Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Bjorn’s Corner: Air Transport’s route to 2050. Part 20. May 2, 2025
- Supplier Howmet exceeds expectations despite tariffs May 1, 2025
- Airbus 1Q2025 results: So far, so good, but US tariffs make future results unpredictable May 1, 2025
- Does an Airbus A220-500 need a new wing and engines? May 1, 2025
- Teamsters, Boeing have a new contract April 29, 2025
Pontifications: A good week for Boeing wide-bodies
By Scott Hamilton
Oct. 17, 2016, © Leeham Co.: Boeing had a very good week for wide-body orders last week. It recorded 42 orders for the 787 and 10 for the 777-300ER.
Thirty of the former and all of the latter came from Qatar Airways. There were 12 787 orders from “Unidentified,” which in this case was from China Southern Airlines. These were announced Wednesday but too late to show up on the weekly orders update posted Thursday.
787 Book:Bill
For the year, Boeing has 61 net orders for the 787, a healthy increase since the end of June, when the book-to-bill was a paltry 0.25 YTD. Even at 61, this is still a book:bill of just 0.42 for the 787, which has not had a book:bill of more than one since 2013. This means Boeing continues to burn off the backlog faster than it is booking new orders.
But it’s welcome news nevertheless in a year when there has been a dearth of wide-body orders.
Read more
Peeking into Boeing’s future airplanes
Oct. 18, 2016, © Leeham Co.: It was a rare look into potential future airplanes and passenger experience by Boeing, which is known for keeping these topics close to
Mike Sinnett, VP Product Development for Boeing. Taking 787 technologies and enhancing them for future airplanes. Photo via Google images.
its chest.
Mike Sinnett, VP of Product Development for Boeing Commercial Airplanes, last week gave an audience of nearly 250 people attending the annual Governor’s Conference organized by the Aerospace Futures Alliance, a look at some of the concepts Boeing is studying. Some may evolve into actual products and some may not, he said.
The evolving European legacy carrier
By Bjorn Fehrm
October 13, 2016, ©. Leeham Co, Nice: Scandinavian Airlines (SAS) has fought its way back from a near-death experience in 2012, readjusting to the growing low cost carrier environment in Europe.
After nearly being bought by Lufthansa in 2008 the airline has had to slug it out themselves, gradually fighting its way back to sustained profitability.
Figure 1. SAS will receive 6 Airbus A350 from 2019 to complement the A330. Source: Airbus.
Things are now looking up and the development and future of SAS is a good example of the problematic past and future of European legacy carriers.
Airbus, Boeing agree on NMA–for now
One concept of the middle of the market airplane.
Oct. 12, 2016, © Leeham Co.: It’s rare when Airbus and Boeing agree on product strategy, but officials of the two companies seemed in almost perfect alignment in separate interviews by LNC last week.
Barry Eccleston, president of Airbus Americas, and Mike Sinnett, VP of Product Strategy for Boeing, each said there is no consensus yet among customers for the Middle of the Market airplane (MOMA), also known as the New Mid-range Airplane (NMA) at Boeing.
Eccleston was interviewed on the sidelines of the annual Seattle conference organized by the British American Business Council Pacific Northwest. Sinnett was interviewed on the sidelines of the annual Governor’s Conference organized by the Aerospace Futures Alliance, a lobbying group in Washington State.
11th 737 MAX on the assembly line as Boeing gears up for delivery next year
Oct. 11, 2016, © Leeham Co.: The 11th 737-8 MAX is already on the Boeing production line at the factory in Renton (WA).
Southwest Airlines will receive the first 737 MAX next year. Boeing photo.
This one is for Lion Air, the Indonesian Low Cost Carrier that’s ordered 201 of the airplanes.
Previous 737-8s that already are built are also for LCCs Southwest Airlines of the USA.
The initial line up of customers scheduled to receive the MAXes next year is in stark contrast to decades ago when the names on the sides of the airplanes would be American, United, Lufthansa or Japan Air Lines. It’s illustrative to the changing airline industry.
Looking under the hood at the Qatar order
Oct. 10, 2016, © Leeham Co.: Qatar Airways announced an expected order Friday for Boeing 777s and 787s, but surprised with the addition of a Letter of Intent for up to 60 Boeing 737-8s.
The latter was characterized as a “blow” to Airbus, which has been the target of high profile, public attacks by Qatar’s CEO, Akbar Al-Baker, over issues related to the
Akbar Al-Baker, CEO of Qatar Airways. Photo via Google images.
A320neo and A350-900. Qatar is a launch customer for each, and each has been delayed due to supplier issues from Pratt & Whitney and Zodiac, respectively.
What Al-Baker expects Airbus to do about PW and Zodiac has never been made clear, but it’s the Airbus name on the airplane, so it’s Airbus that is the target of Al-Baker’s well-known wrath.
Al-Baker refused delivery of the first couple of A320neos due to the engine issues and threatened to turn to the Boeing 737 MAX in retaliation.
The announcement Friday was viewed by some media and aerospace analysts as following through on that threat and delivering a “blow” to Airbus.
But an LOI is the lowest form of a “commitment” to an airplane and one that doesn’t typically even involve deposits.
Let’s look at Friday’s announcement in detail.
Pontifications: Airbus, Boeing and Qatar; and more on the WTO
By Scott Hamilton
Oct. 10, 2016, © Leeham Co.: Last week ended with an order from Qatar Airways for 30 Boeing 787-9s and 10 777-300ERs. Qatar also signed a letter of intent (LOI) for 60 737-8 MAXes.
But that wasn’t the only news in what turned out to be a busy week.
The British American Business Council Pacific Northwest chapter’s annual conference was Tuesday. Airbus Americas president Barry Eccleston discussed the company’s reorganization and recent WTO loss in an exclusive interview with LNC. This was initially behind our paywall; we’ve now opened it to all readers.
He also discussed product development. This post is coming later this week.
Consultant Michel Merluzeau provided his forecast for the next 15 years at the same event.
The Aerospace Futures Alliance held its annual conference two days later. Boeing’s Mike Sinnett, VP of Product Development, gave a rare look into Boeing’s future product thinking. This post is also coming later this week.
Also on Friday, I toured the Boeing 737 factory in Renton with a group of suppliers. I’ll shortly be writing about this as well.
Let’s visit the Qatar order and the WTO issue.
Airbus’ Eccleston talks about reorganization and WTO
Subscription Required Now open to all readers.
Introduction
Oct. 6, 2016, © Leeham Co.: Airbus’ reorganization continues to unfold, with key components to be revealed, including key personnel appointments.
LNC sat down in Seattle with Barry Eccleston, president of Airbus Americas, at the conference Tuesday organized by the British American Business Council Pacific Northwest to talk about the moves. We also discussed the recent decision by the World Trade Organization (WTO) upholding an appeal by the US Trade Representative (USTR) in the 12-year old illegal subsidy cases between the US and European Union over government aid to Airbus and Boeing.
A decision on the EU appeal against the US and Boeing is expected to be issued after the first of the year.
Summary
- Reorganization eliminations duplications.
- Desire is to become more agile, flexible and competitive.
- No comment on whether the EU will appeal the WTO decision handed down last month.
- Two cases against Boeing (the US and Washington State) will see decisions next year.
Air Berlin, Europe’s ninth carrier, announces serious makeover
By Bjorn Fehrm
October 06, 2016, ©. Leeham Co: Air Berlin, Germany’s second airline and Europe’s ninth largest carrier by passengers carried, announced that it will wet-lease 40 aircraft to Lufthansa together with many European routes, concentrate all tourist operations into a new business unit before spinning it off and that it will reduce staff further.
Figure 1. Air Berlin will focus on its long haul network. Source; Air Berlin.
This comes after combined losses of €1.7bn since 2010. Several restructuring programs have not stemmed the losses. Last year they rose to €0.45bn and they have continued on in 2016. Read more
Looking 15 years ahead for Airbus, Boeing
Oct. 5, 2016, © Leeham Co.: The next 15 years won’t bring any relief to crowded airports and airplanes but nevertheless there are warning signs for the likes of Airbus, Boeing and the supply chain.
Michel Merluzeau
Looking ahead to 2030 will see aircraft production peaking early in the next decade but begin to fall off or the Big Two Original Equipment Manufacturers as new entrants begin to be felt, predicts Michel Merluzeau, an independent consultant.
Merluzeau presented his forecast yesterday to the British American Business Council Pacific Northwest chapter’s annual one-day conference in Seattle.
“I’m pretty comfortable about the next five years. I’m comfortable in the next five years. The five years after that,” Merluzeau said his confidence level declines because there are so many variables, ranging from issues within the industry to large ones outside it.