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By Bjorn Fehrm
Introduction
Dec. 16 2015, ©. Leeham Co: Fuel prices at a record low changes a lot of short- and mid-term planning scenarios for airlines. An introduction of a used aircraft with higher fuel burn for a typical lease period of five to six years is possible without endangering the airline’s economics.
The risk of oil prices going sky high in such a period is low, hence the attractiveness of complementing ones fleet with leased older aircraft like Canada’s WestJet has done. It will introduce ex. Qantas 767-300ERs on several traditional 757 destinations like Hawaii and presumably West Europe.
We therefore expand our in dept look of the deployment of used aircraft with a look at the WestJet choice; Boeing’s 767-300ER and compare it to a more contemporary twin, Airbus A330-200.
Summary:
⦁ The 767-300ER is around 25 seats smaller than our benchmark aircraft, the more modern A330-200.
⦁ The A330-200 previously put the 767 under pressure and Boeing responded with the 787-8. We will check if this is still the case when oil is below $40 a barrel and leasing cost for a used 767 is below $300,000.
⦁ We will also check what load-factors an airline like WestJet has to attain on the 767 to reach the same seat-mile costs as for the 757 that the route was up-gauged from.
⦁ We will follow the scheme of the 777-200ER vs. A340-300E comparison, Part 1 compares the aircraft, Part 2 the costs and Part 3 the revenue and margin performance of the aircraft.
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Top 10 Stories in 2015
Here are the Top 10 stories on Leeham News and Comment for 2015:
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10 Comments
Posted on December 23, 2015 by Scott Hamilton
Airbus, Airlines, Boeing, Emirates Airlines, GE Aviation, Leeham News and Comment, Malaysian Airlines, MH370
737, 737-8, 737-8ERX, 737-9, 747-8, A320, A321LR, A321NEO, A350-900LR, A380neo, Airbus, Boeing, Emirates Airline, Malaysia Airlines, Singapore Airlines
Boeing stock sell-off on 777-200ER deal over-blown
Dec. 22, 2105, © Leeham Co.: The sell-off in Boeing stock last week tied to the Delta Air Lines purchase (Letter of Intent) of a 777-200ER for $7.7m was overblown.
The stock was off 2.6% Thursday after Delta CEO Richard Anderson Tweeted an LOI had just been signed to buy a 777-200ER. This sell-off, and an earlier one when Anderson said the -200ER could be acquired for $10m, prompted hand-wringing over 777 values and the potential impact on new 777 Classic sales needed to build the bridge to the production of the 777X.
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19 Comments
Posted on December 22, 2015 by Scott Hamilton
Airbus, Boeing, Delta Air Lines, Emirates Airlines, United Airlines
767-300ERF, 777-200ER, 777-300ER, A330-300, Airbus, Boeing, Continental Airlines, Credit Suisse, Delta Air Lines, Emirates Airline, Kenya Airways, Malaysia Airlines, Singapore Airlines, Transaero, United Airlines, Wells Fargo
CS100 certified; We review CS100’s birth with VP CSeries, Rob Dewar
Introduction
By Bjorn Fehrm
21 December 2015, ©. Leeham Co: Bombardier (BBD) received certification of the smaller CSeries, the CS100, by Transport Canada Thursday. Rob Dewar, vice president of CSeries, reflected on the journey to certification in an exclusive interview with LNC.
CSeries VP Rob Dewar with CS100 Certificate. Source: Bombardier.
The interview was done against a backdrop of more than two years of delays, which in turn drained the coffers of BBD. To save the project and let it prove its game-changing character, management sold 49.50% of the CSeries program to the Province of Quebec for $1bn and 30% of its train division to Caisse de dépôt et placement du Québec, for an additional $1.5bn.
Dewar has managed the project from the program launch in 2008. The transcript of the interview follows.
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16 Comments
Posted on December 21, 2015 by Bjorn Fehrm
Airbus, Airlines, Boeing, Bombardier, CSeries, Pratt & Whitney, Rockwell Collins
737 MAX, 737 MAX 7, A319neo, Airbus, Boeing, Bombardier, CSeries, Pratt & Whitney
How good is a used 767-300ER, Part 2
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Introduction
By Bjorn Fehrm
Dec. 21 2015, ©. Leeham Co: Last week we started our Boeing 767-300ER article series around acquiring used twin-aisle 767 aircraft to upgrade 757-based long haul services, like Canada’s WestJet has done. We compared the aircraft and looked at the base data for the aircraft in article one.
Now we continue by analyzing the Cash Operating Cost (COC) of the aircraft in a typical long haul configuration, using our normalized seating. We are assuming that the 767 and the 757 are a half-life state between overhauls of engines and airframe.
Our benchmark aircraft is an Airbus A330-200 which is flying in a mainline airline. Here we assume that it is 25% deteriorated since new for engines and airframe.
Summary
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Leave a Comment
Posted on December 21, 2015 by Bjorn Fehrm
Airbus, Boeing, GE Aviation, Pratt & Whitney, Premium, Rolls-Royce
757-200W, 767-300ER, A330-200, Airbus, Boeing, GE Aviation, Pratt & Whitney, Rolls-Royce
Bjorn’s Corner: Engine efficiency revisited
By Bjorn Fehrm
18 December 2015, © Leeham Co:Part of the discussion following last week’s article around quad or twin engine airliner designs was about engine efficiency and specifically around the engine’s thermal efficiency as a function of Pressure Ratio, PR.
I got the question, if an engine working at a higher pressure ratio was therefore working at a higher thermal efficiency. I knew enough on the subject to know I did not have a good answer without doing a bit of checking; jet engines are no simple contraptions.
I have previously written about turbofan efficiency in a Corner. The article was focused around propulsive efficiency. Now we will have a look at the other part of overall engine efficiency, the thermal efficiency or the efficiency of the core.
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23 Comments
Posted on December 18, 2015 by Bjorn Fehrm
Bjorn's Corner, Boeing, CFM, GE Aviation
737 MAX, CFM, CFM Leap-1B
How good is a used 767-300ER?
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By Bjorn Fehrm
Introduction
Dec. 16 2015, ©. Leeham Co: Fuel prices at a record low changes a lot of short- and mid-term planning scenarios for airlines. An introduction of a used aircraft with higher fuel burn for a typical lease period of five to six years is possible without endangering the airline’s economics.
The risk of oil prices going sky high in such a period is low, hence the attractiveness of complementing ones fleet with leased older aircraft like Canada’s WestJet has done. It will introduce ex. Qantas 767-300ERs on several traditional 757 destinations like Hawaii and presumably West Europe.
We therefore expand our in dept look of the deployment of used aircraft with a look at the WestJet choice; Boeing’s 767-300ER and compare it to a more contemporary twin, Airbus A330-200.
Summary:
⦁ The 767-300ER is around 25 seats smaller than our benchmark aircraft, the more modern A330-200.
⦁ The A330-200 previously put the 767 under pressure and Boeing responded with the 787-8. We will check if this is still the case when oil is below $40 a barrel and leasing cost for a used 767 is below $300,000.
⦁ We will also check what load-factors an airline like WestJet has to attain on the 767 to reach the same seat-mile costs as for the 757 that the route was up-gauged from.
⦁ We will follow the scheme of the 777-200ER vs. A340-300E comparison, Part 1 compares the aircraft, Part 2 the costs and Part 3 the revenue and margin performance of the aircraft.
Read more
2 Comments
Posted on December 17, 2015 by Bjorn Fehrm
Airbus, Airlines, Boeing, GE Aviation, Pratt & Whitney, Premium
757-200W, 767-300ER, A330-200, Airbus, Boeing, GE Aviation, Pratt & Whitney
Reaction mixed to Boeing increase in share buyback, dividend hike
The announcement had been expected. The share buyback was increased from $12bn to $14bn in aggregate and the dividend was increased by 20%, to $1.09 per share. The latter was somewhat higher than expected. Boeing has repurchased $6.75bn in stock so far.
Initial reaction from analysts ranged from positive to cautious.
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27 Comments
Posted on December 16, 2015 by Scott Hamilton
Boeing
Boeing, Buckingham Research, Cancaccord, Goldman Sachs, Wells Fargo
Analyzing Air Bridge Cargo plans for Boeing 747-8F
Dec. 15, 2015, (c) Leeham Co.: A plan by Russia’s Air Bridge Cargo to acquire another 18 Boeing 747-8Fs does little to solve Boeing’s production gap and program viability, an analysis by LNC shows.
Bloomberg News published a story yesterday saying the fate of the 747 program rests with Air Bridge Cargo, which announced an MOU for 20 747-8Fs at last summer’s Paris Air Show.
But as LNC reported shortly after the MOU was announced–once we had the opportunity to look behind the hype–it was clear that the news was hardly anything to count on.
This remains the case despite Bloomberg’s story.
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11 Comments
Posted on December 15, 2015 by Scott Hamilton
Airbus, Airlines, Boeing, Paris Air Show
747-8, 747-8F, 777-300ER, 777-9, 787, A330, A350, Air Bridge Cargo, Air Force One, Airbus, Bloomberg News, Boeing, Paris Air Show
4-engine single-aisle airplanes could make comeback, says technology VP
Dec. 15, 2015, © Leeham Co: LNC’s Bjorn Fehrm started a firestorm of discussion last Friday with his Corner about twins-vs-quads column. His focus was on the Very
Could a four-engine, single-aisle airliner make a comeback? It’s something that might be possible. Photo via Google images.
Large Aircraft sector. Overlooked in all of the discussion was a piece of information LNC wrote April 6 from an interview with Alan Epstein, VP of technology and environment of Pratt & Whitney, in which he mused that quads could make a comeback—on smaller airplanes.
The original article was behind our Paywall, but the Summary with this reference was in the freewall portion. We’ve now opened the article to full freewall and it may be found here.
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49 Comments
Posted on December 15, 2015 by Scott Hamilton
Airbus, Boeing, Pratt & Whitney
727-200A, 777-300ER, 777-8, 777-9, 787, A330, A350, A380, Airbus, Alan Epstein, Bjorn Fehrm, Boeing, open rotor, Pratt & Whitney, twins-vs-quads
The future of the A319neo and 737-7
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Introduction
Dec. 14, 2015, © Leeham Co. There are just 49 orders for the Airbus A319neo. There are only 55 orders for the Boeing 737-7 MAX.
The A319neo has been ordered by Avianca (19), Frontier Airlines (18) and there are 12 orders from Undisclosed customers.
The 737-7 has been ordered by Southwest Airlines (30), WestJet (25) and Canadian start-up Jetlines (5).
Bombardier’s CS300 is a direct competitor. There are 190 orders, but a fair number of these are soft, such as Iraqi Airways, Republic Airways Holdings and lessor LCI.
Embraer’s E-195 E2 has 90 orders through September, the most recently reported period by the OEM. While it is not a direct competitor when configured to the same standards—it carries slightly fewer people—EMB is effectively competing the 195 E2 as a replacement for the 737-700 and A319ceo in “right sizing” operations.
Summary
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8 Comments
Posted on December 14, 2015 by Scott Hamilton
Airbus, Boeing, Bombardier, Embraer, Premium
737-7, A319neo, Airbus, Boeing, Bombardier, C Series, CS100, CS300, E-195 E1, E-195 E2, Embraer
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