Leeham News and Analysis
There's more to real news than a news release.
Airbus Group, first half results 2014
Airbus Group (before EADS) reported 1H 2014 results yesterday against the backdrop of an eye-catching cancellation (Skymark A380). Overall it was a report which showed solid progress in making the former EADS a homogenous, modern industrial group managed by market realities and not involved government’s politics.
Much has been achieved since the same occasion last year when then EADS announced the name change to Airbus Group and the merging of its Defense and Space side into one tighter knit division. These changes reflected market realities; civil aerospace is growing year over year whereas Defense budgets are shrinking. The yesterday announced group numbers shows gains in revenue and profitability (+6% each when EBIT is cleaned from sale of ex. Paris HQ) underlining solid progress in the undertaken structural changes. Read more
Farnborough does little to relieve 777 Classic, A330ceo production gap issues
The orders and commitments announced by Airbus and Boeing at the Farnborough Air Show last week for the A330ceo, the A330neo, the Boeing 777-200LRF and the 777-300ER will help fill the looming production gaps for the two airplanes, but work by both OEMs still needs to be done.
See the production gaps, before the orders and commitments were announced, by clicking the following links:
Airbus A330 delivery schedule, 2015-2020
Odds and Ends: Hawaiian orders A330-800, drops A350-800; A330neo market potential; Engines and Airbus
Hawaiian Air’s A350-800s: Hawaiian Airlines July 22 ordered six Airbus A330-800s and simultaneously dropped its order for six A350-800s. HA also took six purchase rights for the A338. Deliveries begin in 2019.
The A338 is slightly smaller, nominally at 252 seats, and has somewhat less range at 7,600nm than the 276-seat, 8,250nm A358, but only Hawaiian knows how much it needed the extra range. Losing the extra seats does give HA a hit to revenue potential, however. For wide-body airplanes, Airbus says each seat has the revenue potential of $2m/yr.
Offsetting the revenue loss is a far lower capital cost for the A338 vs the A358. Our economic analysis, based on technical specifications estimated before the Farnborough Air Show and before Airbus revealed data for the A338, showed the A338 pretty close to the A358 on a pure operating cost basis, not including adjustments for capital cost.
Airbus A330-800 and -900neo, first analysis, part 3: performance
In our first two parts of the analysis of the Airbus A330neo launch at the Farnborough Air Show, we have gone through the information provided by Airbus and Rolls Royce and provided comments on what these really mean from a practical point of view.
Areas we wanted to verify with our independent model have been how the A330neo would perform versus the A330ceo, especially on shorter ranges, than the Airbus example of 4,000nm and how it would stack up against the Boeing 787.
We give the first answer to these questions with data from our proprietary, independent model. This is first-cut data and we bring it forward in time as there is some confusion on what Airbus has said about the shorter range performance of the A330neo. Read more
Farborough Air Show, July 16: Snipe hunts in an era of model improvements
- Upate, 5:30am PDT: The Wall Street Journal has an article that is more or less on point to the theme of this post.
It doesn’t matter what the competition does, it’s always inferior–until you do it yourself.
The continued, and tiring, war of words between Airbus and Boeing throughout the decades is monotonous and self-serving. If you step back, it’s also amusing.
Consider:
- Boeing constantly dissed the Airbus concept of fly-by-wire–until ultimately adopting FBW in its airplanes.
- Airbus dismissed twin-engine ETOPS of the 777 while promoting four-engine safety of its A340–until evolving the A330 into a highly capable ETOPS in its own right.
- Airbus put-down the 777X, saying the only way Boeing could make it economical was by adding seats…which Airbus has now done for the A330-900 to help its economics.
- Boeing ridiculed the idea of a re-engined A320, but then had to follow with a re-engined 737 MAX due to the runaway success of the A320neo.
- Boeing ridicules the A330neo as an old, 1980s airplane–neatly ignoring the fact that the 737 and 747 are 1960s airplanes.
- Airbus still calls the 777/777X/787 a “dog’s breakfast,” though we know some dogs who eat pretty well.
And so it goes.
The fact of the matter is, however, that minor and major makeovers of existing airplanes have long been a fact of life, maximizing investment and keeping research and development costs under control. The Douglas DC-1 was the prototype for the DC-2, which begot the DC-3. The DC-4 (C-54) begot the DC-6, DC-6B and DC-7 series. The Lockheed Contellation was reworked from the original L-049 through the 647/749/1049 (in various versions) and finally the 1649.
Then came the jet age, with vastly more expense, and model upgrades became the norm. The sniping today between Airbus and Boeing goes unabated in an era of historical model improvements.
GE analysis post Farnborough
Our wrap up of Farnborough would be incomplete without looking closer at the world’s leading engine supplier, GE Aviation, which together with partners (like SAFRAN in CFM joint venture) garnered more than $36 Billion in orders and commitments during the show. This figure was only significantly bettered by Airbus ($75 Billion) and it came close to Boeing’s $40 Billion. With such level of business the claim by GE Aviation CEO, David Joyce, that the Airbus A330neo engine business was not the right thing for GE as they have more business than then they know what to do with, was certainly no case of “sour grapes”. Read more
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Posted on July 28, 2014 by Bjorn Fehrm
Airbus, Airlines, Boeing, Bombardier, CFM, Comac, CSeries, Embraer, Farnborough Air Show, GE Aviation, Leeham News and Comment, Pratt & Whitney, Rolls-Royce, Uncategorized
737 MAX, 777, 777-300ER, 777X, 787, A320NEO, A330neo, Airbus, Boeing, Bombardier, CFM, Embraer, Pratt & Whitney, Rolls-Royce