Leeham News and Analysis
There's more to real news than a news release.
India’s Spicejet big turnaround
Boeing 737-8. Boeing photo.
May 2, 2018, © Leeham News: Spicejet, the Indian low-cost airline, in its 2016-2017 Annual Report (to March 31) didn’t mince words or try to parse over its troubled history:
“Back after near shutdown. Restoring confidence. Organisational restructuring. Rising crude prices.Stiff competition. Legacy issues. We were determined to transform.”
These words are on the first page of the Annual Report.
Name another airline that is so up-front, open and candid about its past turmoil.
Southwest accelerates 737-700 retirements
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Introduction
April 30, 2018, © Leeham News: Southwest Airlines announced orders 80 Boeing 737-8s so far this year and market intelligence indicates the carrier may be far from done.
Another 60 orders may come during the year, though this trend could slow, market intelligence indicates.
The carrier is accelerating fleet retirements of its Boeing 737-700s with the orders. The latest round last week now makes Southwest the largest single customer for the MAX.
Significantly, the orders represent an up-gauging to the 8 MAX from the -700. The similarly-sized, slow-selling 737-7 MAX, of which Southwest is one of only four identified customers, is being bypassed. Southwest previously deferred delivery of 23 7 MAXes four years.
Click on image to enlarge.
Southwest historically operated its 737s for at least 25 years. Some 737-300s were 28 years old by the time they were retired and stored, according to the Airfinance Journal Fleet Tracker.
Summary
- Strong economic business case cited to retire 737-700s.
- 40 737-700s to be retired with concurrent deliveries.
- Retirements occurring at earlier age.
- Aging aircraft issues exist.
Pontifications: Fine balance needed by Boeing in aftermarket services drive
By Scott Hamilton
April 30, 2018, © Leeham News: The Wall Street Journal Friday reported Boeing was poised to purchase a supplier; a deal could be announced as early as today.
The acquisition, if it happens, will be a major step toward increasing the business at Boeing Global Services (BGS).
It will be another step in the vertical integration that recommenced under Boeing CEO Dennis Muilenburg, an outgrowth of too much outsourcing with the 787.
Coincidentally, the day before, Wendi Folkert, director for Supply Chain Propulsion Strategy for The Boeing Co., acknowledged that the growing BGS has to balance against competing with Boeing’s own suppliers.
Folkert made her remarks at the I-90 Aerospace Corridor Conference in Spokane (WA).
Phil Krull of Embraer Executive Jets will present at the Southeast Aerospace and Defence Conference in Mobile (AL) in June. Airbus, NASA, Pratt & Whitney, Bombardier, Southeastern state governments and suppliers will also present.Go here for Agenda and Registration information.
32 Boeing 787s are AOG due to Rolls-Royce Trent issues; number will climb
April 27, 2018 © Leeham Co.: There are 32 Boeing 787s grounded because of problems with the Rolls-Royce Trent 1000-C engines and the number will rise “a bit,” LNC has confirmed.
The US Federal Aviation Administration and Europe’s EASA this month issued Airworthiness Directives that limit ETOPS to 140 or even 60 minutes from the 330 minutes certified originally.
A Royal Brunei Boeing 787 sat engineless April 12 at Paine Field, awaiting Rolls-Royce powerplants. Photo by Jennifer Schuld.
Following the AD and inspections, the number of grounded aircraft rose from 15-20.
The limitations balloon costs on trans-ocean flights and render trans-polar flights impossible.
Suppliers confirm Airbus, Boeing rate hike studies to 70/mo for single-aisles
April 26, 2018, © Leeham News: Two suppliers publicly confirmed what’s been whispered for months: 
Airbus and Boeing are checking with the supply chain about taking production rates of the A320 and 737 families to 70/mo.
Representatives of Crane Aerospace and Esterline confirmed the studies at the I-90 Aerospace Corridor conference today in Spokane (WA).
Boeing to hike 767F production; may be only first of several
April 25, 2018, © Leeham News: Buried deep within Boeing’s first quarter earnings report is a single, seemingly innocuous sentence:
“Reflecting the strength of the cargo market, we now plan to increase the production rate on the 767 program from 2.5 to 3 per month beginning in 2020.”
There is more to this than meets the eye. It portends potentially big orders and this rate increase may be only the first to come.
Boeing 1Q earnings: cash flow, EPS guidance raised on strong results
April 25, 2018: Boeing today said its strong first quarter financial results means it has boosted cash flow and earnings per share guidance.
From its press release:
Is Long-Haul LCC viable? Part 4
By Bjorn Fehrm
April 24, 2018, © Leeham News: In the third article about Long-Haul LCC and if it’s a viable business, we described the operational costs for typical aircraft used by a Long-Haul LCC.
We now look at the revenue side of the equation, including how much revenue we need to cover our costs and what variations we have over the year.
Engine makers may face stiffer future ETOPS certification requirements
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Introduction
April 23, 2018, © Leeham News: Even before last week’s Southwest Airlines accident raised the focus on aircraft engines, industry officials were becoming worried that problems with engines powering the Boeing 747-8, 787, 737 MAX and Airbus A320neo may lead to stricter certification standards by regulatory authorities.
There is also emerging evidence that the issues with the Rolls-Royce Trent 1000 on the 787s may negatively impact Airbus’ sales efforts with the A350. The A350 is
powered by an entirely different RR engine, the Trent XWB, which by all accounts has had a virtually trouble-free entry into service.
But it’s a Rolls-Royce engine and airlines affected by or watching RR’s response to the Trent 1000 problems are skeptical about the Trent XWB, LNC is told.
Summary
- How long will it take for the FAA and EASE to restore full ETOPS for the 787?
- Concerns emerge that regulators may be more restrictive of ETOPS for new engines powering new planes, with the Boeing 777X next up.
- Impact seen on reception of Rolls-Royce engines on Airbus A330neo and A350.
- What do the engine problems mean for the Boeing NMA?
Pontifications: Uncontained engine failures are rare but not unknown
By Scott Hamilton
April 23, 2018, © Leeham News: Last week’s engine malfunction on a Southwest Airlines Boeing 737-700 was another in a rare, but not unknown, uncontained engine anomaly in recent years.
All recent similar failures didn’t cause a loss of life or serious injuries if the passengers were evacuated. Unfortunately, this accident caused one fatality and seven injuries.
Let’s put the context to this issue.