Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Bjorn’s Corner: Air Transport’s route to 2050. Part 19. April 25, 2025
- How good is the C929? Part 2. April 24, 2025
- Boeing First Quarter Results Update: China is 10% of the backlog, with 500 in “Unidentified” April 24, 2025
- Boeing First Quarter Results: Tariffs, Return flights, $10.55bn asset sale April 23, 2025
- RTX Q1 2025 Earnings: GTF Talk Takes A Back Seat To Tariffs April 22, 2025
737 MAX 8 could be enabler for some LCC Long Haul
Subscription Required
By Scott Hamilton and Bjorn Fehrm
Introduction
Figure 1. Nominal range of 737 MAX 8 from Oslo Source: Great circle mapper, Boeing. Click on Image to enlarge
Dec, 8, 2014:The Boeing 737-8 MAX is the successor to the 737-800 and has largely been thought of in this context.
Our analysis, prompted by Norwegian Air Shuttle (NAS) plans to use Boeing 737-8 MAXes to begin trans-Atlantic service on long, thin routes, comes up with a conclusion that has gotten little understanding in the marketplace: the 8 MAX has enough range and seating to open a market niche below the larger, longer-legged 757, and the economics to support profitable operations for Low Cost Carriers interested in some trans-Atlantic routes or destinations beyond the range of the -800.
Summary
- We based our analysis on our proprietary, economic modeling, assumed Norwegian cabin configuration standards.
- We compared the operating costs of the 737-8 with Norwegian’s present long haul aircraft 787-8 in a similar cabin configuration.
- The comparison range is the max endurance range for an LCC long haul 737-8, eight hours or 3,400nm air distance (no wind included).
Boeing and Washington State; and: Congressional meddling may threaten KC-46A
The Washington State Legislature may consider implementing a mechanism to track the benefits of the Boeing 777X tax incentives granted last year, according to the on-line news service Crosscut. Boeing opposes the measure, according to the report.
USAF moves up AF One replacement, reports Inside Defense
Dec. 7, 2014: The US Air Force is moving up the the Presidential Aircraft Replacement program to seek Requests for Proposals next year, according to the specialty newsletter Inside Defense.
The Boeing 747-8 is viewed as the certain selection to become the next Air Force One. Source: Flight Global.
An airframe purchase will occur in 2016, according to the newsletter. Delivery would be in 2018. Boeing, which supplied the two 747-200-based VC-25 aircraft that comprise today’s Air Force One fleet, already has assembled a team for the proposal, Inside Defense reports.
The USAF previously had talked about acquiring replacements in 2021.
Notably, Airbus–which previously said it won’t compete for a new AF One–hedged when asked by the newsletter. Read more
Boeing retains net order lead going into last month of year
Dec. 5, 2014: Boeing retains the lead in net orders going into the last month of this year, although the gap has narrowed considerably–and there are a couple of public campaigns and commitments Airbus has announced or talked about that could shift the year-end balance.
Boeing has been less open about pending campaigns, so it is harder to gauge potential orders this month.
Figure 1. Click image to enlarge.
Year to date, Airbus reports 1,031 net orders and 297 cancellations, including the 70 A350s canceled in June by Emirates Airlines. Boeing 1,274 orders net of 106 cancellations, for a net advantage of 234 orders over Airbus. Airbus previously announced a commitment from Indigo Airlines of India for 250 A320neos and it continues to press China for an order of 70-200 A330 Regionals. Airbus also said it expects an order before the end of the year for the A321neoLR, but the quantity has not been specified. Read more
Boeing remains confident it will fill 777 production gap; cash flow to remain strong
Dec. 3, 2014: Boeing remains “confident” it will be able to bridge the 777 Classic production line at current rates to the introduction of the 777X in 2020, including some “feathering” of the two airplanes.
Boeing president and COO Dennis Muilenburg also said cash generation and free cash flow will remain strong even as Boeing invests in research and development, hikes stock dividends and buys back shares to boost shareholder value.
Muilenburg made the remarks today in a wide-ranging question-and-answer format during the annual Credit Suisse Global Industrials Conference in New York.
Fundamentals of airliner performance, Part 5; Approach and landing
By Bjorn Fehrm
Dec. 2, 2015: The time has now come to cover descent and landing in our 
articles around airliner performance. As many aspects of descent are similar to climb we will repeat a bit what we learned in Part 4:
- For high speed operation the pilots fly on Mach as this gives him maximum information around possible effects on the aircraft when he is close to the high speed limit, the maximum Mach number. Beyond this the aircraft gets into supersonic effects like high speed buffeting or unsteady flight.
- For operations under the cross over altitude for Mach 0.78 to 300 kts IAS the pilot flies on Indicated Air Speed (IAS) which gives him maximum information how the aircraft reacts should he go close to the aircraft’s lower speed limits.
Lets now start to go through the steps that our 737 MAX 8 performs after leaving its cruise altitude.
Air Canada: 787s have 29% lower costs than older 767s (before the latter’s reconfiguration)
Dec. 2, 2014: Air Canada says its new Boeing 787s will have 29% lower fuel, maintenance and per-seat costs than the old Boeing 767-300ERs being replaced.
Part of this is because the 787s seat more passengers.
But the airline has found new life in the 767s through increased density, shifting them to its low cost carrier, Rouge, which has lower labor costs and overhead. Rouge’s 767s have 30% lower CASM costs than the same airplane at mainline Air Canada. Read more
Oil heading toward $40? Economist still thinks so, with caveats; and: NTSB issues 787 battery report, Azul’s A320/CFM order
Dec. 1, 2014: Adam Pilarski, an economist for the consulting firm Avitas, predicted several years ago that the price of oil would drop to $40bbl. Few believed him.
Oil hit $66 this week, on a steady decline over the past months, and, according to an article by Bloomberg News, could be on its way to $40.
Pilarski, who originally made his prediction in 2011 at a conference organized by the International Society of Transport Aircraft Traders (ISTAT). He predicted this price by October 2018.
In an interview with Leeham News today, Pilarski concurs that oil may hit $40 soon, though he believes the low end will be in the $40-$50 range. The low price will not for the reasons he outlined in 2011 and neither will it stay at or near $40 for long.
MTU investors day: views of its engine programs, future airplane timelines; separately, Embraer COO interview
Figure 1. Technical milestones have been passed on PW GTF programs for the applications on Bombardier, Airbus, Mitsubishi and Irkut airplanes and are approaching for Embraer. Source: MTU Investors Day. Click to enlarge.
Nov. 30, 2014: MTU Investors Day: MTU is a major participant in engine development and supplies, participating on the GEnx, GTF and GEnx program. It’s also a member of the joint venture in International Aero Engines and it’s a major player in the aftermarket Maintenance, Repair and Overhaul (MRO) sector, providing a serious competitive alternative to the aftermarket contracts offered by the engine OEMs. Its held an investors day conference Nov. 25. Highlights included:
- Milestones have been passed on the Pratt & Whitney Geared Turbo Fanengine for the Bombardier CSeries, Airbus A320neo family, the Mitsubishi MRJ and Irkut MC-21; and are on schedule for the Embraer E-Jet E2.
- The success of the GTF is requiring huge production commitments.
- The large number of airplane/engine programs require a major ramp-up of production during the next few years.
- The major investment in new engines is largely over for now, leading to the expectation of long-term revenue from MRO.