A350 Loan: The Wall Street Journal reports that Airbus and Germany ended talks about a state loan for the A350 program. Good. Airbus doesn’t need the loan and “divorcing” from state aid frees Airbus to make decisions for the production based on commercial considerations and not politically-driven jobs requirements.
Airbus is considering a second A350 production line to open up slots for the -1000 model. Germany made no secret that this line had to be in Hamburg in exchange for the loan. Our Market Intelligence indicates Airbus may want to locate the line outside Germany and perhaps outside Europe. Ridding itself of continue German meddling is a good thing for Airbus; now it “only” has the unions to deal with.
Bridging 777s: Jon Ostrower at The Wall Street Journal published this story today about Boeing’s plans to support the 777 Classic sales in advance of the 777X. He reports that Boeing will try to pair 777 Classic orders with the 777X (something we forecast months ago). Boeing is also going to launch a 777 P2F program, persuading airlines to sell their older 777s to cargo carriers and replace them with new 777 Classic orders. This is a challenge because of the continuing softness in the cargo market and plenty of 747-400s available for conversion and 747-400Fs parked in the desert. Such a plan will make it increasingly difficult to support sales of the new-build 747-8F as well.
Although Boeing said it won’t shave the price on the 777 Classic to stimulate sales, we think it will (as it has on the 737 NG).
Embraer nabs E2 customer: Embraer today announced it won an order from an Indian airline for 50 E190 E2s and 50 E195 E2s with options for 50 each. The airline, Air Costa, is a current E1 customer. This is the first E2 order since the launch of the program at the Paris Air Show last June.
Reuters has an article from the Singapore Air Show quoting the Air Costa CEO. The article takes a look at the “small” aircraft market.
IAM chief speaks out: The president of the International Association of Machinists, Tom Buffenbarger, called the Puget Sound Business Journal to talk about the controversial Boeing 777X contract vote.
Why would Buffenbarger do this? He’s facing his first contested election since 1961 and his opponent is from IAM District 751 right here in Seattle. The article makes fascinating reading.
MC-21 profile: A Russian newspaper provides a profile of the Irkut MC-21 (or MS-21 or Yak-242). Talk about confused branding.