Odds and Ends: Bombardier signs Macquarie Airfinance for 40+10 CS300s; 787 fire suppression

Big CSeries order: Bombardier today announced a firm order for 40 CS300s with options for 10 more with lessor Macquarie Airfinance. This brings firm orders to 243 and orders and commitments to 563.

This is the order that was has been pending since the Farnborough Air Show, and which was delayed perhaps a month because of the grounding of the test fleet from May 29. Flight Global initially reported that Macquarie could be lined up to place an order, and we followed up with some additional information July 29.

Macquarie is a small lessor by today’s standards, with 128 aircraft in the portfolio. These have all been acquired through purchase/leasebacks or via a portfolio purchase from other lessors. The CSeries is the first speculative order placed by Macquarie. As such, this is a major endorsement of the CSeries program. It also makes Macquarie one of the largest customers: Republic Airways Holdings, a launch customer, ordered 40 and optioned 40; Lufthansa Group ordered 30 plus options; and Ilyushin Finance Corp., a Russian lessor, has ordered nearly 40.

Macquarie bypassed Airbus and Boeing A320s and 737s for new orders. It has 63 and 57 in its fleet already and the backlogs for new orders stretch to 2020.

787 fire suppression: The Wall Street Journal reports that regulators have ordered changes in the Boeing 787 fire suppression system.

Boeing initially issued a service bulletin in May but regulators have now made the fix mandatory. The order covers 88 earlier versions of the 787; there are more than 150 in service today.

Coincidentally, a LOT Polish Airlines 787 made an emergency landing today in Scotland because of a faulty fire warning.


29 Comments on “Odds and Ends: Bombardier signs Macquarie Airfinance for 40+10 CS300s; 787 fire suppression

  1. Having some unknown and small lessor as one of your biggest customers doesn’t really create strongly needed tail wind for the programme. I guess the lessor got a very good price and gambles: if the aircraft becomes succesful he can lease it out for big money. If it doesn’t, there will be some sort of back door from the contract.

      • Macquarie Bank has the financial credibility to hire whoever they like in the financial world, I presume MAF is being run by experienced aviation leasing professionals, any idea where they came from or who they are?

    • Might not be a big leaser but it’s one of the biggest infrastructure inverters on the planet. They have grown a lot in the last 30 years and are not known for losing money.

    • Sour grapes me thinks.
      I defer to Scott on the leasing company pedigree, if its good enough for him its plenty good enough for my respect
      I continue to think that the C series is going to be one hot machine once its into service.

      there are a lot of 717s, MDs, BAE 146 Fokker’s etc out there that are a very viable market.

      You don’t need a 3500 mile aircraft for a lot of those missions and you can save huge bucks by not hauling all that excess weight.

      I can see Delta buying them eventually as they do operates down on that C series range.

  2. This new order brings the backlog to more than 250 firm orders. That is less than 50 airplanes away from the 300 that Bombardier is aiming at before EIS. So it looks like BBD might actually far exceeds its own target.

    We are more than a year away from EIS, possibly 1 1/2 year. And we are entering a critical phase of flight testing where the aircraft performances are being validated one after the other. Shortly we will also see FTV5 flying around the world with a typical airline interior. It will probably appear at various air shows and will be visited at any opportunity by journalists and potential customers. We can also expect the first CS300 to start flying in the coming months.

    So if everything goes well from here we can expect quite a few more orders in the next 18 months as the CSeries gradually makes the transition from “prototype” to “airliner”. I expect China to order it, sooner or later, in great numbers. And I don’t see why a major carrier would not eventually place a significant order as well.

    What Bombardier needs most right now is the have the entire fleet of flight test vehicles flying as soon as possible. That is the five CS100 and the two CS300 that are needed to get certification.

    • The problem with China could be the Comac ARJ21. So even if the CSeries is the more economic aircraft China could still prefer the ARJ21 for own economic reasons.

      • Yes but a significant portion of the CSeries is manufactured in China. So it could be argued that China “owes a favour” to Bombardier and should “make an effort” to acquire it in quantities commensurate with its manufacturing contract.

        By ordering the CSeries the Chinese government puts to work more Chinese people in an industry that requires highly skilled people that have been trained by Bombardier in Canada and , to a lesser extent, in China as well.

        I think China should split its requirements for small airliners between the ARJ21 and the CSeries.

  3. Not being in the industry I am curious how the CS100 & CS300 are seen technically. My sense is that as BBD is smaller, there is caution but if the plane meets specs it will be a good choice in its size range.

    • The CSeries is a state-of-the-art aircraft. I think everyone agrees on that. What is most striking is that it has never been criticized directly by its competitors on its technical merits. Bombardier is often attacked and is treated as a weak player in the industry, but the CSeries itself is never questioned as a viable airplane.

      The reason for this is that it stands alone, all by itself, in a niche where there is practically no competition. But we can expect the attitude of competing manufacturers to change drastically when the larger variants of the the aircraft will be offered. That is because the CS500, CS700 and CS900 will compete directly with existing models of the Big Two.

      What we see right now are just skirmishes. The real war has not started yet.

      • As you might know, when BBD planned the CSeries, it anticipated a response from Boeing and Airbus. Bombardier’s greatest risk was that one of these major manufacturers would launch an all-new aircraft in the same category as the CSeries. The re-engining of existing (larger) models was the response Bombardier expected to be the least threathening to the commercial success of the CSeries.

        The lay press keeps comparing the CSeries to the B737 and A320, but as you say, the CSeries is specifically tailored to a well-defined market niche. In addition, the CSeries will create its own market, as Bombardier’s first RJ did.

        As for future stretches, my information is that the wing is optimized for the CS100. We might see a CS150, but going beyond that could be more complicated.

        • I also thought, at least initially, that the wing had been optimized for the CS100. But apparently it has been optimized for the CS300. That would make more sense anyway. The CS300 has already been “stretched” by one row of seat (five seats) from the original design.

          The CS700 and CS900 would definitely require a new wing. But Bombardier has done this before with the CRJ700/900 and CRJ1000.

          A new wing would be very costly, but the largest models would also be even more competitive than the CS100/300 are. Provided an operator does not need the A320/737 kind of range, the CS500/700/900 would be hard to beat on fuel burn for an equivalent payload.

  4. Looks like the A330neo is looking better and better. The 787 just has too many hang ups. Flew a brand new Iberia A330 yesterday. Comfortable and quiet. My only suggestion is that the Neo undergo a substantial interior modernization with new paneling, bins, and lighting design. The A330 is def more comfortable but the interior needs a revamp for the Neo for sure.

      • I guess this is a result of increasing German competition, Lufthansa’s Germanwings long haul plans etc. LCC long haul is getting more competition all the time. Still, 787 business has been slow this year and it’s probably not what Boeing wanted. I don’t think AirBerlin operates any really long haul, I’m not sure, if they don’t could A330-NEO feature in their plans?

        • It probalby makes Boeing happy. Early order at very low price, they can sell those slots at a much higher price and probably the -9 or -10.

        • Air Berlin is partly owned by Etihad who has large numbers of 787 and A350 on order. Air Berlin currently uses A330-200’s for long haul. It is possible that Etihad will pass on some of the orders to them.

        • Air Berlin is close to bankrupt. Just no money to order new aircraft.

          Air Berlin did order the 787 on July 7th 2007. About 500 787 were sold before the infamous roll-out.

          10 A321 are still on the Air Berlin’s order book.

  5. According to Canaccord, Bombardier has already reached CSeries order target. “We think this puts Bombardier’s ‘real’ firm order book at 291-311 aircraft or essentially at Bombardier’s target level of 300 units by entry into service. We define ‘real’ firm order book as the current firm order book plus expected conversions of letters of intent, conditional orders, and options exercises less firm orders that are questionable in our opinion,” said David Tylerman in a note to investors.
    Last year Aviation Week said:
    Based on data from Aviation Week Intelligence Network’s Fleet Database, the CSeries has accumulated more orders than almost every other commercial jet in history on the date of its first flight, surpassed only by the A320, A350, and 787.

    It is important to note that aircraft based on existing types, such as the A320neo or MD-11, are not included as they are based on proven airframes. While the A320neo, for example, has an impressive number of orders, it is based on a proven airframe that’s been in service for 25 years. The CSeries, as with every new aircraft type taking to the skies for the first time, has no such advantage.

    So while the CSeries has a backlog that is certainly respectable, it will be an impressive feat to gather another 123 orders before its first delivery, something only one aircraft type has managed to accomplish.

    • When you say “something only one aircraft type has managed to accomplish” I assume you are talking about the Dreamliner, are you not? If that is indeed the case you may have forgotten the A350 which has not been delivered yet and has 750 orders, with a few more months to go before EIS.

      • Actualy it was the ERJ 170. The Aviation Week article was from Sept 2013 and said that between first flight and EIS the 787 only picked up 51 additional orders. The A350 was not included as at that point it had not entered service.

        1 ERJ 170 148 2004-03-05
        2 SSJ 113 2011-04-19
        3 DC-9 52 1965-09-18
        4 787 51 2011-09-25
        5 SE210 Caravelle 49 1959-03-19
        6 737 48 1967-12-27
        7 A380 36 2007-10-12
        8 A320 32 1988-03-26
        9 707 32 1958-08-15
        10 A340 29 1993-01-29
        11 EMB-145 28 1996-12-27
        12 BAC 1-11 25 1965-03-11
        13 DO328JET 24 1999-07-22
        14 CRJ 23 1992-10-19

        • What is really important is the total number of firm orders before EIS. With more than a year before the CSeries is delivered to its first customer I would say there is plenty of time left for Bombardier to secure additional orders that would bring the total well past the 300 that had been originally targeted.

    • I agree 300 orders is respectable, but the trouble is that there are huge question marks over quality of some of the orders. So the Canaccord mumbo jumbo is just a marketing pitch, nothing else. And just to add to that, it is also difficult to compare sales of the C-series with say B-727 or DC8/9 which are aircrafts that flew 40-50 years ago. Clearly the overall volume of current sales (2014) is much higher so no surprise that the C-series has in this sense a better starting position. So, while I’m a fan of C-series I just laugh at statements like the one mentioned above.

      • That is why Bombardier needs a substantial order from a major carrier plus a big order from China. That would compensate somewhat for those orders that are firm but not very strong. In other words both quantity AND quality of firm orders are required to make the programme truly successful.

        But in order to attract these exclusive customers Bombardier needs to get its entire fleet of flight testing vehicles in the air as soon as possible. That is five CS100 and two CS300. For now only two are flying but five are needed for certification of the CS100, plus two more for certification of the CS300.

        The aircraft performance parameters need to be validated and the various systems of the aircraft have to be proven in order to secure potential new customers while reassuring the existing ones.

        What this means is that in the next three months three more CS100 plus one CS300 will have to be flying regularly along with the two CS100 that are flying today. Plus an additional CS300 early next year. All this remains a huge challenge for Bombardier though.

        FTV3 and FTV5 need new engines, but that should not be a problem. FTV1 also needs new engines but first it has to be repaired and the repair has to be accepted by the certification authorities. In addition to that the two CS300 need the larger variant of the engine. So lots of work remains to be done before certification.

      • The Canaccord analyst looked at the 500 orders, options and LOIs and estimated that after all the questionable orders are taken away, there are still over 300 quality orders which is quite an accomplishment when looking back at the other clean sheet programs. There is still a year before EIS and now that performance data is coming in one could expect more orders to come in.

  6. And an interesting question is, has the delays helped or hindered that?

    And as noted, I think it’s a very well done concept and has a bright future.

    Sadly management shoots itself in the foot (or the company and the workers)

  7. Bye the way, I think you meant the Headline to read “Bombardier signs Macquarie Airfinance for 40+10 CS300s” instead of “…40+10 CS330s”

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