Is tide ready to turn for CSeries?

CS100 first flight, September 16, 2013. Photo via Seattle Times.

Is the tide ready to turn for the Bombardier CSeries?

Following a nine month delay, the CS100 Flight Test Vehicle #1 took to the air September 16. It’s flown only twice since and has been undergoing ground vibration tests and more software upgrades. BBD is pretty mum about the testing program, which causes speculation about whether some issue emerged during the three flight tests. But we’re told by a source familiar with the program, but who is not with BBD, that BBD is being conservative in its pace, counting on the fact that it will eventually have seven FTVs to bring entry-into-service on time. A few Canadian aerospace analysts think EIS will slip to 1Q2015.

Then there are the orders, just 177 firm, which is more than those for the Airbus A319neo and the Boeing 737-7 MAX combined, but which the market perceives as low and a slow-selling program. Bombardier points out that the firm sales are about on par with other new airplane programs at this stage, but the market–dazzled by the thousands of orders placed for the NEO and MAX–won’t make these distinctions.

But it’s possible the tide is ready to turn for the CSeries. Here’s why.

  • Potential customers have been waiting for the first flight and to see whether the program will be more or less on time with the new, implied schedule emanating from first flight. We believe a few more months have to pass before any conclusions are drawn on this score.
  • Likewise, a few months have to pass before Bombardier and Pratt & Whitney will know whether the economic promises will in fact be achieved.
  • There are some key sales campaigns for which decisions should be made in the coming months, both this year and into next, that if BBD wins will serve to build significant momentum.
  • Airbus is running out of delivery slots for the entire A320 family.  The VivaAerobus order announced October 21 includes deliveries beginning next year. The backlog goes to 2019-2020, and while John Leahy, COO-Customers, is adept at finding slots through juggling the skyline, there simply aren’t too many left mid-term. Bombardier is sold out into 2016 and is a better position to offer deliveries in quantity. This makes it difficult for Leahy to “buy” a deal, which he has done on several occasions, to under-price CSeries to a point where BBD can’t play in the sandbox.
  • Boeing remains more focused on the 737-8/9 than on the 737-7, leaving BBD to largely fight its war against the diminishing Airbus and the forthcoming Embraer E-190/195 E2, the latter with a planned EIS of 2018, a good three years after CS100 enters service.

It will likely be next year before solid trends are noticeable. BBD retains its goal of reaching 300 firm orders and 20-30 customers by EIS, at least a year from now. We think this is easily achievable.

Update, Oct. 22: The Iraq-Business News reports that the government has approved the purchase of five CS300s at $40m each.

11 Comments on “Is tide ready to turn for CSeries?

  1. There could be airlines like AA, DL, UA, BA, AF, etc. waiting in the wings to order the C-Series. This would be a big boost to our Canadian friends should it actually happen. But BBD has to give some ‘wiggle room’ on price to win more orders.

  2. Its a pity they have such a timid PR department.
    Have not even seen a comment on the noise readings taken during the second test flight.
    Surely a statement that it met initial expectations would not have been too bold, unless of course it did not do so.

  3. Momentum is what the CSeries is lacking right now. It has lost the momentum that was generated by the first three flights. And in terms of sales it never had any real momentum until today. But the situation could change in the near future because a number of factors are now converging to favour the CSeries:

    1- The smaller A320 and 737 variants are not selling.
    2- The larger A320 and 737 variants are nearly sold out.
    3- There is a four year gap between the CSeries and Embraer E2.
    4- The CSeries will soon start to produce hard numbers in terms of fuel consumption and noise footprint.
    5- Five CS100 will be flight testing in the coming months, plus two CS300 later on.
    6- The new CSeries assembly building will be operational by next Spring.
    7- The first CSeries will likely enter service at the end of 2014 or early 2015.
    8- The CS500 variant will progressively become a reality.

  4. The biggest problems with CSeries sales have been perception and the legacy of the 787. The only people complaining or worrying about the CSeries in public are pundits and self proclaimed aeronautical experts.

    While BBD would no doubt love to have a backlog spanning into next decade, current customers remain silent…and in this case, no news really is good news.

    As we’ve seen over recent years, customers are not shy in the least about going public with complaints for a manufacturer.

    Instead of listening to so called experts who have no more stake in the program than using it as fodder to sell themselves, one should pay more attention to those who have actually put their money where their mouths are.

  5. If the A319/737-7 are not what the market wants, is there any real reason to believe that there will suddenly be flood of C series orders?

    • There re several smaller airlines, like Porter, that can use the C-Series to fly their current and planned future expansion missions. The B-737-7MAX and A-319NEO may be ‘to much airplane’ for these carriers. The B-737-7MAX and A-319NEO only compete directly with the CS-300 model, not the CS-100 model.

    • The A319/737-7 are not what the market wants because of their respective performance in terms of passenger-miles fuel consumption, especially when compared to their larger variants. But the CSeries sets new standards in that regard.

  6. I believe, as has been mentioned, the B787 teething problems are a big factor for this early concern about orders for the CSeries. Also, the dominance of BA and AB play into this. But as an aerospace worker of many years, as most of you are, usually when a better “mousetrap” comes along, it is accepted in the market place. Cases in point: the B747 trumped the SST; the F-4 built McDonnell, The A320, some could say built AB, the DC-3 made Douglas. I think BBD will get the orders because all indications are that this is a ground breaking narrow body jet.

  7. AINonline: In an interview with AIN last Friday, Bombardier Commercial Aircraft marketing vice president Philippe Poutissou said the CSeries would fly again once engineers finished an upgrade to its Parker Aerospace fly-by-wire flight control system to allow the airplane to operate in “normal” mode.

    No date is specified for when the CSeries will take to the sky again. No date either for FTV2’s first flight. I would not be surprised if Bombardier came out in the next few months with a revised and expanded flight test schedule, along with a new EIS date.

  8. An opportunity for BBD is that A & B might not be willing to underbet its prices because they could sell the slots better as A320/A321s (& resp. Boeing models). If Airbus sells an A319NEO against a CS300, it does so with bad pricing and hence doesn’t earn any money on it.
    Big questionmark is the role of C919, MS21 ans E2-Series. A&B have strong interest in not giving COMAC and UAC (maker of the MS21) any opportunity to establish on the market.

    • A as well as B have both some leeway for flipping the monthly rates further up from 42 to … how many more ? and if of strategic value to A or B, this is indeed what they will do. The response time is of 36 months or less : whilst BBD are held back struggling to climb the ladder of their own learning curve, at any point in time for A or B it will suffice just to screw up the tap to open for a more generous throughput flow ?

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