Leeham News and Comment
Intelligence for the Aviation Industry: Value*Performance*Reliability
Leeham News and Comment
- Assessing the 25 YOA aircraft factor September 21, 2017
- Bjorn’s Corner: Electric aircraft, Part 13 September 21, 2017
- Pratt & Whitney Canada monitors engines through FAST September 20, 2017
- CSeries economy up to 3% better than advertised September 19, 2017
- Assessing the 787 production rate increase September 18, 2017
Assessing the 25 YOA aircraft factor
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Introduction
Click on image to enlarge.
Sept. 21, 2017 © Leeham Co.: Airbus and Boeing look ahead to 2021 and the next several years when wide-body aircraft begin turning 25 years old to spur orders for this sector.
Boeing specifically points to this period as one reason for the announcement last week that it will boost production of the 787 to 14/mo beginning in 2019.
Summary
- There already are 1.4 times more wide-body airplanes scheduled for delivery in 2021-2025 than there are aircraft turning 25 years old.
- The next surge in aging aircraft comes ~2030.
- Middle of the Market aircraft isn’t factored in.
Bjorn’s Corner: Electric aircraft, Part 13
By Bjorn Fehrm
September 22, 2017, ©. Leeham Co: After 12 articles about electric aircraft, it’s time to wrap up. We will go through what we have learned and discuss future developments.
Our designs were aimed for the next decade and the result was sobering. Electric aircraft have important challenges to traverse. As had electric cars, and they have turned the corner.
Figure 1. Idea for future aircraft that could use electric propulsors. Source: NASA.
CSeries economy up to 3% better than advertised
Sept. 19, 2017, © Leeham Co., Montreal: The Bombardier CSeries has proved to be 1% to 3% more fuel efficient in service than advertised, the company revealed last week at its Media Day.
The improvements depend on the mission: 1% on shorter routes and 3% on the longer ones.
Better-than-advertised performance had been rumored, and reported, for months but this is the first time Bombardier confirmed the reports.
It also depends on the model. The CS100, a shrink design, is slightly better than advertised; the CS300—the optimized design—is the better performer.
Assessing the 787 production rate increase
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Introduction
Sept. 18, 2017, © Leeham Co.: Boeing last week announced it will take the production rate of the 787 from 12/mo to 14/mo in 2019.
Boeing 787-9. Source: Boeing.
The decision to do so was couched in a strong backlog and strong forthcoming demand by CEO Dennis Muilenburg at a Morgan Stanley conference.
But analysts think the move is more about boosting free cash flow and hitting margins than it is about demand.
Summary
- Boeing sees demand surging from 2019 for widebodies generally and the 787 specifically.
- Muilenburg says Boeing is working “skyline” positions in 2019 and 2020 (LNC saw these years as already filled).
- Widebody jets hitting 25 years old early next decade.
- Airbus concurs.
Pontifications: Next steps in Boeing-Bombardier trade complaint
By Scott Hamilton
Sept. 18, 2017, © Leeham Co.: The US Department of Commerce is due next Monday to hand down its preliminary decision on whether to impose tariffs on Bombardier’s C Series sold to Delta Air Lines.
The price dumping complaint, filed by Boeing earlier this year, cleared the US International Trade Commission on a 5-0 vote. The ITC found probable cause (my words) to proceed with the complaint. From there, investigation shifted to the DOC.
- Update: Boeing UK responds to UK criticism.
- Update: Bombardier responds to Boeing’s response.
The details are complex and need not be recapped here. What is important are the next steps, assuming—as widely expected—DOC sides with Boeing.
Bjorn’s Corner: Electric aircraft, Part 12
By Bjorn Fehrm
September 15, 2017, ©. Leeham Co: Last week we compared the energy economics of our 10-seater electric commuter to an equivalent commuter with gas turbine power.
Now we dig a bit deeper in the operational costs of the two aircraft. Is the electric commuter cheaper to operate over short sectors than a gas turbine driven variant? For the energy costs, it could be the fact. What about other operational costs?
The commuter designs we discuss would be similar to the Zunum Aero 10-seater commuter in Figure 1.
Figure 1. Zunum Aero’s short-haul turbofan commuter. Source: Zunum Aero.
Pratt & Whitney Canada continues development of new airliner turboprop
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Introduction
Sept. 14, 2017, © Leeham Co., Montreal: The prospect of a clean-sheet design turboprop to replace the Bombardier Q400 and ATR series likely has moved to the right by two to three years,
Frederic Lefebvre, Pratt & Whitney Canada.
and the total market remains small, but Pratt & Whitney Canada is forging ahead with development of the next generation engine.
- Update: Embraer is considering reentering the turboprop market, reports The Wall Street Journal.
The goal is to reduce fuel consumption by 15%-20% compared with today’s ubiquitous PW127 and PW150, which continue to see reductions in fuel burn through product improvement packages.
Frederic Lefebvre, VP-Marketing for Regional Airlines, now sees development of the new turboprop slipping to 2022-2026 compared with previous forecasts of an EIS in 2020-2023.
Summary
- The Next Generation Regional Turboprop (NGRT) has major challenges to improve upon the current generation of engines.
- PWC sees a much larger market for a 90-seat turboprop than others.
- Emerging markets key to new opportunities.
Bombardier concedes likely loss in trade complaint, looks to next phase
Sept. 14, 2017, © Leeham Co., Montréal: Bombardier officials conceded Tuesday that they are likely to lose the price dumping complaint filed by Boeing with the US Department of Commerce.
Fred Cromer. Photo via Google images.
This is the phase in which DOC determines if tariffs (penalties) should be imposed because Bombardier sold its CS100 to Delta Air Lines at a price so low it constitutes dumping under US law. Boeing is asking the department to impose a tariff of 79%, the difference between the sales price estimated by Boeing (which Bombardier and Delta dispute) and the production cost. Boeing cited LNC’s cost estimate, which was made before BBD wrote off several billion dollars of the program and cut costs through a financial restructuring.
Boeing ignored the well-known fact (which itself experiences) that production costs for early orders exceed sales price. DOC seems unlikely to make this distinction, based on filings reviewed by LNC.
A preliminary decision is expected Sept. 25.
Boeing to boost 787 rate to 14/mo
Sept. 13, 2017, (c) Leeham Co.: Boeing announced today it will boost the production rate of the 787
to 14/mo in 2019, confounding analysts who believe the rate is not warranted.
LNC‘s own analysis agrees. The backlog through Aug. 31 is 700, down 20 airplanes from Dec. 31. The book:bill rate has not exceeded one since 2013.
The rate is not sustainable, LNC believes, beyond 2020.