Leeham News and Analysis
There's more to real news than a news release.
Airbus sees 3.8% growth in new aircraft deliveries through 2043 vs last year’s forecast
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By Scott Hamilton
July 15, 2024, © Leeham News: Airbus boosted its 20 year forecast for new aircraft deliveries by 3.8% compared with last year’s Global Market Forecast (GMF).
Single aisle mainline aircraft (ie, no regional jets) deliveries edge up by 880 aircraft in the new forecast. Widebody passenger and freighter deliveries also edge up, by 700 aircraft.
GMF forecast 2024-2043
Airbus summarizes:
- Initial average traffic growth rate of 8.4% CAGR until 2027 as it recovers growth lost during the pandemic;
- Long term trend: average annual passenger traffic growth of 3.6% per year from 2027 to 2043, and 3.1% for freight;
- China and India, and more generally Asia-Pacific as a whole, will power growth, further shifting aviation’s center of gravity’ towards Asia;
- The projected 2043 world Fleet-In-Service will be 48,230 in 2043 vs. 24,240 beginning of 2024.
Demand for 42,430 new passenger and freighter deliveries (vs. 40,850 GMF2023) in the 2024-2043 period;
- Of these: 33,510 Single aisle (v 32,630 GMF2023); 8,920 Widebodies (v 8,220 GMF2023);
- This is 1,580 more (v GMF23) reflecting one extra year of growth
- Freighter demand: 2,470 deliveries of which 940 are new-build, the rest coming from P2F conversion; and
- Growth primarily driven by GDP increase (+2.6% 2023-2043), middle class expansion, first time fliers, and growing trade (+3.1% 2023-2043 CAGR vs. +2.9 % GMF23).
Airbus does not specify sub-categories of the single- and twin-aisle sectors. It’s not possible to delineate sub-sectors such as 100-150 seats or 151-240 seats or similar designations within the twin-aisle sector with the information available.
But in the first half of 2024, the A321neo accounts for 93% of the A320 family orders. The A320neo won 6.5% (there was one order for the A319neo.) There were no orders for the A220.
To what extent can the A321XLR replace the Boeing 757, Part 3
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By Bjorn Fehrm
July 11, 2024, © Leeham News: We are comparing the Airbus a321XLR to the Boeing 757 to understand to what extent it can replace the 757 on the longer routes it operates for major airlines like United, American, and Delta.
We have looked at the development and operational history of the aircraft, their Apples-to-Apples capacity and range. Now, we use Leeham’s Aircraft Performance and Cost Model (APCM) to compare the operational costs of the aircraft.
Summary:
- The Boeing 757-200 has the same passenger capacity as the A321LR/XLR and a larger cargo capacity.
- Its range can compete with the A321LR but not the XLR. Both beat the 757 on operational economics.
To what extent can the A321XLR replace the Boeing 757, Part 2
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By Bjorn Fehrm
July 4, 2024, © Leeham News: We are comparing the Airbus A321XLR to the Boeing 757 to understand to what extent it can replace the 757 on the longer routes it operates for major airlines like United, American, and Delta.
After Boeing didn’t do the obvious 757 replacement, the NMA and Airbus gradually eked out more range and seats on the A321; the A321LR/XLR is the only game in town to replace the 757, especially as the Boeing 737-10 availability continuously slips to the right.
Summary:
- The A321LR/XLR has the same passenger capacity as the 757-200.
- The 757-200 has the range of the A321LR but can’t match the A321XLR.
Boeing is fighting fire with fire in reacquiring Spirit Aero (Updated)
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By Dan Catchpole
Analysis
July 1, 2024, © Leeham News: This is an analysis of Boeing’s reported $4.7 billion purchase Spirit AeroSystems, as Reuters reported Sunday.
First, let’s set the frame.
Boeing seems incapable of doing anything right these days. Even a pre-Farnborough Airshow media briefing by the aerospace giant last week resulted in a reprimand from the National Transportation Safety Board for sharing information about its investigation into the panel blowout on an Alaska Airlines flight on Jan. 5.
The company is bleeding money in its commercial and defense divisions. Boeing could turn around its balance sheet if it could straighten out production for its cash cows—the 737 and 787. Yet somehow, both programs are still struggling.
Boeing’s pissed off the Federal Aviation Administration, the NTSB, key members of Congress, some of its biggest customers, and the Machinists union in Washington and Oregon, among others. Its current CEO is a lame duck who helped create the crises overwhelming the company. Potential successors have said they don’t want the job. Among the front-runners to succeed David Calhoun is BCA’s new CEO Stephanie Pope, who has no production or product development experience and has had few public appearances since she took over BCA in March. There are plenty more problems, but you get the point.
Spirit AeroSystems has been floundering since the COVID-19 pandemic threw the aviation industry into chaos. Since 2020, it has recorded $3.2 billion in net losses, including $617 million posted in the first quarter of this year. Boeing has helped keep the company afloat with financing and price changes.
In short: Boeing is fighting countless fires, and it just bought another one.
Can Boeing fight fire with fire?
To what extent can the A321XLR replace the Boeing 757, Part 1.
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By Bjorn Fehrm
June 27, 2024, © Leeham News: The Airbus A321XLR, the extra-long-range version of the A321neo, will start operational service with IBERIA on the Madrid-Boston trans-Atlantic route later this year. It’s the type of thin, long-range route the Boeing 757 has served to date.
We will use our Aircraft Performance and Cost model (APCM) to examine to what extent the A321XLR can replace the 757 on world routes. What is the difference in capacity and range, and what improvement in operational economics can be expected?
Summary:
- The Boeing 757 was the original MOM/NMA (Middle-Of-the-Market / New-Midmarket-Airplane).
- It had unique characteristics, which Boeing would have followed up with the NMA project.
- Boeing hesitated, and Airbus developed the A321XLR to fill this role. Has it succeeded?
Airbus lowers 2024 guidance amid A320/A321 supply chain and space system challenges
Bjorn Fehrm
June 24, 2024, © Leeham News: Airbus issued a press release today where it lowered guidance for 2024.
The release highlighted two areas as the drivers for the update:
- Larger-than-expected supply chain issues for the single-aisle segment (A320/A321), where delivery ramp problems in engines, aerostructures, and cabin equipment mean that the guidance for 2024 goes from 800 aircraft in total to 770. Because of this, the ramp to 75 A320/A321 deliveries per month has been moved out a year to 2027 instead of as previously forecasted 2026.
- The Defence and Space Systems management has, after an extensive review, found schedule, workload, and sourcing challenges for certain Space telecommunications, navigation, and observation programs. Airbus has decided to record charges of around € 0.9bn in the H1 2024 report to cover the problems in these programs.
As a result, Airbus has decided to update the 2024 guidance ahead of its 1H2024 results release, which is on 30 July:
- Around 770 commercial aircraft deliveries (was 800).
- EBIT Adjusted of around € 5.5 billion (was €6.5bn to €7bn).
- Free Cash Flow before Customer Financing of around € 3.5 billion (was € 4bn).
Airbus adds the usual caveats to the guidance:
The Company assumes no additional disruptions to the world economy, air traffic, the supply chain, the Company’s internal operations, and its ability to deliver products and services. The Company’s 2024 guidance is before M&A.
Aircraft production woes stretch far beyond Boeing
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By Judson Rollins
June 17, 2024, ©. Leeham News: Estimating airplane delivery rates isn’t much more than a guessing game nowadays.
While many headlines point fingers at beleaguered Boeing and Spirit AeroSystems, aviation’s production woes are much more complex. Even in 2024, the labor shortage legacy of COVID-19 and raw material shortages exacerbated by the Russia-Ukraine war loom large over the industry.
Airbus struggles to deliver airplanes on time, and engine makers also see their deliveries constrained by supply chain issues.
Source: AFP via Aviation Week Network.
Summary
- Boeing commercial production is far below advertised rates.
- Airbus deliveries suffer from shortages of seats, other parts.
- Embraer says deliveries would be higher without supply chain issues.
- COMAC’s disruption opportunity is dampened by likely trade conflict.
- Pratt and GE Aerospace slowly ramp up delivery of redesigned components.
Freighter market faces turmoil while passenger sector gets the headlines
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By Scott Hamilton
June 10, 2024, © Leeham News: Delivery delays of widebody airplanes are causing disruptions in freighter conversion plans as feedstock is retained for passenger operations.
IAI Bedek Boeing 777-300ER P2F. Photo: IAI Bedek.
Demand for passenger airplanes also is slowing Airbus’ plans for the A350 freighter, according to market intelligence.
Softening of the cargo market since the end of the COVID-19 pandemic also impacts the immediate need for converting airliners to freighters, sources say.
Although Boeing’s delays with the 787 and 777X get most of the blame, Airbus also gets some credit for the A350 program. Already, say potential cargo airplane buyers, the A350 freighter is looking at a delay beyond the 2026 entry into service (EIS) date. Uncertainties among Middle Eastern carriers Etihad and Emirates over the A350-1000 Rolls-Royce engine durability are also causing officials to rethink retaining Boeing 777-200LRs and 777-300ERs in service.
Certification of the IAI Bedek 777-300ER freighter conversion program is taking longer than expected. The reason: the negative halo effect dating to the Federal Aviation Administration (FAA) certification crisis with the Boeing 737 MAX.
It took Boeing 21 months to recertify the MAX after its grounding began in March 2019. The MAX 7 and MAX 10 still aren’t certified and aren’t expected to be until sometime next year.
Certification of the 777X, also affected by the negative halo effect of the MAX crisis, isn’t certified. EIS was intended to be in 1Q2020. Boeing has yet to receive Type Inspection Authorization (TIA) from the FAA, one of the final steps required before certification. Boeing officially hopes certification will occur next year. But quietly some within Boeing now don’t think TIA will come until 1Q2025. Emirates and Lufthansa Airlines, the first scheduled operators of the airplane, openly say they don’t expect deliveries until 2026.
The upshot: feedstock of the 777-300ERs for conversion companies is drying up.
The all-important cabin. Part 3
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By Bjorn Fehrm
June 6, 2024, © Leeham News: We do an article series about the all-important cabin and its seating for an airliner. We have looked at different narrowbody cabins and how the seating differs widely depending on the market and customer segments the aircraft addresses.
This week, we focus on why widebody aircraft have relatively low seat counts compared with single-aisle aircraft, like the A321neo.
We use the cabin generator in our Aircraft Performance and Cost Model (APCM) to configure widebody cabins and compare these with the narrowbody equivalents.
Summary:
- The widebody cabins are configured for longer flight times, resulting in them taking more space.
- When a widebody is configured for domestic flights, its seating per cabin area is closer to that of a narrowbody.
The all-important cabin. Part 2
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By Bjorn Fehrm
May 30, 2024, © Leeham News: We will do an article series about the all-important cabin and its seating for an airliner. The cabin layout and its comfort are the most important part of an airliner for the passenger. For an airline it’s its face to the customer.
We will look at the different types of cabins used and how these use the airliner’s real estate, what the cost is, and what the weight is. With the weight, we can also predict how different cabins affect the aircraft’s performance.
Summary:
- The configuration of the cabin has a large influence on total seating, weight, and cost.
- The relationships change up to 500%.