Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Airbus 1Q2024 results: Airbus CEO: “A350 in-service experience drives positive reputation and orders” April 25, 2024
- A350-1000 or 777-9? Part 3 April 25, 2024
- Boeing CEO promises company is turning around…again April 24, 2024
- Solid start for stand-alone GE Aerospace despite cuts to LEAP output April 23, 2024
- SPEEA, Boeing at impasse over safety program, union says April 23, 2024
Boeing’s message changes on 737NG v A320neo
Here’s an article we did on changing messaging at Boeing about the 737 and the A320neo.
| Date: | 11/04/2011 10:07 |
| Source: | Commercial Aviation Online |
| Location: | Seattle |
| By: | Scott Hamilton |
Boeing’s messaging on the 737 against the Airbus A320neo has changed subtly in recent weeks. Does this signal a slight shift in Boeing’s intentions whether to proceed with a new airplane in the 737/757 class?
Boeing dismisses the business case for the A320neo, until recently saying the 737-800NG has only a 2-3% cash operating cost deficit today versus the projected NEO economics. By the time the A320neo entered service what was originally announced as Spring 2016, Boeing officials were confident that they could improve the economics of the 737-800 by at least that amount, retaining a fleet advantage of one engine type and a lighter airplane.
But Boeing’s message has shifted slightly.
Southwest fatigue failure likely to have little effect on 737 values
Here’s an article on values we did for Commercial Aviation Online:
| Date: | 11/04/2011 08:04 |
| Source: | Commercial Aviation Online |
| Location: | Seattle |
| By: | Scott Hamilton |
The in-flight fuselage rupture caused by metal fatigue is, in the end, likely to have little affect on Boeing 737 Classic values, predicts Fred Klein, president of Aviation Specialists.
Odds and Ends: Entertaining recap on Leahy and NEO
1. Entertaining look at Leahy and A320neo
Max Kingsley-Jones, editor of Airline Business, has this amusing take on Airbus COO John Leahy and Leahy’s view of his latest toy, the A320neo.
Last week we received a couple of inquiries and comments about the investment Airbus has made in the NEO and whether this will be worth it. Figures publicly issued by Airbus were that the investment in NEO is about $1.5bn.
What is not discussed but which is widely known within insider circles is that the engine makers, Pratt & Whitney and CFM, are footing most of the bill. We don’t know the split between the engine OEMs and Airbus, but we understand the engine share is not insignificant. Thus, the actual financial risk to Airbus is, by R&D standards, pretty small. We remarked to one who inquired that NEO will probably have one of the best ROIs for Airbus of any program.
Aviation Week’s Robert Wall has this story about the NEO, emerging from the Airbus 320neo briefing last week.
Airbus, the NEO program and an interview with John Leahy
Airbus held a media day today about the A320neo; we were scheduled to go to Toulouse for this event but circumstances required we stay in Seattle, so our partner at AirInsight, Addison Schonland, made the journey.
He obtained an exclusive interview with John Leahy, COO Customers. Here is his report. Addison will have additional reports later in the week.
FAA 737 inspection AD covers 175 jets
Note: Dominic Gates of The Seattle Times has a particularly thorough piece looking at this incident. The Wall Street Journal also has a good story on the topic. The New York Times has this story.
Update, April 5: Flightblogger has this story about how the 737s subject to the AD were identified. As Jon Ostrower closes his piece, he asks what the design changes were. KIRO TV (Seattle) told us that Boeing told it design changes were made to strengthen that area of the airplane.
Original Post:
The FAA said late April 4 that it will issue an airworthiness directive April 5 requiring immediate inspections of 175 Boeing 737-300/400/500 aircraft, following the Southwest Airlines in-flight decompression April 1. Eighty of the aircraft are in the US. Only those with more than 30,000 cycles are affected.
The FAA press release is here.
Other countries with reciprocity airworthiness agreements with the US–such as Germany, for example–will follow the FAA’s AD. Countries without airworthiness agreements with the US aren’t required to follow the FAA AD, and it’s unclear how many aircraft are involved.
Odds and Ends: Three drivers for Bombardier; PW GTF gains momentum
1. JP Morgan looks at Bombardier
Aerospace analyst Joe Nadol has an interesting take on Bombardier and the next 12 months. Nadol begins with, “We believe Bombardier may be better positioned now than at any time in the 10+ years we’ve followed the stock,” and continues:
Three Important BBD Drivers: 1) CSeries, 2) CSeries, 3) CSeries. With the business jet and train businesses both poised for solid earnings growth, the CSeries is now clearly set as the key likely driver of the stock. There are two primary issues here. The first is demand, and we believe the program needs to start racking up more orders this year, even by the Paris Air Show in June. We believe there is a high level of interest, and we are fairly confident Bombardier will sell more aircraft. The partnership with Comac that Bombardier announced last week seems to foreshadow meaningful Chinese orders. Bombardier also has nearly $12 bil in financing for CSeries aircraft available from Chinese sources. The second issue is execution. Management noted that Bombardier still expects to fly the aircraft next year and also highlighted some recently achieved milestones for the engine. However, Flight reported in recent weeks that the date for first flight may have slipped by a few months into next fall, so the program does appear to be experiencing at least the normal level of fits and starts. Thus far, the CSeries appears on track overall, but execution obviously remains a major overhang given the complexity of the program and the well-known problems the industry has had meeting cost and schedule targets in recent years.
Southwest Air’s second 737 decompression
Southwest Airlines suffered a second in-flight decompression of a Boeing 737-300 yesterday. This is the second–the first was in July 2009.
Both airplanes were 15-year old 737-300s and the failure on both airplanes were in the aft fuselage. The 2009 incident involved a hole in front of the vertical fin about one foot in size. Friday’s incident was bigger, about three feet, further forward and on the left size but aft of the wing.
Southwest grounded 79 737-300s for inspection, all about 15 years old. The company doesn’t have word how long the inspections will take; about 300 flights will be canceled today.
Boeing WTO panel report released; podcast with Airbus and Boeing
The WTO released the public version of its report on the illegal subsidies for Boeing. There are plenty of stories on the Internet to choose from, so we won’t recap it all here. We have said and still say a pox on both houses.
But here is a 10 minute podcast by AirInsight of an interview with Airbus’ Alan McArtor, Chairman of Airbus Americas.
Here is a slightly longer podcast with Boeing’s top WTO official.
Odds and Ends: Orient Aviation’s profile of John Leahy
This is an abbreviated Odds and Ends; we are traveling this week and next and we’re not sure if we’ll have the chance to update while we are on the road. Meantime:
Orient Aviation magazine has a cover story profile of John Leahy, COO of Customers, and it’s a good one.
FlightGlobal has a long piece about the new competitors to Airbus and Boeing.
This is a frightening story about construction at Chicago’s O’Hare Airport.
An Australian TV station has a special on the Qantas A380/Rolls-Royce incident.
George Talbot of The Mobile Press-Register takes a look at how all the analysts and pontificaters were flummoxed by the Boeing win on the tanker.
Odds and Ends: Airbus wants to advance NEO EIS by six months; name that tanker
1. Airbus wants to advance NEO EIS six months
Airbus wants to advance the entry-into-service of the A320neo by six months, to October 2015, we have learned. Airbus plans to introduce the neo in six month increments (A320neo followed by A321neo followed by A319neo). Airbus has more than 300 orders and commitments for the 320/321 and none for the 319. With Boeing increasingly talking about a new airplane in 2019, any advance Airbus can get for EIS on the neo will be beneficial.
Pratt & Whitney can probably meet this requirement. It will have versions of the GTF in service with Bombardier in 2013 and with Mitsubishi in 2014. Testing on the Irkut MS-21, a competitor to the A320/321, is to begin in 2014 with an EIS planned for 2016 (though we believe the MS-21 will likely be later than 2016).
Whether CFM can have the LEAP-X ready for a NEO 2015 EIS is unknown. CFM has yet to be selected for a NEO order (this is only a matter of time, though). The LEAP-X is in development for the COMAC C919, also a competitor to the 320/321. Flight testing is planned for 2014 and EIS for 2016 but we think the C919 will run years late, just as did the ARJ-21. Can CFM shave six months off its flight testing to meet an advanced NEO EIS when it is disadvantaged to PW’s CSeries and MRJ operating experience? We don’t know.
Over at Boeing, Aspire Aviation has this think-piece about the “737X.”
2. Airbus ponders slight larger A350-1000
The A350-1000 is aimed directly at the Boeing 777-300ER, but it is slightly smaller at 350 passengers vs 365 in typical three-class. Boeing, and others, question whether Rolls-Royce’s Trent XWB engine is big enough for the -1000 (Airbus, not surprisingly, said that it is). But we learned that Airbus is considering a 380 passenger -1000 and 50 miles more range to make it sure to do Dubai-Los Angeles non-stop. For this, the Trent XWB needs 5,000 lbs more thrust, and Rolls has been asked to figure this out.
In our view, this is the airplane Airbus needs to take on the -300ER.