Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- RTX Q1 2025 Earnings: GTF Talk Takes A Back Seat To Tariffs April 22, 2025
- Tariffs Tumult Takes Over GE Aerospace Q1 2025 Earnings Call April 22, 2025
- Boeing reports mixed results of latest employee survey, but middle management and officers remain key obstacles April 22, 2025
- Hopes for 1Q financial progress turns into bumpy ride for Boeing April 21, 2025
- Bjorn’s Corner: Air Transport’s route to 2050. Part 18. April 18, 2025
Congressman from Boeing to retire
Norm Dicks, the prominent Congressman from Boeing who made winning the KC-X contract for Boeing the “highlight” of his career, announced today he is retiring.
Dicks has one of the safest Democratic seats in the State of Washington. His retirement will be a big loss for Boeing in Congress.
Odds and Ends: 737 MAX development cost; another range boost for A330
737 MAX: We did this story last week on the development cost of the Boeing 737 MAX.
A330: Airbus is going to boost the range of the A330 to make it more closely match that of the Boeing 777 and 787, according to this story.
Fill ‘er up: Here’s a scary story about a goof in aerial refueling of a Boeing 707-based JSTARS.
Punching through the hysteria about closing Boeing Wichita
Mike Mecham of Aviation Week has a thorough analysis of what’s behind the decision to close Boeing Wichita.
Contrast Mike’s story with this ridiculous analysis. It’s very, very rare that we call out someone else but this one is so far off the wall that we can’t help ourselves. (It should be noted Loren Thompson was paid by Boeing to do a report about the Airbus subsidies and the tanker competition.)
George Talbot of The Mobile Press-Register weighed in with this story.
Thoughts on the Boeing-IAM deal
We couldn’t be more delighted.
The agreement announced Nov. 30 between the IAM 751 local and Boeing is an outstanding development.
Who wins? Basically, everybody.
The Company gets:
- Production stability through most of 2016 without the pain and agony of protracted negotiations and all the uncertainty associated with this process;
- No-strike through most of 2016;
- The NLRB case goes away., by all indications. How this specifically relates to Charleston and the Surge Line remains to be seen;
- A contented workforce; and
- Stability for ramping up production of all the 7-Series, most particularly the 737.
The union gets:
- The 737 MAX;
- More work on the KC-46A tanker if Boeing Wichita closes;
- An economic package with no apparent “take-aways;” and
- No stress over contract negotiations or a strike.
Customers get:
- No strike;
- No interruption of deliveries; and
- Certainty over deliveries.
Suppliers get:
- Pretty much the same thing as customers.
Washington State gets:
- The 737 MAX and all the jobs and supply chain benefits there from.
Losers:
- Everybody else who salivated over the prospect of winning the 737 MAX, but more or less you don’t miss what you don’t have; and
- Airbus: it can ‘t play on the uncertainty of a Boeing strike and delivery reliability.
We’re delighted management and labor set aside the antagonism of the decade-and-a-half and all the testosterone that went with it and realized that a partnership is more beneficial than being in their corners ready to fight.
A note of interest: Boeing Commercial Airplanes CEO Jim Albaugh was asked at the Credit Suisse conference Wednesday morning about the prospect of labor negotiations next year. (This during the 8am hour, EST.) Albaugh, in his characteristic understated way merely opined he was optimistic a successful negotiation could be achieved.
Six hours later, the deal was announced.
Milestone in aerial refueling: the unmanned KC-10
Very clever and creative flying, as reported here.
McCain puts Boeing, USAF in his sights for $1bn overrun on four tankers
Well, it’s started. See McCain’s letter to the Department of Defense here.
How will Boeing profit from tanker contract?
Just whenever you think there’s nothing more to write about the air force aerial tanker, more news pops up.
The news that Boeing would first lose $300m on the initial KC-46A tanker contract, and now perhaps another $400m (will there be still more to come?), isn’t particularly surprising.This is on top of the $600m the USAF (read that “taxpayers” agreed to absorb of the first $1bn in excess program costs.
In fact, when the first loss projection was announced, Wall Street aerospace analysts noted the news but shrugged it off as falling under the “what did you expect?” category. We didn’t even both to write about it, except in passing.
Odds and Ends: Orient Aviation’s profile of John Leahy
This is an abbreviated Odds and Ends; we are traveling this week and next and we’re not sure if we’ll have the chance to update while we are on the road. Meantime:
Orient Aviation magazine has a cover story profile of John Leahy, COO of Customers, and it’s a good one.
FlightGlobal has a long piece about the new competitors to Airbus and Boeing.
This is a frightening story about construction at Chicago’s O’Hare Airport.
An Australian TV station has a special on the Qantas A380/Rolls-Royce incident.
George Talbot of The Mobile Press-Register takes a look at how all the analysts and pontificaters were flummoxed by the Boeing win on the tanker.
Odds and Ends: Airbus wants to advance NEO EIS by six months; name that tanker
1. Airbus wants to advance NEO EIS six months
Airbus wants to advance the entry-into-service of the A320neo by six months, to October 2015, we have learned. Airbus plans to introduce the neo in six month increments (A320neo followed by A321neo followed by A319neo). Airbus has more than 300 orders and commitments for the 320/321 and none for the 319. With Boeing increasingly talking about a new airplane in 2019, any advance Airbus can get for EIS on the neo will be beneficial.
Pratt & Whitney can probably meet this requirement. It will have versions of the GTF in service with Bombardier in 2013 and with Mitsubishi in 2014. Testing on the Irkut MS-21, a competitor to the A320/321, is to begin in 2014 with an EIS planned for 2016 (though we believe the MS-21 will likely be later than 2016).
Whether CFM can have the LEAP-X ready for a NEO 2015 EIS is unknown. CFM has yet to be selected for a NEO order (this is only a matter of time, though). The LEAP-X is in development for the COMAC C919, also a competitor to the 320/321. Flight testing is planned for 2014 and EIS for 2016 but we think the C919 will run years late, just as did the ARJ-21. Can CFM shave six months off its flight testing to meet an advanced NEO EIS when it is disadvantaged to PW’s CSeries and MRJ operating experience? We don’t know.
Over at Boeing, Aspire Aviation has this think-piece about the “737X.”
2. Airbus ponders slight larger A350-1000
The A350-1000 is aimed directly at the Boeing 777-300ER, but it is slightly smaller at 350 passengers vs 365 in typical three-class. Boeing, and others, question whether Rolls-Royce’s Trent XWB engine is big enough for the -1000 (Airbus, not surprisingly, said that it is). But we learned that Airbus is considering a 380 passenger -1000 and 50 miles more range to make it sure to do Dubai-Los Angeles non-stop. For this, the Trent XWB needs 5,000 lbs more thrust, and Rolls has been asked to figure this out.
In our view, this is the airplane Airbus needs to take on the -300ER.