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
US start-up has a lot of Moxy
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Introduction
June 21, 2018, © Leeham News: A new US airline secured delivery positions for 60 Bombardier CS300s for deliveries from 2020, according to its business plan circulating this month.
Moxy Airlines is led by David Neeleman, founder of several airlines including Morris Air (later acquired by Southwest Airlines), WestJet, JetBlue and Brazil’s Azul Airlines.
No application for certification had been filed with the US Department of Transportation as of last week.
The plan was first reported by Airfinance Journal June 11.
Summary
- Business plan says an “order” has been placed for 60 CS300s but also says “delivery positions” were procured.
- Delivery positions may be those of Republic Airways Holdings.
- Initial funding of $100m raised.
- Secondary cities, point-to-point business model.
- Likely boost for C Series plant in Mobile (AL)—but a suggestion that this fills the line for two years is off base.
VLA era is over; are 777X, A350-1000 too large?
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Introduction
June 18, 2018, © Leeham News: The era of the Very Large Aircraft appears over.
The Boeing 747 passenger airliner, while nominally still offered for sale, is in reality dead.
The Airbus A380 limps along in what may prove to be a vain hope that airport congestion will spur sales next decade.
The next level down, however, doesn’t appear very strong.
Sales of the Airbus A350-1000 stalled at 200 or less for years.
Sales of the Boeing 777X likewise stalled following program launch in 2013-2014. Although the 777X has twice as many orders as the A350-1000, fully 72% of them come from three customers, one of which is in serious financial trouble and may cancel or defer some or all its orders.
Summary
- Orders for the largest Large Twin-Aisle aircraft lag the Small and Medium Twin-Aisles.
- Big 3 in the Middle East are major customers for the 777X, A350-1000. Iran Air also buyer of -1000.
- While Big Twin languishes, small- and medium-twins remain in demand.
Read more
Airbus-C Series closing a “positive catalyst,” say analysts
June 13, 2018, © Leeham News: The news Friday that Airbus and Bombardier concluded the deal in which Airbus takes a 50.01% ownership in the C Series program was greeted favorably by two analyst reports LNC saw.
Credit Suisse and JP Morgan each called the approval by all regulatory authorities and closing the deal—well ahead of schedule—as positive catalysts for the C Series.
A synopsis of the two research notes are below.
The partnership becomes effective July 1, just two weeks ahead of the Farnborough Air Show.
Airbus risks losing market share if it doesn’t boost A350 production
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Introduction
June 11, 2018, © Leeham News: Boeing is increasing the production rate of the 787 next year from 12 to 14/mo.
Airbus is reducing the production rate of the A330neo from 10 to 6/mo.
Last year, buried deep in its website, Airbus indicated plans to go to rate 13/mo, although no date was listed.
With few sales of the airplane last year or so far this year, will demand support a rate hike next year? If so, a decision is needed pretty much now to go forward.
One London-based aerospace analyst tells LNC the top executives say no rate hike will be coming.
Scheduled deliveries may lend a clue.
Summary
- Boeing is winning the wide-body order race and retaken the lead in market share.
- Airbus’ former top sales chief bemoaned the lack of delivery slots for the A350.
- Supplier issues still slow A350 deliveries.
Airbus-C Series deal closes July 1; presents challenges for Boeing, Embraer
June 8, 2018, © Leeham News: Airbus assumes its 50.01% majority stake in the Bombardier C Series program July 1, the two companies announced today.
The company is called C Series Aircraft Limited Partnership, or CSALP.
The CS100 and CS300 may be renamed the A210 and A230, according to a previous press report.
A C Series Final Assembly Line will be constructed in Mobile (AL), next to the Airbus A320 FAL, to serve the US market.
Airbus and Bombardier will speak at the Southeast Aerospace & Defence conference June 25-27 in Mobile (AL). The C Series final assembly line will be an extension of the A320 FAL.
Airbus-C Series deal to close July 1
- Note: A press conference follows today. Here is the press release issued by Airbus and Bombardier.
Airbus, Bombardier and Investissement Québec agree C Series Partnership closing effective July 1, 2018
- Airbus to acquire majority stake in the C Series Aircraft Limited Partnership, effective July 1, 2018
- All regulatory approvals required for the closing of the transaction have been obtained
- Partnership head office, leadership team and primary final assembly line located in Mirabel, Québec (representing some 2,200 employees and subcontractors), with the support of the C Series global supply chain
- Partnership brings together two complementary product lines, with 100-150 seat market segment projected to represent 6,000 new aircraft over the next 20 years
- Addition of Airbus’ global reach to create significant value for C Series’ customers, suppliers, employees, shareholders and communities
- Significant C Series production efficiencies anticipated by leveraging Airbus’ production ramp-up expertise
- Growing market for C Series to support second Final Assembly Line in Alabama, serving U.S. customers
Bombardier will talk about the new C Series Final Assembly line planned for Mobile (AL) next to the Airbus A320 FAL during the Southeast Aerospace & Defence Conference June 25-27 in Mobile.
How competitive is A330neo? Part 3.
By Bjorn Fehrm
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Introduction
June 7, 2018, © Leeham News: In Part 1 we compared the base characteristics of Airbus’ A330-900 and Boeing’s 787-9. In Part 2 we compared the fuel consumptions. Now we continue with the other costs of operation.
With these we form Cash Operating Costs and then add capital costs to get Direct Operating Costs.
Summary:
- The operating costs for the A330-900 and the 787-9 are close.
- The difference can be compensated with lower capital costs. Monthly lease rates for the A330-900 are below the 787-9 lease rates.
- We think there are other Boeing strengths which turn the deals the 787 way.
Airbus sees potential for A330neo sales; Boeing sees opportunity
June 6, 2018, © Leeham News: Airbus remains confident that the sales boon for the slow-selling A330neo is just around the corner, but an analysis of Airbus’ current operator lists shows significant inroads by Boeing for its 787.
Airbus is counting on aging A330ceos by 2020 to spur sales of the A330neo. But Boeing already sold the 787 to 19% of the A330 operators. Look for more aggressive campaigns. Airbus photo via Google.
LNC outlined Airbus’ strategy last December in which officials are confident the A330neo will see an uptick in orders as the current A330 operating fleet, now called the ceo, ages beginning in 2020.
The new sales chief, Eric Schulz, reiterated Airbus’ confidence at the IATA AGM this week in Sydney, Australia.
But 19% of the 109 A330 operators already ordered the 787. One, American Airlines, already announced the 787 order will replace the A330s in its fleet. Air Canada long ago made a similar announcement. Hawaiian Airlines canceled an A330-800 order in favor of the 787-9.
EU, Airbus saw hope to negotiate end to WTO dispute; US says nothing changed
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Introduction
June 4, 2018, © Leeham News: A report a week ago in the long-running dispute between the US and Europe over Airbus launch aid left the impression the US position softened a bit, favoring negotiations over another round in the protracted process.
Airbus and the EU appeared to take comments made by the US Trade Representative (USTR) at a hearing last Monday out of context, grasping at a sliver of hope that negotiations will resolve the dispute.
The USTR’s office told LNC nothing has changed. One source told LNC no negotiations will be undertaken unless Airbus drops launch aid entirely, something the WTO didn’t find to be illegal, but which was implemented improperly.
Summary
- Airbus and the EU claim the violations have been remedied, something the USTR and Boeing reject.
- Airbus claims any harm to Boeing was minimal. The Seattle Times has this story; LNC has this report.
- The EU and USTR filed new statements with the WTO that remain contradictory.
Pontifications: Lufthansa is sabotaging history
By Scott Hamilton
June 4, 2018, © Leeham News: I never thought I would find myself writing something like this.
Lufthansa Airlines is sabotaging history and its own airplane restoration project.
Lufthansa, the airline that honors its history with the airworthy Junkers JU-52, flying it around Europe garnering millions of Euros of publicity in the process.
Lufthansa was one of the few airlines to fly the Lockheed L-1649 Starliner Constellation. Only 44 were built.
Lufthansa, which agreed to restore one of just 44 Lockheed L-1649 Starliners to full LH colors and make it flyable.
The engines have been run up. The airplane was assembled. First flights were planned for next year.
And now, Lufthansa is pulling the plug.
Despite media inquiries and questions from leaders of the project, Lufthansa hasn’t said why it is shutting down the effort to create an airworthy airplane.