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By Scott Hamilton
Jan. 30, 2025, © Leeham News: When Airbus began to record more orders than Boeing in the early 2000 decade, Boeing’s CEO dismissed the shift.
Orders didn’t matter, sniffed Phil Condit. Only deliveries mattered. The statement ignored the obvious: if you didn’t have orders, you wouldn’t have deliveries.
For much of the past two decades, Airbus has been delivering more airplanes than Boeing. According to both companies’ forecasts, this trend will continue in the heart of the market in the coming years by a wide margin.
Deliveries of the 737 MAX are key to Boeing’s financial recovery. The cash flow and profits from the MAX line will drive Boeing’s ability to develop a new airplane. (This does not ignore the necessity of Boeing’s defense unit to get its financial house in order.)
Kelly Ortberg, Boeing’s CEO, appeared on the financial news network CNBC this week and said Boeing hopes to return to a production rate of 38/mo in the second half of this year.
“I’m not going put a date on when we need to get to rate 38 and get approval for the FAA to go beyond,” he said. “It’s more important that we do this right; we have a stable production system, we get through that, and I expect by the second half of the year, we’ll have that approval, and we’ll be moving to a higher production rate.”
Ortberg added, “Well, we’re planning to be at about 38 a month for the balance of this year, ramping up, and we’ll go in five-step increments every six months after that. On 787, we’re at five a month rate, moving to seven a month rate…hopefully, that’s in the next quarter or so.”
The 737 data can be extrapolated to suggest Boeing will return to the pre-MAX grounding rate (52/mo) in the first half of 2027. (Others are skeptical, and the ramp-up appears aggressive.) This would be eight years after the MAX was grounded on March 10-13, 2019, for what turned out to be 21 months.
Boeing was on its way to a rate of 57/mo by the end of 2019. Under the Boeing plan, this rate won’t be achieved until the end of 2027. If Boeing still believes demand supports this rate, a higher rate of 63/mo that was planned pre-grounding would follow in 2028.
Airbus will also increase its production rate. Production and delivery forecasts appear to place Boeing at a permanent distant second to Airbus as long as the competitors are the A320neo and 737 MAX.
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By Scott Hamilton
Jan. 27, 2025, (c) Leeham News: Boeing’s inability to deliver 787s on time and continued delays in certification of the 777-9 mean airlines planning to replace aging aircraft or expand must retain older aircraft longer than expected.
Airbus’ inability to deliver the A350 on planned schedules also affects fleet renewal and expansion plans, but to a much lesser extent than caused by Boeing.
Boeing’s circumstances also mean that feedstock intended for conversions of 777-300ERs from passenger aircraft to freighters upset the business models of the three P2F conversion companies: IAI Bedek, KMC, and Mammoth Freighters.
Finally, certification of IAI’s conversation program is running two years behind schedule, and Boeing’s reluctance to license critical flight control software has also stalled P2F programs.
In addition to the problems outlined above, the inability to convert the big twin 777-300ER to freighters or receive new 777-8Fs and A350Fs in the coming years means that 747-400 freighters, which are gas-guzzlers by today’s standards and expensive to maintain, must remain in service longer than planned.
It’s a bleak picture emerging for the near- to-mid-term freighter market.
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By Scott Hamilton
Jan. 23, 2025, © Leeham News: Earnings season begins today. Among the companies followed by LNA, GE Aerospace and Hexcel report today. RTX and Boeing report next week. ATI and Spirit AeroSystems follow the week after. Other suppliers follow then.
Airbus doesn’t report until Feb. 20. Rolls-Royce reports on Feb. 27.
The manufacturers draw the headlines, but LNA found long ago that the supply chain often provides better information to draw conclusions about the future than listening to the OEMs. All it takes is one supplier to fall down on the job to muck up the works for the OEMs.
That’s not to say listening to the OEMs is not important. Clearly, it is. But there’s just no getting around it: the credibility of many of the OEMs is damaged. Airbus hasn’t hit its production ramp up targets in years. Quality control suffers. And deliveries are consistently late.
Steven Udvar-Hazy, executive chairman of the board for Air Lease Corp, says that every single Airbus aircraft, 250 of them, has been late since 2017. That’s long before the pandemic began in March 2020, which caused such disruption continuing to this day. Airbus was still delivering A320ceos during 2017 and 2018, which didn’t have engine issues.
Boeing’s credibility speaks for itself. It doesn’t matter that it has a new CEO. Until Boeing starts performing, anything it currently says is hope, not performance. Post-strike delivery recovery will be an important indicator of Boeing’s performance in the essentially truncated fourth quarter and January.
Suppliers often discuss information on their earnings calls that provides a better understanding of production rates at the OEMs and where downstream issues are or are emerging.
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By Scott Hamilton
Jan. 20, 2025, © Leeham News: The A321neo continues its climb as the dominant single-aisle airplane in the Airbus family.
Figure 1. Airbus A321neo deliveries overtook all its single-aisle deliveries beginning in 2023 and continued to climb last year. Credit: Leeham News.
Given Boeing’s continued inability to deliver its 737 MAX single aisles at pre-grounding rates in early 2019 and the inability to certify and deliver the MAX 7 and MAX 10, comparisons are irrelevant.
The A321neo became Airbus’ dominant narrowbody aircraft in 2023. The upward trajectory gained momentum last year. The A321 is compared with the A320neo, the largely irrelevant A319neo, and the A220. A220 deliveries are overwhelmingly for the -300 model, with the -100 model, like the A319, largely irrelevant.
Airbus wants to increase production of the A320 family to 75 per month by 2027. It has studied boosting rates to 83 per month. Supply chain and engine delivery constraints caused Airbus to push the 75 rate to the right. There is no projected date for increasing to rate 83.
Airbus also wants to increase production of the A220 to 14/mo next year. Supply chain and engine delivery issues have also hurt boosting rates. Regardless, the goal of 14/mo next year seems unrealistic, given the current rate, which is believed to be around six or seven a month.
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By Scott Hamilton
Jan. 6, 2025, © Leeham News: Don’t look for any dramatic new product launches in 2025.
Nor should you expect any dramatic news, absent global upheaval of some kind.
This year is going to be yet another year dominated by recovery. Recovery from the COVID-19 pandemic, which officially ended in 2022. Recovery by the supply chain. Recovery for Pratt & Whitney’s nearly decade-long problems with its Pure Power GTF engines supplying the Airbus A220, A320 family and Embraer E2 jets. Recovery by Airbus from its production and delivery delays. Recovery by Boeing from its series of self-inflicted crises, now beginning the sixth year.
There is just no getting around the fact that the commercial aerospace industry isn’t a smooth-running industry. It’s a long way from 2018, when all sectors were running smoothly. There is still a long way to go to recovery.
Here’s LNA’s take on what’s to come this year.
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By Scott Hamilton
Dec. 16, 2024, © Leeham News: A new airplane from Airbus or Boeing is years away.
Engines drive whether a new airplane program makes sense. Technology just isn’t “there” yet. In any event, Boeing can’t afford to fund a new airplane program even if it wants to. Furthermore, until its stored inventory of 737s and 787s are cleared, or mostly so, production rates are back to 2018 levels, debt is substantially reduced, and profits and cash flows return, Boeing is mired in recovery from the past. Addressing the future must wait.
Airbus has no incentive to rush into a new airplane program, even if engine technology was available. Its backlogs extend into the 2030s, and it can’t meet the current demand. Production is mired in delays for the A320 and A350 families.
Both companies, and Embraer, remain adversely affected by supply chain parts delays.
Airbus CEO Guillaume Faury previously said he doesn’t see the company moving forward with a new airplane until 2035-2040. Additional insight into the company’s thinking came last month at the Aviation Forum 2024 in Munich, where vice presidents of Airbus’ propulsion and new programs departments outlined what’s ahead.
By Scott Hamilton
Dec. 13, 2024, © Leeham News: It’s been two years since the generally accepted end of the COVID-19 pandemic. But the aerospace industry hasn’t fully recovered. Nor will it do so for some time to come.
Predictions suggest another year or two will be required to restore pre-pandemic employment levels within the supply chain. This isn’t even certain. What is certain is that the impact of inexperienced new hires in the meticulous aerospace requirements will linger on for years to come.
Michael Haidinger, president of Boeing’s European and Middle Eastern regions, and Juergen Westermeier, chief procurement officer for Airbus, agree challenges remain in the near future.
“There is always a shortage of skilled aerospace talent intensified by the pandemic,” Haidinger said this month at the annual Aviation Forum (2024) in Munich, Germany. “As all the professionals retired, fewer new employees entered the field. Our industry needs more people who not only bring expertise but also embrace the mission of advancing aerospace.”
Haidinger added, “The deficit of skilled engineers, technicians, and other aerospace workers has made ramping up production more challenging. Attracting and retaining talent has become a top priority for us. [We are] with many companies investing in workforce development, partnerships with universities, training programs, and apprenticeship programs.”
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By Scott Hamilton
Dec. 12, 2024, © Leeham News: Airbus wants to sharply increase the production rates of its A220, A320, and A350 lines between now and 2027. This has been a goal since emerging from the COVID-19 pandemic.
However, continuing supply chain issues repeatedly moved the targets to the right. The A220 production rate goal of 14/mo was moved from 2025 to 2026. A dramatic increase in the A320 family rate to 75/mo is now set for 2027, a delay of more than a year. The new production target for the A350, 12/mo, is now 2028.
Increasing the rates is key for Airbus to meet demand and take full advantage of Boeing’s continuing disruptions as it works to emerge from its long-running safety, quality assurance, and production disruptions.
Airbus officials have been frustrated by the repeated delays in ramping up production and obtaining a reliable stream of parts deliveries from the supply chain. Annual delivery goals are challenging to meet and have fallen short of guidance. Airlines and lessors are unhappy over missed delivery dates.
But the head of Airbus’ procurement believes things are, at long last, on the right track.
Juergen Westermeier explained why in an interview with LNA last month during the Aviation Forum 2024 in Munich.
By Bjorn Fehrm
December 10, 2024, © Leeham News: CFM has announced that FAA and EASA have certified an upgrade to the LEAP-1A turbine, allowing the engine to stay on wing longer, especially in hot and harsh environments.
The upgrade was developed using a new dust ingestion method CFM developed to simulate the wear on the LEAP first turbine stage and nozzle in certain dusty environments.