Leeham News and Analysis
There's more to real news than a news release.
Pratt & Whitney at inflection point
April 1, 2015:
- We’re at the Pratt & Whitney Media Days today and tomorrow. We’ll be posting running information in our usual format of paraphrased synopses for such events.
This is PW’s 90th year.
Panel Discussion: “Big Data”
Lynn Fraga (LF), analytics manager in PW Services Group.
Larry Volz (LV), VP and chief information officer.
Matthew Bromberg (MB), president of PW aftermarket unit, providing MRO services, parts customer support.
MB: Big Data is a buzzword in the industry that has mixed connotations and emotions. PW has been in data monitoring business for decades. 13,000 engines have monitoring systems. We are accelerating and doubling down on a challenging path going forward. Read more
Bombardier CS300 analysis vs A319neo, 737-7
By Bjorn Fehrm
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Introduction
March 29, 2015, c. Leeham Co: Bombardier’s big bet in the aeronautics sector, CSeries, is well into flight testing, now more than half way toward the 2,400 hours required by Transport Canada before certification can be granted. The first aircraft to be certified will be the smaller 110 seat CS100 but the market is most interested in the larger 135 seat CS300, which has 63% of present orders and commitments, Figure 1.
Figure 1. Cseries largest model, CS300. Source: Bombardier.
Bombardier’s new CEO, Alan Bellemare, told reporters last week that the CS100 would be certified during 2015 with entry into service slipping into 2016. The CS300, which is a direct challenger to Airbus’ A319neo and Boeing’s 737-7, should follow six months after CS100. With the CS300 in flight testing and going into service next summer, we decided to have a deeper look at CS300 and its competitors.
Summary
- A319 and 737-7 are shrinks of the market’s preferred models, A320 and 737-8, and as such not the most efficient models.
- The CS300 is the series center-point and it shows. The modern design beats the Airbus and Boeing designs on most counts.
- Part of the modern concepts in CSeries is the well-conceived Pratt & Whitney PW1000G geared turbofan.
- PW’s 73 in fan version of the PW1000G for CSeries is slightly less efficient that the 81 in version for A319neo but CS300 lower weight makes sure this is more than compensated for.
Challenges working against A330ceo production goal
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Introduction
March 23, 2015, c. Leeham Co. Airbus faces a production gap for the A330ceo and has twice announced reductions in the rate: first, from 10/mo to 9/mo in 4Q2015 and then again to 6/mo in 1Q2016.
Despite confidence expressed by John Leahy, chief operating officer-customers, that rate six will be maintained going into production of the successor A330neo, we think the production gap is great enough that another rate cut might be necessary.
Summary
- Filling the production gap depends in part on converting options and letters of intent into firm orders and obtaining a significant number of firm orders between now and when the A330neo enters service in 2018.
- We see a need for more than 100 orders between now and 2018.
- The A330 Regional has yet to land a single order, but an Airbus official says don’t count it out.
Leahy gets lifetime achievement award; CSeries could be delayed again
March 23, 2015: John Leahy, Aviation Week Lifetime Achievement Award: John Leahy, the chief operating officer-commercial for Airbus, received the Lifetime Achievement Award from Aviation Week. It’s a well-deserved award.
John Leahy. Airbus photo.
As the AvWeek write up details, Leahy has been instrumental in bringing Airbus to the market position it is today. We’ve known Leahy nearly the entire time he’s been at Airbus. He’s one of those love-him or hate-him kind of guys (or, in my case, like-him). Whether loved or hated, his industry accomplishments deserve respect and admiration. Joe Sutter, who is still around in his 90s as a consultant to Boeing, would be Boeing’s counter-part for the impact of his influence on the industry. We certainly can’t think of a Boeing salesman or any other contemporary in the front office who would match Leahy’s tenure and influence. In his day, Bill Allen, the long-time CEO, certainly would qualify.
Challenges working against 777 Classic production goal
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Introduction
March 22, 2015, c. Leeham Co.: The aerospace analyst team at Wells Fargo last Thursday predicted a production rate cut for the Boeing 777 Classic despite continued statements by Boeing it will maintain production at the current 100/yr.
“We remain skeptical that Boeing will be able to sustain 777 production at 8.3/mo (100/yr) through 2020,” Wells Fargo’s Sam Pearlstein wrote.
Pearlstein predicts a rate cut in 2017 to 7/mo. We believe rates will eventually fall to 5/mo by the time the production airplanes for the 777-9 begins in 2018 for 2020 entry-into-service. (Boeing hopes to advance EIS to 4Q2019, according to our Market Intelligence).
Wells Fargo cites several reasons for its conclusion about the 777 Classic. We have some additional information gleaned from Market Intelligence that cast some unexpected challenges for Boeing to achieve its goal of selling 40-60 Classics per year.
Summary
- A few 2016 delivery slots haven’t been placed by lessors.
- Given two-year lead time for Buyer Furnished Equipment, timing is becoming critical for some deliveries.
- BFE issues are focused on seat manufacturers’ shortfall.
- Freighter sales needed to fill early slots.
Bjorn’s Corner: Intro, LCC long range and CFM’s LEAP
By Bjorn Fehrm
March 19, 2015: This is the first version of my Corner where I will comment on the aeronautical world as I see it. It will be a mix of tech things (I am an engineer) and my view on things from my European vantage point. Enough on reason and style; lets get started.
LCC goes long range: After AirAsiaX and Norwegian, now Ryanair is going long range, according to Irish Times (or not; the latest news from Robert Wall of The Wall Street Journal is that the board has not approved a long range business plan).
Be that as it may with Ryanair, the key thing is that what happened to the majors on short haul is about to hit them on long haul as well. Short haul LCCs brought about a change in airline economics and in single aisle aircraft. The LCCs, followed by Ultra LCCs, started the trend to denser and denser configurations where the latest trends are sub 29 inch pitch slim-seats and lavatories that started at 37 inch getting slimmed to 31 inch. It has also brought about changes in galleys and emergency exits configurations, all leading to aircraft with higher and higher capacities.
Redefining the 757 replacement: Requirement for the 225/5000 Sector, Part 6.
By Bjorn Fehrm
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Introduction
18 March 2015, c. Leeham Co: In Part 1 of of this series we investigated the market sector 225/5000, which is our name for the market segment beyond the capacity of single aisles A320 and 737 aircraft. Boeing calls this Middle Of the Market, MOM, and is studying which aircraft type would best cover this segment.
In Part 5 of the series we concluded that beyond 220 seats a dual aisle aircraft can be competitive as it can increase utilization due to shorter ground turn-around time. We now conclude the investigation by looking at what Airbus response can be based on a further developed A320 and how it would stack up against optimized seven abreast dual aisle alternatives from Boeing’s MOM study, one of these using Boeing’s patented elliptical fuselage, Figure 1.
Figure 1. Compared cross sections for MOM market. Source: Leeham Co.
Summary
- The rational further stretch of Airbus A321LR is a re-winged/re-engined A322 with 30-40 more passengers, or five to seven additional rows.
- We compare this development with optimized models from our MOM studies and the A321LR.
- For the comparison we focus on efficiency in weight, drag and fuel for the different alternatives. How competitive will a stretched A321 be and how close in weight and drag comes an elliptical MOM model?
Rebuilding confidence at Bombardier
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- This week the Malay government announced an order for 20 CSeries CS100s. for a new airline.
Introduction
March 17, 2015: c. Leeham Co. Turmoil at Bombardier, both financial and with the departure of several key personnel, caused a crisis in confidence among customers and shareholders. The stock price took a tumble and some Canadian aerospace analysts, and the few on Wall Street who also follow the stock, have become increasingly pessimistic. Leeham News and Comment published a long analysis after Ray Jones departed Bombardier Commercial Aircraft in a surprise move, the latest in a series of top-level departures at the unit. Market reaction was decidedly negative.
CEO Pierre Beaudoin stepped up February 12 to executive chairman, relinquishing the chief executive title of Bombardier to Alain Bellemare, a veteran of Pratt & Whitney whose appointment was generally well received.
Still, customers we talked with continue to be cautious. One has a wait-and-see about what Bellemare will be able to achieve, and how soon. This customer believes Bellemare has until the Paris Air Show in June to show some tangible progress.
Another customer was considerably more upbeat, viewing the appointment as a major change in the company for the better.
Canadian analysts were positive about the management changes, in part because the market has lost confidence in the Beaudoin management and in part because Bellemare and his PW experience are viewed as heavy-weight.
Ross Mitchell, vice president of Business Acquisitions and Commercial Aircraft, Bombardier. Source: Fleigerfaust.
We sat down with Ross Mitchell, vice president of Business Acquisitions and Commercial Aircraft for Bombardier, at the ISTAT conference last week in Phoenix for a wide-ranging interview. Here is Part 1.
Summary
- Bombardier needs to restore confidence in the market after all the turmoil. How will this be accomplished?
- Will Alain Bellemare have the flexibility and freedom to do what needs to be done?
- Organizational restructuring has already made some progress.
- The financings are a positive.