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 21. May 9, 2025
- Does an A220-500 need a new wing and engines? Part 2. May 8, 2025
- Embraer downplays tariff impact on 2025 results May 6, 2025
- JetZero readies effort for private equity fund raising May 5, 2025
- Bjorn’s Corner: Air Transport’s route to 2050. Part 20. May 2, 2025
Boeing, Embraer differ on the future of upgauging
By Judson Rollins
Introduction
July 30, 2024, © Leeham News: Embraer’s new 20-year Market Outlook, released during the Farnborough Air Show, forecasted the demand for jets with more than 150 seats for the first time. This comes as market observers speculate the Brazilian jet maker is mulling a move into aircraft larger than its current flagship E2 family.
However, the Brazilian jet maker delivered temperate commentary on the future of upgauging, citing one-time developments it believes are unlikely to repeat. It said, “The market environment that led to [an] increase in average aircraft size will not be the same in the future. Consequently, the growth trend likely will not continue.”
For instance, a typical two-class Boeing 737-800 Layout of Passenger Accommodations (LOPA) in the mid-2000s comprised approximately 150 seats. By the late 2010s, this shifted to 160-166 seats. A similar Airbus A320 LOPA went from 140 to 150 seats.
Source: Embraer Market Outlook (data from Sabre).
Will the pre-COVID upgauging trend continue, and what are its implications for future aircraft selection? Boeing and Embraer have decidedly different views, and the latter’s view will drive its decision whether to enter the market for 150+ seaters.
Summary
- Boeing says upgauging will continue, driven equally by cabin densification and aircraft size selection.
- Embraer believes upgauging is largely over.
- Both OEMs’ views have key flaws.
- The upshot: “Bigger” doesn’t always equate to “more profitable.”
Farnborough, Day 4: Airbus comes from behind to win order contest
July 25, 2024, © Leeham News: Airbus came from behind today with a big order from flyNAS, a Saudi Arabian low cost carrier, for 75 A320neo family members and its first widebody order, for 15 A330-900s.
The announcement is a Memorandum of Understanding.
Airbus ends the show with 139 orders and commitments. Boeing ends the show with 118 orders and commitments.
ATR announced its only order for the show yesterday, for four ATR-72s from Air Tahiti.
De Havilland Canada ended the show with 22 orders and commitments for the Twin Otter and Certified Refurbished Dash 8-400s.
Embraer didn’t announce any commercial orders, but added nine C-390s to its order book.
Farnborough, Day 2: Boeing dominates again
July 23, 2024, © Leeham News: Boeing dominating Day 2 of the Farnborough Air Show with a new, direct order for 20 737-8s from lessor Macquarie AirFinance, and a follow-on order from Qatar Airways for 20 777-9s.
Airbus announced a new order for seven A330-900s from Virgin Atlantic Airways and firmed up a previously announced order from Japan Air Lines for seven A321neos and 20 A350-900s.
Airbus, Pratt & Whitney, and Cebu Pacific Airlines of The Philippines celebrated a Memorandum of Understanding for an order of up to 152 Airbuses announced on July 2. This celebration is not in LNA’s table below.
De Havilland Canada announced orders for 11 DHC-6 Twin Otters.
Farnborough, Day 1: Boeing jumps to orders lead; De Havilland puts new life into the Dash 8-400
July 22, 2024, © Leeham News: Boeing was the clear winner in the orders announcements today at the Farnborough Air Show.
The beleaguered company announced orders, options, and commitments for 78 aircraft (see chart). Rival Airbus announced a Memorandum of Understanding for just five airplanes.
Tiny De Havilland of Canada announced firm orders and commitments for 11 “Certified Refurbished” Dash 8-400s.
The Certified Refurbishment Program is a multi-step process to rework used Dash 8-400s “to keep the fleet flying.” DHC terminated production of new -400s during the COVID pandemic when the old Bombardier factory at Downsview, Toronto, was closed. The airport there is being redeveloped. DHC is building a new plant in Calgary in Western Canada. It’s unclear if production of new -400s will resume. When the factory is complete.
“DHC has actively been acquiring aircraft in the marketplace and has begun upgrading these aircraft for delivery to customers looking to expand their fleets or become Dash 8 customers for the first time,” the company said in a statement.
DHC says refurbishments include:
- Aircraft configuration to match the customer’s existing fleet
- Completion of overdue maintenance, integration of Airworthiness Directives, and Service Bulletin upgrades
- Airframe life extensions through our ESP (Extended Service Plan) to extend the lives of Dash 8-100/200/300 to 120,000 cycles, or the ESP+ which can take the Dash 8-100 to 160,000 cycles
- Freighter conversions, including the introduction of the new Dash 8-400 Large Cargo Door and Quick Change between cargo and passenger missions
- Avionics upgrades
DHC has acquired 28 -400s for the program so far.
Boeing sees traffic recovery from pandemic, growth for future in latest forecast
By Scott Hamilton
July 19, 2024, © Leeham News: Boeing sees airline traffic recovery to near-pre-COVID pandemic levels in its latest 20-year forecast for aircraft demand.
It also sees growth through 2043 along similar lines announced by Airbus last week in its 20-year forecast. The numbers between Airbus and Boeing are inconsequentially different. Boeing includes regional jets in the 70-90 seat sector; Airbus doesn’t forecast the RJ market. Over the next 20 years, Boeing forecasts deliveries of just over 1,500 RJs—a market that has been shrinking for years.
Embraer, the sole manufacturer outside of China and Russia of RJs, hasn’t announced its 2024 forecast (this usually comes during the international air shows—Farnborough is next week). Nor does it break out the RJs in its forecast, which is for single-aisle jets up to 150 seats.
In its 2024 20-year forecast released last month, the Japan Aircraft Development Corp. (JADC) forecasts deliveries of 1,584 new RJs in the 61-100 seat sector—very close to the Boeing number for RJs and the Boeing and Airbus numbers overall. The JADC forecast is the only one to provide details for sub-sectors within the RJ, single-aisle, and twin-aisle markets.
Aircraft Certification: How the Max crashes changed everything
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By the Leeham News Team
The Airbus A321XLR got caught up in the new aircraft certification environment created by the Boeing 737 MAX crisis. Source: Airbus.
July 18, 2024, © Leeham News: Much of the attention in the airline industry has recently been focused on the production issues faced by both major OEMs, Airbus (AB) and Boeing (BA). Supply chains are snarled, airlines had to re-jig their fleets, keeping less efficient aircraft in service longer than they planned and financial performance suffered.
LNA recently drilled down and detailed the long-term effects on Southwest Airlines, which is dealing with jet certification delays and must make do with a less-than-ideal fleet mix.
One of the overlooked aspects are the consequences of the Boeing 737 Max 8 accidents and subsequent Alaska Airlines 737 Max 9 door plug blowout is the effect it is having on getting new, more efficient variants certified into service to replace older aircraft.
Both OEMs have been affected. Airbus had to push back the introduction of its A321XLR by about a year, but a detailed inspection by LNA reveals that Boeing is suffering more from the increased scrutiny of the FAA and Congress.
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?