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
Bjorn’s Corner: New aircraft technologies. Part 42. Improving the learning curve
By Bjorn Fehrm
December 15, 2023, ©. Leeham News: We are discussing the different phases of a new airliner program. After covering Conceptual, Preliminary, and Detailed design, the manufacturing of prototypes, and their roles in flight tests, we now look at the production phase.
Last week, we discussed why production costs vary over time and why they can be up to 500% higher for the first units than for units past 400 to 500 aircraft produced. Now we go deeper into the reasons behind this and what can be done to improve the situation.
Figure 1. The program plan for a new airliner. Source: Leeham Co.
Collaboration is key with supply chain, says Airbus
By Scott Hamilton
Dec. 12, 2023, © Leeham News: The aerospace supply chain still hasn’t fully recovered the COVID-19 pandemic. All aerospace manufacturers are affected, as are the supplier to the suppliers.
At the annual Aviation Forum last week in Hamburg, Germany, Airbus said collaboration is one of the keys to recovery.
Jurgen Westermeier. Credit: Airbus.
Jürgen Westermeier, the chief procurement officer (CPO) at Airbus, said “unlocking the power of collaboration” means “great things happen when we work together.
“This has been illustrated in the past, when we had to face a situation of crisis together. In the past, in the face of a crisis, collaboration has been key,” Westermeier said.
There have been first-hand a series of successive crises which radically reshaped the aerospace sector. “Be it in an unprecedented global pandemic, geopolitical events, the likes the world hasn’t seen in a long time, and a climate emergency that no one can ignore anymore. Several suppliers entered the COVID period with weak financials.”
In addition, the CPO said, there has been high inflation, increasing energy prices, rising labor costs, and bank interests that are putting the ability of certain categories of suppliers at risk. “Airbus developed over the years several collaborative tools designed to better manage the crisis together. First, the Supplier Financial Watchtower,” Westermeier said. “This allows Airbus to monitor the financial health of its supply chain and identify potential issues. We are then able to deep dive into specific situations to understand the risk at stake, and if necessary, co-develop a mitigation plan with the supplier concerned. Not only does this approach ensure we can support our supplier in securing a planned ramp-up, but it also allows us to develop a sense of community.”
Airbus: Global services sector to double by 2042
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By Gordon Smith
December 4, 2023, © Leeham News: If the last decade taught us anything, it’s just how challenging it is to make accurate forecasts. While this is true of almost all industries, few are as difficult to predict as aerospace. It can feel like a feat to quantify the immense number of variables involved, never mind establishing what they actually mean.
So credit where it is due to Airbus, which has published its latest Global Services Forecast (GSF) for the coming two decades.
The headlines are eye-catching. The European firm believes the value of the commercial aircraft services market will double by 2042 to $255bn. Driven by soaring traffic demand and technological developments, the sector will require millions more staff than it has today and thousands of new aircraft.
Summary
- The services market is supporting more than 24,000 aircraft globally this year, valued at approximately $130bn – up 46% on 2022 as the post-pandemic recovery reaches a crescendo
- This figure is due to reach $180bn by 2030 and $255bn by 2042, representing a compounded annual growth rate of 3.6%
- Aircraft maintenance will comprise 80% of the market by 2042, valued at $210bn, with ‘aircraft enhancement’ estimated at $28bn, and training and operations generating $17bn
- Connected aircraft is a key trend, with Airbus forecasting that more than 44,000 airplanes will form part of a ‘connectivity ecosystem’ by 2042, with significant passenger benefits and operational efficiencies
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.
Related articles
- Airbus to develop second generation MRTT based on A330neo. (Aviation Week.)
- Lockheed Martin sees MRTT as complimentary to KC-46A
- Lockheed bows out, Airbus to continue, Boeing favored in tanker procurement
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.
Preview of Rolls-Royce Capital Markets Day
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By Scott Hamilton
Nov. 27, 2023, © Leeham News: Rolls-Royce’s Capital Market Day is tomorrow. “Our multi-year transformation programme will deliver a high-performing, competitive, resilient, and growing business. Join us to find out how we are going to do it and what a stronger Rolls-Royce will mean for all our stakeholders,” the company says on its website.
“Our multi-year transformation programme has started well with progress already evident in our strong initial results and increased full-year guidance for 2023. There is much more to do to deliver better performance and to transform Rolls-Royce into a high-performing, competitive, resilient, and growing business. We will share the outcome of our strategy review along with medium-term goals for the Group in November,” said CEO Tufan Erginbilgic on its website.
It has some other questions to answer, too.
An order for Airbus A350-1000s was expected to be announced at the Dubai Air Show by Emirates Airline. Another order, for a combination of A350-900s, -1000s, and A320neo, was expected from Turkish Airlines. Neither materialized—and, LNA is told, issues with the Trent XWB 97 were one reason.
Further developments of the A321, Part 6
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By Bjorn Fehrm
November 23, 2023, © Leeham News: We do an article series about what can be the subsequent development for Airbus’ most popular aircraft, the A321neo. We looked at different changes to the aircraft in previous articles and the economics in short haul configuration. Now, we compare the capacity and economics of the different variants when configured for long-haul missions.
We use our Airliner Performance and Cost Model (APCM) to look at passenger capacity, seat-mile costs, and range.
Summary:
- A stretched A321 is limited as a long-haul aircraft, as it needs additional fuel and additional takeoff weight to carry the fuel.
- Long-haul variants of a stretched A321 will need the XLR center tank or the new, larger wing of an A32x to extend the range to long-haul values.
Boeing beats Airbus in order tallies at Dubai Airshow thanks to widebody jetliner demand
By Dan Catchpole
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Nov. 20, 2023 © Leeham News: Boeing dominated the Dubai Airshow, racking up 313 orders—232 firm and 81 non-firm. Meanwhile, Airbus garnered only 86 orders, as of Friday, the last day of the biennial airshow.
Credit: Boeing
It was the first time that American aerospace giant has beaten its European competitor at Dubai since 2017. Heavy demand for twin-aisle aircraft helped Boeing land more orders.
A much anticipated mega order by Turkish Airlines for Airbus jetliners didn’t materialize. However, both entities said they plan to announce a significant order in the future.
Summary
- Widebody orders lead narrowbody orders
- Resurgent international travel demand drive order split
- Performance problems soften demand for Airbus A350
Airbus eyes carbon capture to broaden its eco arsenal
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By Gordon Smith
November 20, 2023, © Leeham News: Airbus’ flagship decarbonization initiative appears to be gaining momentum. The European OEM is betting big on Direct Air Carbon Capture and Storage (DAC) next-generation facilities that remove CO2 directly from the air to compensate for emissions produced by airline operations.
Airbus has described the technology as a “key bastion in the fight against climate change and the world’s transition to a net-zero energy system”. It has partnered with 1PointFive – a US partner of Canadian firm Carbon Engineering – to bring the innovative system to the aviation sector.
Last month, easyJet became the first airline to ink a deal with Airbus for the decarbonisation initiative. The OEM is offering carriers ‘carbon removal credits’ as part of a broader deal with 1PointFive. Read more
Further developments of the A321, Part 5
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By Bjorn Fehrm
November 16, 2023, © Leeham News: We have done an article series about what can be the subsequent development for Airbus’ most popular aircraft, the A321neo. We looked at different changes to the aircraft in previous articles. Now, we compare the capacity and economics of the different variants.
We use our Airliner Performance and Cost Model (APCM) to examine passenger capacity, range, and seat-mile costs.
Summary:
- The stretched A321s have improved operating economics.
- The question is if the cost and time of the projects are motivated versus keeping the A321s “as is” and then make a clean sheet replacement.
Has Airbus pinned too much of its hopes on LCC growth?
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By Judson Rollins
November 14, 2023, © Leeham News: Much ink has been spilled over the bad – and increasingly worse – year for America’s low-cost carriers or LCCs. Frontier, JetBlue, Southwest, and Spirit have all reported disappointing results, with increasingly negative outlooks for the rest of this year and well into 2024.
Source: DigitalAirliners.com.
The future of the LCC model is increasingly murky, having historically depended on consistent double-digit capacity growth to spread fixed costs. Such rapid growth is imperiled in the short term by reluctant lower-income consumers, in the intermediate term by shortages of airplanes, parts, and skilled staff, and in the long term by a growing worldwide pilot shortage.
Boeing’s 737 MAX has its share of LCC exposure; LNA analysis puts it at 37% of unfilled orders. But Airbus’s A220 and A320 programs are even more intensely exposed, with 48% of combined orders coming from LCCs.
Will Airbus’s focus on selling to LCCs eventually return to haunt the OEM? We take a closer look.
Summary
- US LCCs are hampered by excess capacity; is a shakeout coming?
- Europe is brighter for now but faces near- and long-term constraints.
- Airbus has more to lose than Boeing in a global LCC retreat.