Airbus, Boeing pause on some production rate hikes

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Introduction

Feb. 21, 2019, © Leeham News: Airbus is boosting the A320 production to 60/mo this year and 63/mo next year.

But it’s put a pause on increasing the A350 rate from 10/mo to 13/mo.

Boeing was widely expected to follow its planned 737 rate hike of 57/mo, from this summer, to 63/mo next year to keep up with demand and with Airbus.

However, on the sidelines of the annual Pacific Northwest Aerospace Alliance conference last week, LNA learned that a 737 rate hike has been apparently put on a pause.

Summary

  • Airbus, Boeing backlog for single-aisle airplanes extends years.
  • Both have ramped up production to meet demand, create delivery positions.
  • Supply chain struggles to keep up.
  • Twin-aisle demand waits for replacement surge.

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A380 end opens opportunity for A350-2000

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Introduction

Feb. 18, 2019 © Leeham News: Airbus’ decision to end the A380 program clears the path, if chosen, for a plane that was studied three or four years ago: the stretch of the A350-1000 to the size of the 777-9.

Will the termination of the A380 open the way to stretch the A350-1000? Source: Airbus.

A 400+ passenger “A350-2000” would have encroached too closely on the A380’s 500+ passengers. Officials feared the A350-2000 would hurt the sales prospects of the A380.

With the A380’s last delivery now planned for 20xx, this becomes a moot point.

The prospect of a new, Rolls-Royce Ultra Fan engine for the A350 around 2025 will give the -2000 significantly superior economics to the 777-9 and a longer range, a preliminary analysis by LNA shows.

Summary

  • An A350-2000 with RR Ultra Fan engines is superior to the 777-9.
  • However, Boeing has a big head start with orders for 340 777Xs, most of which are for the -9.
  • The market demand for a 400-450 seat airplane is increasingly iffy.
  • But the A350-900/1000neo helps business case.
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Pontifications: Which airplanes are revolutionary or evolutionary?

By Scott Hamilton

Feb. 18, 2019, © Leeham News: Last week’s column about the revolutionary Boeing 747 prompted some Twitter interaction asking what other commercial airplanes might be considered “revolutionary.”

I have my views. Let’s ask readers.

There are also three polls below the jump in addition to the usual comment section. Polling is open for one week.

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Bjorn’s Corner: Pitch stability, Part 10. Wrap up.

Feb. 15, 2019, ©. Leeham News: We now summarize the problems around an airliner’s pitch stability and why a good pitch stability is so important before we go to the next subject, yaw stability.

The pitch stability and how it works in different parts of the flight envelope is the trickiest of the aircraft’s stability problems around its three axes; Pitch, Yaw and Roll. Here is why.

Figure 1. A thought pitch moment curve for Boeing’s 737 MAX. Source: Leeham Co.

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A380 launch aid in limbo at WTO, member states following program termination

Feb. 14, 2019, © Leeham News: Termination of the A380 program leaves unanswered Airbus’ obligation of outstanding launch aid from France and Germany.

But apparently it removes any overhang of this aid in the long running trade dispute between the US and Europe (Boeing vs Airbus) at the World Trade Organization.

As the dispute wound its way through the WTO since the US filed its complaint nearly 15 years ago, the only surviving issues were subsidies for the A380 and A350.

Based on precedent involving termination of the A340 program, in which the WTO ruled there was no further harm to Boeing once the last A340 was delivered, the remaining launch aid was rendered moot in the context of the WTO. The governments wound up eating the balance of the launch aid.

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Launching the NMA could mean new business model for Boeing

By Dan Catchpole

Feb. 14, 2019, © Leeham News: Commercial aerospace’s super cycle is alive and well—and looks to keep going through the foreseeable future. Major suppliers and OEMs, and industry analysts at the Pacific Northwest Aerospace Alliance annual conference are all optimistic about the industry demand. Analysts noted potential concerns, such as a trade war with China, a catastrophic terrorist attack, or an economic shock. However, even the often bubble-bursting Richard Aboulafia, an aerospace analyst and vice president at the Teal Group, said the party likely will keep rolling on for several years more.

Amid such a sunny forecast, Boeing is weighing whether to overhaul its commercial aerospace business model, said Kevin Michaels, a co-founder of AeroDynamic Advisory.

The company is working to close the business case on a new midmarket airplane (NMA), already dubbed the 797 by industry watchers. The NMA—or, if Boeing does not launch it, then its next single aisle airplane—likely will usher in “the next evolution of the jetliner business model,” Michaels said.

The new model, he said, has four key aspects:

  • Greater vertical integration and in-sourcing work;
  • Targeted, yet aggressive expansion of services;
  • Redefining supplier relationships to capture more aftermarket revenue; and
  • Introducing model-based systems engineering.

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A simple solution to congested skies

By Dan Catchpole

Danieljcatchpole[at]gmail[dot]com

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Introduction

Feb. 14, 2019, ©. Leeham News: Flight delays cost the airline industry

Traffic back ups are increasing–so much so that Airbus has invested in improving air traffic management to avoid congestion affecting aircraft sales.

billions of dollars each year. They cause travelers untold aggravation and inconvenience every day. And the main culprit—air traffic congestion—is only going to get worse as Boeing and Airbus deliver tens of thousands of jetliners over the next couple decades.

Regulators, lawmakers and the aviation industry in the United States have settled on spending billions of taxpayer dollars on NextGen—after having already spent billions—to implement complex technical solutions to keep the skies safe and cut down on flight delays.

The Federal Aviation Administration (FAA) estimated in 2017 that implementing NextGen will cost roughly $35.7 billion by 2030–$20.6 billion from the FAA and another $15.1 billion from the aviation industry.

NextGen has moved with the swiftness of a sprawling, technocratic federal program—that is to say like an elephant at the ballet. It has endured delays and cost escalation, though these have not been crippling. However, it is years away from unclogging America’s congested air spaces.

Moreover, there are very real questions as to whether NextGen will be able to deliver all the FAA promises it can.

Summary
  • Air spaces are getting more crowded, leading to greater flight delays.
  • Airbus is concerned that congestion could hurt demand for jetliners, and is taking steps to improve air traffic flow.
  • Substantial questions exist as to NextGen’s ability to unclog air traffic congestion.
  • Taking a system-wide approach that taps into airlines’ desire to maximize profits could be implemented now, say proponents.

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Airbus ends the A380 program

Feb. 13, 2019, © Leeham News: Airbus announced today (Seattle time, Feb. 14 in Toulouse) that it is terminating the A380 program.

The last airplane will roll off the assembly line in 2021, for Emirates Airlines.

Emirates cancelled an order for 39 A380s. In its place, the carrier ordered 30 A350s and 40 A330neos.

The Emirates and Airbus press release is here.

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Boeing expects another banner year for customers

By Dan Catchpole

Danieljcatchpole[at]gmail[dot]com

Feb. 13, 2019, © Leeham News: Boeing Commercial Airplanes expects another banner year in 2019, Randy Tinseth, BCA vice president of marketing, said Tuesday at the PNAA conference.

The airplane maker expects its customers to make about $36 billion in profit this year, he said. That would make five consecutive years of BCA customers recording more than $30 billion in profits.

Tinseth declined to comment on the company’s decision to delay possibly launching the New Midmarket Airplane (NMA) to 2020. However, as Boeing CEO Dennis Muilenburg noted during the Jan. 30 earnings call, Boeing likely will seek authority to offer this year from its board of directors.

He did say he was surprised to hear so many people already referring to it as the 797.

“I can tell you one thing—that has not been discussed,” Tinseth said.

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Supplier consolidation leading to unionization at some

By Bryan Corliss

Feb. 12, 2019, © Leeham News: While Boeing is enjoying “labor peace” in its Northwest facilities, a couple of aerospace industry suppliers are in the midst of contract negotiations with the largest union representing aerospace industry workers in the region.

At one of the new Collins Aerospace plants in Everett, those talks are contentious. Workers there staged a one-day walk-out on Jan. 17 after (according to union officials) Collins representatives refused to bargain with them.

The workers were back on the job the next day. However, the union representing them – International Association of Machinists District 751–filed a stack of Unfair Labor Practice complaints with the National Labor Relations Board’s Seattle office, accusing the company of, among other things, bad-faith bargaining.

Since the January walk-out, the two sides continued talks with the help of a federal mediator.

“The workers who generate the profits should share in the prosperity we create,” said Joshua Whitcomb, a mechanic at the landing gear shop, in a statement provided by the union. “This is very skilled labor, and not just anyone can perform our work.”

For its part, a Collins spokesperson in Iowa gave LNA a statement saying the company is “committed to continue negotiating with the union in good faith, and hopes to reach a mutually beneficial agreement.”

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