Leeham News and Analysis
There's more to real news than a news release.
Odds and Ends: Comparing Airbus, Boeing 20-year forecasts; A320neo first flight; 787 battery probe fizzles; Mythbusting
Airbus v Boeing forecasts: The Blog by Javier takes its annual look at and comparison of the Airbus and Boeing 20-year forecasts. Airbus issued its new forecast this week; Boeing’s annual update was issued last summer.
Separately, the A320neo with Pratt & Whitney engines made its first flight today. The CFM LEAP neo is supposed to follow by six months. Showing class, Boeing Tweeted a congratulations for a milestone for the industry.
787 battery probe: The US National Transportation Safety Board hasn’t been able to find the root cause of the lithium ion battery failure in the Japan Air Lines and ANA Boeing 787 incidents. Now, the Japanese investigation has also failed to find the root cause of the ANA battery meltdown.
It’s rare but not unknown for investigators to not find root causes of problems, sometimes for years. A Northwest Airlines Boeing 747-400 split rudder hard over during a flight from Anchorage to Tokyo is one example; it took four years to determine the cause. The root cause of Boeing 737 rudder hard-overs, two of which caused fatal accidents, went unsolved for years.
Boarding airplanes: The reality show Mythbusters, an often entertaining look at myths, conventional wisdom, fact and fiction, takes a deep dive into airplane boarding. The article, with an insert to the episode, is here.
The Southwest Airlines style of boarding, with no seat assignments and derisively called cattle-call boarding, is the fastest and the most annoying, according to Mythbusters. Back-to-front is the longest. The Window-Middle-Aisle works best (but for those of us who like the aisle seat, the overhead bins are usually stuffed by then).
Odds and Ends: wrap-up from ISTAT Europe Conference; Airbus Group joins Aerion to create biz-jet.
The European 2014 ISTAT conference took place in Istanbul Monday and Tuesday. We have reported elsewhere on the presentations by Airbus and Boeing, here follows three interesting tidbits from the rest of the conference. We also comment on the surprising news that Airbus Group will join the US company Aerion to develop the worlds first supersonic biz-jet.
Airline and passenger growth: The ISTAT conference had an inspiring keynote by the CEO of Turkish Airlines, Dr. Temel Kotil. It was all about phenomenal passenger growth.
Turkish Airlines uses its location between east and west for a development in the scale of the Gulf airlines, Turkish is thereby a good example of the doubling of passenger traffic over 15 years as presented by Airbus. From its privatization in 2004 it has gone from 12 million passengers per year to 60 million 2014, spanning 250 destinations with 260 aircraft.
Turkish Airlines feels it is ideally placed at the cross roads to Asia and Africa, both continents with very high growth. They therefore foresee continued growth to 120 million passengers by 2033. They are fortunate that the Turkish state has played its part in enabling such expansion, leasing land to a 3rd major airport in the Istanbul area. This will be necessary should the majority of these passenger streams pass Istanbul, then the area will beat London Heathrow’s present 70 million passengers, calling for additional infrastructure.
Wizz Air CFO Mike Powell: In a discussion over the future of airlines, the development in USA and Europe was compared. In the US the consolidation has led to 4 airlines handling 90% of the traffic, in Europe the numbers are 40 airlines covering the same extent of the market. Wizz Air CFO Mike Powell (fifth largest LCC in Europe after Vueling) predicts that airlines which does not deliver returns on their assets or state-owned airlines not being able to operate without subsidies would be victims of European consolidation. The local traffic will to a large degree be taken over by LCCs whereas long-haul will move to the large hubs and networks in Western Europe like Frankfurt, Amsterdam, Paris etc.
Powell also explained what drove Wizz Air to go from taking delivery of A320 to A321 from next year. Their LCC traffic is very price sensitive but not so frequency sensitive, if they go from an average frequency over their destinations of 5 flights per week to 4 they would normally only loose a couple of percent in traffic margin. Flying the same load factor with a 321 and at lower frequency gains them around 6-7% in cost i.e. going to the larger aircraft will gain them something like 4-5% in margin.
Airbus Group teams up with Aerion: Airbus Group has joined Aerion, the supersonic biz-jet company from Reno, to help them develop the world’s first business jet which can fly at speeds up to Mach 1.6. The aircraft, called AS2, will seat 8 persons in typical biz-jet comfort and has transatlantic range.
Aerion AS2 supersonic Biz-Jet
ISTAT Europe Conference in Istanbul: Boeing and Airbus slugging it out with some new twists
Airbus and Boeing squared off once again Monday, this time at the ISTAT Europe conference in Istanbul, once again pretty much over the entire product lines.
Boeing’s VP Marketing Randy Tinseth began with two focal points, the 737 with its latest developments and Boeing’s “superior” Twin Aisle line-up. Tinseth claimed Boeing has caught up to the A320neo with the 737 MAX.
After an A320neo head start of a year, Tinseth says Boeing has kept the same sales rate per year for the 737 MAX. The backlog of 737 MAX now stands at 2,300 aircraft and he described why Boeing thinks it is well positioned in this market segment.
Airbus critiques the Boeing 737 MAX 200
With the formal launch by Boeing of the 737 MAX 200, the 200-seat high density version of the 737-8 with an order for 100+100 from Ryanair, Airbus was quick to launch its own critique on the airplane.
Kiran Rao, Executive Vice President, Sales & Marketing for Airbus, was quick to take aim at the advertised seating capacity of the MAX 200 and at the 197 seats Ryanair CEO Michael O’Leary says will be in the carrier’s configuration.
In an interview with Leeham News and Comment, Rao said that Boeing has to eliminate too many galley carts, even at reduced food and beverage options, to adequately service passengers. One cart is needed for every 40 passengers.
Airbus could decide on A380neo within six month: Emirates’ Tim Clark
Airbus could decide within the next six months whether to re-engine the A380 with Rolls-Royce powerplants, says Tim Clark, the president of Emirate Airlines, which has ordered more of the giant airplanes than any other customer.
Tim Clark, president of Emirates Airlines. Emirates Airlines photo.
Clark, speaking to a press gaggle on the sidelines of the World Routes conference Sunday in Chicago, said a RR engine would likely be based on elements of the Trent 1000 and Trent 7000 engines on the Boeing 787 and Airbus A330neo.
Odds and Ends: Delta/Airbus/Zodiac unveil A320 interior; Upgauging narrow-bodies, down-gauging 747s
A320 interior upgrade: After nearly a year of denying a story by Mary Kirby of Runway Girl Network and avoiding our own report from two years ago, Delta Air Lines, Airbus and interior OEM Zodiac revealed a new interior for the A320 family.
The announcement was made at the APEX convention by Airbus. The interior will appear beginning in Q12016, in this case in Delta’s A321ceos.
New pivot bins will be installed on the Airbus A320 Family beginning in 1Q2016. Delta Air Lines will be the first customer in the A321ceo. Airbus photo.
The overhead bins, which mimic the A350 design, are available for retrofit. Airbus says there is 10% more space compared with today’s bins.
Odds and Ends: KC-46A update; A440M in the US; A320neo first flight; Southwest no longer an LCC
KC-46A update: Aviation Week has an update on the status of the Boeing KC-46A tanker. Among other things, first fight has now been moved from June to November at the earliest.
A400M in the US: Airbus thinks it’s possible to sell hundreds of its A400M to the US Armed Forces to replace the Lockheed Martin C-130 and Boeing C-17, according to this article by Reuters.
A320neo first flight: Is the Airbus A320neo first flight going to run behind schedule? Airbus won’t say but Reuters suggests that it might. So does Aviation Week, like Reuters, pointing to an issue with the engine.
Southwest no longer an LCC: Bloomberg writes that Southwest Airlines is no longer a low cost carrier, with Cost per Available Seat Mile now approaching the legacy carriers. Years ago we characterized Southwest as the first legacy LCC, as costs increased, low fares began to disappear (it’s often easier to find a low fare on a competitor today) and routes took it into big city airports previously eschewed.
Odds and Ends: Safran benefits from engine after-market; ExIm could back Airbus; Paine Field future
Engine After-market: Safran, which owns 50% of CFM International with GE Aviation owning the other half, is positioned in the “sweet spot” of the engine after-market, according to a recent report by Bernstein Research.
The report further supports our own analysis posted August 25 and the growing importance of MRO support in winning engine orders.
According to Bernstein, Safran “has the best positioning in the aircraft engine after-market” in the investment bank’s coverage. This position is “driven by two engine families with strong growth ahead and low exposure to older engines that are at risk of early retirement.”
Bernstein notes that more than 95% of Safran’s after-market sales are derived from the CFM56, which powers 75% of the narrow-bodied aircraft, and the GE90, which powers the Boeing 777-200LR/LRF and 777-300ER.
Future programs include the CFM LEAP, GEnx and GP7200. Past programs, in decline, are the first generation CFM56 and the CF6 on earlier wide-bodies.
ExIm and Airbus: In a statement surely to inflame those opposed to renew ExIm Bank authority, the president of the bank said it’s possible it could back funding of the Airbus A320 family built in Mobile (AL).
Paine Field future: It’s a little parochial but The Everett Herald has an article looking at the future of Paine Field, where Boeing’s wide-body airplanes are assembled. The article necessarily looks at the future of the Boeing 747, 767 and 777 Classic production.
Congress is now talking about a nine month extension of ExIm.