The news that Asia’s Lion Air might be planning an order for the Bombardier CS300 energized the media and those that follow the OEM. If Lion Air follows through, this would be a major defection from Airbus and Boeing, which have large backlogs with this Low Cost Carrier.
It would be a major breakthrough for Bombardier. But there are key questions about the prospective order.
Chinese Lessor for CSeries: Bombardier today announced the identity of a previously undisclosed customer for the CSeries, and it is important for two reasons: one, it’s a lessor, and two, it’s from China.
CDB Leasing Co. signed a conditional order for five CS100s and 10 CS300s, with 15 options, in 2012. The press release infers this is now a purchase order, but the wording is somewhat ambiguous:
Bombardier Aerospace announced today that CDB Leasing Co., Ltd. (CLC), one of China’s top leasing companies, is the previously announced undisclosed customer that signed a conditional purchase agreement for five CS100 and 10 CS300 jetliners. The purchase agreement also includes options on an additional five CS100 and 10 CS300 aircraft, for a total of up to 30 CSeries aircraft. This agreement was initially announced as a conditional order from an undisclosed customer for five CS100 and 10 CS300 jetliners on July 8, 2012.
BBD’s Mike Arcamone’s interview with the Globe and Mail suggests this is now a firm purchase contract. We received word from BBD that this remains a conditional order. The “conditional” part remains undisclosed.
CLC is the second lessor, after LCI, to order the CSeries. The fact that this order is from China is also important. BBD has a significant presence in China for production of Q400 fuselage segments and part of the CSeries fuselage is to be produced in China, though start-up has been difficult and the first fuselage sections were back-stopped and produced at BBD’s Belfast plant. The absence of a Chinese customer raised a number of questions with some observers, which are now answered to some degree, who will nonetheless seek additional Chinese orders (as well as more orders overall) now that the first flight has taken place.
Separately, this story in the Montreal Gazette provides the most comprehensive look at the CSeries test program since first flight September 16. BBD hasn’t said much about the testing since first flight, and the plane has only flown twice more.
Aircraft gap: This fits right in with our Boeing 757 replacement post this week–the creation of the Airbus A330 Lite still leaves a gap in OEM product lines, Aviation Week writes.
Delta vs Alaska: The schedule ramp-up by Delta Air Lines into Seattle, in competition with its marketing partner Alaska Airlines, continues to draw attention with the media.
Ted Reed of TheStreet.com has a thorough look at the competition.
CrankyFlier (we love this name) has a different take, which provides some valuable insight into the burgeoning competition.
Supply chain demands: Earlier this week, we talked about the prospect of production wars as Airbus and Boeing ramp up over the next five years, combined with the new entrants and the new offerings from Bombardier and Embraer.
We noted that this will mean opportunity and risk for the supply chain. Ryan Murphy from Salem Partners has a long analysis the starts with the finishing sector but which goes beyond this to discuss the broader implications. It makes for an interesting read.
Southwest: Hints of things to come? Yesterday we wrote about Southwest Airlines and the demise of the Wright Amendment that restricts travel from Dallas Love Field. We suggested several routes that Southwest would launch from Love once the Amendment passes into history.
Here’s a display Southwest erected on its countdown to the end of the Wright Amendment. We think it hints at things to come. Going clockwise: Chicago, New York and Charlotte seem to be where the airplanes are going. Then Los Angeles and Salt Lake City seem to be implied destinations. But the last one? Boise, or some other obscure city?
Or are we reading too much into the placement of these airplanes?
Source: Dallas Morning News
Retrospective: We were looking at previous posts for some specific information and in the process re-read one about replacing the Airbus A320 and Boeing 737. The post dates from 2009. In light of subsequent events, it makes for interesting re-reading. We discuss the internal views of Airbus and Boeing about replacement or re-engining their aircraft and the engines from Pratt & Whitney and GE Aviation/CFM. We also touch on Boeing leaning toward not replacing the 777.
Retrospective, Part 2: Airchive has a nice set of historical looks at the development of the Boeing factory at Everett: Part One and Part Two.
Southwest Airlines has begun a one year countdown to the day the Wright Amendment will disappear.
The Amendment, named after former US House Speaker Jim Wright, restricts Southwest’s ability to fly from in-town Dallas Love Field. Originally Southwest was restricted to Texas and the immediately adjacent states. The Amendment has been modified several times. Today the carrier may fly anywhere within the US beyond the exceptions with one stop. Love Field is now restricted to 20 gates; Southwest controls all but a few of them.
The restrictions were put into place to protect the then-new Dallas-Ft. Worth Regional Airport, which was constructed mid-way between the two cities. All the airlines at the time served Love Field and when DFW was created, they all agreed to move to the new airport and close Love Field to airline traffic. Except Southwest, which didn’t exist at the time of the agreement but which began service from Love in the interim between the signing of the agreement and the opening of DFW. The attempts by Braniff International Airways and
Trans Texas International (nee TRANS Texas) to put Southwest out of business are industry folklore.
The fear was that Southwest and Love would hurt DFW and the airlines competing from the distant airport, including American Airlines. When Southwest a few years ago launched a full-scale attack on the Wright Amendment, American led the charge to block the effort. The compromise was the gate restriction, the one-stop service and a five year phase out.
Who could have foreseen that this now could help come to the rescue of American and US Airways as they fight the US Department of Justice’s attempt to block the merger of these two carriers?
Flight Test Programs: Here’s a quick update on the flight test programs underway right now:
Airbus A350XWB: The sole flying test platform in the A350XWB program has accumulated 150 hours since its first flight just before the Paris Air Show in June. The second test plane is due to enter the program this month. The program is believed to have completed its VMU (unstick) testing.
Boeing 787-9: The second member of the 787 family has accumulated 40 flying hours since its first flight on Sept. 17. Aviation Week has a good article on the flight test progress. The airplane is nearing its flutter testing.
Bombardier CSeries: Flight Test Vehicle 1 returned to the skies Tuesday after two weeks since its first flight Sept. 16. Further software upgrades and analyzing test results were stated as the reasons for the gap. The airplane reached 25,000 feet and Mach 0.60 in its second test flight, which lasted four hours.
New A320/737 cabins: Interior maker Zodiac has designed retrofit cabins for the Boeing 737NG and the Airbus A320 families. The 737NG cabin is similar to the Boeing Sky Interior installed on every new 737, but Boeing didn’t offer this as a retrofit to the installed base. Zodiac’s design actually carries more luggage than Boeing’s. The Zodiac A320 cabin is similar.
APEX reported in 2012 that Zodiac had designed an A320 cabin. Zodiac has this detail of its 737NG cabin offering.
Only Qantas Airways has purchased Zodiac’s 737 interior and so far there are no customers for the A320 version. But this is about to change. Here is the story we wrote for APEX.
JetBlue Tails: The airline’s blog has a nice compilation of all its tail liveries here.
United Airlines announced it is adopting a new seat in coach to improve the passenger experience.
Its press release is here.
The new design includes:
Update, 2:30PM PDT: Boeing confirms that Tuesday is the target day for 787-9 first flight, time TBD and subject to weather and other factors.
Update, 3:30pm PDT: Bombardier says 9:30 EDT Monday is the scheduled first flight for CSeries. Twitter follow is #CSeries
It looks like it will be a busy week in aviation news. Bombardier plans the first flight of the CSeries tomorrow, weather permitting (it looks good). Exact time hasn’t been announced. Reuters reports Boeing plans the first flight of the 787-9 Tuesday, though we haven’t seen notice from Boeing on this yet. And we’re waiting any day for Lufthansa Airlines to announce its long-awaited wide-body order.
Lufthansa said to split order: Lufthansa Airlines reportedly will split its order for widebody airplanes between Boeing and Airbus, according to this Bloomberg report.
Embraer EJet improvements: Flight Global has this story about the improvements and another about production rates.
Air Force One: The Seattle Post-Intelligencer has a 42 slide photo display of Air Force Ones, past to present, that’s quite interesting.
Update: “Small Airbus:” If you listen carefully, someone at the end of the video notes that the CSeries “looks like a small Airbus 320.” We couldn’t help but chuckle at this.
S&P says don’t pay attention to our ratings: On the same day Delta Air Lines was named to the S&P 500, The Los Angeles Times had this article commenting on Standard & Poor’s legal defense of its investment grade credit ratings of companies involved in the 2008 financial collapse in the US that led to the global recession in 2008, affects of which are still felt today.
S&P’s defense included the argument that nobody should pay attention to its ratings, according to the article.
The ratings issue is important because airlines, lessors (and, of course, others outside aviation) covet investment grade ratings for the capital-intensive aerospace industry. Airlines and lessors need “cheap” money to buy airplanes. Air Lease Corp recently obtained its first investment grade rating, for example, something for which it issued a press release. Delta gained headlines for its return to investment grade status. Airlines have long used S&P, Moody’s and Fitch for rating equipment trust certificates used to finance airplanes.
The columnist for the LA Times is incredulous that S&P’s legal defense in the federal lawsuit is, essentially, nobody should pay attention to its ratings. It is indeed remarkable.
Final C-17 for US Military: Boeing’s C-17 program has been struggling to stay alive for the past several years and the challenge will get worse when Boeing hands over the final order to the USAF. The airplane’s survival depends now entirely on non-US sales, and these come few and far between. It’s also the last program of McDonnell Douglas; Boeing killed the MD-11, MD-80, MD-90 and MD-95 lines not that long after the two firms merged, though it did keep the MD-95 alive for a short time, renamed the Boeing 717.
The Long Beach Press-Telegram has a couple of additional stories here and here.
Why States opposes AA-US merger: Micheline Maynard writes in Forbes why she thinks states have joined the US Department of Justice lawsuit to block the merger between American Airlines and US Airways. The actions have nothing to do with consumer protection, the alleged motive of the DOJ, she opines. Rather, the states’ interests are far more parochial.
ElectroImpact competes for 777X work: ElectroImpact makes wings for the Airbus A380 and A350 XWB and it’s headquartered in Boeing’s back yard at Everett (WA). Now it’s hoping to build wings for the 777X. This Seattle Times report tells the story.
Washington State’s future in aerospace: The Pacific Northwest Aerospace Alliance hosts its second annual series of luncheons with members of the Washington State Legislature to talk about what needs to be done for the future of aerospace in this state. The first lunch is in Bellevue (WA) September 24 and the second is September 26 in Spokane, the other major aerospace cluster in the state.
Confirmed Bellevue Panelists
• Sen. Nick Harper (D), District 38 – Everett
• Sen. Paull Shin (D), District 21 – Lynnwood
• Rep. Mike Sells (D), District 38 – Everett
• Rep. Bruce Chandler (R), District 1 – Yakima
• Rep. Larry Springer (D), District 45 – Kirkland
Confirmed Spokane Panelists
• Sen. Michael Baumgartner (R), District 6 – Spokane
• Rep. Timm Ormsby (D), District 3 – Spokane
• Rep. Kevin Parker (R), District 6 – Spokane
• Rep. Mark Schoesler (R), District 9 – Ritzville
Information and registration for Bellevue is here.
information and registration for Spokane is here.
Clever headline: The Street.com column has a clever headline this morning in a post written by Ted Reed concerning the on-going sales battles between Airbus and Boeing.
The US Department of Justice’s lawsuit to block the merger of American Airlines and US Airways displays a concern that comes a little late.
As far back as the Reagan Administration, DOJ had ample opportunity to take aggressive action to block mergers. It’s concerned now about hub concentration? The Northwest Airlines-Republic Airways merger eliminated competition at the Detroit and Minneapolis hubs, where both carriers competed. The TWA-Ozark merger eliminated Ozark’s hub at St. Louis.
The new American would control 69% of the slots at Washington Reagan National Airport, and this is a concern? Consider:
And so on.
There are actually few directly overlapping routes and no competitive hubs between US Airways and American.
DOJ is concerned about job losses? Even the unions support this merger.
DOJ is concerned about the effect on consumers? Welcome to the club. All the previous mergers mentioned above were detrimental to consumers, but these cleared DOJ.
If United-Continental and Delta-Northwest were OK, this merger is, too.
Two video interviews popped up this morning with key leaders of airlines: Tim Clark, president of Emirates Airlines, and Richard Anderson, CEO of Delta Air Lines. Each is more than 25 minutes.
Emirates’ Tim Clark:
Delta’s Richard Anderson via Bloomberg News is here.