in the demand on the 737 at our current production rates or a weakness in demand as we transition to the MAX.”

Wyse gave this assessment during a briefing to the media in advance of the Farnborough Air Show. The briefings were embargoed until July 5.

“Basically we are full all the way through to the middle of 2016. We do have some capacity left in 2016 and 2017 prior to the introduction of the MAX,” she said. “We do have some NGs out in 2018 but that capacity is filling up. We still have customers coming in for NG and MAX four or five or six years out.”

She predicted there will be a two-three year transition period of NG and MAX overlap, though she prefers two years. Wyse acknowledged that the 737-based BBJ and P-8A Poseidon could further extend production of the NG even if passenger models are discontinued.

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Airbus and Mobile: Implications and analysis

Before getting to the meat of things, a couple of key stories:

Mobile Press-Register, June 30. Details of the plan.

Wall Street Journal: Boeing complains.

It’s now one of the worst-kept industrial secrets: Airbus will announce at 10am CDT July 2 that it will construct a $600m A320 Family Final Assembly Line (FAL) in Mobile (AL).

This is a major strategic and tactical move in the intense, often bitter competition between Airbus and Boeing.

Even before the plans became official, Boeing issued a pissy slam, harking back to the World Trade Organization dispute, rather than stating that it is in a position to compete against Airbus and its A320 with what Boeing otherwise routinely characterizes a better airplane with the best workers in the world.

Perhaps the pissy statement was chosen because in many respects, Airbus has mouse-trapped Boeing—and there is very little the company can do about it.

Before explaining, here are some facts to keep in mind. Click on the graphic to enlarge.

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Odds and Ends: Airbus to Mobile; No “doubts” about A350

Airbus to Mobile: The New York Times reports that Airbus is gearing up to announce plans to build the A320 in Mobile (AL). We reported this prospect during our reporting from the Airbus Innovation Days last month. Bloomberg has this take.

A350: No doubts at Airbus. But the margins are probably gone to first flight and EIS. Airbus is sticking to its schedule of EIS by mid-2014; we think it will slip into early 2015.

Update, June 28, 10am PDT:

We can confirm that as of this moment, EADS/Airbus has not made the decision to establish a final assembly site in Mobile. We think we have a reasonably clear understanding of the situation that leads us to believe an affirmative decision is near. It is our belief that any FAL will follow along the lines that were discussed for the KC-30/45 FAL: build the parts within the current supply chain and ship to Mobile for final assembly. This follows the well-established FAL model for Hamburg, Toulouse and Tianjin.

We received some speculation that this FAL might be fore the A330 P2F conversation. We don’t see a business case for this. Our focus is entirely on the A320 family and the intense competition with the 737 family. Note we do not distinguish between ceo/NG and neo/MAX.