Leeham News and Analysis
There's more to real news than a news release.
New Report on Boeing
AirInsight has published a new report on The Boeing Co. This follows reports on Airbus, the emerging competitors to Airbus and Boeing and Re-Engining the A320 and 737 families published since August.
We co-authored these reports with Ernest Arvai and Addison Schonland of The Arvai Group and Innovation Analysis Group. The link to these reports is here.
The Boeing Co. report contains a competitive assessment vis-a-vis Airbus, updating our Airbus report published in August; a close look at Boeing’s programs; its relationship with labor; the prospect for replacing the 737 and 777 to meet Airbus competition; the KC-7A7 and more.
Airbus raises prices on weak dollar
Airbus raised its list prices for aircraft by an average of more than 5% because on the continuing weakness of the dollar vis-a-vis the Euro. Airbus prices its airplanes in dollars but much of its costs are in Euros. Every 10 cent decline in the dollar costs Airbus $1bn in EBIT profits. The price list is at the end of this column below the jump.
This article explains the details. But this isn’t the only problem Airbus has.
Tanker Contract: Follow the law
Update, Feb. 1:
The newspaper The Hill, which covers Capitol Hill, reports the USAF plans to award a contract for the KC-X this summer, sticking (more or less) to the timetable originally projected. Secretary Robert Gates also plans to urge President Obama to veto any FY2011 defense bill that contains funding for the Boeing C-17, which Gates cuts from the proposed budget.
We believe cutting funding for the C-17 is a mistake. We also believe the Administration ought to take Stimulus funds, double the KC-X procurement from 12-18 tankers a year (resulting in retiring the ancient KC-135s a lot faster) and split the contract between Boeing for the KC-767 and Northrop Grumman for the KC-30. In addition to the only political solution that will work, there are solid strategic reasons for the procurement to be split.
Taking Stimulus money to establish a new aerospace industrial base in Mobile (AL) while supporting the existing 767 program is far more productive than giving Stimulus money to things like a California dinner train.
Original Post:
Here’s a commentary from an outfit we’d never heard of before, the Forerunner Foundation. This op-ed piece appeared in the January 11 issue of Aviation Week magazine. The writer, Jerry Cox, makes an interesting point over the campaign by Boeing supporters to exclude the Northrop Grumman (Airbus) bid for the KC-X tanker.
A400M management criticized
In what might seem to be stating the obvious, an audit criticizes the Airbus management of the A400M, according to this German news report via Business Week.
What is most interesting is the audit’s assertion that EADS can absorb the losses.
France “protectionist,” says Boeing
We wonder what took Boeing so long to make this obvious point: France is protectionist in its defense purchases and should quit complaining about the KC-X competition in the US. See this Reuters story.
Airbus annual press conference
Airbus held its annual press conference today, with several news items coming from it:
A400M
This program remains a financial disaster, with Airbus now acknowledging it threatens the well-being of the entire company. This New York Times article sums it up best. This Reuters article also has great detail. This 14 minute podcast by Innovation Analysis Group with the A400M chief test pilot talks about the flight testing.
Outlook for Airbus, Boeing in 2010
Introduction
2009 has faded into history and 2010 is here. Last year wasn’t kind to Airbus or Boeing—though it was worse for the latter than the former. How will this year be?
We’ll get right into how we see things lining up for the two largest airframe OEMs for this year.
Why US transport producers failed
Defense analyst Loren Thompson picks up the old refrain about Airbus subsidies running McDonnell Douglas and Lockheed out of the commercial airliner business. We add our thoughts at the end of his article.
By Loren Thompson
Airbus subsidies have destroyed thousands of US jobs
Monday, December 21, 2009
In a few days, the world’s two major producers of commercial transports (jet airliners) will release their order and delivery results for 2009. The results will show that European champion Airbus delivered slightly over 50% of all planes built, while greatly exceeding American champion Boeing in the number of new planes ordered. It’s been going this way pretty much since the decade began, because after 40 years of subsidies from European governments, Airbus now has a complete family of transports that can aggressively compete in virtually any capacity/range category with Boeing.
Airbus, Boeing nearing re-engining decision
Reuters has this report saying Airbus and Boeing will decide, probably next year, whether to re-engine the A320 and 737 families.
The AirInsight team of The Arvai Group, Innovation Analysis Group and Leeham Co., published the report below earlier this month that decisively predicted this will happen. The report may be purchased here.