Re-engining the Boeing 767, Part 3

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By Bjorn Fehrm

December 21, 2023, © Leeham News: We are looking at a re-engine of the 767, a move that Boeing is considering to avoid a production stop after 2027. The present 767 engines don’t pass emission regulations introduced by the FAA, EASA, and other regulators for production and delivery beyond 2027.

We looked at what airframe modifications are necessary to house more efficient engines last week; now, we use our Aircraft Performance and Cost model to look at the economics of the original 767 versus a re-engined one.

  • New, more environmentally friendly engines give the 767 better fuel economics.
  • The Cash Operating Costs improvement is affected by higher engine maintenance costs and higher underway and airport fees as a re-engined 767 is a heavier aircraft.

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Re-engining the Boeing 767

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By Bjorn Fehrm

December 7, 2023, © Leeham News: We wrote last week that Boeing is considering re-engining the 767 to avoid a production stop after 2027. The 767 is still an interesting aircraft for companies flying cargo and for the US Air Force, which is taking delivery of the tanker version KC-46A for years to come.

The problem is that all the 767 versions are using engines from the 1970s (GE CF6, PW4000, RB211), and as the FAA has accepted the ICAO emission rules from 2017, the production of the 767 with these engines has to stop after 2027. As reported last week, Beoing is looking at re-engining the 767 to avoid a production stop.

We use our Aircraft Performance and Cost Model (APCM) to look at the different possible configurations with new engines and model their performance data and operating economics.

  • The Boeing 767 needs new engines if it shall be produced after 2027.
  • While the engine candidate is clear, the rest of a re-engined 767 can be configured in several ways. We look at what different configurations bring in operational performance.

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Pontifications: Airbus ponders A330neo MRTT, Boeing ponders KC-46A re-engine

By Scott Hamilton

By Scott Hamilton

Nov. 28, 2023, © Leeham News: In a reversal of intent, the airplane that Airbus may submit to the US Air Force for the next round of aerial tanker procurement may be based on the A330neo instead of the current production A330-200ceo MRTT.

The Air Force, however, may forego competition between Airbus and Boeing and place a sole-source follow-on order with Boeing for the KC-46A tanker, based on the 767-200ER. Boeing already has a contract for 179 KC-46As, and the USAF appears to be leaning toward a sole-source award. Political pressure from Airbus partisans and others who favor competition may prevail.

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Airbus wants to discontinue production of the A330-200ceo-based MRTT. The neo-based version would be based on the A330-800. Sales of the -800 are poor—fewer than 20 have been ordered. An -800 based MRTT will breathe life into the nearly still-born model.

  • Boeing considers re-engining the 767-300ERF and the KC-46A.
  • KC-46A, 767-200, A330 MRTT exempt from 2027 ICAO standards.

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Lockheed bows out, Airbus plows ahead in USAF tanker procurement; Boeing favored

By Scott Hamilton

Oct. 24, 2023, © Leeham News: Lockheed Martin Co. (LMCO) threw in the towel on Oct. 23, announcing it will not submit information to the US Air Force for the KC-Y aerial refueling tanker procurement.

Lockheed Martin drops out of the KC-Y US Air Force tanker procurement for an aerial refueling tanker. Airbus, its partner, will proceed alone. Credit: Lockheed Martin.

But its partner, Airbus, quickly said it will respond to the USAF’s Request for Information (RFI).

“Airbus remains committed to providing the U.S. Air Force and our warfighters with the most modern and capable tanker on the market and will formally respond to the United States Air Force KC-135 recapitalization RFI. The A330 U.S.-MRTT is a reliable choice for the U.S. Air Force: one that will deliver affordability, proven performance, and unmatched capabilities.”

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Tanker competition decision expected later this year

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By Scott Hamilton

May 29, 2023, © Leeham News: Procurement of a new round of US Air Force aerial refueling tankers resulted in a shift in strategy driven by new threat assessments, a service spokesperson tells LNA.

The Lockheed Martin LMXT concept. Credit: Lockheed Martin.

“The Next Generation Air-Refueling System (NGAS) is being accelerated due to threats. Therefore, the Air Force is no longer pursuing the original envisioned tanker strategy,” an Air Force spokesperson said in an email on May 22.

Boeing KC-46A. Credit: Boeing.

“However, we know that between KC-46A (179 aircraft on current contract) and an accelerated NGAS, we still need uninterrupted tanker recapitalization. Therefore, we are working on validated requirements and a finalized Business Case Analysis (BCA) for this tanker before making a final decision later this year whether or not we’ll hold a competition for aircraft (approximately 75) as the gap filler to ensure uninterrupted tanker recapitalization. Andrew Hunter, the assistant secretary of the Air Force for acquisition, technology, and logistics provided this update on March 7 during a media roundtable at the AFA Warfare Symposium.”

Initially, the Air Force posited that the next round of tanker contracts would be for around 160 aircraft. Originally, the procurement, called KC-Y, was expected to be an advanced tanker design. Then it shifted to a “bridge” procurement for an existing tanker. Now called NGAS, the procurement concept is reduced to 75 tankers.

Boeing favors a sole-source, follow-on order. Unsurprisingly, Lockheed Martin Co. (LMCO) favors a competition.

Boeing currently has contracts for up to 179 767-based KC-46As. Airbus has delivered about 50 MRTTs worldwide. Boeing has delivered more than 60 KC-46As worldwide, nearly all so far to the USAF.

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Pontifications: Looking ahead to a major Defense procurement: Boeing vs Lockheed-Airbus

By Scott Hamilton

May 23, 2023, © Leeham News: Decisions by the US Air Force in Washington (DC) on whether to require competition for its next round of aerial refueling tanker aircraft are still months away.

But so far, the USAF technical group at the Wright-Patterson Air Force Base in Dayton (OH) is proceeding as if there will be a competitive battle. At stake is an order for more than 160 tankers.

Boeing thinks this will be a sole-source, follow-on order for its KC-46A, based on the commercial 767-200ER. Lockheed Martin Co (LMCO), partnering with Airbus, wants to see a version of the Multi Role Tanker Transport (MRTT), based on the commercial A330-200.

So far, the secretary of the Air Force publicly said he is leaning toward a sole-source follow-on order.

I visited LMCO last month to talk about the tanker competition. We also talked about the C-130J and its new commercial model, as well as other defense programs.

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Making the case for competing the next USAF tanker procurement

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By Scott Hamilton

May 22, 2023, © Leeham News: The US Air Force is moving slowly toward another aerial refueling tanker procurement. With hundreds of ancient Boeing KC-135 tankers still to replace, the procurement will be a big one: more than 160 jets.

Concept of the Lockheed Martin LMXT aerial refueling tanker it wants to sell the US Air Force. This tanker is based on the Airbus A330 MRTT now in service. Credit: Lockheed Martin.

The big question that is as yet unresolved is whether the Air Force will place a follow-on, sole-source order with Boeing, or seek a competitive bake-off. If it’s the latter, a bid by Lockheed Martin Co. (LMCO) will be the competition. (Others may submit a bid, but the Boeing-Lockheed face-off will be the one to watch.)

LMCO partnered with Airbus to offer the A330 MRTT (Multi-Role Tanker Transport). This sets up a third Boeing-Airbus contest that could well be as bitter as the two previous ones. Make no mistake: although Lockheed will be the company submitting the bid, Airbus will become the target. It already has. Boeing surrogates lost no time in attacking Airbus after LMCO announced it will submit a bid, using the same old tired illegal subsidies claims and adding some new ones.

One surrogate questioned Airbus’ safety record. This was an astounding line of attack, considering the Boeing 737 MAX history and all the scandals that emerged in its development; and the 2013 grounding of the Boeing 787 for safety reasons. Airbus has never had a fleet type grounded by regulators for safety reasons traced to the design of the aircraft. (India’s regulator grounded A320neos equipped with Pratt & Whitney GTF engines due to issues related to the engine durability.)

More relevant is whether it makes economic and financial sense for the Air Force to have two primary tanker fleets: Boeing’s KC-46A and the A330 MRTT. LNA visited LMCO last month in Marietta (GA), the location of much of its defense business. It’s where the LMXT, as Lockheed calls its offering, will be militarized after production at Airbus’ Mobile (AL) aerospace complex should LMCO win the contract—if the procurement is competed.

LNA tomorrow will discuss some of the history of previous procurements.

  • Commonality is Boeing’s argument. Derisking the fleet and greater capability is Lockheed’s argument.

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UPDATE: Calhoun upbeat on cash flow despite fifth consecutive quarterly loss

By Bryan Corliss

Oct. 26, 2022, (c) Leeham News: The Boeing Co. posted a loss from operations of nearly $2.8 billion for the third quarter, citing losses on fixed-price defense development programs that offset an overall 4% growth in revenues.

The consensus of Wall Street analysts earlier this week was that Boeing would announce profits of 13 cents a share and would break a streak of four consecutive losing quarters. Instead, Boeing posted a loss of $5.49 a share.

However, in a conference call with stock analysts later in the morning, Calhoun was upbeat, emphasizing Boeing’s positive operating cash flow of nearly $3.2 billion for the quarter.

“This quarter was a big one for us,” he said. “We hit a marker … to generate positive cash flow.”

Boeing booked losses of roughly $1.95 billion on two defense programs, CFO Brian West said: KC-46 tankers and new Air Force One presidential transports. Both are fixed-price contracts for commercial jet conversions that forced Boeing to eat any cost overruns.

“We aren’t embarrassed by them,” Calhoun said. “They are what they are.”

But in an interview with CNBC’s Phillip LeBeau Wednesday, Calhoun said Boeing will not do fixed-price defense contracts in the future. “That is not our intent.”

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Boeing sees incumbency as advantage in coming air force tanker procurement

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By Scott Hamilton

KC-46A. Source: Boeing.

March 21, 2022, © Leeham News: Lockheed Martin Co. (LMCO) plans to submit a proposal for the US Air Force’s KC-Y aerial refueling tanker procurement. So does Boeing. LMCO joined with Airbus and will offer a tanker based on the existing Airbus A330 MRTT (Multi-Role Tanker Transport). Boeing will offer a follow-on purchase of the incumbent KC-46A, based on the 767-200ER.

These two aircraft faced off in the KC-X competition. Airbus initially teamed with Northrop Grumman and was awarded the contract. Boeing protested the award on procurement procedural grounds and prevailed. Northrop dropped out of the recompete, which Boeing won in 2011.

The two aircraft will be offered again, but this time, one party doesn’t view the aircraft as competitive. LMCO sees the Airbus airplane, which it brands the LMXT, as complementary to rather than competitive to the KC-46A. Lockheed explains why here.

Boeing, on the other hand, isn’t convinced the USAF will even seek a competitive bid—or that LMCO’s belief that the service wants a larger airplane than the KC-46A to fill a “gap” is correct.

Mike Hafer, senior manager of KC-46A Business Development, explains why.

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Pontifications: Advice for Boeing in the coming KC-Y campaign

Part 6: The KC-X competition from Boeing’s perspective

By Scott Hamilton

Feb 21, 2022, © Leeham News: Jim Albaugh, the former president and CEO of Boeing Commercial Airplanes and of Boeing’s defense unit, retired from the company in 2012. He oversaw the first competitive bid at the defense unit for the US Air Force KC-X refueling tanker. That was lost to Northrop Grumman-EADS (Airbus) in 2009.

As CEO of BCA, he oversaw commercial efforts to get Boeing’s cost down on the 767-200ER, which formed the basis for what became the KC-46A tanker. Defense won this round against a solo EADS bid. Boeing’s winning price was about 10% below the EADS bid for its A330-based MRTT.

Years removed from Boeing but nevertheless an interested observer with experience on the losing and winning bids, Albaugh has some observations and advice as Boeing prepared to compete against Lockheed Martin-Airbus for the KC-Y campaign that already has unofficially begun.

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