The thrice-delayed first flight of the Bombardier CSeries may come Sunday, reports Reuters.
We previously posted some thoughts on the pending first flight. We expanded on these thoughts in our e-mail newsletter Aug. 26. Below is the entire newsletter.
Implications of the CSeries first flight
This is BBD’s multi-billion dollar gamble to jump into the Big Leagues. Its CRJ program is no longer the bread-and-butter for the commercial aerospace division, but rather a niche airplane. The Q400 turbo-prop may see a resurgence if prospects in Russia take off, with the creation of a joint assembly line there. It’s the CSeries that is BBD’s future in aerospace.
It’s been a tough, uphill climb so far. The troubled new airplane programs at Airbus and Boeing have created a hefty amount of skepticism for Bombardier, and three delays in the CSeries have only reinforced those looking askance. With first flight, it’s time for BBD to demonstrate all the performance promises will be kept, come in better than target or come in worse. If BBD hits or comes in better than target, we expect sales to begin to pick up.
Bombardier has been in a price war with Airbus, which has cost its some orders officials had hoped to win. Broad skepticism over new airplane programs has hurt sales. With the first flight and the flight test program (FTP), new expectations will arise that orders should be forthcoming.
Test flights should reasonably quickly validate economic promises, internally at least-how soon BBD might release test results publicly remains to be seen and there are commercially sensitive reasons to keep the data close to the vest for competitive reasons. But this is a small industry and data information will leak out eventually. Bombardier will be under great pressure to make public test results public because of the stakes to the company, this being the first clean-sheet airplane in its class in decades, and the highly public claims of efficiencies vs the Airbus A319 and Boeing 737-700 as well as the re-engined entries of these models.
Boeing never officially released flight test results on economic claims for its 787, nor, so far, has Airbus for the A350 XWB. Bombardier doing so would be a departure from industry practice. Failure to do so will lead to suspicions the test flights aren’t providing the promised figures.
Assuming all goes well, customers should begin to place orders that have been withheld pending proof-of-concept demonstrations. We don’t expect the floodgates to open, but we do expect a steady stream of orders following first flight and preceding entry-into-service.
EIS becomes the next question. With three delays to first flight, Bombardier hasn’t officially revised its current EIS estimate but sticks with previous statements that EIS will follow first flight by 12 months. Some believe this timeline to be ambitious, with EIS to slip to early 2015.
Here are the current estimates for EIS for new airplane programs.
Aircraft/Original EIS/Current EIS
A320neo/Oct 2015/Oct 2015
* One analyst suggests early 2015
** Market Intelligence estimate.
Sources: Leeham Co estimates and company statements.
Some customers interested in the CSeries are waiting until the airplane enters service before deciding whether to order the aircraft.
One company that will be watching the CSeries test flights and results very carefully will be Airbus. As noted, Airbus considers the CSeries to be a real threat to the low end of its market. Officials have been quite open about keeping their thumb on Bombardier, saying they won’t ignore the company in its early mainline jet efforts as Boeing ignored Airbus.
But more to the point, with the Pratt & Whitney Geared Turbo Fan on the CSeries, the first commercial application, Airbus is more than mildly interested in the engine’s performance because a larger version is on the A320neo due to enter service in late 2015. Airbus tested an early design of the GTF on its A340 test bed, but the CSeries version is a production model-and the results will be watched by Airbus, the airlines-and by PW rival CFM.
More than Bombardier’s future is riding on the CSeries test program.