Airbus sees potential for A330neo sales; Boeing sees opportunity

June 6, 2018, © Leeham News: Airbus remains confident that the sales boon for the slow-selling A330neo is just around the corner, but an analysis of Airbus’ current operator lists shows significant inroads by Boeing for its 787.

Airbus is counting on aging A330ceos by 2020 to spur sales of the A330neo. But Boeing already sold the 787 to 19% of the A330 operators. Look for more aggressive campaigns. Airbus photo via Google.

LNC outlined Airbus’ strategy last December in which officials are confident the A330neo will see an uptick in orders as the current A330 operating fleet, now called the ceo, ages beginning in 2020.

The new sales chief, Eric Schulz, reiterated Airbus’ confidence at the IATA AGM this week in Sydney, Australia.

But 19% of the 109 A330 operators already ordered the 787. One, American Airlines, already announced the 787 order will replace the A330s in its fleet. Air Canada long ago made a similar announcement. Hawaiian Airlines canceled an A330-800 order in favor of the 787-9.

Aggressive pricing

Boeing engaged in aggressive pricing to win the Air Canada, Hawaiian and American deals, all with intent to displace Airbus.

Although Boeing consistently claims there is no price war, Airbus claims otherwise and Steven Udvar-Hazy, the executive chairman of Air Lease Corp—and an A330neo purchaser—says the pricing competition is “intense.”

Dual operators

Comparing the list of A330 and 787 operators, and A330 customers that ordered the 787 but do not yet operate them, some 787 orders exceed the number of A330s operated. On its face, this suggests the A330s may already be on their way out at these carriers.

Some carriers have under-ordered the 787 compared with the A330s in service.

Dual sourcing

Some A330 operators that ordered the 787, whether already in operation or yet to be delivered, have a long history of dual sourcing.

The Chinese government likes to order Airbus and Boeing aircraft, if for no other reason than to use them for political pressure against the European and US governments if and when necessary. But the requirements are sufficient that one OEM may not be able to fill the needs on a timely basis.

Potential vs reality

There are more than 1,000 A330ceos in service with more than 100 operators. There are only about 200 orders from fewer than a dozen customers.

With 19% of the A330 operators already 787 customers, fleet simplification may be an issue Airbus will have to fight against in key campaigns. It was a significant factor in the American campaign; the airline will eliminate the A330s and Boeing 767s with its follow-on order for 47 787-8s/9s.

This also makes an effort to sell the A330neo to United Airlines highly uphill. UA doesn’t operate the A330, but it does the 787, with more on order. Introducing a new fleet type is highly unlikely.

Published reports that are several months old indicated Airbus thinks it will sell upwards of 1,000 A330neos. Others believe this is widely optimistic. One pessimist puts the number at 400.

The A330neo was late to the market, coming years after the 787 entered service and after Boeing launched the 787-10 derivative. Fuel prices subsequently plunged, depressing sales.

Airbus probably had little choice in launching the airplane. The A330ceo was rapidly being overtaken by the 787 as Boeing finally straightened out this program. The potential Boeing NMA/797 will be far more economical than the A330ceo. Although the A330-800 really doesn’t cover the upper end of the potential NMA like Airbus claims, at least a low-cost entry into the upper end of the Middle of the Market is provided by the A330-800.

155 Comments on “Airbus sees potential for A330neo sales; Boeing sees opportunity

  1. Thanks for the article.

    Any ideas how Deep are the discounts regarding this “intense price compétition” ?
    Are we above the typical 50%?

  2. The A330 program shares resources with A350 on most sites. Further, the A330 is also a military and freighter program. Keeping the A330 available is hence rather cheap for Airbus, and even a rate of 2-3 is conceivable.

  3. Airbus are going to have to create a buzz around the program that is currently lacking. The neo is ‘perfect’ for many routes but at a price. That price is the key, with such a longstanding airframe Airbus must and should be able to undercut Boeing significantly, think the Boeing response to offloading the remaining slots of the B77w.

    Fundamental to all of this is getting the cost base down across the board and come out fighting on the sales front. As I understand it The Airbus Sales team was charged in recent years with making margin rather than making sales at any price. This has seen a significant drop in the sales achieved. The only realistic way to drive up margin is cost cutting and efficiency gains.

  4. Using the 787’s for flights of just a few hours that many 767/A330’s fly is overkill , even doeing UK-US East cost with an aircraft capable of 19hrs flight is not optimal.
    Hence the 797 will replace alot of shorter 787 flights and replace the 787-8 besides the 767. One would think the A330Re would suit these and domestic US flying quite well.
    In the US, the govement buys/pays for lots of pax/cargo tickets and thus can influence the airlines fleet choices with its buying power hence Airbus can drive down Boeins prices for 787 sales/leases to A320 levels and always loose the deal.
    It would be interesting if they offered UAL A330neos for free during 3-5 years to try them out how quickly Boeing would match/exceed it with 787’s even though UAL knows them pretty well by now.

    • I think too much is being made of the 787’s long range, how many frames are really being used for its maximum range? The 787 can make money on shorter flights such as over the pond and these flights make up much of the the planes routes and beat the 330NEO fuel numbers.

    • the 330-800 is also tremendous overkill for this mission, in fact even more so if you go by their range claims, and the 330RE is just a paper derate that is still carrying all the weight of the 251T model, so the only operating cost savings is landing/transit fees, something that could also be done with a 787.

      • The A330ceo and its Re version are pretty cheap and its engines are one generation behind the 787 in both performance and cost. Hence if you don’t need the 787 full performance you should be able to make money flying the A330.
        Boeing seem to ba a bit nervous of the A330 so they match the purchase price and offer total care at the same cost I assume so you can take advantage of the 797 good payload/range and long range low fuel burn.
        It often comes down to what you have to pay in engine PbH maintenence fees and if they let you have a pretty low hrs/cy ratio for the same price as a high one the choice is simple in 787 advantage for most airlines mixing flight lengths for widebody jet flying.
        From a cost view the 787 should still be more expensive to make, hence Boeing can only do these sweet deals for a few quarters then it starts to feel the pain unless increased 737 production profits are used to stop the A330neo’s or uncle SAM helps out one way or another.

        • it is unclear whether the 787 is still actually more expensive to make (per unit current, forget deferred costs/sunk tooling etc). the process for most of the major components is either highly automated or performed by cheap(er in theory) non-union labor and only the 50% of the frames final “snapping together” is done in union shops…

          so, in theory, even with higher raw materials costs, the 787 should (eventually) be cheaper to make than the A330 which requires much more manual labor by much better compensated euro employees….

          • The cost to produce an Alu aircraft I think still is cheaper as it can easier be automated than the first generation Commercial carbon fiber major structures aircraft.
            It takes time doing the Composite lay-ups and autoclave bake then ultrasonic inspect and figure out what to do with the parts that has deformed out of drawing tolerances (often more than 10%). Still the race is on and every generation of Composite aircraft will get the latest production systems better than the previous, Boeing did calculate a cost reduction curve when started the 787 and is was not as steep as expected from +200M/ea toward the goal of I guess $50M/ea without Engines, APU, cabin interior and BFE’s.
            So mass producing Aerospace Composite quality primary structures quickly & cheaply is till not that easy. The 797 shall get a completely new production system so my feeling is that it might get Close compared to the latest alu aircraft robotic build system (Line #4 for A320 in HAM just getting ready) once it is fully debugged and fine tuned around 2030.

          • do you have any evidence that your “thoughts” apply to the current situation at Boeing and its subs?

            10% defect rate (to the point of scrap status) would be ludicrously high for automated fiber placement after the initial tooling kinks have been worked through, I would be surprised if after over 600 aircraft if they currently have a greater than 1% scrap rate. if they do, then they need to fire their whole QC and Production Engineering team. for hand laid components I could see _maybe_ 5% (and even that would point to serious deficiencies in QC and PE), but there are very very few of those in a 787.

          • @bilbo, most of the small tolerance deviaiton when inspecting composites after autoclave bake and cool down are accepted and are written off. Deviations so big that you need to rework or scrap are less frequent.

          • @claes – so what you are saying is your 10% defect rate mentioned above was complete FUD and hyperbole?

            if the part isn’t scrap or rework, then the defect doesn’t matter.

            you don’t think they need to do xray, ultrasonic and electric flux testing on metal parts? what about deburring all those hundreds of thousands of rivet holes (not to mention installing the rivets, still often done by hand) which then need several layers of inspection and QC…

          • @Bilbo, a deviation is a condition outside DWG dimensions and spec’s and need its paperwork and review with its time&cost. It is the same general procedure for Composite and metal parts. The argument is that they are much more common still on Composite parts. I can agree that very large metal structural precision castings can create a good harvest of deviations but they are few parts like that in an Aircraft.

    • “In the US, the govement buys/pays for lots of pax/cargo tickets and thus can influence the airlines fleet choices with its buying power hence Airbus can drive down Boeins prices for 787 sales/leases to A320 levels and always loose the deal.”

      Never heard this excuse before. Please tell us more!

      • The US govement is also a big cargo customer of both FedEx and UPS by the US Postal service and other agencies and their fleet choices the last years are getting more “All American”.
        The US goverment paid pax tickets purchase volume is not as easy to track still the total air travel expenses paid include many Contractors that can invoice travel as part of performed services.

        • Airbus’ offering is only the a330, so I struggle to see how you believe cargo fleets would get anything but “more American” due to the fact that there are no other offerings. Suggesting that UPS and FedEx get or react to government pressure is pure folly.

          • Most cargo haulers use a mix of new build and pax to freight converted Aircrafts. There is a good mix of Aircraft to choose among for PTF conversion.

          • The only PTF available on an Airbus aircraft is the A330, and so far only a handful have been completed and delivered to just DHL. A320PTF is in development but none completed yet. No A340 PTF available, and A300PTF opportunities are limited to nonexistent due to basically no usable feedstock left.

        • having traveled for the US govt, both as military and as a contractor, there is no “bulk buying of tickets” that the govt uses to bully airlines to buy boeing. the stupid, it burns.

          the requirements are:
          you must purchase coach unless your trip is more than 14 hrs air time in which case you can get business class
          you should buy the cheapest ticket that fits the schedule (some games get played here)
          you must buy your ticket from a US flagged airline (flying to Germany, I had to buy my ticket on a Lufthansa aircraft through United’s code share listing of the same flight for $150 more than if purchased directly through LH)
          the Airline has to give you the lowest rate available for that seat at the time of purchase (again, games are played due to dynamic pricing models, whatever price they show you is technically the lowest price available for that seat at time of purchase)

          but the govt does not force you to or away from some specific carrier due to their willingness or failure to buy boeing.

          • edit to above: when the gov’t does buy bulk tickets, such as for unit deployments or the (used to be a couple times a week, now less frequent) flights for troops and their families doing PCS moves to Europe/Japan/Korea, they charter entire planes, generally configured 100% coach, from charter operators who are part of the CRAF program.

            there is no requirement that CRAF aircraft be Boeing or even US made, when I PCSd to Germany, we flew on an A300.

            http://www.af.mil/About-Us/Fact-Sheets/Display/Article/104583/civil-reserve-air-fleet/

        • This is wrong on so many levels. The US government does not pay for tickets in volume. Nope.

          The current airline that has the contract is American Airlines (yuck). And guess what? They’ve bought a whole lot of Airbus aircraft. Just a couple of weeks ago I had to travel for training and even though DTS showed a cheaper price on Southwest, by the time the travel gurus got done, it was $500 bucks more expensive than American, the preferred carrier. So I had to book American, and half my travel (to/from) was on Airbus metal.

  5. Believe the 330NEO’s are good aircraft but there is a negative market perception to it greatly amplified by Boeing marketing which includes that the 787 is a complete modern aircraft family, easy to finance, etc. When AB launched the 350MK1 the market didn’t want it, so why would they take the 330NEO?

    Maybe AB should take the punch and re-visit the 350-800. Shrink the 359 for example by ~4.5m (7 panels) and not by 6.3m (10 panels) to give seating of 280-290 (358+) vs the 325 of the 359. Engines could be 75Klb XWB’s with PIP’s that’s expected in 2021/2. Then the 350 will also be a complete modern aircraft family with potential for a shorter range (400 seat) 350-2000.

    …or AB can see where they can take out weight and cost/price of the 359 and offer an 359Re (6-7K Nm) that could compete with the 789 and 789J.

    AB seems possessed by range, how much time/money is spend on Qantas project sunrise for example, (also only 7 A359ULR’s ordered so far)? The likely hood is >>50% that Qantas will go with the 777-8. There are other more important fish to fry.

    • Shrinks never work as good. Why shrink the A359?

      The A339 should be competetive,
      it’s more that it’s an orphan as the 800 doesnt see sales.

      You can speculate if a reengined A300/A310 (same fuselage) at 50m will see sales if you develop a new wing.

      Boeing was clever when it outgrow the A350/B777 with it’s B777x.
      The A330neo is having a hard time to see sales against a more modern direct competitor.

      • An A350-900 with -1000 body with -900 MTOW might be a 400 seat MoM killer. Doing NY-BOS-BWI-SFO-LAX-DEN-ATL-MIA-ORD routes in the US. LHR-CDG-MUC-MAD etc. in Europe and Chinese and Japanese trunk routs.

        The Qantas sunset project might result in great updates for the normal A350-900’s benefiting everbody in a block update 1-2 years from now.

        • Hope so. can see an 400 seat 35K2 with 6-7K Nm range as what many airlines will need replacing 773/W’s. Its OEW should be more than 20T less than an 779.

        • The A350 is overbuilt and not optimized for that role, it would not be a MoM killer. Remember the A350’s wing and engines are designed with long range cruise in mind and that is where the plane’s efficiency is maximized, not short hops when the plane barely has time to cruise at altitude. A slightly smaller but lighter and optimized aircraft would fly circles around the A350 in that role when it comes to CASM.

          • Maybe, still Composites are fatigue and corrosion durable and with reduced actual Take-off thrust requirement reflecting pax& fuel uptake for the route it might be more flexible than the 777-300ER that see a good mix on short and long range flying at Emirates.
            In the old days the DC-10-10 at 380pax and open cabin config did these routes but could not take the cycling very well, it might be that the composite A350 with its Heavy and durable Trent XWB’s with massiv derate can do it and replace 2ea A321’s in the morning rush hours before doing a Trans Atlantic trip and home for the next moring rush hour.

          • You need some fantasy, those guys have it for sure.

            Actually, a A35k2 would be same size and lenght as B779x – and a long range aircraft.

            Idk how you can come up with a 400pax MOM when MOM is defined about 240 – 280 pax in 2 class for everything up to max. of 10 flight hours.

          • I agree this proposed mid range A350-1000 could be a great product.
            However it would not be a MOM killer, but would be competing with the B787-10 and B777.

          • MoM here refers to range/missions not seat capacity. The 777(ER) is widely used for many missions of <5000Nm, EK and Qatar use these to many destinations in Europe (<3000Nm) for example.

            Who needs an 777-9 to fly transatlantic for if you can do it with a much lighter 350-"2000". There are many more routes of 7000Nm.

      • As you said, difficult to compete against a modern aircraft. Even if the 350-800 uses the same wing, etc. of the 359 its OEW is likely not to be more than the 339, also it could have potentially serious range if required.

        Overall aerodynamic’s and air frame maintenance cost should make it very competitive relative to the 339. Increased production rate that will be required in 350 production line will lower production cost and hence price that it could be offered, this will also be for the XWB engines with PIP’s expected 2021/2.

    • Believe the 330NEO’s are good aircraft but there is a negative market perception to it greatly amplified by Boeing marketing which includes that the 787 is a complete modern aircraft family…

      Do you really believe airline executives can’t see through marketing hype?

      • Sometimes I wonder, especially the guys wearing yellow ties, they just see numbers.

  6. Airbus’ marketing assumption was that Boeing would not / could not (given the massive outstanding non-recurring on the programme) drop below $130m net for the 789 and that the A330-900 would sell at around $100m – making a convincing deal for airlines not needing v long range. In recent campaigns Boeing has dropped the price to around $110m and at this price the A339 can’t compete. If such Boeing pricing is sustainable, the A330neo will be in real trouble. Airbus must hope that it isn’t.

    • The 339 has got competition from the 789 and 359. Maybe AB should REALLY aggressively market the 338 that can compete with the 789 on range and sector costs, they have nothing to loose.

        • Thanks for correction, seems I have lo(o)st it, but the 330NEO story gets me worked up!!!

      • It’s not true.

        Between A359 and A339 is a range and pax difference, about 30-40 pax.
        They dont compete, unless your are at apples and oranges.

        A338 -> B788
        A339 -> B789
        A359 -> B78T

        There are minor differences, because every plane is positioned a little different, but that’s the competition.

    • @Torquelink

      On the 14th of December 2005, Qantas ordered a total of 115 Boeing 787s including 50 options or rights to purchase. Boeing, apparently, went as low as $65.7 million for the 787-8 in order to beat the initial version of the A350. Interestingly, $65.7 million in 2005 is the equivalent of $84.29 million today.

      Now, according to an analysis by Jon Ostrower back in 2011, the 2004-06 787 airframe prices charged to airline customers ranged from $83.5 million down to $65.7 million for the 787-8, while 787 airframe prices averaged just below $76 million — not including engines, buyer furnished equipment etc.

      Of course, the buying power of $76 million and $83.5 million in 2005 is today equal to $97.5 million and $107.12 million, respectively.

      What you’re implying, therefore, is that a bare 787-9 (without engines) is now offered at about the same price level as in 2004-2006 and that Airbus can’t sell the A330neo for less than the original version of the A350, which is ridiculous. What’s for sure, though, is that you’ve helped piling on even more FUD at the A330neo — something which seems to be contagious.

      Back in 2005, Airbus wasn’t willing to go as low in pricing with the initial versions of the A350-900 and the A350-800 ($65.7 million for 787-8) — an aircraft that was a much more expensive undertaking than just “neoing” the A330 a decade later.

      What you seem to be missing, though, is that Airbus can go lower than $100 million for an A330neo, if they so choose, and that Rolls Royce would be able to offer the Trent 7000 engine at a significantly lower price than the Trent 1000 and the GEnx engines, since the Trent 7000 cost a lot less to develop than the Trent 1000/Genx engines. Remember, the Trent 7000 is essentially a bleed-air version of the Trent 1000 TEN.

      When the A330neo has entered into service I would not be surprised to see Airbus starting to match Boeing in aggressive sales tactics. With respect to the recently hyped sale “losses” to the 787 in the US market segment, it’s quite obvious that Airbus didn’t want to be too aggressive due to the possibility of Boeing responding with dumping charges.

      Data obtained by Flight International shows Boeing’s historic order backlog for the 787 was based partly on steep discounts driven by now-discarded design and manufacturing assumptions.

      Cost overruns, penalty payments and supply chain changes adopted in the past two years will force Boeing to achieve unprecedented cost savings for the widebody to turn a profit even after delivering the current 846-aircraft backlog.

      With first delivery nearly three years behind schedule, the cost to build each 787 has skyrocketed from original assumptions of lower and more predictable production costs, say company insiders.

      In the race to sign up customers between 2004 and 2006, airframe prices averaged just below $76 million, a price that does not include the $20-30 million GENx or Rolls-Royce engines, buyer furnished equipment and in-flight entertainment, according to pricing data.

      While Boeing will probably never disclose the actual prices for which its mega-backlog of 787s were sold, chief executive Jim Albaugh acknowledged in a recent interview: “I think we gave away some of the value of this airplane to a lot of our customers.”

      Customer and company sources, as well as industry analysts, say that statement is an understated acknowledgment that Boeing’s huge 787 backlog was fuelled not only by predictions of huge future growth in air travel and sharply-rising fuel prices – but by a steady and strategic drop in the price of the aircraft.

      In late 2004, Boeing started employing aggressive, price-cutting sales tactics, according to sources familiar with the pricing discussions, blunting the ambitions of the original Airbus A350, which at that time was an A330 update rather than the all-new aircraft in development today.

      In the more than three and a half years since its first 787 began assembly, the prevailing wisdom about Boeing’s woes have centred upon moving past manufacturing design issues, completing extensive rework of production airframes, certificating and delivering the first units for revenue service and building a steady industrial ramp-up at its Everett and Charleston facilities; all while rebalancing its supply chain as it develops the 787-8’s larger successor.

      Although each is a formidable task, the pricing data indicates Boeing also must overcome five-year-old pricing decisions on more than 300 787s still in the backlog.

      The 2004-06 airframe prices charged to airline customers ranged from $83.5 million down to $65.7 million for the 787-8 for one higher-volume deal with a blue-chip customer.

      https://www.flightglobal.com/news/articles/analysis-boeing-787-historic-pricing-discounts-put-pressure-on-programmes-profitability-351323/

      • As the A330 was still morphing into the A350 at the time of the order, that would undercut the argument.

          • The fact that at Qantas the bid was against A330 not A350.

            The rest just a twisted bit of odds and sods with no relevance.

          • @TransWorld

            You appear to be somewhat confused.

            The fact of the matter is that Qantas chose the 787 over the original version of the A350

            The original A350 was officially launched on October 6, 2005 — two months before Qantas ordered the 787. Just like the 777X, the original A350 would have had an all new compostie wing, while aluminium lithium was planned to be used extensively in the fuselage. Further adaptations included; weight reduction by some 8 metric tonnes, reprofiling of the nose, reprofiling of the fuselage frames that would increase cabin width by 4 inches — i.e. just as in the 777X fuselage — and larger cabin windows. Hence, the commonality between the A330 and the original version of the A350 had been reduced to less than 10 percent between the two platforms. That’s part of the reason why it made sense for Airbus to change course in 2006 and go for an all new aircraft – the A350 XWB.

            Now, just to help you out: On December 10, 2004 — a year before Qantas chose the 787 — the shareholders of Airbus had given the managment of the company an authorisation to offer (ATO) and formally named the aircraft the A350. Finally, the industrial launch of the redesigned A350 XWB occurred on December 1, 2006.

            http://aviationweek.com/awin/qantas-eyes-787-a350-part-largest-aircraft-order-2000

            https://blogs.crikey.com.au/planetalking/2013/02/23/how-the-qantas-787-ordered-changed-the-future/

          • OV-099: Original version of the A350, A330 Rev 1!

            That’s funny. Don’t try to take a case to court with that logic.

      • RR does not really want to sell T7000 with deliveries before 2020 as they work their way out of T1000C problems by boosting T1000TEN production with mostly common parts to the T7000.
        Airbus is hurting as there is no engine option on the A330neo and RR is dug-in deep in Derby. Trying to offer A330ceo’s as an interim solution is a no starter if the customer really need the 787-9 payload/range now and then. Airbus could offer a lease mix of A330ceo’s and A350’s, maybe asking Qatar to accept later line numbers instead. Airbus could then shake life into the Toulouse parked Qatar A350’s and get them leased out until RR can pump out T7000 maybe from both Derby and Dahlewitz. But it might be a bit late as Al Baker seems to have found routes for them and many seems to be moving towards delivery.

        • RR also has to work its way out of the Trent 1000 as those engines will not go away (unless they replace them with a TEN for free.

          I can’t remember a bigger mess.

          Shades of the advanced Radial era where they worked, but failed often. Good to have 3 more engines.

          • One easy forget, the early widebody Engines like JT9D-3, CF6-6, RB211-22 were not wonders of reliability and were pretty quickly improved to JT9D-7A, CF6-50 and RB211-524. The next generations even better JT9D-7Q, CF6-80A/C/E, RB211-524G and G/H T. The early Caravelle RR Avons did see the Engine shops quite frequently as well as early PW2000/PW4000 and V2500-A1. The CFM56-3/-5/-7 has blinded us a bit being quite reliable. One can argue that the P&W JT3D showed what was possible with Engine on wing for over 18000hrs.

          • No disagreement that the older engines from the 50s on had issues ( the 4 and 3 engine requirements)

            But those got fixed, in this case its being replaced by an all new engine and the Trent 1000 will no longer be built.

            They will try to back fix the current, but its no longer a production item.

      • Trent 7000 engines are cheaper than Trent 1000 engines even though they have to start with a Trent 1000 engine to make the 7000? That doesn’t make much sense.

        Matching Boring pricing doesn’t cut it. The 787 is cheaper to finance and is more capable. Discounts have to be significant.

        Every lost sale drives production rates down which drives variable costs higher causing a downward spiral on the model. Meanwhile the 787 goes to 14 units/month…

        • @Tortugamon

          I’m not saying that the Trent 7000 cost less to manufacture, but that RR can choose to price the engine lower than the Trent 1000. RR is the de facto engine OEM for Airbus wide-bodies and in order to counter 787 GEnx offerings, RR can offer a lot of flexibility in joint A330neo and A350 sales campaigns, going forward. For example, it is also well known that the engine OEMs have on numerous occasions sold engines at a loss, knowing all the while that although selling at a loss upfront still means that they’ll be making money by servicing the engines down the road — including spare engines that are sold much closer to list prices. I’d guess that the best analogy is printers and printer cartridges….

          As for you claim that the 787 supposedly is cheaper to finance than the A330neo; is that claim based on facts or on wishful thinking. It’s true that banks add risk factors and toughen the terms when backing thinly sold jets, but the A330neo still has a significantly larger backlog at EIS than what was the case for the 777-300ER at EIS — i.e. 186 vs. 119 (Iran Air A330neo orders not included). Of course, it’s in the interest of Boeing that all sorts of FUD is thrown around about the A330neo in such a way as to create a perception that the 787 is cheaper to finance than the “risky” A330neo, even though the price of an A330neo is still lower after allowing for market discounts.

          Meanwhile, Boeing needs to secure many more 787 orders in order to be able to sustain a production output of 14 787s per month post 2022 — just as the 767 replacement market is starting to wind down…..

          • RR can choose to price the Trent 1000 lower too, and may have to in some scenarios to compete against a GE offer for 787 customers.

            RR is going to look at the Trent 1000/7000 as one family. It is not like the Trent 7000 only has to pay back the development costs to transform the 1000 to 7000…RR wants the 7000 to help recoup all that money they spent on the 1000 too. That is why RR (and GE) wanted exclusivity on the A330neo! They viewed the program as an excellent way to recoup all the money they spent on the way over budget Trent 1000 (and GEnx).

          • I’ll also add that RR/Airbus is not unique in being able to offer Trent 7000/Trent XWB A330/A350 packages. GE can offer Genx/GE90X packages for 787/777X deals (many 777X customers are also A350 and 787 customers!), or CFM/GEnx packages with A320/737/787 deals (You think Safran, with no skin in the widebody game, is going to oppose that?).

            It is very tricky wire that RR has to walk along. It is not RR A330neo vs GE 787. It is RR A330neo vs GE 787 vs RR 787. Some airlines are going to opt for 787s for reasons completely unrelated to engine deals but RR would still love to power them.

          • Do you think Air Asia takes all 66? I don’t. Still I think the a330 will sell a couple hundred. I didn’t indicate any different. Just that the road ahead isn’t Promising. The 77W this is not; there is available, more capable competition at similar pricing and RR isn’t instilling confidence in the Trent right now.

          • @Whynot

            RR can choose to price the Trent 1000 lower too, and may have to in some scenarios to compete against a GE offer for 787 customers. RR is going to look at the Trent 1000/7000 as one family.

            The Trent 7000 and Trent XWB engines can be looked on as a family of aero engines that have a monopoly on Airbus’ big twins. For example, the 787-9 competes with both the A339 and A359. It’s in RR’s interest, therefore, that potential 787-9 customers that would likely choose to select the GEnx engine instead would be pursuaded to choose the A339 and/or the A359. RR is probably not in the know regarding what kind of deal sweeteners — including GE with the GEnx and GE9X — that Boeing is offering to existing and potential new 787/777X customers. In short, RR is the odd man out on the 787. No matter what they do, Boeing/GE can always offer deals that would be “better” than what RR can come up with single-handedly. On that note, it’s interesting to note that the vast majority of 787 customers that have selected the Trent 1000 engine are loyal long time RR-customers; customers where RR typically has had an incumbent advantage.

            For 787 customers that are likely to choose the GEnx engine, RR can obviously

            The Trent 1000 engine, on the other hand, can act as a spoiler — forcing GE to significantly lower their 787 engine bids.

            The 787-9 competes against

          • Addendum

            What happened to the edit function?

          • @Whynot

            Edited Version:

            RR can choose to price the Trent 1000 lower too, and may have to in some scenarios to compete against a GE offer for 787 customers. RR is going to look at the Trent 1000/7000 as one family.

            The Trent 7000 and Trent XWB engines can be looked on as a family of aero engines that have a monopoly on Airbus’ big twins. For example, the 787-9 competes with both the A339 and A359. It’s in RR’s interest, therefore, that potential 787-9 customers that would likely choose to select the GEnx engine instead would be pursuaded to choose the A339 and/or the A359. RR is probably not in the know regarding what kind of deal sweeteners — including GE with the GEnx and GE9X — that Boeing is offering to existing and potential new 787/777X customers. In short, RR is the odd man out on the 787. No matter what they do, Boeing/GE can always offer deals that would be “better” than what RR can come up with single-handedly. On that note, it’s interesting to note that the vast majority of 787 customers that have selected the Trent 1000 engine are loyal long time RR-customers; customers where RR typically has had an incumbent advantage.

          • @Tortugamon

            What you seem to ignore is how fast the market is growing in Asia and that Airbus has already sold a couple of hundred A330neo aircraft.

            I’d not be surprised, though, if total sales of the A330-900 will have exceeded the total sales of the 777-300ER, a decade hence.

          • @ OV-099

            That line of thinking makes no logical sense, especially in your original context that RR can price the Trent 7000 more aggressively than the Trent 1000 because it is a simple adaptation of the Trent 1000 engine.

            First of all engine deals are not the sole reason airlines opt for one aircraft over another. If an airline selects the 787 than RR is going to aggressively try to get them to go for the Trent 1000… not change their mind and go for the A330/A350XWB or give up. They want the orders on the 787, not to just act as a price spoiler for GE while ceding to GE the 787’s entire market share. Take EK’s MOU for 40 787-10s for example, do you think RR is telling them to change their mind and go for the A330neo/Trent 7000 or A350/TXWB? Of course not. RR are trying to convince them go for the T1000 over the GEnx. Not all airlines are ordering 787/777Xs or A330/A350. Many are just ordering the 787, A350, or A330. In that case package deals (and RR’s ability to offer a T7000/TXWB package) does not come into play (and with EK specifically no doubt discussions about future A380 engines and potential A380neo come into play, it is not like since EK also has the 777X on order the 787 is a lost cause for RR).

            If RR does not price the T1000 aggressively and win T1000 orders it is not like all the T1000 development costs disappear in a poof of smoke and RR is magically refunded all the money they spent on it. No, if RR does not win T1000 orders then it falls on their other engines (such as the T7000) to prop up RR’s balance sheet and recoup money lost in bad investments (the T1000 in this scenario) for their shareholders. Which suddenly means that RR has less wiggle room to discount on the T7000/TXWB because…drumroll…it would be picking up a “share” of the T1000’s development costs ;). That is why it makes no sense to state that RR can afford to discount the T7000 more heavily than the T1000 when they are virtually the same engine.

          • Come again? Rolls is so enamored with Airbus that they want to take a loss on a 7000 to get the customer into a NEO rather than sell a 1000 competitively because that would help Boeing?

          • @whynot

            They want the orders on the 787, not to just act as a price spoiler for GE while ceding to GE the 787’s entire market share.

            Ok…but you’re talking as if the 787 programme has just been launched. The fact of the matter is that 40 percent of all 787s that have been delivered are powered by Trent 1000s; thus RR has already delivered about 100 more Trent 1000 engines than what they ever did with the Trent 800 engine for the 772/77E. Hence, if RR ever made any money on the Trent 800, IMJ they should be able to do same with the Trent 1000, over the life of the programme, just with the number of engines that have already been delivered. That doesn’t mean, however, that RR won’t compete fiercely for new Trent 1000 orders.

            Now, compared to the other Trent-family engines, the Trent 7000 cost a lot less to develop. R&D was essentially paid for by the Trent-1000/Trent-1000TEN and TXWB — RR didn’t even have to flight test the engine before the first flight of the A339. Contrary to what you may believe, there is no rule saying that RR can’t sell the Trent 7000 for less than what they’re currently charging for the Trent 1000. If they sell more engines overall by “giving away” Trent 7000s, then they’ll do it. As I’ve already indicated, engine OEMs have on numerous occasions sold engines at a loss, knowing all the while that although selling at a loss upfront, still means that they’ll be making money by servicing the engines over the lifespan of the programme.

            RR has around a 50 percent market share of the widebody market via positions on the A330, A350XWB, A380, and 787. With total orders now standing at 1800 units for the Trent XWB — significantly exceeding the number of Trent 700 engines delivered over its 20-year lifespan to date — the TXWB will be the real money maker for RR over the next decade. Additional Trent 7000 sales will just be icing on the cake. 😉

        • If using an ex-import bank how is financing a B787 cheaper than an A330 NEO?

          • Trent 1000 is being replaced by the Ten

            The Trent 1000 is no longer offered as a new build, only the 10.

          • While the ten has a lot of changes it is still the Trent 1000 TEN, not the RR Ten or Trent Ten.

          • Hello Julian,

            Regarding: “Is using an ex-import bank how financing a B787 is cheaper than an A330 NEO?”

            The reason that A330 neo financing is more difficult than 787, A350, A330 ceo, 737, or A320 financing is that the higher risk a loan is, the higher will be the interest on the loan and the harder it will be to get the loan, and a loan to buy something that is not selling well is more risky to the institution making the loan than a loan for the same dollar amount for something that is in high demand. Something that is in high demand will be easier for the loaning institution to sell to someone else if the original buyer defaults.

            High loan risk is presently a particular problem for the A330-800. No bank is going to be enthusiastic about being the owner of a fleet of several dozen airplanes of a model that has been ordered only by a customer whose purchase they are financing. For customers like Hawaiian and American who typically need to finance large aircraft purchases through loans, bonds, or some type of financial instrument, rather than buying directly, this presently makes A330-800 purchases pretty much impossible unless Airbus were to provide some type of guarantee to take the aircraft back at a good price at any time with no questions asked. A well funded government buyer, such as China, who has lots of money to burn on whatever they want to burn it on, might be much less concerned with such issues.

            The US Export-Import Bank is not currently a factor in large aircraft purchases, since it is presently restricted to loan guarantees of 10 million dollars or less due to not having enough people on its board to provide the number of votes that would be needed to approve larger loans. Below is an excerpt from an April 2018 New York Times story about the status of the US Export -Import Bank, see the link after the excerpt for the full article.

            “April 19, 2018

            WASHINGTON — As trade tensions mount, an 84-year-old Washington institution could have been a powerful tool for President Trump. The institution, the Export-Import Bank, was created to help American companies compete overseas and bolster exports by providing cheap government-backed loans.

            But the institution, which once financed multibillion-dollar projects, has been effectively crippled by the Trump administration. The bank has been without a chairman since Mr. Trump took office and the last of the bank’s five board members quit in March. Since 2015, it has not had the quorum of at least three members it needs to finance deals or projects worth more than $10 million.”

            https://www.nytimes.com/2018/04/19/us/politics/trump-trade-export-import-bank.html

          • On the subject of 787 financing in general, and American Airlines’ ability or preference to purchase outright vs. use financing or leasing for large orders in particular, I think it is interesting to note that Boeing’s April order summary shows 25 orders for 787’s by American Airlines and 22 orders for 787’s by Boeing Capital Corporation. Apparently the 787-8 portion of American’s order of 22 787-8’s and 25 787-9’s that has been reported here, and in many news articles, is being purchased by Boeing Capital on behalf of American Airlines.

          • @AP,
            I think it’s highly unlikely the “financing costs (I mean the capital costs not the actual capital) on a B787 would less than the financing costs on an A330 financed through an EU financ ex-impory agency.

          • @Julian

            Although a temporary situation, right now Airbus has limited access to those EU finance ex-im agencies because of its corruption scandal and ongoing investigations.

          • The Trent 10 is 75% new (hopefully the right 75%)

            While most don’t work in the real world of mechanics, I do, that’s an all new engine.

            What moniker they attach to it does not make it what the 1000 is.

            So all that carrying on about how you can price a 1000 below anything else and stick it to GE is bunch of baloney.

            It would be nice if people would understand the facts before endless postulating.

          • Hello Julian,

            Regarding: “I think it’s highly unlikely the “financing costs (I mean the capital costs not the actual capital) on a B787 would less than the financing costs on an A330 financed through an EU finance ex-impory agency.”

            Whatever financing is offered by EU export credit agencies for A330 neo purchases was irrelevant to Hawaiian Airlines and American Airlines, since under the OECD Home Market aircraft understanding the export credit agencies of France, Germany, the UK and Spain do not offer financing to US Airlines, and even if this understanding did not exist, both of these airlines have good enough credit ratings to be able obtain better terms on the commercial financing market than the minimum rates set by the OECD agreement for export credit agency aircraft financing. See the excerpts below from a 2013 FlightGlobal article at the link after the excerpts.

            “One reason for the OECD’s approach is that the home country rule is hardly a “rule” in the traditional sense, but rather an unwritten, informal understanding between the USA’s Ex-Im bank – and its counterpart export credit agencies in the UK, France, Germany and Spain – that they will not offer export credit to airlines in their own or each other’s countries. Skirting around this rule may have temporarily averted a showdown but the unresolved issue of Canada and, by extension, Brazil and Japan, remains potent.”

            “How much will these new rules add to the cost of export credit? “The 2011 ASU roughly doubles premiums contained in the 2007 ASU,” says Gerber. The minimum premium for an investment-grade airline will rise from about 4% of the transaction value to almost 8%. For lower-rated airlines, the new premiums will be higher. Airlines in any country which adopts the Cape Town Convention will qualify for that discount.

            Higher-risk airlines will continue to rely on export credit because they have nowhere else to go, but stronger airlines with access to commercial financing may find export credit less attractive. This is the underlying goal of the new ASU.”

            https://www.flightglobal.com/news/articles/in-focus-how-new-export-credit-rules-will-change-ai-381363/

      • I agree that the talk about the lack of competitiveness of the A330NEO are 1) premature, 2) overblown, and 3) based on zero actual evidence.

        All airliners go through a period after launch and before EIS where they don’t sell very well. Launch pricing goes away and airlines wait until they have in-service performance data and a firm delivery date before ordering. It has happened to the 787, the A350, the CS, the A380, and the 777 (-200, -300ER, 777X). Each time pundits speculated that the model wasn’t competitive and each time they were wrong (or at least the jury is still out on a couple of those models). The A330NEO is in this period now.

        When actual performance numbers are in the orders will start happening.

        Scott’s points are very valid though. Boeing has the 787 line running smoothly and has slots to sell. Airbus has to resolve all their production issues quickly to retain their customer base.

        More important then the A330NEO, however, is the slow sales of the A350 at a time where sales should be materializing.

        • Its not that common for a new model to be produced even though it has no orders (A338).

          Losing new and existing orders due to price isn’t a good sign either.

          Lack of blue chip airline customers (except Delta) isn’t great either.

  7. Sad to see such a poor sales turnout at AB for all widebodies lately [last few years], and as an a330 fan, hope she find her place.

    AB need to get some TAP videos and images out into the market to showcase the new interior, and create some buzz about an actual airplane, as opposed to test aircraft. Now is not a time for margins over sales… worry about the margins once she’s resplendent at airports around the world, and hopefully proving herself.

    Right now – she’s a debutant and needs to her ‘conming out season’. AB marketing seems lactluster of late.

  8. Without any question will the 787 dominate the segment (in terms of Pax count) the A330 once ruled, and with the RR as only engine supplier things will not be easier.

    That said, I would assume that after a few more lost sales campaigns the decision makers at Airbus will probably adjust their strategy and offer the A330NEO at lower prices, accepting lower margins. It may concur with RR comming back to normal operation probably by the end of this year. They may also be required to squeeze some cost cutting out of their suppliers to acchieve that.

    Regarding the -800: It will only have a chance if the 797 is significantly delayed or not launched, both of which is very possible I think.

    • As the A330-800 is a very heavy for mission aircraft, I fail to see why anyone would buy Airbus contention it is a NMA or even close.

      Its as ludicrous as Boeing contenting the 737-900/9 was a competitor for the A321.

      I could enter my Passat into the upcoming India 500 as a competitor to an Indy care. I wouldn’t even have to stop to refuel.

      Of course once the officials picked themselves up off the floor and quit laughing my entry would be accepted.

      • Did I state that the A330neo is a NMA? Certainly not. Is it close? Well, in the absense of the 797 it certainly is the smallest and cheapest wide body. Regarding the 797 we know that there is no engine and even more importantly, no production system or infrastructure to produce the 797 in CFRP at market price. So up to now it’s not even a complete paper plane.

        I sure hope Boeing will figure it all out, as it will certainly be a fabulous plane, but it may take a long time to launch and even longer to enter service.

        You may indeed not only compete but actually win the Indy 500 with your Passat given that your competition is made up of 2CVs and Beetles.

        • Isn’t the 767 the smallest and cheapest wide body?

          Not to mention closest can be a long ways away.

          • Have I missed something? I didn’t know that the 767 (pax) is back in production.

          • Never went out of production. 767F continues to be mde.

            No longer any Pax orders but there were until recently.

            It can be brought back in any time there is a call for it.

            No call, then the A330X is not an option for that role either.

  9. The RR only engine option is not in favor of the 330NEO. Many CEO operators uses GE engines, this could also swing such airlines to go for GE powered 787’s when aircraft replacements are due (737’s and 320’s are CFM-GE powered)? Turkish airlines might be an example?

    It appears that the NEO’s better economics are only really kicking in after 4000Nm. Was wondering how realistic/practical it will be to continue offering CEO’s but with the Airspace cabin. An 330-200 with the new cabin (257 seats in standard layout) could therefore be well positioned as a medium haul aircraft if offered at really low prices, especially for current GE operators aircraft? (Maybe offer it with 230T MTOW and derated 67Klb engines).

    • Just a thought, wonder how big a role the woes of the Trent 1000 plays in scaring of airlines from the 330NEO with fears of similar problems with the T7000? With the 787 you have the GE option.

      Hopefully the T7000 comes out good but a point AB marketing should address. The problems of the 320NEO’s with PWG’s may also sit in the back of airlines mind with AB launching a “new” engine type on an aircraft.

      • I don’t buy the RR vs GE thing.

        Operators accepted the 777, 747 and 737 single engine choice

        Granted if the Trent 7000 has issues then all bets are off.

        • There may also be nervous people who want to see someone else run those RR engines for a while before getting in.

        • Some Airlines are “allergic” to certian Engine manufacturers from previous broken promises, some like to teach Engine OEM’s a lesson or 2 then come back buying the next model (like BA launching the GE90’s)

      • The T1000-C is quite different from the T1000-TEN and T7000, the only possible “common problem” are the HPT blades.
        Airlines can see this and also compare to the Trent XWB experience that so far is excellent Before making their Engine choices. It would be interesting to see how well the TEN compare with the latest GEnX both in fuel burn and maintenence package costs.

  10. To improve the competitiveness of the A330NEW;
    – Reduce the cost
    – Reduce the weight
    – Increase the propulsive efficiency, decreasing fuel burn still further
    – Reduce the maintenance cost

    A simple way to do this would be to offer it without thrust reversers. They’re expensive, heavy, unreliable (if the A330CEO is anything to go by) and increase pressure losses in the bypass duct.

    A few operators couldn’t countenance it sure, but the rest with access to long runways surely could.

    Also, reducing its range capability – less take-off mass would mitigate the loss of thrust reversers and it would compete better at short/medium haul routes where it isn’t at [such] a disadvantage to the 787. This would also improve engine and landing gear life.

    • I am sure Airbus never thought of any of those things.

      If I wanted to be thin all I have to do is loose a lot of weight. Who knew?

    • Ummm…I’m sure they’ve tried cutting weight out of that airframe. Not sure where they will cut more, or how they can reduce maintenance costs. They can reduce the cost (and likely sell it at a loss) but how long can they sustain that?

      Don’t see where the A330NEO goes from here. Delta is probably ready to gouge their eyes out for buying into the jet instead of just buying 787s. I’m sure Boeing will sell them some….but not at any significant discount given all the shade Delta was throwing at Boeing for the last few years (and Richard Anderson’s hubris and ego contributing a lot to that)

      • What I’m posting gives you the quickest, easiest, least risky way to do it – ditch the thrust reversers just like the USAF have with their 767 tanker.

        • But if ditching the thrust reversers is effective Boeing can just do the exact same thing with the 787 and now we are back to square one.

          • TR are used by airlines to save brakes.

            Military apparently does not land often enough to make it worth while (tankers)

      • If the 797 is delayed much more Boeing won’t lose. Delta for example will be forced to go for the 787 replacing 767’s. The 338 just an overkill for their use, could however opt for used 332’s or even place an order for more 332’s as they have don’t not so long ago ordering more 321CEO’s.

  11. How about the lower maintainace costs and fewer checks required for a carbon structure? I would imagine that this gives the 787 a significant advantage to balance against the higher purchase price.

    • As said, AB should bury their pride, pull their head out of the sand and revisit their 350-“800” options. Commonality with the 359/K and higher production rates will bring down the unit costs for an 358/9/K family that will reduce prices. Now you have a trickling/decreasing production rate for the 330 that increases costs and hence losing sales.

      On the engine side the low volumes of T7000’s results in higher unit costs, RR wants to recover their development costs as well resulting in a snowball effect on aircraft price and ability to price below the 787’s.

      • why the 350-800?
        – 350 production line is booked out for years.
        – 350-800 would be an expansive to certify plane and still be inferior to the lighter 787.
        – biggest asset of the 330 is you can sell it for a lower price. if you start discounting the 350-800, all airlines want discounts on the other 350 models and Airbus loses money.
        – at a point a lost 330 sale is a gain for Airbus, namely when it blocks a 787 slot, where Boeing could have gained more. So they need to keep the 330 to “limit” Boeing’s gains.

        • The lightest 359 has an OEW of 135T, the 789’s OEW is 129T. The 339’s OEW not official as far as I know but should be between 125T and 130T. Is not ruled out that AB can make an 358 lighter than the 789 and it will have the superior wing (and 18″ seats).

          Assuming an MTOW of 280T for an 350-800ULR it could potential fly ~50pax more over a distance of 9000Nm as an 359ULR due to lower OEW and less drag? SIA seating on the 359ULR is ~160.

          Yes certification cost will be there but it will be there for at least 20 years longer than the 339?

          • That wouldn’t cut it. Yes your proposed A358 is 1 ton lighter than the 789 ( whether that is achievable is questionable). One problem- your proposed A358 is also smaller than the 789. Airlines, unless they absolutely need the A358’s massive range (most don’t), will just select the 789 because it may be 1 T heavier but they also can seat ~20 more people in it. Airbus won’t make a A358 the exact same size as the 789/A339 because it would be too close in scope to the A359.

            All this talk about bringing back the A358 conveniently ignores how it too was struggling on the market place in the last couple of years of its life with airlines converting away from it to the A359 while garnering no new orders. At the end of 2013, the newest A358 order remaining was from 2008 (and it only had 79 orders total).

    • Grubbie: A factor, not likely the sole one.

      The biggest factor is Airbus thinking Boeing would not cut prices to knock them off.

      If Boeing can cut prices supposedly Airbus can as well.

      On the other hand, Boeing is cranking out 787 at a rate of 12 a month and going to 14.

      Airbus is what 6-7 total A330 ? (and not all NEO)

      • 2019 it will be rate 4.

        No wonder Boeing is aggressive and licking their chops.

    • “How about the lower maintainace costs and fewer checks required for a carbon structure?”

      How much of this is fact, and how much a projection ? I know we have had carbon parts for a long time, but the complete barrel of the aircraft is another step.

      • I don’t really know, that’s why I’m asking the question.In the highly unlikely event of fatigue cracks developing, it would be a major problem.

    • The total maintenance cost for a 787-9 fleet including spare LRU’s, Tools, spare Engines, APU and nacelle parts, Engine maintenance and Aircraft maintenance might not be that cheap compared to a regular fleet of A330ceo’s with CF6-80E’s. The 797 main advantage is payload/range/speed/cabin air quality and fuel burn.

  12. It’s not the first time that the A330 is allegedly going to be killed by the 787. First time it was the CEO, now the NEO. It’s amazing to see how the discussion turns to look like the Panurge’s sheep (for non-french speakers, please google “Panurge” if you don’t know it). It’s not a question of taking a stance for or against Airbus or Boeing. It’s just too early to reach any conclusion.

    • From what I saw, if Boeing had executed the 787 program right, then the A330 would never have sold in the numbers it has.

      Referencing an American football game where the winning team screwed up royally, its been refereed to snatching Defeat from the Jaws of Victory (it hurts the brain to even think about it).

      That is not to say Airbus would have sold no A330, there are operators who prefer it. But like the A340, it would have been constrained.

      It took a while for the 777 to kill off the A340 as well.

      This has the feel of while the one team messed up a regular season game, come the playoffs they soundly beat the other team like they should have in the first place.

      Granted Boeing is not playing fair.

  13. While Airbus has many options, the fact that they just spent a lot of time and money developing the 330neo, and the fact that people are questioning it’s viability, I would think they are not ready to jump into another reconfiguration. They need to sell what they have by showing customers that it will work for their application.
    And what is better, maintaining your margins (and not selling aeroplanes) or competing on price and running your production line.

    • Me thinks they need to get the production line going (or the engines on it to get it into service)

  14. What will airlines and lessors make buying the 330NEO and financial institutions make to finance those sales vs the 787?

    The 787-8/9 has the the price edge and operational edge, so AB needs to be realistic facing these challenges and not “just hope for the best”. Boeing is exploiting the situation with avenges.

    If AB is honest with themselves, serious about it and think medium term only an 350 derivate (weight loss, Advance-3 engines) can topple the 789 in the eyes of especially lessors and financiers.

    ….or, AB needs a new clean sheet aircraft between the 797 and 787 for EIS in 10 years with GTF’s and/or Ultra fans.

  15. I don’t get the comment that dropping fuel prices shifted the favor to the 787.

    It should be just the opposite.

    • Some airlines can see past the brief era of lower fuel prices and know it will not last. Oil is the most volatile of the commodities and those who don’t learn from history will suffer. Independence Air with its fleet of 50 seat CRJ’s came on the market when oil skyrocketed and their story is history.
      People bought big trucks and suv’s because gas prices dropped and financed them for 5-7 years, not too smart to believe fuel will stay cheap for that many years. Bottom line the 787 is more fuel efficient than the 330 and that’s what matters over the course of many years.

    • Hello TransWorld,

      Regarding:” I don’t get the comment that dropping fuel prices shifted the favor to the 787.

      It should be just the opposite.”

      Are you referring to the following comment by Mr. Hamilton in his blog post?

      “The A330neo was late to the market, coming years after the 787 entered service and after Boeing launched the 787-10 derivative. Fuel prices subsequently plunged, depressing sales.”

      If this comment is what you were wondering about, my understanding of the comment was that lower fuel prices caused some airlines to delay plans to replace older wide body aircraft with new more fuel efficient models. If there had instead been a sudden sharp increase in fuel prices, airlines might have been looking for ASAP new replacement aircraft and unwilling to wait 3 to 4 years for delivery slots for new models with long backlogs. See for instance, the following quote from the MRO Network article at the link after the quote.

      “As a result, the pipeline for suitable teardown candidates, especially the 737NGs and (midlife) A320s, has been constrained given the relatively lower fuel-price environment. In addition, Brown cites the Boeing 767, 777 and A320 families. “There have been more lease extensions and decisions to keep the aircraft in service for longer than we anticipated,” he points out.”

      http://www.mro-network.com/airframes/top-aircraft-teardown-contenders

      • While leases are being extended for 20 year old aircraft for some aircraft types, for other aircraft types 11 year old aircraft are headed for the scrapyard.

        “Business News

        June 5, 2018 / 2:34 AM

        SYDNEY (Reuters) – A German investment company said on Tuesday it would strip two unwanted Airbus A380 superjumbo passenger jets for parts after failing to find an airline willing to keep them flying following a decision by Singapore Airlines not to keep them in service.”

        https://www.reuters.com/article/us-airbus-a380/a-decade-after-debut-first-a380-jumbos-to-be-broken-up-idUSKCN1J10R2

        • To be fair, this is a pretty constrained fleet, that probably pays “up the wazoo” for OEM spares.

      • In the following quote from a MRO Network article that I included in my post above, I believe that “A320” is a typo which should have been “A330”. It doesn’t make much since to say: “In addition …. A320 families”, when A320 family was already mentioned in the previous sentence. Lease extensions and delayed retirements for 767’s, 777’s and 330 ceo’s due to low fuel prices mean fewer sales opportunities for both 787’s and 330 neo’s.

        ” In addition, Brown cites the Boeing 767, 777 and A320 families. “There have been more lease extensions and decisions to keep the aircraft in service for longer than we anticipated,” he points out.”

  16. Boeing’s plan for package future all-encompassing care may be adding a certain percentage to the finances. Does Airbus have a plan to counter this? What percent impact to the Boeing sales price does this have?

    Is Boeing doing an HP ink cartridge concept?

  17. Not sure if 2020 is the key date for AB. By 2028 ~970 A330’s (excluding NEO’s) will be 20 years old or newer (deliveries peaked between 2010-2015). Shouldn’t AB target those aircraft with a clean sheet design with new generation engines that’s 20+% more efficient than today’s (EIS 2028?). Could even make airlines hang onto 330’s longer waiting for this.

    They should start marketing it now as part of a long term strategy, it will also put a cat amongs the pigeons for the 797 development. An 322 is lurking in the lower end and the 359 is there in the upper end of the 200-300 seat market. How long has Boeing been marketing the NMA?

    B787 deliveries started to increase from 2014, such a new aircraft could be well positioned to replace those 787’s in 20 years from now.

    • Interesting to read, finally, some airbus fan panic that the 330 day has passed, moving on to assuming the 797 will be superseded by a superior Airbus offering.

      Perhaps one of the reasons, really, that Boeing/GE is in no rush to launch the 797. They have Airbus frozen in a widebody disadvantage today. Rolls/Airbus have no real threat in the A330NEO.

      • @Texl1649

        Hmm, there’s currently a lot of cheerleading for Boeing; going on talking about Boeing supposedly “crushing” Airbus in the wide-body market segment — it’s highly amusing. 😉

        For some time, though, Boeing seems to have been in a rush to counter the A321neo with some sort of patchwork “middle of the market” aircraft. Perhaps, part of the reason that the A322 is yet to be launched, really, is that Airbus is in no rush to launch it. They know, of course, that it’s widely accepted that the Boeing NMA definition is, indeed, “difficult”.

        Meanwhile, Airbus could quite easily launch an A350-1000ULR (i.e. significantly higher MTOW), an A350-2000 (i.e. same MTOW as an A350-1000ULR) and an A330-1000F for air-freight operators in addition to a passenger-carrying A330-1000.

        Emirates President: Widely-Accepted Boeing NMA Definition Difficult

        Emirates Airline President Tim Clark has a cautious view on the prospects of Boeing’s proposed new midmarket aircraft (NMA). “Maybe there is a market,” he said at the IATA AGM here. But he noted that “differences of opinion between the carriers in Asia-Pacific and domestic U.S. operators” is making it very hard for Boeing to define a configuration that is widely accepted. He pointed to requirements such as range, passenger capacity and cargo capacity that will influence the aircraft’s design.

        http://aviationweek.com/commercial-aviation/emirates-president-widely-accepted-boeing-nma-definition-difficult

        • Its just that those of us who are balanced get a good laugh out of the whoopee that results when that Dastardly Villain Boeing undercuts airbus on price.

          How dare they, they are not playing by the rules we set.

      • Unfortunately you right. To clear up things, I have nothing against Boeing in principle but found the 787 in economy an “unpleasant flying experience”.

        The 767 was the most comfortable twin ever build to fly in, but lets see what the 797 brings.

  18. The 787-10 is a jewel but he A330 is also an fantastic aircraft. Boeing has been threatened by the A330 for years and it has been Boeing’s mission to copy and then kill the A330. The A330 is the original twin wide body copied by Boeing. I wonder how low Boeing has gone with it pricing to take the Hawaiian business. The American Airlines thing means absolutely nothing. US air was out and AA is all about Boeing as wide bodies go. IF UA doesn’t buy the A330, that also means nothing since they already have the 787, including the -10. In fact, in this political climate, expect Boeing to win US orders. The whole thing about “orphan airplane” etc is a marketing slogan to hurt the A330. Nothing more. Lets see what happens. Maybe Delta will surprise us again with intelligent and out of the box choices. And lets not forget the A321Neo LR plus which will do everything the 797 does but with single aisle economics.

    • You brought to mind MP’s “the Black Knight” at the stream crossing. “‘Tis only a flesh wound. C’mon then, let’s keep fighting!” LOL

  19. Arm chair ranting…

    Well, looks like AB wins on both the single isle aircraft and the C-series level (one day possibly). EB E2’s not selling anything much either/old tech).

    But BA kills AB on the wide bodies led by what looks like now a better focused/aggressive sales team. A350 probably too $$/big to really compete and they can’t produce anyhow. & still ironing out cabin/rampup issues. A single source engine with RR was a bad choice too. The 787 prod line seems by now a well humming machine — Charleston helping.

    With the 797 freezing also the market around the lower mid-range, combined with the 787, AB needs a new aircraft?…perhaps. Or a very aggressive cost cutting program, focused team. Remember the E/$ rate is not so bad for AB…so what gives? AB used the cry foul when it was 1.45$ for 1E. Now at 1.1/1.2… BA’s edge is gone from that angle.

    And AB’s management is MIA dealing with their own self inflicted issues (ie, the ‘irregularities’ with some customer wins that decimated ALL top management once discovered….think of the lebanese guy, Lahoud, who was a few years back groomed/extolled to replace JL…. boy, he disappeared without a wimpier one day…just…gone! He was a 20+y veteran who knew the business).
    Rebuilding into a well oiled exec team takes time. Taking a helicopter guy is an interesting choice. Takes time to learn the business.

    And no one wants the A380 either… i had today a conversation with a 60yo, KLM E&M veteran, whose mental i quite respect:…”should have never been built… too much of an airplane. BA was right. We never really seriously looked at it”. Ouch… (though i am on the *record* for loving the flying experience). But aside from Emirates (or BrA?)) no one seem to have the real volume to turn this into a $ winner.

    • Considering KLM made some strange choices over the years – but not as bad as Swiss who always made the wrong choice-
      Lockheed Electra
      747 Combi later converted at factory to stretched upper deck
      MD11 along with 777-200 and A330
      and now is getting A350-900 and 787-10s
      Its really only a small airline from a small country and has a jumble of planes from multiple manufacturers and of course paid the price with the Air France merger, another strange choice

    • Regarding the A380, looks like the Dr Peters Group who received the initial two Singapore A380s back from their 10 year lease are planning to part them out. Possible similar fate for models #3 and #4 when those come back from Singapore

      https://finance.yahoo.com/news/spurned-airlines-first-a380s-stripped-084236258.html

      I also don’t see why everyone is so aghast of Boeing discounting the 787s recently. I simply see this as Boeing returning the favor back to when Airbus sold highly discounted A330CEOs as Boeing was in the deep manufacturing/assembly quagmire and battery flightworthy-ness issues five years ago. It’s not personal — it’s just the high dollar, high stakes world of aerospace business.

      • But why destroy your own profit margin?Perhaps they imagine that they can wipe out Airbus and politicians will be unable to ride to the rescue owing to world trade rules that somehow don’t apply to themselves?

        • Going to rate 14 I believe they have no choice. They need all the market to make that work. Kill off the neo and suddenly pricing will start firming up. This is high stakes poker, if the neo exists then pricing constraints on the Dreamliner will remain.

          Airbus have to make the neo work as otherwise they cede a massive segment to Boeing for a long time. Having said that if it doesn’t work what price a new A330 replacement, the B787 can be beaten by better, newer technology, for a revolutionary product is it not that much better than the original A330. Time has moved on and a truly optimised CFRP aircraft based on what has be learnt on A350, Cseries and B787 would materially improve on that design. Couple it with an Ultrafan (TW will like that) and optimise over 4,000 to 7,000 miles and 10%+CASM improvement is there to be had

        • “But why destroy your own profit margin?”

          Are you referring to Airbus 5 years ago on the A330 or Boeing on the 787 today? I think both manufacturers did so to to keep the competitor aircraft from gaining traction & economies of scale. Also, the profit margin on a lost sale is zero so of course they’ll discount to win a sale.

          • Sowerbob: The A350 was not nor is a template for going forward (we don’t know how that plays out)

            Its different is all, it is all that Airbus could do with their lack of research into production of large spun structures.

            The A350 turned out to work and from what Bjorn says, equally as good as the Boeing approach (I do question the aluminum nose and the maint checks that will require that the carbon fiber should not but that is also open ).

            Boeing may have problems, Airbus may have problems or they both may have problems with their versions.

            What is clear is the A350 is not an advance but a paralleled (alternative ) approach to Boeing take.

            Nothing that has not been done in bits and pieces before.

            Boeing is actually more advanced tech, may not be better.

            In any case, the A350 was not a leap ahead and its bleed air is old stuff.

  20. Depends how the market evolves with time but a general trend is size kreep. Maybe in a couple of years the 789 size of today is the 359 size that is required tomorrow, so AB should keep on refining it. It will be challenging for BA to give the 78J the 359’s range wing without a new wing, etc.

    Some interesting info using our friend Wikipedia as reference;
    A359 OEW: 135T-145T (~140T), 325 pax,
    B789 OEW: 129T, 290 pax.

    So the 359’s OEW is 431 kg’s per pax and the 789 is 445kg’s per pax, say no more.

    First time saw the OEW of the 787-10, its ~136T, so the 359 not much heavier if so. So why do airlines buy the 78J, fleet commonality with 789.

    This brings me back to the A350-“800″(~280-290 seats), if it was available airlines they could buy a complete family of twin aisle aircraft from 358/359/35K and potentially 35K2.

    By doing that AB could develop an NMA/MoM “base model” with around 240-250 seats, range ~5500Nm and good cargo capacity.

    • Hello Anton,

      I believe that your stated seating capacities of 290 for the 787-9 and 325 for the 359-900 are apples and oranges numbers.

      In his current paywall series on the A330-900 vs. the 787-9 Bjorn Fehrm is using normalized seating capacities for each type that vary by only 2 passengers.

      American Airlines which operates both A330-300’s and 787-9’s has 291 seats on its A330-300’s and 285 seats on its 787-9’s. American also has A330-200’s, on which it has 247 seats instead of the 280 to 290 seats that you suggest for an A330-200 or 800.

      Delta which has both A330-200’s and A330-300’s, uses 234 seats on its A330-200’s and 293 seats on its A330-300’s.

      If it is true that the A330-300/900 and 787-9 have very similar seating capacities, then the OEW figures you cite actually demonstrate that the A330neo has greater OEW per seat than the 787-9.

      • Hello Anton,

        I misread your post. Somehow I got the idea that you were talking about A330-900 vs. 787-9 instead of A350-900 vs. 787-9. After writing 359-900 in the first paragraph of my post above while thinking 330-900, I careened off into 330-900 statistics that weren’t relevant to your post.

  21. Maybe I am reading it wrong but the current trend seems to be for airlines to replace A330-200’s with 789’s and 330-300’s with 359’s? Ageing fleets of 767’s are being replaced with 788’s and/or 789’s.

    The 330-900 could find its way as replacement for current A333 operators on medium haul, mostly from the East. A338’s might find it niche as a very long range aircraft for thin routes but not as replacement aircraft for 332’s or 767’s.

    Speculating on possible 330NEO sales is highly speculative but possible not (much) more than 500?

  22. I’m an optimist, but with such subdued twin-aisle sales in recent years, and the 787 sales team actually selling at killer prices to keep the neo out [and AB focussing more on profit # than sales #], it’s going to be hard for the neo to gain much traction in sales campaigns.

    If and when the twin-aisle market rebounds, the lack of available 787 slots may/should play into the neos favor and it may win a third of the orders.

    The summary section of the a330neo review on this site seems to point to the airframes being comparable enough. If you can get a 787 for the same price as a neo, you’re likely to go for the 787, if not just to future proof yourself.

    Hard to look into the future these days. There seem to be so many models and variants, and possible newbies.

    The a321lr 100% full year round does eat into the market that would traditionally be served by 70/80% full twin-aisles, further reducing the need for 787/a330’s in some eyes.

    I often times get the feeling there BA/AB have given too much [range] and too many [variants] to too few [airlines], and are now suffering with a too complicated market.

    My money is on the a321 and it’s future [plus] derivatives/wings. Singles aisles have more flexibility/less drag/better optimized use of space for low to med-long-haul.

    • I think you are correct, the slow but steady displacement of TA with SA in the middle range sector is eroding some of the market for the TA. Both BA and AB seem to have been carried away with servicing this part of the market when the SA market volume has exploded.

      When looking at investment return surely spending on the SA market must be more beneficial and the $100bn invested by BA/AB over the past 15 years will be looked at with raised eyebrows in the future. There are so many options but simply the supply capacity of 35-40 units per month is probably higher than the market is demanding by an order of 20-30% over the medium term.

  23. An 321+ (“Super”) might actually have a bigger impact on the 797 business case than is expected, price, seat mile cost, etc. BA is however better position with the 788 for around 250 seats until the 797 is there. So AB there is a window of opportunity for a new twin aisle to be developed, engines (and money) the key time factors.

    Wonder if AB has ever considered to continue the 330 production line with an 330-200CEO and 330-900 for a couple of years?

  24. How much of the B787 business model is based on crush loading up the back?

    How would it’s economics stack up if it was 8 wide in economy rather than 9?

    Then you have the runt of the litter — the 8/800 with it’s quick bodge it and scarper design ethos.

    BA sold the sizzle and the airlines lapped it up.
    Issue is the high run rate BA is now working to has created a rod for its own back in that it’s backlog is shrinking fast.

    How low does BA have to go to keep the sales moving?

    AB are not being very dynamic at the moment.
    Plus they are having to deal with the RR only engine offer.

    They don’t have to win the fight — all they need to do is make BA offer stupid prices to win the business.

    Plus work on a 90T OEW MD version of the platform.

    No matter the tech the B787 is still a 125T lard bucket.

    • I wanted to stay out of that one but the main thing that gives the 789 vs 339 better economics is its 3-3-3 layout with 17.2″ seats. Nothing can beat the 330’s comfort with 2-4-2 layout and 18″ seats.

      The 777X will come with 3-4-3 and 18″ seats, its only a matter of time and you will see 3-5-3 with 16.5-17″ seats and and narrow aisles, airlines will be happy to squash in pax as they are now doing with 77W’s.

      • B7Double7 CEO is 10 wide at 16.8” up the back now.
        B7Double7 NEO is 10 wide at 17.2” not 18” up the back.

        Shame on the full service airlines putting in narrower seats than RyA in full stuff a pleb mode.

        Shameful yet they get away with it.

        Sign of the times — more space for the capitalist class and less space for the working class.

        • OK …

          From this we can surmise that JA do not play the stuff-a-pleb game up the back.

          However they must be BA fan boys if the economics work for them.

          However RoW — they pack them in.

  25. The A330-300’s that needs replacement in the next 10 years had a range of <6000Nm. So where does the range issue come in for airlines currently operating those?

    Yes, the 330-200's had 7000Nm range and maybe that's why airlines replacing them with 789 looking for range and larger capacity. The 251T A339 will have more range an thus better suited to replace 332's.

    Was wondering why AB is not going 254T, landing gear and/or wing, the T7000 should be good for 76Klb thrust.

    That brings me to the 787-10, airlines looking for 330-300 replacements and increase in capacity may opt for them. So AB must not get caught asleep and look at something like an 359Re with less range (~6000Nm), lower MTOW and hopefully a few tons shaved of the OEW. De-rated engines could also stay longer on wing.

    • The problem is if Boeing does go forward with the 797 the A330 risks being squeezed. Less efficient than the 797 (which could potentially replace A330ceos) on shorter routes but unable to fly as far as the 787 can.

      AB is being careful to not give the A339 too much range (i.e. 254T mtow) because they are protecting the A350-900, especially since the -1000 has yet to really set the world on fire. They don’t want [potential and current] customers of their shiny new jet that they just spent billions developing deflecting away to the lighter and cheaper, although slightly less capable, A339,

  26. “TE are used by airlines to save brakes.

    Military apparently does not land often enough to make it worth while (tankers)”

    I was not aware that the Boeing Tanker had removed the thrust reversers. Doesn’t this mean it needs more runway to land ? I suppose that if it always takes more runway to take off than it did to land there is no problem. Otherwise wouldn’t the military want maximum flexibility ? Did the Airbus tanker proposal also leave off the thrust reversers ?

    • The TRs were left off as part of a lowering of the bid and the fact that the USAF did not request them.

      I assume the A330 would have been the same, but you have larger aircraft and the same runways so it would have to be a can we meet the airport specs and still not have them. If we add them we get no credit and it costs us.

      I thought it was a no brainer to have them but USAF does not.

      They do tend to throw FOD forward and that may be a factor as well with some of the strips they operate out of.

  27. Something dawned on me, if the 787 “kills” the 330NEO’s, especially as NMA/MoM, why should BA launch the 797?

    Is this another “Sonic Cruiser” and the 797 is actually an NSA/FSA, CFM/(PW) can have upgrades of current engines certified in less than 5 years (hopefully also new wing box and CAT-D wing for the 330-800/(“700”).

    So hopefully AB have final drawings and for a new wing for an 320+ and 321+ sorted out.

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