Odds and Ends: China’s Wings; B-17; Airbus Market Forecast

We just finished a book about China National Aviation Corp. (CNAC). It’s a long book, 498 pages. it’s meticulously footnoted. The Bibliography is 100 of the 498 pages. We found the book a bit tedious for all the detail, but others will find the vast, detailed history of CNAC and the politics of dealing with the pre-World War II Chinese government fascinating.

The book details the famed “Douglas 2 1/2,” the war-damaged DC-3 with the right wing replaced by one belonging to a DC-2. The airplane flew, as did another with a mis-matched, smaller engine and smaller propeller.

There are several instances of the DC-3 being flow overweight, one in which the airplane carried more than 70 passengers vs the then-standard 21. The airplane couldn’t get off the runway. But the runway was built ending against a sloped berm, and the DC-3 became airborne ski-jump style.

CNAC was run by an American, William Langhorne Bond, whose son Langhorne became US Transportation Secretary under President Carter (and who was responsible for grounding the McDonnell Douglas DC-10 after the crash of American Airlines flight 191 in Chicago-a crash we covered as a reporter).

The senior Bond was one of those rare individuals who successfully went up against the legendary Juan Trippe, whose Pan Am owned a minority stake in CNAC, and persuaded him to stick with CNAC when Trippe was ready to abandon the airline during the Sino-Japanese war preceding Pearl Harbor.

Bond’s disappointment of losing CNAC to the Communists after World War II after all he’d been through to keep the airline alive is palatable.

The book is easily available through Amazon.com.

Boeing B-17: Here is 3 minute video about the iconic bomber, including footage inside the airplane.

Airbus Market Forecast: Airbus forecasts 28,000 aircraft over the next 20 years. It’s new GMF is here.

The 100-210 seat single aisle forecast is to the left. Click on the graphic to enlarge it for more crisp viewing.

The controversial 100-149 seat segment has been reduced in Airbus’ forecast from 5,115 to 4,708, an 8% reduction. The total market remains very close to last year’s forecast, at 19,498. Boeing forecasts more than 23,000 for this entire segment, a sharp difference between the two companies.

Airbus forecasts a need for 1,330 Very Large Aircraft (plus another 400 freighters). This is slightly more than last year and compares with Boeing’s forecast of 740 VLAs.

71 Comments on “Odds and Ends: China’s Wings; B-17; Airbus Market Forecast

  1. The Boeing B-17 is by far my favorite WWII airplane. It took a tremendous amount of damage and abuse, mostly from the Luftwaffe, and in many cases brought her crews home.

    http://www.daveswarbirds.com/b-17/contents.htm

    It didn’t fly as fast, nor as far, nor the bomb load of the B-24, but her wings didn’t break as the long and slender Davis Wing of the B-24 did so often.

    http://www.youtube.com/watch?v=ZLNESDqoZS4 (about the 1:30 mark)

    Don’t get me wrong, the B-24 could take a lot of battle damage, too. It just couldn’t take it to the wings like the B-17 could.

    • My favorite world war 2 aircraft is the Spitfire with the Rolls Royce 27Liter Merlin engine.
      P.S once again thanks for my freedon fron this side of the pond.

  2. “Airbus forecasts a need for 1,330 Very Large Aircraft (plus another 400 freighters).”

    Isn’t the 748 the only freighter that fits the category?

  3. Airbus and Boeing will have to deliver an average of 87 yearly A380 and B747-8 for airbus forecast to be true. 1000 thousand delivery is about the high threshold.

    • Airbus’ forecast is wildly optimistic–just like the business case for the A380.

      I think Boeing’s numbers are much more grounded in reality.

    • That’s why I think Boeing’s forecast of 740 VLAs, including freighters is a more realistic number, and even that may be slightly high.

  4. booch221/KC135
    Five principle factors will prove you wrong, about the number of A380s which
    will be required in the foreseeable future.
    1. When the 747 was launched in 1965, nobody in or outside Boeing, would
    have predicted that it would sell as many as it did..
    2. It was 300% bigger, compare to the 707s and DC8s it was replacing, while
    the A380 is only 30% bigger, compared to the 747-400.
    3. By the time the 747 was the right sized a/p in the late 70s, it was too late for
    any other manufacturer to build a competitive a/p, due to inflation and the
    same will happen to the A380 and especially the A380 STR.
    4. While the 747 operated and benefited from a controlled envirionment, be-
    case of Bilateral Agreements outside the US and the reason it did sell very
    well inside, the A380 is already benefiting from virtually worldwide “Open
    Skies” agreements everywhere and already operating between capital cities
    worldwide, replacing 747s everywhere!
    5 .The rapidly increasing number of passengers, especially within and to and
    from the Pacific and the corresponding CONGESTION at all major airports,
    will rapidly increase the demand for A380s(STR),while the smaller 777s,
    A350s and 787s, will primarily connect the smaller cities around the world,
    to each other, the official justification Boeing gave, for launching the 787!

    • “It was 300% bigger, compared to the 707s…” We need to be careful about believing hyperbole. There might have been a few 707s configured for 200+ pax (perhaps with an extra over-wing exit a la 737-900s set up for, say, 205 pax) but mostly they were no more than 189 seats. 4 x 189 = 756, and even 3 x (ie 200% larger) is 567, which perhaps only the most high-density 747Ds in Japan have reached or exceeded.
      Although very few 747s, even today’s 747-800s, ever offered the 500 seats suggested by early 1960s’ marketing promotions, the same is true for the A380, which very few operators configure for 656 or even 565 as promoted initially. In truth most early 747s ran at about 375 seats, which is why they can be replaced easily by 777s. By the same token the day will surely come when A380s will be replaced by very very large twins offering, say, 550 seats. When, not if…

    • Your principles are an example of faulty logic. What was true of the market in the 70s 80s and 90s is not necessarily true today. The world has changed. Think ETOPS.

      If the A380 is benefiting from open skies, why have only 257 been ordered since 2001?
      Compare that to 824 787 orders since 2004, or 548 A350 orders since 2006.

      Boeing sold 200 777’s in 2011 alone!

      Clearly, quads are no longer the airliner of choice.

      • 257 a380s since 2001 is still ~25 per year. certainly enough to run a VLA production line

        You’re comparing A380 orders to 787/350? why?

        I do agree that the quad market hes become a smaller niche since the introduction of 360?min ETOPs and very large twins. that doesn’t mean it’s not viable or even worthwhile to fill that smaller requirement.

    • Your logic is flawed for one key reason…most airlines ordered the 747 for the range rather than for the passenger capacity. Today you can get as much or more range by ordering much smaller aircraft like the 330, 350, 777 or 787. While some will say that crowded airports such as Heathrow justify the 380, the conservative nature of many airlines pushes them to smaller aircraft that they know they can sellout. The 380 is just too much of a financial risk to many airlines.

  5. “Bond’s disappointment of losing CNAC to the Communists after World War II after all he’d been through to keep the airline alive is palatable.”
    I assume you mean palpable rather than palatable.

  6. 8-10 Yrs ago the main story line was only a few airlines would need a limmitted number of A380s, because it would be hell to fill them year round. Passenger wouldn’t care and the 747-8i would make sure Airbus would never make any profit on it.

    Since then many medium sized airlines ordered them, often unexpected. Airlines and the public continue to love them. Alliance networks were further integrated, Asia kept growing, hub remained vital and increasingly congested.

    I think the next economic upturn will lift orders above 600. Enhanced, larger, more efficient versions will be launched. And more quiet of course..
    http://www.youtube.com/watch?v=ltz-Oug3hjU

    • Rudy and keesje, you seem to forget it took Boeing about 25 years to sell the 1,000th B-747, and that would not have happened if it had not been for the B-747-400. In just over 40 years on the market, the B-747 has sold about 1,500 airplanes, an average of 37.5 per year. The A-380 has sold just about 250 airplane in the 10 years it has been offered for sale, an average of 25 per year. The sales of the A-380 can only be described as anemic at best, and Airbus still counts airlines like Kingfisher as a customer. Delivery rate is poor, and it has had some bad press this year. It seems few airlines want to take a new build airplane they know will take some 80,000 man hours to fix at some time in the near future.

      The A-380 list price is nearly $400M US, while the B-747-8 lists for about $350M US, even the B-777-300ER, which some consider as the best B-747 Classic replacement airplane lists for about $315M US. Think about those prices for a minute. An A-380 for almost 1/2 BILLION USD, and the B-747-8 and B-77W for about 1/3 BILLION USD. Yes, both OEMs heaverily discount the actual sales price to their customers, but the size of those discounts vary greatly depending on the customer airline. Even at a 50% discount, I cannot imagine what a pile of money like $200M for the A-380 or $175M for the B-747 would look like if stacked on a pallet, or how many pallets it would take. The actual contract prices from Airbus or Boeing for a VLA will have to raise or their program will become a huge money pit. Airbus is saying that in the next 20 years, their is a need for more than 1700 VLAs, combined pax and freighter versions. That is about the same number of all sold B-747s and A-380s combined to date, a period that covers 40 years for one and 10 years for the other.

      Of the 1,500 (or so) B-747s sold since 1967, about 300 have been dedicated new build freighters, or about 20%. The A-380F was offered, and about 37, or about 15% of the CURRENT total, were ordered, but all have been either cancelled or converted to the pax version.

      • So lets assume that Airbus ends up selling and delivering an average of 25 A380s per year over forty years. That would end up being 1000 aircraft. Part of the difference between the average 747 sales and the A380 sales can be atrributed to the lack of an A380 version.
        Boeing sold 315 aricraft in the first 10 years of the program, for an average of 31.5 sales per year. Airbus has an average of 25 per year.

        While the numbers are not quite up to the Boeing numbers for the 747, they are not near the disaster that some here consistently wish to portray.

        I also note that none of the A380 naysayers have yet to address the issue of overcongestion at some of the world’s leading airports and how I still don’t seem to be able to get easy direct flights from “smaller” cities (2 million people) to other “smaller” cities.

        Why the continual slam on this aircraft?

        I would also point out, as has Rudy, that the big impact from the A380 will be when they finally go ahead with the A380-900. I believe that will come at the end of this decade and then you will see some orders for the A380.

      • Boeing sold 315 747s in the first 10 years of the program, Airbus 253.
        Average of 25.3 vs 31.5.

        Going by your logic of a 40 year program, Airbus should theoretically sell over 1000 aircraft.
        Your numbers also indicate that the average of the first 10 years was below the overall program
        average of 37.5 per year. Assuming the average for the A380 would also increase, there is some
        room to improve on that 1000 aircraft.

        It would also be relevant to point out that the big success for the A380 should come about when they
        go ahead with the A380-900, which I would estimate would start after the A350 series are done. That
        should be around the end of this decade or the beginning of the next. I think the sales for the A380
        will really take off then, and don’t forget that by then, the Emirates current fleet of A380s will start
        to approach an age of 10 to 12 years.

        While the A380 is not seeing the same numbers of the 747, they are not near as catastrophic as
        many people here seem to be so insistent on asserting.

        Why the consistent slamming of the A380?

    • Compare 777 orders to A380 orders since 2001.

      The main story line from 8-10 years ago is still valid.

      • booch221 – let’s compare the 777 and A380 with 737/A320… We need to compare apples with apples.

      • Which plane reduces congestion at a busy hub more? An A380 with many pax needing to take a connecting flight, or a 787 which bypasses the congested hub altogether.

        • Remember that part of the Airbus argument is that the A380 also serves O&D markets like London-Toyko, New York-London, etc., that will become so congested that the A380 is the answer. It’s not just connections at a hub.

    • Airlines and the public continue to love them [A380]

      Do airlines love the cracked wings?

        • You miss the sarcasm. Both OEMs (and others in history) have issues. If you want to narrow this down, Boeing delivered 747-100s that later were in major need of Section 41 repairs and 737-200s/Classics with rudder issues.

        • Your point, Sir!
          Undelivered lawndarts can’t show issues in customer hands 😉

  7. Perhaps we are discussing at cross purposes here. I do not think that anybody here is proposing or supposing that the A380 will match the sales numbers of the 777, A330, 787 or A350. So why do people keep trying to compare it with these aircraft?

    On to the point-to-point argument, I would gladly love to get on an aircraft in my home town (population of 2 million, i.e., not so small) and fly to any of many hundred destinations available to me. But there aren’t that many direct destinations available. Why not?

    I also remember that one of the main routes touted to be the ideal for the 787 would be Houston to Aukland. What happened? United cancelled it before even starting. Why, because Soutwest would steal there connecting passengers coming through to connect to that flight. So much for point to point. (http://www.ausbt.com.au/united-cancels-boeing-787-based-houston-auckland-route).
    Then they cancelled Houston to Paris CDG. Why? Because Southwest is ruining their plans to increase Bush International’s growth as a hub. (http://www.chron.com/business/article/United-cuts-route-to-Paris-in-the-fall-3689090.php)

    I just do not see the point to point argument working as well as its supporters claim it is.

    Let’s put it this was, if overall airline traffic increases to the degree that there will be a massive increase in point to point destinations, such a traffic growth would also include a massive increase between the major hubs in the world, leading to over congestion at these, thus requiring larger aircraft to service them.

    • Obviously point-to-point is most attractive to folk flying, er, between those points. If hubbing is so important – because of the connecting traffic – it doesn’t actually matter where the hub is. Hence a flaw in arguments now being put for a third runway at LHR on the ground that London is losing out to Frankfurt, Paris, Amsterdam etc etc as a connecting hub. Several years ago BAe Systems (!) promoted a possible coastal location in northwest England to ‘capture’ north Atlantic traffic (which would have no interest in London per se). If London can lose its connecting-hub fixation it might attract thousands more O&D spenders to its streets. If people are only changing planes, the hub can be anywhere — even in the Arabian desert…

    • In both articles you link to, Southwest, the king of point to point, is the reason given for United cancelling Houston-AUK, and Houston-CDG. Just because its not working for these particular flights from this particular airport, due to particular local circumstances, does not invalidate the point to point argument everywhere.

      JAL’s Tokyo (Narita)-Boston flight is doing quite well I hear. There will be more. JAL announced it will fly the 787 from Tokyo to San Diego on four weekly flights beginning Dec. 2. JAL also said 787 flights from Tokyo to Helsinki in Finland will begin next March.

      You see a massive increase in point to point flying also including a massive increase between the major hubs of the world. I see it leading to a decrease in flying through major hubs. Time will tell. But so far, the dearth of orders for VLA orders, indicates which way the wind is blowing.

      • Where do you see the “massive increase” in P2P flying? Except for the massive increase in the LCC industry where flights are overwhelmingly flown by NBs on intra-US/-Europe/-Asia routes. I can’t see any “massive increase” in P2P on intercontinental routes.

      • Do we know which came first: demand for Houston-CDG and -AUK or an aircraft offering that range for which sample routes had to be selected for marketing? Perhaps we also have to analyse whether most ordered 787s will be operated not between established hubs.

  8. Flight International has an interview with Leahy on A380, and includes this paragraph:

    “In its latest market forecast, Airbus predicts 20-year demand for 1,330 very large aircraft in the A380’s category, of which it expects to capture at least a 50% market share. This equates to approximately 30 deliveries a year and Leahy is resolute in his belief that this is achievable: “There’s no way that the traffic growth [forecast for the industry] can occur without larger aircraft. The A380 is not just larger but it is more comfortable, more fuel efficient and much, much quieter. Of course we’re going to be selling them at 30 a year.”

      • Certainly the question for him this year has been whether the greatest challenge will be to sell 30 A380s or to deliver 30…

  9. Pundit :
    booch221 – let’s compare the 777 and A380 with 737/A320… We need to compare apples with apples.

    The 777 matches the range of the A380, the 737/A320 do not. If the congested hub theory were really valid you would have seen a lot more than 252 A380 orders over the last 11 years.

    • The world’s busiest airports are not fully congested – yet, but most of them are getting there.

      Notwithstanding the global crisis, demand for air services in Europe is still expected to double by 2030. By this date, it is estimated that up to 39 European airports will be fully congested and up to 25% of the demand for air services will be unable to be accommodated.

      http://www.dttas.ie/upload/general/13310-DAA_SUBMISSION-3.PDF

    • Booch #39 – i thought we were talking VLAs, that is seats not nautical miles… For sure, Boeing wants everyone to think that, for example, the A380 and 787 are alternatives – so would i if I didn’t have a natural head-to-head competitor to offer.
      Booch #29 – it is surely a lot easier to add a terminal capacity than a runway but, yes, we must define whether we mean capacity for passengers on the runway or in the lounges.

  10. booch221 :The sales numbers tell a very different story.

    Oh, you’re sure about that, are you ?

    What the sales number tells you for not only the A380, but also for the 787 and the A350 as well, is that there is a seeming correlation between delivery slot availability and sales drying up, when the former creep towards delivery dates of more than five years in the future. Narrow-body aircraft demand is much bigger than for wide-bodies, but when available delivery slots extend more than 7 to 8 years out, sales for NBs seems to dry up as well.

    As both Boeing and Airbus like to point out; the industry doubles every 15 years. For these-reasons alone, there’s no reason not to expect current A330-300s, A340-300s and 777-200ERs to partly be replaced by bigger aircraft such as 787-10s, A350-1000s and 777-9Xs. Of course, there’s no reason to believe that this won’t hold true for all aircraft sizes. Hence, current A340-600s and 777-300s would partly be replaced by bigger aircraft such as next generation A380-800/-900s or even A380-1000s, and 777-9Xs/Y3s, while the A388 itself would be replaced by even bigger aircraft (A380-900s/-1000s). For example, Emirates will be operating 5 daily A388 flights to LHR in half a year’s time. They might go to 6 within due course. Cathay Pacific operates 3 daily 77W flights plus 3 additional weekly flights to JFK. A few years back, CX had only one daily flight into JFK! Considering the traffic growth that has occurred between New York and Hong Kong in recent years, I would not be surprised if a decade hence the 77Ws currently flying the route will all have been replaced by A380-900s and/or A380-1000s.

    • I would not be surprised if a decade hence the 77Ws currently flying the route will all have been replaced by A380-900s and/or A380-1000s.

      I would.

  11. Aero Ninja :Why the consistent slamming of the A380?

    Because the A380 is seemingly a thorn in the side for those who have an extreme dislike of Airbus, which is possibly caused by Airbus displacing Boeing as the number one OEM in 2004. They apparently view the aircraft as some sort of a symbol of a program supposedly propped up by European “socialist” governments that have little regard for the virtues of the free: As if there ever were a true free market in the high capital-intensive, low volume aerospace manufacturing industry. 😉

    I don’t believe Dick is part of this group of people, but he seems to be able to put into words what many of these people seem to think:

    And Airbus, with much less discipline from equities markets to keep them from pursuing misbegotten concepts, launched the A380 and A340-500/600. If they had Boeing’s financial discipline, Airbus wouldn’t have been able to make these self-inflicted wounds.

    http://www.richardaboulafia.com/shownote.asp?id=364

  12. Airbus cancelled the A380F like Boeing cancelled the 787-3. Because the main versions of the aircraft required priority.

    Booch221 is perfectly free to compare A380 sales to 777 sales. Or Iphone sales, or whatever.

    “If the congested hub theory were really valid you would have seen a lot more than 252 A380 orders over the last 11 years.”

    Yes, maybe the hubs aren’t getting congested. Maybe it just a cheap sales trick of that John Leahy!

    • Boeing cancelled the 783 because their one customer for it switched to the 788. Airbus cancelled the A380F because FedEx and UPS cancelled and switched to Boeing jets due to A380 delays. The A380F will never be built. There is no demand for such a plane.

      Booch221 is perfectly free to compare A380 sales to 777 sales. Or Iphone sales, or whatever.

      Sour grapes. You are just jealous of the success of the 777. It killed the A340 and is making it hard for the A380. That drives you crazy.

      Yes, maybe the hubs aren’t getting congested. Maybe it just a cheap sales trick of that John Leahy!

      If hubs are getting so crowded, why is the A380 selling so poorly?

  13. booch221 :I would not be surprised if a decade hence the 77Ws currently flying the route will all have been replaced by A380-900s and/or A380-1000s.
    I would.

    When CX845 goes daily, CX could be adding another daily flight.

    CX845__JFK__01:30__HKG__05:20+1__15:50__77W*
    CX841__JFK__10:05__HKG__14:05+1__16:00__77W
    CX831__JFK__14:55__HKG__18:55+1__16:00__77W
    CX889__JFK__22:40__HKG__06:55+2__20:15__77W**

    *Monday,Wednesday,Friday,Saturday
    **One Stop (YVR)

    http://www.cathaypacific.com/cpa/en_GB/manageyourtrip/schedules?CX_FCN=FSCH0_result

    If, let’s say, the total traffic volume between HKG and JFK would double a decade hence, would Cathay be content with reducing their market share? And if not, how would Cathay maintain their current market share without using bigger aircraft. BTW, I’m not sure if Cathay would be very happy cramming their 77Ws (or possible 777-9Xs) full with 10 abreast in economy class, especially not on flights with that long a duration.

  14. You’re comparing A380 orders to 787/350? why?

    Because I was responding to the argument that because the 747 sold well in the 70s, 80s and 90s, it’s a given the A380 will sell well too. But the 787 and A350 can perform many of the missions that the 747 did range wise. You can also increase frequency or split the route. For example, fly LAX-SYD and LAX-BNE, instead of just one VLA flight to SYD. So contrary to the thinking of John Leahy, 747s will not be replaced 1:1 with A380s. Hence his market forecast is way off.

  15. “So contrary to the thinking of John Leahy, 747s will not be replaced 1:1 with A380s.”

    I have not noticed Leahy communicating/ thinking this, so no need to put a smoking gun in his hands 😉 Many 747s are replaced by A380s, (Air France, Asiana Airlines, British Airways, China Southern Airlines, Korean Air, Lufthansa, Malaysia Airlines, Qantas, Singapore Airlines, Thai Airways International, Transaero Airlines & Virgin Atlantic) but many not (e.g. Air Austral, Emirates, Etihad Airways, Hong Kong Airlines, Kingfisher Airlines, Qatar Airways, Skymark Airlines, Transaero Airlines).

    • 747-400s have been replaced by A340-600s, 777-300ERs and A380-800s. I expect many A346s/77Ws/A388s eventually to be replaced by even bigger aircraft such as A380-900s/-1000s. 🙂

    • Many 747s are replaced by A380s…
      Many more are replaced by 777s and will be by A351s.

  16. ‘Tis interesting to note how, er, flexible Mr Leahy’s analysts are in responding quickly and at short notice to market fluctuations.For example, on September 14 last year at the new GMF launch he said demand for almost 27,900 new aircraft included “1,780” VLAs. By November 18 his GMF presentation in the U.S. was saying “1,680” VLAs. (Simultaneously, twin-aisle numbers grew from “6,910” to “6,920”.) The lower VLA figure evidently is used to support a claimed year-on-year increase of 30 in the 2012-31 forecast VLA requirements, which otherwise are down 70 on 2011 GMF-launch predictions. No doubt someone with access to original documents can check my math.
    What happened in those 65 days in 2011 to reduce predicted 20-year VLA demand by 100 units? I think we should be told.

    • He expected more than just the 50 A320 order announced during Ms. Merkels visit?
      My guess is “slow cooking” orders are not limited to a bunch of A330.
      TK may have got/will get some political offer from Boeing to mellow Turkey’s stance
      in the Syrian domolition act.

  17. With some recent large commercial airplane programs the focus should not be on numbers sold, but on production cost. Selling large numbers while unit cost renders orders unprofitable is not a good business proposition.

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