Leeham News and Analysis
There's more to real news than a news release.
How useful is an NMA, Part 4
By Bjorn Fehrm
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Introduction
November 1, 2018, © Leeham News.: Last week we looked at how a Boeing NMA would function as a medium range airliner in the Asia-Pacific.
We now continue with flying the two aircraft variants from Middle East locations, exploring how large an area in Asia, Europe and Africa the aircraft would cover.
Artists impression of the Boeing NMA. Source: The Air Current.
Summary:
- The profile of an NMA fits well in a Middle East Carrier’s fleet. Dependent on location it covers all of Europe and most of Africa and Asia.
- As the NMA is a lesser aircraft than the present long-range aircraft used on the routes it would have impressive economics for this type of operation.
Airbus’ disadvantages in widebody campaigns
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Introduction
Oct. 29, 2018, © Leeham Co.: Airbus faces a key disadvantage when it comes to winning current wide-body campaigns against Boeing.
The disadvantage is entirely out of its control.
It’s not about whether the A330neo or A350 vs the 787 economics are out of kilter. They’re not.
It’s about the engines, LNC is told by multiple market sources. Specifically Rolls-Royce engines, which exclusively power the Airbus wide-bodies.
Summary
- Airlines affected by Rolls-Royce-powered 787 problems are hopping mad.
- The negative halo effect puts questions over the Trent 7000-powered A330neo.
- While less affected, there is a negative halo effect over the Trent XWB-powered A350.
- Airlines considering follow-on ordered of 787s are ready to jump from RR to GE.
Boeing’s growing 777X challenge
- Boeing 3Q earnings call Oct. 24, 10:30am EDT.
Oct. 23, 2018, © Leeham News: Boeing has been confident it has bottomed out the production rate of the 777 line, successfully bridging between the Classic and the X models.
CEO Dennis Muilenburg nevertheless typically couches this confidence with “with still have some work to do.”
But during LNC’s trip last week to New York, sources said this bridge may be moving to the right.
Etihad Airways was a launch customer for the Boeing 777X. It’s deferred delivers once. It may do so again. LNC has been on this story since January 2017. Image via Google images.
How useful is an NMA, Part 2
By Bjorn Fehrm
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Introduction
October 18, 2018, © Leeham News.: Last week we started an article series which analyzes how useful a Boeing NMA will be for medium to long-haul flights in different markets.
We first went through all the factors which will change the OEM’s nominal range to an operational range. Now we fly the NMA in one of its main markets and look how it fairs.
Artists impression of the Boeing NMA. Source: The Air Current.
Summary:
- The NMA is designed to compete on operational economics with Single Aisle aircraft, yet offer the comfort and turn-around times of a Twin Aisle.
- To get to Single Aisle economics, the NMA can’t be too much aircraft. This shows when analyzing how NMA fares on trans-Atlantic routes.
Pontifications: Amazon’s quiet plans to grow its airline
By Scott Hamilton
Oct. 8, 2018, © Leeham News: Amazon, the giant on-line retailer, continues to move quietly to expand its Amazon Air cargo carrier, with plans to grow the airline to a size that could rival FedEx, market sources tell LNC.
Amazon’s contracting with Atlas Air, ATSG and others for Boeing 767F services is well known.
So are plans for a $1.5bn cargo center at the Cincinnati (OH) airport (which is really across the state line in Kentucky). This expansion will support more than 100 airplanes. Operations are targeted to begin in 2020.
Prime operates about 40 through its airline partners and is in the market for 10 more, LNC is told.
But this is just the tip of the iceberg. Read more
Huge surge of A320 orders greatly exceed near-, mid-term A320 retirements
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Introduction
Oct. 4, 2018, © Leeham News: The huge surge of orders for the Airbus A320 family far outstrips the aging aircraft statistics, an analysis shows.
Airbus has a backlog of more than 6,000 A320 family members, with more than 1,700 sales potential just for retirements.
There is a backlog of more than 6,000 A320neo family members, with the near- and mid-term delivery schedule far exceeding A320 retirements. Photo credit: Airbus.
There are more than 4,300 A320s scheduled for delivery from 2019 through 2025.
There are just 765 A320s that hit 25 years old during the same period.
The surge in A320-family aging aircraft begins in 2030, just as the bulk of the current backlog ends, according to data bases maintained by Ascend and Airfinance Journal’s Fleet Tracker.
Summary
- Useful lives of A320s in passenger service historically have been 25 years. Till now, no P2F programs existed to extend the useful lives.
- But, some passenger airlines are returning A320s off lease in 12 years or less—accounting for some of the surge in orders vs aging aircraft.
- Supply-demand imbalance in the secondary markets could emerge.
What costs dominate an airliner’s operation? Part 4
By Bjorn Fehrm
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Introduction
September 27, 2018, © Leeham News.: Over the last week’s we have looked at the costs for a typical Mainline and LCC airline operating in the US, Europe and Asian markets. The costs have been Direct Operating Costs (DOC) for the average routes operated by these airlines.
Now we finish the series with a look at the seat-mile costs so the Narrowbody and Widebody aircraft economics can be compared on routes both can serve.
Summary:
- When comparing seat-mile operating costs between Narrowbody and Widebody aircraft one must use the same cabin standards.
- Doing so will show the apples to apples operating costs of the two types when operating on sectors out to the maximum practical range of the Narrowbodies.
What costs dominate an airliner’s operation? Part 3
By Bjorn Fehrm
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Introduction
September 13, 2018, © Leeham News.: Last week we looking at the costs for a typical Mainline airline in our series about the airliner cost equation. We discussed the operating costs of Mainline airlines and how these would be affected by the operating area.
Now we calculated the different costs for a Low-Cost Carrier (LCC) operating either in the US, West Europe or Asia.
Summary:
- Fuel costs are the dominant costs for an LCC, regardless of geography.
- Airport fees and crew costs are other costs which differ between LCCs, Legacy carriers and Geographies.
Assessing A320 production rate interest in >70/mo
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Introduction
Sept. 17, 2018, © Leeham News: With the supply chain under major stress and Airbus and Boeing trying to recover from scores of “gliders” sidelined at airports without engines, each company nevertheless continues to study production rate increases for the A320 and 737 families.
Airbus publicly has said it’s looking at rate 70/mo. Boeing publicly acknowledges it’s looking at rate 63/mo.
Supply chain sources tell LNC Airbus is studying an even higher rate, into the “70s,” at early as 2020—a date that most consider out of the question.
Boeing is known to be considering a rate of 70/mo for its most profitable program.
Today, LNC looks at the A320 scenario. A future post will examine the 737.
Summary
- Airbus is scheduled to deliver more A320 members in 2019 than production capacity. Some of these may be parked backlog airplanes.
- 2020-2021 sold out at rate 60/mo, 2022-2023 nearly so.
- Rate increase to 70/mo opens opportunities for Airbus, pressure on Boeing.
What costs dominate an airliner’s operation? Part 2
By Bjorn Fehrm
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Introduction
September 13, 2018, © Leeham News.: Last week we began an article series looking at the cost equation for an airliner. We discussed the different costs and how these would be affected by airline type and operating area.
Now we calculated the different costs for a Legacy airline operating either in the US, West Europe or Asia.
Summary:
- The Narrowbody operated by a legacy carrier has high Aiport costs as it frequently take-offs and lands on major airports.
- For the Widebody operation, the fuel and capital costs are higher than Navigation and Airport fees. The differences in how the US, Europe and Asia handle en route navigation fees creates a large Navigation cost difference between the geographies.