Leeham News and Analysis

There's more to real news than a news release.

There's more to real news than a news release.

Leahy to Boeing: you’re “whistling past the graveyard”

This is a story we provided KIRO TV in Seattle, for which we provided reports during the air show.

Airbus A320neo success far exceeds expectations

Special to KIRO TV

Airbus ended the primary portion of the Paris Air Show Thursday with 700 new, firm orders for the A320neo (New Engine Option) and a total of 1,029 firm orders and commitments year-to-date. There possibly could be a few more orders before the show officially ends Sunday, but the trade show portion ended Thursday.

The results surprised even Airbus super-salesman John Leahy, who said at the company’s closing press briefing that some deals came together unexpectedly during the show.

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 122 Comments

 Posted on June 23, 2011 by

 Airbus, Boeing

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Odds and Ends at the Paris Air Show, Day 4

Our final Odds and Ends as we head back to Seattle Friday.

  • Marc Birtel, one of the corp-com guys at Boeing, asked us what we were impressed by at the Air Show (this was Tuesday, before the Airbus landslide of NEO orders). We must be getting too jaded or too familiar with Air Shows, because we said, “nothing comes to mind.” On reflection, these impressed us: Boeing’s display of technology in the form of the two 747-8s, a 787, a 737-700 with the Sky Interior; the ever-impressive A380 flying display; the Breitling Constellation; the Bombardier “igloo” Pavilion (well, its contents, actually) was way-cool; and of course the impressive number of NEO orders.
  • We were also impressed by the laid-back, almost shoulder-shrugging at attitude of Airbus CEO Thomas Enders. We interviewed him shortly after the press conference summarizing the best Airbus Air Show ever and the historic AirAsia order, the largest ever in commercial aviation. He seemed suitably excited in the press conference but afterward he could have been ordering a cup of coffee. (He did consent to a glass of champagne). The orders were all well and good, he said, but now Airbus had to produce and deliver them. Today’s news was already yesterday, for Enders; there were other things to be concerned about.
  • We opined over at AirInsight about the increasing nasty battle shaping up between Airbus and Bombardier.
  • See this story about John Leahy dancing to seal the AirAsia deal. CEO Tony Fernandes was very funny when telling it and words can’t do it justice. But Leahy dancing is not a vision we want to have. But it’s better than the story of his old boss, Jean Pierson, dropping his pants to seal a deal. Now that’s not a vision to go to bed with.
  • The saying is “Paris in the springtime.” We can say, “Paris in June sucks.” It rained (sometimes heavily) for three of the four days at the air show. In 2009, it was two out of four.

 9 Comments

 Posted on June 23, 2011 by

 Airbus, Boeing, Bombardier

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Qatar, the launch customer, gives harsh critique of A350 revamp

There’s nothing we can add to this account.

 24 Comments

 Posted on June 22, 2011 by

 Airbus, Boeing

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Odds and Ends at the Paris Air Show, Day 3

Odds and Ends at the Paris Air Show, Day 3

  • John Leahy, COO-Customers for Airbus, says that after CFM re-jigged the LEAP engine with a larger fan and the seventh LPT stage, has brought the engine to parity with the Pratt & Whitney GTF in fuel burn. The LEAP initially was up to 4% lower in fuel burn, leading to PW’s early lead in sales.
  • “We don’t buy deals,” CFM told our associate, Addison Schonland of AirInsight Wednesday during his visit with them at the Paris Air Show. He’s going to have a special post about the War of Words between PW and CFM soon on AirInsight. Read more

 8 Comments

 Posted on June 22, 2011 by

 Airbus, AirInsight, Boeing, CFM

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1,000 NEOs and “parity” is all it is

Airbus may have booked close to 900 orders for the A320neo family by the time the air show ends tomorrow, a plane that  Boeing says merely reaches “parity” with the 737-800.

Airbus, of course, hotly disputes Boeing’s computations and says if the A320 were so deficient to the 737-800, why would airlines and lessors buy so many of them?

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 27 Comments

 Posted on June 22, 2011 by

 Airbus, Boeing

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Odds and Ends at the Paris Air Show, Day 2

Odds and Ends at the Paris Air Show, Day 2

Airbus

Airbus owned the day again with a bunch of orders, including capturing a Boeing 737 operator, Garuda Indonesia. For the A320neo (In this context, we’re not counting SAS, which already operates A320s.) Up to now, Boeing has been dismissing the sales of the neo as being only to A320 airlines, as well as winning deals on price and asserting the neo only brings the airplane to “parity” with the 737-800. Airbus’ John Leahy, COO-customers, counters that airlines aren’t buying Boeing’s line and are buying the neo because it is more efficient than the 737-800. So, it would seem, lessors are also convinced. ILFC previously ordered the aircraft. Air Lease Corp, CIT Aerospace and GECAS also placed orders.

The ALC order could be considered particularly significant. Its CEO, Steven Udvar-Hazy, previously was cool to the neo and now placed a bet for 50 of them.

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 12 Comments

 Posted on June 21, 2011 by

 Airbus, Boeing, Bombardier, CFM, Pratt & Whitney

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Qatar’s CEO on A350, CSeries

Qatar Airways was the launch customer of the Airbus A350-1000, for which Airbus has now moved entry-into-service back from 2015 to 2017 in order to provide for a higher-thrust engine design from Rolls-Royce, increased payload and increased range.

John Leahy, Airbus COO, said Saturday at the EADS media day, that all delays for the -1000 and the -800, which is also seeing an EIS adjustment from 2014 to 2016, were “consensual” with the customers.

This makes comments by Akbar Al-Baker, Qatar’s CEO, all the more interesting. Al-Baker was at a Boeing press conference to announce the order of six 777-300ERs. In the Q&A, he was asked about the A350-1000. His response from the recording we made:

Q. How does the performance of the revised A350-1000 compare to the 777?

Al-Baker: …We have great confidence in Boeing, they have the finest products in the range of the Triple 7 type. As far as the A350s are concerned, it is still a paper airplane. The proof is in the pudding. The Triple 7 is already flying. It is doing fantastic. It is reaping us huge benefits. I would not like to talk about the Dash 1000 at the moment until I have been properly briefed by Airbus and of course I will critique that product when I have been given more details, as I do not have them. It would be unfair for me to sit her and criticize the competitor’s product, especially since we are the launch customer.

Q. I know you don’t want to talk about the A350-1000 in detail, but could you give us any reaction at all to the delay? Is that going to pose a significant problem for you?

A. Yes, we are hearing rumors that the aircraft will have significant delay. This will dent our expansion and fleet replacement program. As CEO of an airline, it would never make me happy that one of the programs we are so dependent on is getting delayed. This is very disappointing to us. We hope that the performances they are today talking about is the right information and it will do what Airbus says they are intending to do.

Qatar has also been a key target to order the Bombardier CSeries. Expectations were high at the Farnborough Air Show last year that Qatar would do so and when it didn’t, BBD suffered huge negative press. Expectations have been that the order was likely ready to go at this show. We learned shortly before the show that there would be no order.

We caught up to Al-Baker immediately after the Boeing press conference ended and had this exchange:

Q. Could tell me what your approach to the CSeries right now. It seems to be on and off, on and off, on and off.

A. No, the CSeries, we have just deferred our decision because we have so many airplanes coming one after the other within the same time, so we have deferred it. We still have confidence in the CSeries. We feel it is a very fine airplane. We have not changed our mind, we have just deferred the decision until  not too long in the future.

Q. How long? Three months, five months?

A. I don’t know. We still are quite busy with what is in the pipeline, but we are still very keen. I assure you that the CSeries is an extremely fine airplane in its category of aircraft.

 4 Comments

 Posted on June 20, 2011 by

 Airbus, Boeing, Bombardier

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Odds and Ends of the Paris Air Show, Day 1

Odds and Ends of the Paris Air Show, Day 1

The Air Show began with heavy downpour that delayed traffic and buses, but fortunately not us since we didn’t stay in the City—but rather just 5km up the road. Nonetheless, we got soaked. Yet the rains couldn’t dampen the spirit of either Boeing or Airbus—or the wiseacre at the Show who played the theme song from the old movie, “Singin’ in the Rain” during one of the periodic cloud bursts.

For Boeing, rain notwithstanding, Monday was a very good day for the company. It received 17 orders for the slow-selling 747-8 (15 from one airline), customers unidentified. Boeing also announced orders for the other 7-Series airplanes except the 767. The various order announcements may be found on the Boeing website.

Contrast this to the Paris Air Show in 2009 (Paris runs in odd years, Farnborough in even years). On the Monday and Tuesday, officials vowed the 787 would have its first flight by the end of June. On
Tuesday evening, these officials were called back to Seattle to deal with the fact the test pilots would not fly the airplane because the wing-to-body join was not up to snuff. A few days after the air show ended, the company called off the first flight, to great embarrassment. It was six months before the airplane flew.

At this air show, Boeing has one 787, two 747s, a 737 with the Sky Interior inspired by the 787 and a 777-200LR. This represents the technology The Boeing Co. is known for and the achievements that can be had.

Boeing started the air show with a bang (figuratively). The remaining days should be good as well.

Airbus

If Boeing started the show with a figurative bang, Airbus did literally. The big A380 scraped a wingtip on a building after airport controllers sent them down what turned out to be an incorrect taxiway. The A380 was beached for the first day and probably a few more. This came on the heels of the A400M scrubbing its aerobatics because another test plane had an engine problem. The best aerial display (to us, anyway) was the flight demonstration of the Breitling L-1049 Constellation.

But Airbus began with 100 orders for its A320neo from GECAS and Air Lease Corp., putting COO John Leahy well on the way toward the 600 orders for the airplane that was his goal by the end of the air show. We think it possible he’ll be much closer to 700.

Bombardier

The other manufacturer that has been in the focus is Bombardier. Following a long draught in orders, BBD racked up two in the week before the air show and a third Monday. Two of the three are Unidentified, but now BBD has 113 firm orders and almost as many options. BBD also said today’s customer will be the launch operator.

Rain, rain go away—a rail strike is coming

Buzz among journalists today is that a one-day rail strike is planned for tomorrow. Traffic to and from Le Bourget is bad enough on a good day. Rain makes it worse and a rail strike will paralyze the roads. Except for us. Taxis get to use dedicated bus lanes and we should be at the air show tomorrow in 10 minutes, strike or no strike. The US should take a cue on the dedicate bus lanes. But in typically Washington/Puget Sound fashion, nobody can make a decision let alone one in a timely fashion without some nitwit launching an initiative to reverse the decision.

AirInsight has been doing a running commentary on Monday’s air show events.

 6 Comments

 Posted on June 20, 2011 by

 Airbus, AirInsight, Boeing, Bombardier

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Odds and ends on the final pre-Air Show day

 Odds and Ends from the Paris Air Show

  • While an order or two are expected to come from Qatar Airways’ mercurial CEO Akbar Al-Baker, the buzz here already is that U-Turn Al may yet again live up to his nickname. It’s been widely expected that he would, at long last, order the Bombardier CSeries, but Al-Baker is renowned in aviation circles for embarrassing OEMS. He’s done it to Bombardier, Airbus and Boeing and has flipped-flopped in his praise-criticism-praise for the CSeries and the A320neo. For Boeing, it was a major embarrassment when at the Farnborough Air Show in 2008 Boeing issued a press release announcing Qatar ordered the 777 only to rescind it hours later (even though it was correct) at Al-Baker’s insistence. Neither did he show up for the 787 roll-out even though Qatar’s logo was displayed in the roll-call of tail logos and a chair was reserved with his name on it. While Al-Baker recently trashed-talked the A320neo, word now is that he will place an order for the airplane (with CFM LEAP engines, maybe?) for a new Qatar leasing company. He has been feuding with Pratt & Whitney, and if he by-passes the GTF for the A320neo, this could mean PW hasn’t bent over to his demands—and the CSeries could suffer as a result.

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 4 Comments

 Posted on June 19, 2011 by

 Airbus, Boeing, Bombardier, CFM, Pratt & Whitney

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777 remains stalwart at Boeing

Boeing retains full confidence in the 777 despite the frontal attack by Airbus with its A350 family. News, first broken by Leeham News June 5 in this forum, that Airbus and Rolls-Royce will revise slightly the design of the A350-1000 and the engine powering this model—the direct competitor to the 777-300ER—doesn’t seem to faze Boeing.

Officials have held off any decisions on what to do about the future of the 777 until they fully understand the competitive threat posed by the A350-1000. Company CEO Jim McNerney and Jim Albaugh, the CEO of Boeing Commercial Airplanes, others at Boeing and some executives of airlines and lessors said for the better part of a year the -1000 as designed fell short of the performance promised by Airbus.

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 8 Comments

 Posted on June 18, 2011 by

 Airbus, Boeing

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