Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Services are driving revenues and profits in difficult times, Part I May 15, 2025
- The BWB has a long way to go before flying passengers, freight May 12, 2025
- Bjorn’s Corner: Air Transport’s route to 2050. Part 21. May 9, 2025
- Does an A220-500 need a new wing and engines? Part 2. May 8, 2025
- Embraer downplays tariff impact on 2025 results May 6, 2025
Services are driving revenues and profits in difficult times, Part I
Subscription Required
By Karl Sinclair
May 15, 2025, © Leeham News: The aerospace industry is a maintenance-intensive operation, where strict regulatory rules drive many requirements.
Assets must be constantly maintained, governed by the time or usage an airline derives from them.
This goes for airframes, engines, and human resources.
Services account for a large part of aerospace corporate profits. Boeing’s Global Services division is the most profitable part of the company. Photo credit: Boeing Global Services.
Some equipment manufacturers derive little or no profits from product sales, but they make lucrative and long-term revenues from attached maintenance contracts.
Political factors are also coming into play in the services segment.
As airlines are forced into a difficult and expensive decision regarding the payment of tariffs on new aircraft they acquire, many could opt for a different strategy.
Older aircraft that were due for replacement with newer, more fuel-efficient jets will be sent into MRO facilities for an additional heavy-maintenance check.
With falling fuel prices playing less of a factor in the acquisition decision, airlines will be tempted to defer deliveries (thus avoiding the payment of tariffs) using their current assets in their installed fleets.
Extending an aircraft’s useful life by another six to seven years will allow carriers to simply wait out the tariff threat when things return to normal.
LNA looks into the growing services revenue segment among various companies in the aviation industry.
The BWB has a long way to go before flying passengers, freight
Subscription Required
By Scott Hamilton
Figure 1. The Horten flying wing developed by the Germans toward the end of World War II. Credit: Michael Jorgensen via BBC.
May 12, 2025, © Leeham News: The Blended Wing Body airplane concept has been around for decades. Its cousins, if you will, appeared in the form of flying wings. The Germans developed the Horten at the end of World War II; it never made it into service.
Northrop Grumman developed propeller- and jet-powered flying wings after World War II. Neither concept was picked up by the US Air Force.
Figure 2. The Northrop YB-49 flying wing developed post-World War II. Credit: Northrop.
It wasn’t until development of the Northrop Grumman B-2 bomber that the flhing wing, or Blended Wing Body, aircraft became an operational reality.
Figure 3. Northrop Grumman B-2 bomber. The similarities with the JetZero Z4 BWB are apparent. Credit: Northrop Grumman.
But none has been able to make the leap into commercial aviation service. JetZero hopes to make this leap in the early 2030s, but it’s got a lot to accomplish between now and then.
Related Article
JetZero readies effort for private equity funding
Many of these challenges were outlined by LNA last week. But there are more.
Bjorn’s Corner: Air Transport’s route to 2050. Part 21.
By Bjorn Fehrm
May 9, 2025, ©. Leeham News: We do a Corner series about the state of developments to improve the emission situation for Air Transport. We try to understand why development has been slow.
Since we started in October last year, we have looked at:
- Alternative, lower emission propulsion technologies, ranging from electric aircraft with batteries as energy source, different propulsion hybrids, and new concepts for Jet-fuel and Hydrogen gas turbine engines.
- We have also reviewed recent research on the role of CO2, NOx emissions, and Contrails generated by airliners in global warming.
- Two weeks ago, we summarized the present situation around SAF, Sustainable Aviation Fuel.
Last week, we listed some base data about the present situation for Global Air Transport. We will now use this data to calculate the effect of air transport on global warming from the three alternatives.
Does an A220-500 need a new wing and engines? Part 2.
Subscription required
By Bjorn Fehrm
May 5, 2025, © Leeham News: We started the articles series about stretching the A220 to a capacity in the A320neo range last week by going through the development of the A220-100 and -300, how it’s designed and compares to the competition in the 100 to 140 seat segment.
Now, we analyze what we need to change to bring the capacity to the level of the A320neo and whether changes to the wing and engines, in addition to prolonging the fuselage, are necessary when we increase its capacity.
We use the Leeham Aircraft Performance and Cost Model (APCM) to look at the design data for the A220-300 and discuss what it will mean to make the different changes.
Figure 1. A rendering of an A220-500. Source: Leeham Co.
Summary:
- The A220-300 has field and range performance that matches an A320neo.
- As we increase the length of the A220 fuselage to match the seating capacity of the A320neo, we run into tricky trade situations regarding range and field performance for an A220-500.
Embraer downplays tariff impact on 2025 results
May 6, 2025, © Leeham News: Embraer CEO Francisco Gomes Neto sought to reassure investors on Tuesday, emphasizing the limited effect of new U.S. tariffs on the company’s operations as its Q1 2025 results were published.
“Our initial analysis points towards limited impact and we remain confident in and reiterate our 2025 guidance,” Gomes Neto said. He added that the company is “working on initiatives to limit impact of U.S. tariffs on our business.”
Gomes Neto credited the resilience in part to its high U.S. content, with Embraer aircraft incorporating substantial American-sourced components and systems—a factor that helps blunt the impact of cross-border tariffs.
But he added: “We join other companies in calling for a return to zero tariffs… for a highly globalised industry.” Read more
JetZero readies effort for private equity fund raising
Subscription Required
By Scott Hamilton
May 5, 2025, © Leeham News: JetZero, the start-up company developing commercial aviation’s first passenger Blended Wing Body (BWB) airplane, is gearing up to seek private equity funding for billions of dollars needed to bring its aircraft to market.
JetZero president and COO Dan da Silva demonstrates the human scale of the Z4 Blended Wing Body mock-up at the company’s Long Beach (CA) facility. Credit: Leeham News.
In a media day on Friday, executives and staff briefed reporters on progress to date, production work on the first full-size demonstrator aircraft, technical details and studies continuing an production plans.
Officials expect to announce a site selection for its final assembly plant in the coming weeks, before the Paris Air Show that begins in mid-June.
JetZero’s airliner is dubbed the Z4. It’s nominally a 250-passenger, 5,000nm design for the so-called Middle of the Market currently occupied by out-of-production and aging Boeing 767-300ERs, Airbus A330-200s and a limited number of Boeing 757s. Entry-into-service is targeted for the “early 2030s.” The first flight of the demonstrator aircraft is planned for 2027.
JetZero has an ambitious goal for producing the composite aircraft. The final assembly site, for which the company has down-selected the finalists, will be on a 1,000 acre site with a building about the size of Boeing’s widebody plant in Everett (WA). Boeing’s Everett site is somewhat larger than 1,000 acres.
JetZero is planning for a monthly production rate of 20 five years after production begins. The company has hundreds of conditional orders from major airlines.
Daunting tasks remain in the coming years. Among them: there is currently no engine commitment for the airplane; a product support system is needed; finalizing the method to product the composite airplane; “flying” the iron bird; and much more.
Bjorn’s Corner: Air Transport’s route to 2050. Part 20.
By Bjorn Fehrm
May 2, 2025, ©. Leeham News: We do a Corner series about the state of developments to improve the emission situation for Air Transport. We try to understand why development has been slow.
We have since we started in October last year looked at:
- Alternative, lower emission, propulsion technologies, ranging from electric aircraft with batteries as energy source, different propulsion hybrids and new concepts for Jet-fuel and hydrogen gas turbine engines.
- We have also reviewed recent research on the role of CO2, NOx emissions, and Contrails generated by airliners.
- Last week, we summarized the present situation around SAF, Sustainable Aviation Fuel.
Before we proceed, we shall examine some facts about the scale of the emission/global warming influences from Air Transport.
Figure 1. A picture of global Air Transport flying different routes. Source: Flightradar24.
Supplier Howmet exceeds expectations despite tariffs
By Karl Sinclair
Howmet 1Q2025 earnings report.
May 1, 2025, © Leeham News: Howmet Aerospace (HWM) reported record revenues, record profits and a strong cash position in 1Q2025.
Revenues were up 6%, Year-Over-Year (YOY) to $1.94bn, beating the baseline projection of $1.935bn, driven by Commercial Aerospace, which was up 9%.
Adjusted EBITDA was $560m, up 28% YOY, crushing baseline estimates of $520m.
Cash from operations generated $253m, while $125m was spent on stock buybacks, during the quarter. The company also spent a further $100m on buybacks in April. Total capital deployment was $167m on buybacks and dividends, for the period.
Free-cash-flow was $134m, up from $95m, YOY.
Howmet reported net income of $344m in 1Q2025, versus $243m in 1Q2024.
“While the tariff situation remains fluid, we expect to pass on tariff-related costs to our customers,” remarked Executive Chairman and CEO John Plant.
Airbus 1Q2025 results: So far, so good, but US tariffs make future results unpredictable
May 1, 2025, © Leeham News in Toulouse: Airbus CEO Guillame Faury and CFO Thomas Toepfer presented the Airbus 1Q2025 results yesterday. All Airbus divisions performed to plan, producing a group EBIT Adjusted of 0.6bn Euro.
The company delivered 136 aircraft, which was to plan. The lower deliveries than last year (142) were due to CFM’s extra delivery efforts in 4Q2024, leading to fewer LEAP deliveries for 1Q2025. EBIT at €0.5bn and Free Cash Flow at -€0.3bn were also as planned.
The big unknown going forward is the effect of the US tariffs and the trade war it has caused. Airbus CEO, Guillaume Faury, said, “Airbus will not cover tariffs applied to Airbus aircraft that are imported to the US for US customers (read A330 and A350). For A220s and A320s produced in Mobile for US customers, tariffs apply for parts that must be imported to produce these aircraft. The effects are here less clear as the tariff situation can change at any time”.
Does an Airbus A220-500 need a new wing and engines?
Subscription required
By Bjorn Fehrm
May 1, 2025, © Leeham News: For years, the debate has been going on about when Airbus will complement the A220-100 and -300 with a longer, higher-capacity A220-500.
In fact, the Bombardier team that designed the A220 as the CS300 already foresaw the prospect of a longer -500. The latest discussions have been around how much to stretch and whether a new wing and stronger engines are needed if the A220-500 replaces the A320neo in the Airbus lineup.
We use the Leeham Aircraft Performance and Cost Model (APCM) to examine the design data for the A220-100 and -300 and determine whether a stretched -500 would benefit from a new wing and stronger engines (which would then be the CFM LEAP-1Bs used on the Boeing 737 MAX).
Figure 1. A rendering of a possible A220-500. Source: Leeham Co.
Summary:
- The A220 started life as the CSeries, designed to compete with Embraer’s E-Jet E2.
- It has since added range through increased Maximum Takeoff Weights to enter the single aisle segment range-wise.
- A stretched A220 would expand the present A220 series upwards and potentially replace the A320neo for Airbus.
- We start by comparing the A220 to the E2, then we move on to examining whether an A220-500 can successfully replace the A320neo.