Oct. 17, 2017, © Leeham Co.: The Airbus-Bombardier transaction announced yesterday has implications well beyond the United States, which has been much of the focus of analysis post-announcement.
The analysis focused on the US is natural, given the Boeing trade complaint involving the CSeries sale to Delta Air Lines.
But it’s important to step back to see what this means for CSeries.
Despite the financial bail outs by Quebec, a Quebec pension company and the Canadian federal government, long-term stability of Bombardier remained a question. Sales were hampered as a result.
The Airbus backing removes doubt over the CSeries program.
Bombardier’s product support has long been a target of criticism in the industry, particularly after high-profile landing gear collapses on the Q400. Airbus’ support will address this.
Bombardier has Memorandums of Understanding or Letters of Intent for 50 CSeries from two Chinese companies, a lessor and an airline. Both were announced years ago and neither has been converted to firm orders.
The reasons why these orders haven’t been converted or new ones landed are speculative in the highly secret Chinese society. One reason given in industry circles is that the Bombardier fuselage production plant in
Shenzhen Shenyang remains a problem child. Bombardier is producing fuselages to backstop Shenzhen Shenyang. The story goes that until Shenzhen Shenyang is fully up to speed, no orders will be firmed or forthcoming.
Another is the airlines for which the CSeries are prime targets are restricted by government fiat from adding too many airplanes too quickly.
Finally, the stability and product support issues may be at play.
Regardless, Airbus’ involvement will undoubtedly provide some comfort. Chinese orders may start flowing now. Market intelligence indicates BBD has been involved in some serious talks with major airlines. It’s not beyond the realm of possibility that Airbus will now play a pivotal role.
Market intelligence indicates that Bombardier is a serious contender for at least two significant orders in Africa. The Airbus connection might tip the scales.
Although there is nothing common between the CSeries and the A320 family, Airbus is in a position to offer deals linking the CSeries to other Airbus family members.
Aftermarket services might also be a source of income for Airbus. While Airbus is well behind Boeing in pursuing aftermarket services, it’s not ignoring the sector.
There is a lot of information that has yet to emerge to draw complete conclusions. But at least on the surface, this does seem to be one of those instances where there are winners for the participants.
On the other hand, Boeing—which already has denounced the deal—and Embraer appear to be losers.
Is there any way Boeing can stop this deal? I posted earlier that I think AB should go ahead with the CS500 as an A320 replacement and optomize the A320 series as a near MOM, which I suspect BA would be pretty desparate to stop.
I don’t think they can. And the US government can’t either. Even if the USA acts to keep the C series out of the USA, the rest of the world is a far larger market and Airbus / Bombardier could own the whole thing.
Airbus are already in America, so even if they don’t sell the C series there Airbardier can keep selling those ancient old A320 derivatives in the USA whilst selling C series + derivatives everywhere else. Of course, I’m being sarcastic simply to emphasize the decrepitude of the 737 basic design.
Boeing’s actions have given Airbus a free upgrade path to, as you point out, an A320 replacement / MOM / upgrade. They’re now at the next generation without having to lift anything so heavy as a draughtman’s pencil.
Not the smartest of strategies, giving your deadliest competitor a free pass to the next generation. Way to go Boeing, way to go.
I have rarely seen a strategic move like Boeings idea of killing the C-Series with this ugly dumping nonsense backfire so badly. This is about the worst scenario I could think of in regard of the 737.
Did this possibility really not occur to Muilenberg and his crew?
Mully is a disciple of McNerney: profit, stretch, damn technology and the future it’s stock price and options. They, born of their infamous grandfather Jack, none men of vision. See GE stock price which at a time of tripling of the Dow, it continues to go down!
An Advocatus Diaboli seems to be missing at Boeing’s way to make decisions.
S/he’s saying that nobody in Boeing appears to be arguing against dumb strategies, and so they end up doing stupid things.
Ahh, group think.
They all nod our head yes despite the fact that Trump has no brain.
From the construction I would guess the novel phrase means “devil’s advocate”. Of course one expects people posting here include French speakers …
“Of course one expects people posting here include French speakers …”
“Advocatus Diaboli” an Ecclesiastical title is Latin and has its origin in the Catholic Church. see:
his counterpart is the Advocatus dei 🙂
OK, it seems nobody at Boeing had the backbone to tell the CEO it might be an error.
It is some linked to a very old saying:
“The general who wins the battle makes many calculations in his temple before the battle is fought. The general who loses makes but few calculations beforehand.” (Sun Tzu 6th century BC)
Or a more contemporary example: THE GALACTIC EMPIRE
AB are clever! They know they can now father the CS500 for very little money not to mention Canada and Quebec paying for it……AB can also do the CS500 their way!…..AB will ultimately be the big, big winner. That we like it or not, BA is a competitor!
You’d think that, with Airbus’s backing for what is clearly an excellent design, soon no one is going to want to buy a new 737. If Airbus can grow the design to the C300/C500, what exactly would Boeing be bringing to the table of any sales discussion? Economy? Nope. Comfort? Nope.
One reason why 737 sells at all is that Airbus cannot make the A320 quickly enough. If Airbardier can sum and increase their total production capacities, Boeing haven’t even got manufacturing slots as a sales proposition.
Many commentators both here and elsewhere have been saying for some time that Boeing should have been doing a deal with Bombardier, not trying to grind them into the dust. Now Airbus have done that deal, for €0.00, Boeing has lost out overall. You have to wonder what Boeing’s board is going to say to its shareholders today…
Of course, it remains to be seen whether this development turns into a killer blow for the 737 or any possible replacement, but from where I’m sitting the only aircraft that Boeing has that looks like it has a long term future, if any, is the 787 (given Emirate’s strife that’s likely to result in a 777X cancellation). And they’re pretty much done with selling that for the moment too (and being CF, they’re not exactly going to wear out any time soon).
Critical point I think. This will lead to a much quicker ramp of the Cseries than could have been expected. Further the Cseries now becomes the de facto winner in its class rather than a possible and risky bet on a failing programme. If I were Mr Leahy’s successor I would be salivating at the pitch…. ‘you can have an A320 in 2022 but I have got something a bit more shiny you can have in 2019’.
So there proper FALs by 2020? Production capacity in excess of 200 pa? And the cost? What cost? Hahaha
I entirely agree with the thread. But to add, Airbus now have access to significant additional resources. This will help them with the fact that the only reason they can’t sell them is they can’t produce them.
This partnership isn’t limited to the CSeries. Expect Airbus to take all possible advantage!
Can’t say I do.
The C series is going to be an adjunct and its not going to replace the larger 737s.
The heart of the market is 1-3 hours flight, a CS500 could easily replace the 737/A320 over that distance. For longer segments or more pax Airbus can offer an optomized A321/322, something which it sounds like is already quietly underway
No. That is the issue. We are bring told that Boeing’s view of the market is the standard. That’s why the US government upheld the complaint. To generalise:
All law as a rule, a measure, a standard. So we are being told Boeing is the law for they are the standard. Specifically:
Boeing’s law says the C series in the same segment as the 737. Nobody agrees with Boeings law, outside of the USA
Many of us in the US don’t agree as well.
Many in the US has a Trump vision. Ie Talk loud with no strategy. Boeîng will also be loosing on its military contracts outside US
The Cseries could very well replace the 737-8.
Delta currently flies 160 seats 3 class 737-8 and still has a large fleet of 5 a breast MD-90-30 which also carry 160 seats in 3 class.
Potential is there for a stretched Cseries
An airplane that doesn’t exist!
Once upon a time the 707 did’t exist either. CS500 would cheap and easy to do, and likely much more profitable that selling more A320/737-8s.
I was only comparing two existing 160 seaters, one with 5 abreast that is getting long in the tooth and could be replaced with a ‘newer version’. By coincidence that airline has the same number of seats in its 737-800 .
Draw your own conclusions, but a possible new model competes head on with the 737-8 and wont have any problems with dumping and Boeings ‘lawfare’
Airbus will take 100 percent control of the CSeries at about the same time the much hyped Boeing MOM would EIS. That’s about the right time for an A320neo Mk2 — incorporating new wings, an A350-type cockpit and next generation RR UltaFan engines — and for the CSeries to be re-engined with UltaFan engines, in addition to a redesign of the current cockpit/avionics with an A350-type cockpit in order to ensure full compatibility/commonality with Airbus aircraft.
Perhaps we could add backdriven controls from the Cseries
Dream on OV-99. So far non of your photo shopped airline design have come to fruition.
P&W has the other engine choice on the A320NEO.
RR gave up that market a long time ago.
Must be embarrassing for a frequent contributor to this site not knowing that RR do indeed plan to reenter the single aisle market.
As for “dreaming”;
George Bernard Shaw
RR didn’t give up the market. They did make a silly decision that cost them the narrow body market for the time being. They will be back
Talking about silly decisions. They keep coming and coming … from Boeing
OV99: You seem to think things in print are things in reality.
They have to make and engine and they have to have a market.
Singles Aisles are not going to have 3 engine choices.
The NMA is not going to have 3 engine choices.
As Air Asia has gone wobbly on their A330NEO, recouping costs on that program are probably a gone thing as well.
The upgraded A380 engine is not doing so good, so no I don’t buy it. RR is chock full of issues .
I make things work, dreaming has never built anything. Vision and work has. I am not one for vision thing.
Again, your lack of insight is astounding.
The UltraFan should beat the current crop of engines by upwards of 15 percent in TSFC. Believing that the OEMs won’t put that type of engine on new platforms or re-engined ones, is nothing but ludicrous.
The question is not if the OEMs will use the UltraFan on their aircraft, it is if CFM (in particular) will be able to counter with a competing product.
You’re saying that “RR is chock full of issues”. Care to elaborate?
You’re saying that you make things work. What exactly is that?
As for the “vision thing”; don’t watch something happen and do nothing, look outside the “box” and change it for the better. Perhaps that’s what Boeing should have done a long time ago.
Once C Series component sourcing is added to the Airbus supply chain it will be possible to take significant cost out of the aircraft. And when Airbus marketing muscle is added, sales will rise rapidly allowing the production rate to increase thus further reducing costs.
The phone lines between Seattle and Sao Paulo will be buzzing right now!
You say that, but Embraer might be sensing 737 blood. Why would Embraer want to saddle themselves with all of Boeing’s baggage?
Loads of squabbling still to come Boeing can still argue that the C series development has been subsidised. Be prepared for a lot of whingeing from poor old bullied Boeing.
Presumably Airbus has to keep production in relatively high wage locations such as Northern Ireland. Airbus still has the problems Bbd had finishing development,investing in plant and trying to sell for a reasonable price. Boeing can still offer a silly price for the 737max7.
Boeing has a huge backlog for the 737 and has been working on a replacement for at least 15 years. So they will just launch NSA, while Airbus is busy.
It’s up to Boeing if they want to complete with a genuine competitor, but such is the way that the anti dumping case was framed, I suspect that there’s already some sort of arrangement with Embraer being worked out.
Boeing will be fine. In fact they now have a strategic advantage, more freedom of action. In the next few months we will see just how clever Boeing are and whether they really believed in the anti dumping nonsense.
I can see you are a ‘glass half full’ type. There cannot be a strategic advantage associated with ceding technological and commercial advantage for the entire NB market. Of course they can respond but the issue is how and where? Their hand has just been made massively more difficult as they are on the defensive in so many areas. Of course they will survive but this episode will go down as one of the worst decisions ever made by Boeing senior management ever ever ever….
Boeing started the anti-dumping action to kill a potential competitor, that much is clear. Having Airbus take over majority ownership (for nearly free!) instead is surely the worst possible outcome for the Boeing management team.
No, it’s not free! What is the hourly rate of the Airbus sales manager? What are the management costs to launch new bids to lower the price of components? What will be the budget for the training of maintenance teams for after-sales service? We see, there will be thousands of disbursements in dollars from Airbus and it is its contribution of capital in the partnership …
That’s why I said NEARLY free! : )
Yes it is for free.
All these expenses you mentioned will generate revenue and at some point profits.
Upfront cost is zero
Actually I’m a glass is half empty type,I’m not quite sure if this is such a good idea for airbus.
The Max was only ever an emergency stop gap and Boeing was always going to launch NSA fairly shortly. This will be more advanced and easier to produce than the C series or the Max. Airbus on the other hand are now more committed to a strategy. They are now going to have to put a lot of time and money into finishing a project that BBD had gone into half cocked.
If buying into the C series was such a great idea, why did it take them so long?Why didn’t they launch their own C series?
The only problem that I can see is finding the cash for NSA and MOM, but but I’m sure the US government and states will step up to the plate. Are Boeing smart enough to see this? Or will they continue with the self destructive litigation?
Grubbie, I think you are a little too optimistic with the new NSA. The problem is that we are on the threshold of all-composite planes and Boeing just doesn’t have facilities to produce a 737 successor with a carbon wing, let alone a carbon body. Me thinks that is the reason they decided to go for the Max. Developing a new aluminum bird doesn’t make any sense nowadays.
Out-of-autoclave, resin-transfer-molding,… there are new technologies that need to be perfected to make mass production affordable. The production system of the 787 is not it, by the way.
How long will it take to develop a new NSA and in parallel a new production system? Maybe 10-15 years? Or even 20? In the meantime we will see the 737 sales suffering against the C300, C500, A320 and A321.
Development of the CS500 will be quick and easy, especially with the support of Airbus. Their R&D teams are currently not too busy and will certainly lend a hand here.
There’s always something better just around the corner,there’s never a right time. 787 production system is 20 old technology Don’t forget that Boeing was just about to take the leap when they realised that the NG couldn’t hang on against the NEO. Boeing have been waiting to pull the trigger.
Or Boeing could just ignore the C series.
I fear that they might continue with the legal route.
The example of the 777X shows that Boeing is not prepared for a full-CFRP production, otherwise they would certainly not have continued with an aluminum body.
The 737 successor will have to be build in huge numbers, for which we don’t have the infrastructure now. I doubt that there is sufficient production of carbon fibers for example. It’s like batteries for electric vehicles – the reason why Tesla built its own battery factory.
Boeing had a great start with building large passenger planes after WWII because of the facilities they had built during the war for the B17 and B29. Those planes were built almost exactly like today:
From all I know neither Bowing nor Airbus have figured out how to produce a 737/A320 successor. It’s quite useless to pull the trigger when the pistol is not loaded.
I don’t think NSA will have a carbon fuselage, I don’t think that the technology is mature enough for an airliner of that size.But neither is nano carbon fibre or lots of other materials. The wing is a dead cert. Boeing can’t sit around waiting for the perfect technology and neither can airbus. Airbus seems to be lining up a lot more welding and GLARE,although both would seem to me to be a bit of a challenge.
“The problem is that we are on the threshold of all-composite planes…”
Let us not forget Additive Manufacturing here. The printers are becoming bigger, faster and more precise. The step from design to production is a mere click, bionic structures can take a lot of weight from structural parts, spares can be printed where they are needed, metal parts can be easily recycled etc. etc.
This is quite a game of chess. I think you all are hitting on all the possible “moves.” If I may add, I think the cost of Boeing building a NSA would seriously be 20 Billion when you add in B787 debacle, insourcing vs. outsourcing and three lengths of aircraft. If Boeing has any “Devils Advocates” left (yes I had to look that up) they’d offer Bombardier 10 – $12 a share, parse out BBD Transportation (worth 5 – 8 B,) keep what’s needed and go from there.
@sam, interesting idea. Is it too late for Boeing to put in a bid?Could it suddenly turn into a bidding war?I’ll have to think about it, but maybe it makes more sense for Boeing. Several leeham comments have suggested it for months.
I think they played good poker. They risked the Cseries going to Boeing and once that deal did not happen they sat back and enjoyed the fun. What they get is a solid new generation NB for pennies. They still have the opportunity to develop whatever they like but they have pushed the ‘first mover’ onus onto Boeing. It certainly does not stop them from responding to that move.
The NB market is the massive cash generator in the industry. Airbus are waking up to a scenario where they have eliminated a thorn and increased capacity in one fell swoop.
Boeing are waking to relegation to definite number 2, a 60-40 split against them and a technologically challenged lineup. I know where I would rather be.
Airbus don’t just have a strategy, they have a capability. Boeing have no strategy beyond next year’s buyback plan
You might be right, but I don’t think Boeing are stupid.
IMJ, the risk now for Boeing is that their single aisle market share will drop to below 30 percent.
Boeing blew it, and they especially blew it for trying to jump on Trump’s good side by aligning themselves with Trump and his “America First!” nonsense.
I kinda saw this coming, what with Boeing management’s (looking at you, Mr Muilenberg) complete and abject failure of a strong response to Trump’s acceptance of white nationalists in Charlottesville. What did Dennis do? He stayed in Trump’s economic council of morons until it was pretty much dead, and then he decided to leave.
Why? To not get a bad tweet from Trump. Showed a complete lack of courage (and completely full of support for white nationalists, apparently, right Dennis?!) And, now, his lack of vision and support of Trump’s policies has completely screwed Boeing over in Canada, and likely a whole lot of other places.
Why would it be more technologically advanced? Easier to produce? But still ? Why not have launched their equivalent CSeries? Because they needed $ 8 billion…
How could it not be more technologically advanced, being built years later and by the company with the greatest resources? Also it would be hard to make it more expensive to produce because of Boeings resources and much greater volume. The only logical reason they haven’t built their own c series, is that they didn’t see enough profit in it. They had plenty of cash, so much that they had to buy their own shares back.
They have cash, but have they not been cutting back on the engineers? Or do I misremember?
Boeing may have been working on a NSA for a while, the fact is that they still have the 777X, and the MOM on their plate at the moment so launching a NSA is unlikely for a while.
In the meantime with the A320Neo family starting to ramp up, and leaving BBD to possibly design a CS-500, Airbus would be free to re-wing the A321Neo, possibly also do a stretch to a A322, and still have time to take a good look at the proposed 797, and come up with something even better.
I don’t think Boeing will gain much from an arrangement with Embraer, the biggest aircraft they have is the E195-E2 which seats 120 in 2 class so not even a replacement for a 737 Max 7.
If I was Boeing right now, I’d be trying to make sure that nothing happens to the orders from the ME3, 235 orders out of the total 326 currently. I don’t think the program could break even at 91 aircraft.
No 737 RS in sight.
Boeing has the option to link up with Mitsubishi and or Embraer.
Neither is a full C series competitor but can fill in lower rungs.
Assuming that, come the mid 20s, airliner pricing is in US$ and margins on a C Series sized airliner are smaller than the Airbus twin aisles, I’m guessing a majority of C Series will roll of an AL line by then.
Or you could look at it in another way; thanks to Bombardier and the CSeries, the aerospace cluster at Mirabel will now become part of Airbus’ global industrial footprint (i.e. not only CSeries). Politics (i.e. location of work etc.) is still an important part of the global LCA business. The FAL in Mirabel will be the location for all CSeries aircraft going to markets outside the US — and according to Airbus the 100-150 seat market segment is expected to represent more than 6,000 new aircraft over the next 20 years. The only losers here are the folks at Renton.
Assuming that the C series is successful Canadian suppliers will benefit more than Bbd. Perform, and you will find all of Airbus open as well. Airbus would probably quite like to reduce the US content of non US produced aircraft. I think that American workers will also be up on the deal when you include suppliers and assembly workers. Do you think that UTC may have had a hand in this?
Your’re right. Airbus will be able to offer American manufactured aircraft to the US market, while some non US produced Airbus aircraft going to markets outside the US will, in all likelihood, have reduced US content, going forward. Airbus would probably want to offer ITAR free aircraft to markets that are currently vulnerable to the political whims of American politics (i.e. Iran etc.).
Astounding news! Be interesting to see where this goes for the CS (CS500, increased cockpit commonality etc).
Ont he other hand, Embraer, although they have a strong order book, future sales could be threatened, but Boeing as a suitor? Think the price may have gone up a little….
At Bjorn, can you possibly elaborate in a future corner on how different the cockpit and design philosophy of the two aircraft (CSeries vs. A320) are? How difficult would it be to bring them closer together and create cockpit commonality?
I will do. The Airbus philosophie is 30 years old by now. Cseries takes the best from Airbus and Boeing in a good mix.
But there will be articles about the similarities and differences between A320 and Cseries.
@Bjorn That would be great! And maybe a piece on what your opinion is of integrating all the design work into Airbus design system and possible ways Airbus could cleanup the design and maybe even align production technology?
Like moving auto throttles?
Why moving throttles? When you put your car on cruise control does your accelerator move up and down? I don’t think so. Do you have a problem controlling your car?
And to think (if my memory serves me right Scott?) Boeing were offered the Cseries and turned it down….
Were offered? I don’t think so. But Boeing was looking mainly to get the wing technology and other technology as well.
The Bombardier family were and still the majority of Bombardier Inc.
Boeing does not need the wing technology.
Notice that no one has matches Boeing for the crank wing vs a winglet?
My take is Boeing is Number 1 in wind design, C Series 2, and Airbus 3.
Clearly you don’t know what you’re talking about. Only with the 787 did Boeing manage to produce a wing with single-slotted flaps.
And Airbus is still using winglets.
Again, would you care to elaborate further?
Your ( faulty ) assumption is that whatever Boeing uses but others not must be better. Additionally names don’t fly. functionality flies. 🙂
Interesting to note that the A330/A340 wing is ~30 years older, doesn’t have this sexy flex but performs on par to the 787. i.e. Airbus is able to use a thicker wing using less material for similar performance of the Boeing “thin, heavy flexy sexy wing”
It must be embarrassing for Boeing that the 787 is only competitive with the A330neo when the former is configured in a 9 abreast configuration.
Were sounded out maybe
I could see Airbus wanting to make the CSeries type rating more like the A320. How far could they go through software changes?
The CSeries complements the A320 product quite nicely. While the proposed CS500 would accommodate a similar number of passengers to the A320, it would be focused on efficient delivery of short range flights with the A320 providing longer range and flexibility. The same focus would presumably carry over to the A320 family replacement. Airbus bottom off their range with very little investment.
Canadian aerospace is at that point in the game show where you decide to walk away with your modest winnings rather than deal again for the big prize and risk losing the lot. I suspect it is the beginning of the end of Bombardier as an independent aircraft manufacturer. On the other hand Canada gets a large scale Airbus operation. It’s a prize countries pay good money for.
I bet Boeing execs spluttered into their breakfast coffee yesterday!
“On the other hand Canada gets a large scale Airbus operation. It’s a prize countries pay good money for.”
That’s exactly the point I’ve been making. This is IMJ a massively good deal for Canada.
In contrast, look at Italy which never got themselves involved in the Airbus consortium. All that’s been left for the Italian aerospace industry are the crumbs….
“This is IMJ a massively good deal for Canada.”
IS it a bad thing for Airbus? IMU it is more of a win win.
My impression is that for Boeing ( US apparently in general going by my contacts with US derived management ) win on one side is not a win when it is not accompanied by a loss on the other side.
What kind of sustainable win does one expect from f*ing the workforce or beggaring the coop partners?
Yes, a massively good deal for Canada and a massively good deal for Airbus (win win). 🙂
“I suspect it is the beginning of the end of Bombardier as an independent aircraft manufacturer”
While the Q400 situation is less clear, there continues to be a good opportunity in business jets.
Just 24 hours before there was rumours of news, but that rumor mention the possibility to sell the Q400 and the CRJ. The secret was well kept about Airbus.
The business jet market primarily lives or dies on the petroleum industry. Look at GE. It’s recently announced it’s junking most of its corporate jet fleet. (Mr. Market wants to see cost-cutting and virtue-signaling!) Betweem Mr. Market, oil depressed, and the enviros, it’s looking pretty bleak!
Fractional jets are the growth market.
Which also at least implies a collapsing corporate ownership market, GE’s junking action being a prima facie case!
Wich also means less margin as you sell more planes but at a lower price.
Could Boeing really have been caught so flat footed by this action?
Surely they must have calculated that there was a good chance that something like this was coming, considering Airbus openly admitted that they were already once in talks with Bombardier over this but the talks were suspended when their existence had been leaked. Seems like Airbus/Bombardier plugged their leak(s) and got in with it.
I know someone who might want to talk with these two about how to quietly and effectively plug leaks! :-))
The big problem with the CSeries is that it does not have container capabillity. I don’t know if it is possible to change this otherwise I can’t see a CS500 as a A320 replacement.
@Rudolf Svarre Jensen:
“The big problem with the CSeries is that it does not have container capabillity….can’t see a CS500 as a A320 replacement.”
The capability for LD3-45 apparently did not stopped e.g. Silkair and AC fm swapping 320Ceo with 737Max instead of 320Neo….not to mention hundreds of customers continued to bet on 737 family without such capability since 320 family debuted 29yrs ago.
3 decades of narrowbody mkt history has proven that for shorthaul or even medium-haul ops, that “big problem” of no belly cargo capability is less critical for narrowbody operators(especially LCCs) than many folks imagined. Besides, if a 320 family operator must have belly cargo capability in a narrowbody, the 321Neo & its future derivatives will continue to be available for decades to come regardless of a hypothetical CS5.
Any new Boeing NB/ NMA will have AKH/ pallet option. For good reason. Boeing is keeping up the “no need” stories until the day they are able to offer it themselves.
It is not so much for the transport of cargo but to help those poor guys who have to load and unload those planes without containers. They get their backs and legs “broken” crawling in those cargo holds. If ruling gets tougher on this there might be a problem.
Yeah, I know Norwegians (ground handlers) hate Norwegian.
Look at how Monarch was “turned”.
And this years Nobel prize for economics lifted work on the mirage of “the objectively competent decider acting in markets”.
( years ago Scott noted that Boeing is much better at “accessorizing” the market scape to pimp resale and leasing values.)
Monarch 737 deal looks like coming under scrutiny as dumping now.
If an airline wants container then there is the A320. In case a slim leight weight aircraft is preferred the C-Series is a better option. No need for C-Series with container capabilities.
Therefore the C-Series is a nice low end to the Airbus production line.
Imagine where a MAX8 is related to ACS-500 and A320neo.
Excellent point. That’s why a CS500 would only be pitched for commonality reasons and it would only make sense for “all-CSeries” customers (or, put another way: only pushed to non-A320 “CSeries customers”).
It looks like the economics (and ergonomics) of the C-Series surpasses any other plane in its category. So why shouldn’t the C500? It will certainly be a magnificent competitor to both the A320 and the 737 on shorter routes.
And perhaps such a CS500 would be the beginning of renewal of the A320 in the coming years. That is to say that the next single-aisle Airbus that will leave around 2030 will bear the name of CSeries 600,700,800,900,1000, and so on. But before Airbus opts for this solution, the price to pay for this R & D will be the buy-back from Bombardier in 2025 …
Thinking on the put option BAe had and how it planned out I am thinking that perhaps Airbus/ EADS will be quite happy about that. They are in the driving seat and hence the strength of the minority shareholders (theoretically protected) will be much diminished. Airbus will ‘tidy up’ the ownership rights when good and ready. BBD and IQ have already moved on in psychological terms, bruised, battered but still intact
Only about 50% of A320 series customers go for the option of a containerized belly so its not really an issue.
How many of the other 50% operate in an environment that lacks infrastructure for containers like seemingly the US? if you have to interface to bulk loading around you containers make no real sense.
The real “winners” in this deal? Why Bombardier shareholders of course. Whad they get for their six BILLION dollar investment? Bupkis! What’s that? “Zero, zilch, zip, zippo, nada, nothing, the big O.” Way to go, Bombardier! “Do it again!” LOL
Bombardier shares up 7%, Airbus up 3%. Airbus shares gain almost 50% over the past 12 month.
With this deal the outlook for Boeing in the narrow body market has become just as bleak as in the large twin market.
As a Canadian living in Quebec I am one of the winners. Thanks to Airbus-Bombardier agreement I know that the IQ investment into the C-series is now guaranteed and will pay dividends toward my retirement fund.
The shareholders avoid total oblivion, and gain the reasonable expectation of something in the future. And that is about that u
you speak of shareholders as if they were anything more than gamblers in the casino.
measuring corporate success by shareholder return is fundamentally stupid as it is only tangentially related to actual corporate performance while being directly tied to mob/mass psychology and manipulator (i.e. analyst) influence.
Dear Montana O Sprey, it is clear that you are experiencing enormous difficulties to count after 3. There will be a contribution of time, expertise, engineering, financial resources invested in processes, information technology, in industrial equipment, in inventories of parts that will be charged 50% for Airbus … If the partnership sells 1000 CSeries within 5 years, the share price of Bombardier will be correlated accordingly. On the sale of Bombardier shares in the consortium with Airbus (if exercised) in 2025, Bombardier will switch to the fund and the shareholders as well. As a shareholder of Bombardier, my only gain today satisfies me amply !!!
A win-win for all parties involved?
Airbus helping the competitor to establish the “business case” and become another “big planes” manufacturer. That’s cute.
This deal is a start of the end to the emerging worldwide competition among plane manufacturers.
Let’s wait for big sharks Boeing and Airbus making “a win-win investments” in Russian and Chinese manufacturers (although I have doubts that they would be able to do this). However, RIP for Bombardier and CSeries.
Geee MO, those grapes seem to be quite sour over there.
Although it was late when the announcement was made, the Bombardier share prices seemed to have increased last night. Let’s wait and see what happens today.
Ah, the grapes burned up in the fires! And, I when I heard of this deal last night, I just couldn’t get the “Nothing from nothing leaves nothing. Ya gotta have some thin’.” song out of my head. LOL
We have not finished commenting on this partnership that will go into the history books and will become a popular case study in business schools. It is the creation of potential that becomes the most interesting data. This creation requires:
-New assets and unmatched technology that is Bombardier’s contribution to the partnership;
-About Airbus’ ability to have production facilities whose production costs in Canadian dollars will be lower than those paid in France, Germany or Alabama, Airbus is being given a significant means of pressure to threaten to relocate low-cost European projects;
-Bombardier brings its know-how in regional aviation to the consortium, which means the ability to quickly develop CS70, CS75, CS85; the partnership could thus cope with the Scope Clause and its evolution over time and offer aircraft of 70 to 90 seats, which would greatly expand Airbus’ offer;
-in a few months only, indeed, the new group could offer a CS500 and impair sales of the 737-max;
– even if Airbus obtains a right to purchase the consortium for political reasons and for better risk management, there can be no assurance that Airbus will exercise its right, especially if the subsidiary CSeries is developed with optimality, it will cost several billions of dollars to Airbus;
– In a few years, Bombardier will buy back the Quebec government’s share, which will strengthen the partnership in industrial and commercial relations;
– We should not forget what conditional investment means in 100,000,000 shares of the Bombardier conglomerate. Indeed, Airbus could greatly help Bombardier in the whole issue of mobility. Airbus could even become a partner in the development of Bombardier Transportation to otherwise play on aircraft / train complementarity.
I’ve been thinking along the same lines. Perhaps Airbus/Bombardier could buy/merge with the Siemens/Alsthom rail business as well. The main competitor in high speed rail is the Chinese state-backed giant CRRC.
Boeing will have “gamed” this, and local assembly was so obvious an option that most of us posters had thought of it.
The logical progression is wide body final assembly in the US.
I ment final assembly for Airbus, although it already applies for Boeing. Boeing needs to get a grip on the modern world that it helped create.
I’m sure Boeing and Embraer will join forces to stop this deal going through on all fronts, both now have a lot to lose in the long run. Then there is the political fallout that we’ll see in the next couple of months. Boeing will most likely get Trump involved and I can see a scenario of Trump now stepping in to save the day look like a hero for Bombardier by killing the tariffs in the hope the merger/takeover of Airbus and Bombardier doesn’t go ahead.
However you look at it, Boeing and Embraer are the losers and unfortunately Embraer was simply standing on the side lines cheering on Boeing but they still have their complaint to be heard at the WTO and the question remains, will they continue this action or stop it as I understand they do some significant work for Airbus and this amounts to shooting one self in the foot if you carry on with it.
The best thing for Boeing and Embraer is to put their heads down and let their products do the talking instead of the courts. Not a single airline wants to see another scenario as what we’ve witnessed with Boeing/Bombardier as it takes away buyer choice. This current result (Airbus/Bombardier) is poetic justice.
It’s not just airlines, Boeings actions will not be forgotten by the British and Canadian governments. Companies soon forget, cash comes first. Delta seems pretty annoyed though.
For Canada it is also an Adios to sell F35 to Canada.
I think Canada buys the SHF18 from Boeing, Boeing drops complaint and tariffs, condition that CS100 for Delta gets assembled in Mirabel till the assembly plant in Alabama is ready.
Delta starts getting if CS100 planes as of spring 2018 and Boeing get the SHF18.
A win win condition for both. And you won’t have the US on your back.
Canadá has already started the process of buying Australia’s old F-18s. Super Hornet deader than dead.
I don’t see any reason for them not to buy F-35s now. As long as Canadian content remains sufficient. Lockheed is not Boeing.
I presume you mean Boeing’s F-18 Super Hornet. the F-35 is from Lockheed Martin.
The F/A-18 was a stop gap until the arrival of a stable F-35 version but the damage was not only done by Boeing but also by the US government. So a good bye to the F-35 due to delays is also possible.
Chinook will be a tough sell, P8 even tougher and super Hornet almost impossible as long as Boeing keeps digging. Past history shows us that Boeing likes to drag trade disputes out for decades.
Under Trudeau, the RCAF’s probably going to turn into a near total SAR force, operating Twin Otters and Blackhawks! Their fast jets, if any, will probably be BAE Hawks.
Dear Mount Ha.. Na ! O (my) Prey, the words of your irony are the sons of your pain … Come on, be more serious…
NZ did it.
“Payback’s a bitch, Richard Anderson.” LOL
I don’t see this deal not going through. There is nothing President Trump can say or do to stop it, even if he could stop the CVDs being imposed, which would be a good way to get himself impeached (interfering in an ongoing case). Even if the CVDs are removed, what is in it for Airbus and Bombardier to not go through with it. They both said this was in the works before Boeing launched their complaint. This may even be the reason why Bombardier didn’t provide the information the US Department of Commerce was requesting, perhaps even at the request of Airbus.
Sad to say, but the only people who will get anything from Embraer’s “latest” WTO case are the lawyers involved. We have all seen what these actions achieve…..nada!
Isn’t there a senate seat vacant in Alabam? Or have I gotten my American news mixed up. If so Trump is more likely to throw his support behind this one.
OK, so how about this. Airbus had( in line with all their pronouncements) decided not to get involved with the C series. A desperate. BBD was just about to give the whole lot to the Chinese, Airbus changed their minds.
Quite possibly. But, Airbardier it is, and not Boebardier.
The Chinese, had they wanted it, would have to have moved pretty fast and decisively to have secured the deal. An Airbus Bombardier tie up was always going to be attractive to Bombardier in the circumstances of Boeing getting import tariffs imposed. The tariffs finally arrived, the phone call was made, the deal was done with Airbus before the ink dried on Trump’s signature.
You don’t think Trumps approval might have been required for this to go ahead? Trudeau had literally just spoken to him.
Alabama senate seat election?
Trump is not involved. Bombardier and Airbus are both non-US entities. He can shout from the sidelines if he wants. Boeing chose to go this route and, well how can I put it, exploit the current CinC’s MAGA agenda. Ooops.
America is he world’s biggest economy, but it’s not as important as the rest of the world’s economy.
” America is he world’s biggest economy,. ”
lawyers ( and banksters ) _are_ expensive. 🙂
A few points:
– Bombardier can probably get a limited range CS500 to market by 2020 if the two partners really pushed. Extended performance is not as simple as you’d imagine due to shambolic management decisions in gestation.
— This would ease pressure on the A320 line, allowing Airbus to make more slots available for the more lucrative A321.
— Or allow an increase in overall group slots available, meaning orders don’t go to Boeing by default due to slot congestion.
I’m not sure they’ll do that.
Regarding the longer term future of Bombardier’s worldwide operations. As far as I am aware, the agreement is limited to CSeries IP. So tooling, buildings, staff or facilities won’t be changing hands. But there is bound to be much messiness in that.
– I don’t foresee negative effects in Belfast (who are already a supplier to Airbus and have been for decades), as no one else can build the wings without a massive capital investment. Belfast are also suppliers to other OEMs and have their finger in many pies. Inside BBD, Belfast is the go-to group for trouble sorting and outside BBD, they’d largely be viewed as the best in the BBD group.
– Mirabel will have to share with Mobile, which probably isn’t great for their long term, but if they can open up an A320 line there, it would be good for the long term future.
– Downsview could go either way. What remains of BBD could now look to stretch the Q400, which might bring more work in, or they may not. Global 7000 cannot come soon enough, but the program is still in significant schedule trouble (although the danger of a scrap seems to have passed).
– Wichita is possibly the biggest loser of the Western sites, with only Learjets on site, its vulnerable to efficiencies of scale elsewhere in the US (Mobile).
– China is a disaster, with all fuselages currently being built in Belfast and that not looking like changing any time in the future. Until the Chinese get serious about admitting mistakes and scrapping parts, there will never be a Chinese fuselage on a flying aircraft. I don’t see that changing any time soon given they’ve had years and continue to bury their head in the sand.
If I were to assign blame for how things go to where they are now, Pierre Beaudoin would be top of the pile, followed shortly after by the program managers in Montreal. All of these should no longer be with the company. —— Beaudoin took on the Lear85 a significant money drain and technical rist.
— The managers (and bad lead/principal engineers) insisted sandwich composites could be manufactured in Mexico, just 1800m above sea-level.
— The handling of the Global 7000 is a joke. Between Montreal washing their hands of responsibility and Triumph Aerospace’s ineptitude, the wing is a disaster that is only now on the shaky road to a recovery of sorts with ‘outside’ help (Belfast).
— The managers on CSeries deferred far too much trouble to try and keep an illusion of program schedule. Fixing the issues earlier would have resulted in a quicker actual time-to-market.
— CS300 should have been built first. CS100 could have followed much quicker from this. CS500 would then be more straightforward.
Too many bad decisions from people high up the food chain have brought BBD to where they are now. They *could* have broke into the meat of the single-aisle market, but instead made a balls of most strategic decisions.
But one main important decision is by chance the family Bombardier-Beaudoin were and still major shareholder of Bombardier Inc. otherwise the entire Bombardier were gone since a while possible bought by the Chinese, they have the cash.
It is always easier to make the findings you make once the problems are in place. You underestimate the decision-making process and the context that lead to choices. Maybe you do not know yet, but in the field of aeronautics, guess The future is a high-flying exercise! Also ask Airbus, Boeing, Comac (with ARJ): undertaking is taking risks; some are paid, some are not. Here, your picture appears less black …
Airbus is suddenly looking at being a truly global entity rather than Toulouse plus Hamburg plus bits. This is sure to change the political complexion of the entity. I hope they have the management skills to integrate all operations, too often gigantism leads to massive inefficiencies, infighting and fiefdoms. And I thought the big news this week was the A330neo eventually taking to the skies
What the deal mean to ATR? Years ago ATR wanted to design a larger, new turboprop, however Airbus prevented them from doing so due to fear of competing against Airbus product that are close enough in term of aircraft capacity the A318. With the A320neo family, the A318 is dead, so the gap between ATR and smallest A320 family member, the A319neo, have been enlarged. However, now Airbus also have CS100 which is even more close to the 100-seats market. I suppose that would make AIrbus even less willing to authorize a new turboprop by ATR? Then what will it would mean to Bombardier in the 100-seats turboprop market, especially given their current relationship with Airbus, and the CSeries aircrafts that is now more Airbus than Bombardier?
Why would you want to spend many millions or even billions on the development of a new plane, when it’s not forced by the competiton, not asked for by customers and no revolutionary tech is available? They wouldn’t even been a new engine available for a new ATR as far as I know.
I don’t think it was about competing with the A318 at all.
Ideally you go for your next “real new” product when your current product is in its late prime. not later. You’ll never be as flush with money as in that window.
I do believe that some people are reading a bit too much into this.
From what I understand, Airbus is investing in the C-Series, and only the C-Series. Outside of purely C-Series production issues (Final Assembly Line, perhaps suppliers etc) Airbus will take no part in the decisions of the operations at any Bombardier facilities (Downsview, Belfast, Wichita or even Montreal).
I am not even certain if any of Airbus’ engineering staff will have any involvement in the C-Series program, aside from Customer Support, Purchasing and any setup involved for the Mobile Final Assembly Line.
From what I understand, there will be no major integration of operations. It will be interesting to see if a CS500 or even CS700 are in the cards. If so, I am eager to see how they will be developed.
I believe we will all have to wait a couple of days to get the true details, and from that, the real implications and effects of this deal.
50.1% of the Cseries program means you get the final say on ALL Cseries decisions. Its not just the final assembly.
Some of the comments already point into this direction, the one strategic advantage Airbus now has:
They will need to find answers to the NMA and the NSA from Boeing in some ways or the other.
A CS500 – while out of reach for BBD, would be easy to do for Airbus. This takes the pressure to make a one size fits all A320 successor. AB can make half a step to its own NSA by centering on an A321 NG, with a wing optimized and big enough to address the lower end of the NMA market, and the upper End of the 737-8 market. A A321NG de-stretch to A320/737-8 territory would carry a weight penalty, but AB can counter this by adding maybe four rows (two to be on par with the -8, two to make up for the penalty) – while offering the CS500 as alternative or complimentary aircraft for airlines that see an a320NG as too much airplane, as well as protecting ABs margin. Whatever they finally do remains to be seen, but it gives them a lot of moving space to avoid being the first to do an NSA, raising the bar for Boeing, and allowing it to take a wait-and-see approach to Boeing.
Boeing will now ask Trump for an airstrike on Mirabel.
Were you thinking nuke or just small diameter bombs to start? LOL
That Bunker buster thingy.
You have to reliably reach the root of the problem :-))
I am always amazed when I read comments. You guys display through wisdom knowledge and sagacity . You have already finished planning the CS500. Next week I guess you will finish planning the CS700 that will be an all carbon plane printed by additive manufacturing printers.
Let me remind you of some more mundane facts discerned by myself who posses no knowledge at all in airplane design and manufacturing.
1. Whoever sells the CS100 in the US will have to charge much more then 20 or something million dollars. According to Boeing ( to the best of my recollection ) it cost around 60 million to produce one. ( It is an expansive product to produce. Technology does not come cheap).
2. Like some of Airbus latest products ( A320Neo and especially A350 ) flow of orders dried out immediately after the airplane started it’s commercial service. I think it is a bad marketing signal ( The product might not be so great as most people who comments here think). You should not ignore the fact that the only CS300 operator , the venerable AirBaltic has grounded their fleet last week from reasons concerning the engine. They have resumed operation since.
3. The 737-7 is going to have a huge range. According to Wikipedia a range of 7,251 km is planned for those manufactured after 2021. This means it would have sufficient range to offer non stop flights from mid Europe ( Berlin easily ) to the eastern coast. A plane would theoretically be able to leave Europe at night arrive in US in the morning , make some short segments there and return in the evening to arrive in Europe during the day to fly some segments in Europe , before it takes off in the following night back to the States. This , on paper , can revolutionize the industry.
Sorry, I didn’t get past “According to Boeing”. That implies that Boeing set the standard. Boeing don’t set the standard.
To switch subjects for a second. AirAsiaX are now suggesting that they will upgange to A350s from A330neos. That means either AirAsiaX have found a pot of gold or the price of an A350 is coming down. The latter appears to be true. To be clear, the cost of building an A350 is heading towards the cost of building an A330neo. But Airbus do need to increase production of tge A350 to take advantage.
Across the board Boeing is under pressure from pricing. They can’t make money without significant subsidies from the US taxpayer. Yes, I know Boeing share price is through the roof, but then the US tax payer is paying the dividend.
By the time Airbus are finished, a C series will cost $20 million to produce. Your suggestion of $60 million is probably high anyway.
It does bother me when we are told everybody else has the same problems with carbon as Boeing. Airbus are well on the way to making carbon as cheap as metal
Sorry, it won’t cost 20 million even if it was manufactured in China. Only the engines are at least half of that price. And you have to add the avionics, flight controls and other system parts, that would cost on the order of 3 to 5 million dollars at least. That would leave you with 5 million dollars to spend on materials, airframe manufacturing costs and labor.
The numbers exclude engines. Bombardier don’t fix the price of engines, but then Boeing/Airbus don’t fix the price of engines. $20million is the price of the airframe
Boeing managed to persuade US commerce department (?) . Isn’t that enough ?
Serious @David that isn’t enough. Have you heard of judge, jury and execution, or in the alternative the separation of powers.
Boeing needs to do more than just convince the US government. It needs to convince every government in the world and every airline in the world. Boeing can’t even convince US airlines. Indeed Boeing and the US government appear to be isolated
History has the answer. No wild actions. Just death by a thousand cuts. In other words, bit by bit nobody will deal with Boeing, except the US government!
“That implies that Boeing set the standard. Boeing don’t set the standard.”
For the Trump admin and its econ regulatory jurisdiction, Boeing apparently does set the std for everyone else in the industry, regardless of nationality, to abide/follow as demonstrated by the ruling of this trade dispute case.
And that’s all Boeing needs for domination/monopolizing of the U.S. mkt.
I know, but isn’t a monopoly illegal in the USA for monopolies allow price fixing
Anyway it will be death by a thousand cuts. Governments and airlines all over the world are looking at their Boeing contracts. Bit by bit they will disengage. Nothing wild, just bit by bit
Nobody will have this nonesense that Boeing decided how much it costs to develop and build an airplane
That might have been true when Boeing and US Government was beating up on their smaller neighbour to the north. In case you haven’t heard, the company form up there has a new partner, who does seem to be doing quite all right in the US market.
Sorry, but your big wonder there, your thing, your 737-7, no matter what its 7,000 kms, it will not be able to land at London City Airport, only where you would like it, completely thirsty for emergency, empty gasoline to land in Paris or Frankfurt … It’s delirium …
Capitaine Scarlet ,
How many LCC you know that serve London City Airport?
Your post seems to be the ramblings of a madman IMHO and highly selective. What I seem to understand is that only Boeing products are worthy. I can’t even bring myself to get excited about rebutting your somewhat outlandish claims
“it cost around 60 million to produce one. ”
Oh dear. Read between the lines.
_C-Series is at item ~ #15_
The 787 #15 and the other terrible teens too cost Boeing about half a billion dollars each: manufacture, parking fees, massive rework.
Without program accounting they would have been better off to fleece those frames for useable parts scrap the remainder and start from new.
See, Boeing leveled the table to about 85° tilt to their side 🙂
The stock markets have made their initial assessment:
– Bombardier up over 20%
– Airbus up 3.8%
– Boeing down 1%
– Embraer down almost 5%
These comments seem mostly positive for the Airbardier tie up. I think we are ignoring the fact that the CS100-300 are aimed at a dead space in the market. Sales were poor not because it was a bad product or the company was in trouble (though that was a cloud), but because demand moved to higher capacities.
The Max8/200 and 320 are the smallest narrow bodies that sell. Capacity is 185-200 seats in high density, which is the popular configuration. The 321 is increasingly popular which seats 220. Even the non-existent CS500 barely hits the low end of the range and the growth path requires a different product family. This is not attractive to single model LCCs, the fastest growing narrow body customers.
Those interested in stock prices see BBD up 20% today, but over three years it is down 50%. Embraer is in the exact same boat. Boeing and Airbus are both up 100% over the same time frame, and both moved within daily trading ranges since the announcement.
Investors don’t think the industry has changed. BBD got a lifeline, and that’s about it.
Check your numbers for the day following initial euphoria; BA Class B took a 4% slide…..getting to terms with what just happened. Company taking control of a conpetitor’s best and most advanced product, free of charge!
But on longer term, Bombardier Shares are a good bet if Airbus/C Series sell well. Bombardier will still have 30% in C Series.
It’s all about effective control; 30% buys you nothing; your ex-competitor now has 50.1% and they are in charge!…,this is the sad reality which will slowly sink in. I would love to stay positive and hopeful, but common sense does not support that.
With the CFRP wing and all, what is the true production cost of the CS versus the A320 or 737? If it was cheap, they had the whole world to sell them to, not just Delta. I think the production economics will still put a damper on sales, sales price, and production ramp up.
Even if the price of the somewhat smaller C-series is a little higher than the A320 or the 737, it has a huge trip cost advantage. So for all routes on which you can fill the larger birds, the CS will be the champion.
It will be an interesting sell for Airbus, do you sell A320 or C300 and at what price? Three FALs (2 in mirabel, 1 in mobile) will get the volumes up in the next couple of years and the unit cost will tumble for the C300 but my guess is that it will take 5 years to get to cash positive on each one sold. Will the C300 ever be produceable at lower than A320 cost? Well we would be talking in the distant future. At least the amortised development cost seems to not be Airbus’s problem
What 2 FALs in Mirabel ?
The front cockpit is made in Saint- Laurent, the forward fuselage is assembled from scratch in Mirabel.
The FAL is its own operation to bring together all the separate airframe sections and of course fit it out and paint it.
My opinion is that this is a massive shakeup on the industry, and that Embraer took the biggest hit. Not because CSeries is superior than E2, in fact, they are almost the same on cost per seat, despite the increase range of the first. But Embraer’s problem will be Airbus sales team. The blood bath will become even tougher. And this will not change the current situation, where low oil prices and huge competition from used frames are putting a big pressure over all manufactures. Airlines have already sent the message: they won’t pay premium prices due to technology. They want to pay 20 to 30 million dolars at most in this segment.
One HUGE point not made is how leasing rates for Cseries will now PLUNGE!!!
Don’t doubt that CS tech can also be adapted to spit out a clean sheet MOM much faster then Boeing possibly can. Also CF wings for A322 from Belfast ? Sorry Boeing, you YOU LOSE!!!!
And Boeing lose big with the bad world wide negative publicity in trying to kill or choked a Canadian Aviation company.
My take is this frees up Airbus to fix the A320 and make it longer, beating out the 737-8. Drop the bitty A318/19, put the money into the A320X and A321XL (Extra Large)
A few seats more or a match in the A320X to beat out the 737-8
If I was Boeing I would have killed to get the C Series tie up.
That would have freed up the 737RS if it ever comes to move up the ladder. So much for that.
Many years back Tigers Freight went belly up and FedEx was the only one that put a bid in (merger).
I am looking at the routes Tigers has and thinking, you people are idiots if you left FedEx have it (150 million?)
FedEx set themselves up for life with those routes into Asia.
With Airbus in the mix Boeing will be beat to death legally.
Buy a few Reptilians off and change the law if they have to.
self reporting: I had the total Flying Tiger price wrong. Something around 880 million, I think the cash end was a 150-200 million.
One of the all time bargains of all time, the gift that keeps on giving
Shenyang, not Shenzhen.
Airbus have implied un the past that the US is THE cheap labour country for aerospace. Now they have an aircraft in which European governments have no say in that they can mass produce outside of Europe. I suspect the A320 replacement will be CS500s built in Alabama. Higher margin A322/323 whatevers can come from Europe.
Maybe Boeing can leapfrog the C series, but I doubt it, tech isn’t available yet, equal it more likely, and I wouldn’t be too sure United Tech would be in a hurry to supply GTF to a new BA narrowbody if they had nearly 100pc of the market already.
“Airbus have implied un the past that the US is THE cheap labour country for aerospace.”
Well they said that US labor now is marginally cheaper than Chinese workers. But you also have to heavily qualify those workers. ( foreign automobile manufacturers had to do that and Airbus followed up recently.) Not like for example in Germany where the school system produces formally qualified workers.
Boeing have not given up. Boeings Phill Musser (who ever he is) “if airbus and bbd think that this can get them around the rules…… #think again ‘. Personally I don’t think that they need to get around the rules, those are the rules. But then I’m not a highly paid lawyer.
All those who have commented that Boeing can’t do something, think again. Boeing is the biggest and most profitable aerospace company in the world. Their technical resources are greater than anyone else. They also have government contracts that provide leading edge technology and moumtains of cash, some of which are so secret that no one has heard of them. So forget about any ideas that Boeing needs Bbd wing technology etc.
Boeing is #2 in covil aerospace for some time. You can look at fleet in operation, deliveries over the last 1,2,5 or 10 years or the backlogs or total bank account. 0r a combination. Whatever suits you best. IMO they’re #2. Judging their actions, they don’t realize it yet. They just seem to listen to themselves & run into walls.
Hasn’t Boeing been out producing Airbus for the last 3 or 4 years?
A lot more 777s sold than the nearest competitor.
600+ 787s in the air and 168 more soon each year?
737 production matching Airbus?
Number 1 overall not just civil, more money and technology from defence, at least in the US. Don’t understand “total bank account”, it was my understanding that Boeing was making a lot better returns. Of course it’s easier to get a good return in the short term by not investing.
Agree. Boeing doesn’t need Bombardier technology and the C-Series, while being a very good modern aircraft, is not the ground breaker in tech advancements that some here claim it is. This won’t kill Boeing either.
It will however, make things a bit more difficult for them going forward.
Obviously they won’t give up, but the question is, what will/can they do?
Do they have any legal tricks up their sleeves as far as the CVD issue is concerned? They are now not dealing with tiny (ok, not in land mass) Canada, but with the EU. Between the opening of a FAL in Mobile and the clout of the EU behind it, the CVD on the C-Series is probably going to be dropped.
If no legal tricks/options, are they anywhere on the technological front?
If not, then they are going to have to get moving on that.
“This won’t kill Boeing either.”
Wait, wait, didn’t Boeing say in their filings that it WILL kill them?
I have read a lot about winners and losers, but very little about the impact of this deal on the Japanese aerospace industry, and the impact on the MRJ in particular. Can anyone comment?
What exactly constitutes final assembly for the purposes of tariff applications?
Can you fly a minimally equipped bare frame from Canada, do the cabin outfitting and completion in Mobile and still say that final assembly was in the US?
If that’s all that is required, it is a smaller effort on the part of Airbus in expanding the Mobile facility.
Airbus ships in separate sections to Mobile for a full final assembly line, not too different from Boeings Charleston line ( all though Charleston does have a separate fuselage section factory which is nearby, Vought used to own that but Boeing bought them out as part of the ‘difficult times’ for the 787).
The other advantage is that Airbus has its own transporter aircraft but the
airframe sections could still be shipped in to Mobiles port.
If anyone really had any doubts, the saga points out that new entrants face huge/impossible barriers of entry. BBD still had the right pedigree for a credible high tech new airplane family.
They could not pull it off at the end. Had to ‘give it away’.
Sure the Tech was best. So what?
– The soviets (sorry we say Russians today, not really sure why but…) are trying. No chance. Zero. Plutocrats can’t build for real.
– The Chinese may have a better chance, yes, given the unlimited funds and time they have. But it will take 2-3 decades. The curve is too steep. People’s safety is too personal.
Sobering for anyone…
ps: Sure Boeing was the bully, but you think other companies do not play like this everyday? Think again. This case was more in the media currently and interesting indeed to our forum’s favorite pundits 🙂 Fair enough. But how did you think Apple felt when Google’s CEO then who sat on the Apple board knew all about the secret iPhone being developed and scrambled frantically to find an alternative, snatching the startup that became the Android OS to compete frontally. Was that fair? Who remembers this today?
They will all squash a competitor if they can.
Boeing was stupid not to take advantage of an opportunity to joint partner.
Amazing how they can be so stupid and still lumber on pretty successfully.
I cannot imagine this level of stupidity your refer to. In fact, I want to believe that AB and B have had very secret talks about The all deal, and how to set it up. For one thing, China-Russia-Japan will be less of a threat, and second, AB and B have to figure out how to split the big pie without anyone else joining the table! The proof of that, or the demonstration will come from AB taking away the entire C-Series Program as well as the slice of the market. If course, AB so far discount having any desire acquiring 100% of the C-Series…..really? With AB taking complete control of this market segment, they will agree to some other concessions with Boeing, allowing them to maintain a big piece of the lucrative and sweet pie. Having said all of this, it is also implied that AB is potentially in control of B…..a prediction many made 25 years ago! Looking out to the next 25 years, someone else will take control of Airbus and Boeing, likely from east Asia, with or without Russian support and interests, maybe new electrically powered large commercial aircraft?
From a-glass-half-full-trending-toward-evaporation devil’s advocate:
Any chance that they are buying it to kill it. It’s going to be pricey to harmonize it into a common type rating and once it’s gone the A319 starts looking better.
That is B-Think.
Remove the better suited product to foist even more senile technology onto your customers. ( 717 / 737 )
It depends on how important that common type rating is to them; and, yes, the 717 came to mind when writing that agent-provocateur item.
As a result of Boeing’s actions, it was well on its way to dying. Why would Airbus need to get themselves involved?
True, there is still a slight risk of that being the case, but the logic doesn’t really stand up for it.
Boeing was outmaneuvered and became victim if its own greed by trying to keep the CS out of the US. Airbus will now compete with the 737 and Embrear and there wont much they can do.
The CS is a killer advanced aircraft.
Sorry…50/50 with three highly politicized partners sounds like trouble to me. Would love to be a customer and start playing A320neo v CS300…never mind the A319 (or Boeing alternatives). Pity the commercial teams for either Airbus/Bombardier responsible for explaining how these products complement each other vis-a-vis pricing, switching costs and fleet complexity.
50.01% (rather than 50%) makes all the difference.
I thought I might not ever get to fly on the CS so this is great news. I wonder if Southwest might move to CS 300 or possible 500 for 737-700 replacement. The revised Max 7, as a shortened 8, is a heavy and seemingly needlessly long range aircraft for US operations. Probably not but one can hope.
Adding insult to injury Canada’s pathetic prime minister – Justine Trudeau – actually phoned Donald Trump to “sell him on the deal”. Thanks to Trump’s bullying Canada has lost its crown aviation jewel to a European company and 1,000’s of jobs are going south to Alabama and our idiot prime minister thought he had to call the bullying Trump to “sell him on the deal”?
Canada’s future looks bleak with a bully in the white house intent on poaching jobs from Canada so as to “Make America Great”.
Just a note: justine Trudeau is a feminine name. It is Justin Trudeau.
The importance of this deal can be gauged by the massive kickback in the media by Boeing. If you want a laugh get on Twitter now and see how Boeing pronouncements are being commented upon. There is only so much ‘talking up’ the spokesmen can do and now they are beginning to look more than foolish. #letitgo #soreloser etc etc
This cannot possibly be good for Bombardier; they have essentially given away their aircraft industry, built over many decades of hard work and innovative product development. Just remember what could have happened to the Q400 when ATR came so close to buying de Havilland. The language was the same, the alliance would sell hundred of Q400s! ……yeah, right. While inévitable following many mistakes, this is very sad, very sad for Canada.