July 15, 2019, © Leeham News: Boeing can’t catch a break.
Some may argue it doesn’t deserve one, given what’s come out about the 737 MAX development. And the sloppy production of the 787 at the Charleston (SC) plant. And the FOD issues with the KC-46A at the Everett (WA) plant.
To be sure, Boeing has gotten a lot of bad press it’s deserved. But last week, two pieces of news had connections to the MAX that were (1) overwrought and (2) unwarranted.
Flyadeal, a low cost airline in the Middle East, last week “canceled” an “order” for Boeing 737 MAXes. And the media went wild.
This is one of the most over-reported and over-rated stories of the year concerning MAX.
The “order” wasn’t even an order. It was a “commitment” (ie, a letter of intent or memorandum of understanding) made in December 2018. It never was firmed up. So Boeing didn’t lose an “order. Until a deal is a deal, it’s not a deal. (Note: IAG.)
Second, Flyadeal already operates the A320. It made more sense to stick with the neo than to switch to the MAX. Third, Flyadeal gets the neo sooner than the MAX.
OK, fine, Airbus got Flyadeal. Boeing got IAG (200 airplanes). These things happen.
It’s worth noting that the IAG deal is not yet a firm order. Airbus vowed to submit a bid. Unless or until the MAX LOI is firmed up, it’s not an order, either.
LionAir, which was very vocal about canceling its MAX order, hasn’t done so.
Garuada swapped MAX 8s and MAX 10s and 787s. This was a smoke-and-mirrors things.
Now, if United, Southwest or Alaska placed a big order for the Airbus, then Boeing would have something to worry about. If any of these canceled MAX orders, then Boeing would have something to worry about.
(NB: Alaska continues to evaluate A321neo and likes the airplane. If it were to order this airplane instead of the A320neos Virgin America had on order, I wouldn’t read anything about it into the MAX crisis. The A321neo is a far superior airplane to the MAX 10 and it’s also better than the MAX 9 for revenue potential, range and field performance capabilities. United Airlines is evaluating the A321XLR, and should it order, this, too, is unrelated to MAX crisis.)
I’m unconcerned about Flyadeal.
China’s agreement between CAAC and Europe’s EASA was touted by someone who really doesn’t know much about these things as a slap at the FAA, again connected to the MAX crisis.
China wants reciprocal certification for COMAC’s C919. It has been slow in certifying individual Airbus airplanes for delivery into China. It struck a reciprocal agreement with the FAA several years ago. The agreement, announced in May (coincidentally during the Airbus Innovation Days), was on its own agenda.
Here’s what we wrote then:
The proposed US/China Bilateral Safety Agreement (BASA), in which reciprocal aircraft certification is granted, is the model for a similar agreement with Europe’s EASA, which certifies Airbus aircraft.[Airbus Chief Commercial Officer Christian] Scherer said no similar BASA agreement has been reached with EASA and China. But he said Airbus should be able to apply for certification under BASA, because EASA and the FAA have reciprocal agreements.
“It should lead to the opening of new market opportunities,” Scherer said. “I’m thinking of the 220.”
With undelivered MAXes piling up, now at the rate of about 42/mo (since the last NGs have rolled off the line), one media outlet wrote that Boeing will lose its position this year as the world’s biggest airplane maker.
This is stating the obvious, but to me it falls into the “so what?” category.
Wait till next year, when production rates return to normal and deliveries of the Undelivereds surge.
This year is an anomaly. Next year will be, too. Normalcy returns in 2021 (presumably).