- Leeham News and Comment will be on holiday Dec. 24, 2016, through Jan. 2, 2017, barring major breaking news. Merry Christmas and Happy New Year.
By Scott Hamilton
Dec. 19, 2016, © Leeham Co. Two thousand sixteen is almost over. This will be my last Pontifications of the year.
We approach our job with a little different perspective than the daily newspapers and aviation trades. They have greater resources than we do and have a greater ability to report the news. So LNC tries to bring news with perspective that those outlets don’t.
Analysis, economics, forecasts
We provide analysis of events and of aircraft economics and performance. Not even the trades do the latter. We also make our own forecasts of trends and production rates. Sometimes it takes a few years to be proved right or wrong. So far, we have a good track record of being right.
We’re also not afraid to take on controversy—and be controversial. And we don’t hesitate to call bullshit when we see it.
This gets often us into hot water with the subjects of the controversy.
This is what sets LNC apart.
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2017: the year ahead
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Introduction
Jan. 3, 2017, © Leeham Co.: The New Year is here and it doesn’t look like a good one for commercial aerospace, if measured against previous outstanding years.
There are some troubling signs ahead, piling on to a slowdown in orders from last year that didn’t even reach a 1:1 book:bill.
This year looks to be worse than last. Airbus and Boeing will give their 2017 guidance on the earnings calls this month and next. Bombardier and Embraer earnings calls are a ways off, when each will provide its guidance.
But LNC believes the Big Two in particular will be hard pressed to hit a 1:1 book:bill this year and may even struggle to match 2016 sales.
Boeing’s year-end order tally comes Thursday. Airbus’ comes on Jan. 11.
Summary
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1 Comment
Posted on January 3, 2017 by Scott Hamilton
Airbus, ATR, Boeing, Bombardier, CFM, Comac, CSeries, E-Jet, Embraer, Etihad Airways, Farnborough Air Show, GE Aviation, Irkut, Leeham News and Comment, Middle of the Market, Mitsubishi, Pratt & Whitney, Premium, Rolls-Royce, Sukhoi
Airbus, Boeing, Bombardier, CFM, Comac, Embraer, GE Aviation, Irkut, Mitsubishi, Pratt & Whitney, Rolls-Royce, Sukhoi
Airbus, Boeing Top Customers mix of stable, risk and reward
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Introduction
Dec. 22, 2016, © Leeham Co.: When it comes to comparing backlogs of Airbus and Boeing, the latter likes to point to what it calls a better quality of customers.
The fact is, both companies have large orders with airlines that may be characterized as less than top quality, or which appear to have over-ordered.
Summary
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Posted on December 22, 2016 by Scott Hamilton
Airbus, Airlines, Boeing, Premium
Airbus, airlines, Boeing, Lessors
Boeing announces 2017 job cuts
No number was given by Boeing for the workforce reduction.
Just a week ago, LNC predicted more job cuts would be coming at Boeing–and at Airbus.
Boeing’s message to employees is below.
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50 Comments
Posted on December 20, 2016 by Scott Hamilton
Airbus, Boeing
Airbus, Boeing, Kevin McAllister, Ray Conner
Pontifications: Leeham News’ approach to the news
By Scott Hamilton
Dec. 19, 2016, © Leeham Co. Two thousand sixteen is almost over. This will be my last Pontifications of the year.
We approach our job with a little different perspective than the daily newspapers and aviation trades. They have greater resources than we do and have a greater ability to report the news. So LNC tries to bring news with perspective that those outlets don’t.
Analysis, economics, forecasts
We provide analysis of events and of aircraft economics and performance. Not even the trades do the latter. We also make our own forecasts of trends and production rates. Sometimes it takes a few years to be proved right or wrong. So far, we have a good track record of being right.
We’re also not afraid to take on controversy—and be controversial. And we don’t hesitate to call bullshit when we see it.
This gets often us into hot water with the subjects of the controversy.
This is what sets LNC apart.
Read more
28 Comments
Posted on December 19, 2016 by Scott Hamilton
Airbus, Boeing, Pontifications
737 MAX 200, 777 Classic, 777X, 787, A321LR, A321NEO, A330, A350, A380, Airbus, Boeing
US appeals WTO ruling over prohibited subsidies
Dec. 16, 2016: The US filed a notice of appeal today of the WTO ruling that Washington State tax breaks granted to entice Boeing to locate a wing plant for the 777X and assemble the airplane at Everett ((WA) was a prohibited subsidy.
The move was expected.
At issue were $8.7bn in tax breaks.
12 Comments
Posted on December 16, 2016 by Scott Hamilton
Airbus, Boeing
Airbus, Boeing, World Trade Organization, WTO
Top 10 Leeham News stories of 2016
Dec. 15, 2016, © Leeham Co.: The story about a Boeing official who asserted that the Airbus widebody strategy is a “mess” proved to be LNC’s most read story of 2016.
Our second most-read story is why the 787-8 is no longer favored by Boeing.
We list our Top 10 posts each year as we head for a wrap. LNC plans to finish 2016 on Dec. 23, returning Jan. 3, unless there is major, breaking news.
Here are the Top 10 LNC posts in 2016:
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27 Comments
Posted on December 15, 2016 by Scott Hamilton
Airbus, Boeing, Bombardier, Leeham News and Comment, MOM
737-7, 747, 777-10, 777X, 787, A320, A350-1000, A350-2000, A350-800, A350-900, Airbus, Boeing, Bombardier, CS300, Dennis Muilenburg, Jim McNerney, Kevin McAllister, Leeham News, Middle of the Market
Boeing cuts 777 production rate again
Dec. 13, 2016: Boeing yesterday announced another production rate cut for the 777 Classic, effective next August.
Boeing 777 production rates will decline to 5/mo in August 2017. The delivery rate will fall to 3.5/mo. Photo via Google images.
The rate goes to 5/mo. Because of the transition to the 777X, the actual delivery rate will be 3.5/mo.
Leeham Co. was the first in March 2014 to identify a major production gap and predict rates would have to come down significantly from the then-current 8.3/mo. Aerospace analysts on Wall Street began recognizing the gap shortly after.
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52 Comments
Posted on December 13, 2016 by Scott Hamilton
Boeing
777 Classic, 777X, Boeing, Goldman Sachs, Morgan Stanley, Wells Fargo
Boeing faces prospect of China’s political wrath thanks to Trump
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Introduction
Dec. 12, 2016, © Leeham Co.: “China Inc.,” the combined group of airlines and lessors directed or controlled by the government, is Boeing’s largest customer, an
China is Boeing largest single customer. Campaign rhetoric of Donald Trump could prompt the Chinese government to retaliate against Boeing, favoring Airbus for orders instead. Rendering via Google images.
analysis of the company’s’ backlog at Dec. 5 shows.
Boeing’s website lists “China” with 292 orders in backlog. Fifty of these appear to by Unidentified orders. LNC arrived at this figure by viewing the Chinese customers in Boeing’s identified list, which amounts to 242 orders. Some believe the number of Unidentifieds attributable to China may be higher.
The data shows just how much Boeing has at risk with the so-far unpredictable foreign trade policy espoused by President-Elect Donald J. Trump.
Summary
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Leave a Comment
Posted on December 12, 2016 by Scott Hamilton
Airbus, Boeing, Premium
Airbus, Bank of China, BOC Aviation, Boeing, Donald Trump, ExIm Bank, Jim McNerney, Richard Nixon
Pontifications: More job cuts coming at Airbus, Boeing
By Scott Hamilton
Dec. 12, 2016, © Leeham Co.: Airbus and Boeing continue to cut costs with internal reorganizations.
These are needed efforts. And they trickle down to the supply chain.
The new CEO at Boeing Commercial Airplanes, Kevin McAllister, is expected to ratchet up the cost-cutting at BCA, in part because he comes from the cost-cutting environment of GE Aviation.
He’s got a lot of work to do.
It takes Airbus Commercial about 85 employees to produce one airplane. It takes Boeing about 107.
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38 Comments
Posted on December 12, 2016 by Scott Hamilton
Airbus, Airlines, Boeing
Airbus, Bernstein Research, Boeing, CanaccordGenuity, IATA, Impressa, International Air Transport Assn., Kevin McAllister, Spirit Aerosystems
Iran, Boeing reach agreement on big aircraft order; Trump casts cloud
No 747s are included in the final deal between Boeing and Iran. The original announcement included four 747-8s to replace aging 747s. Photo via Google images.
Dec. 11, 2016: Iran and Boeing reached an agreement on the 80-airplane order that includes 50 737 MAX 8s, 15 777-300ERs and 15 777-9s.
The final contract still has unspecified contingencies before it can be booked as firm orders, Boeing said. One of those contingencies is clearly President-Elect Donald Trump, who criticized the larger Iran-US-allies deal of which the Boeing order is a part.
Airbus has 116 orders pending that could also be upended if Trump, upon taking office, vitiates the deal.
Boeing’s mix of aircraft changed slightly from the original news in June. The original mix included 40 737 MAXes and six 737NGs. Also included then were four 747-8s.
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39 Comments
Posted on December 11, 2016 by Scott Hamilton
Airbus, Airlines, Boeing
737 MAX, 747-8, 777-300ER, 777-9, Airbus, airlines, Boeing, Iran Air, President Obama, President-elect Trump
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