Pontifications: Recertification flights for Boeing 737 MAX appear close

By Scott Hamilton

June 29, 2020, © Leeham News: Boeing may be set to begin recertification flights of the 737 MAX as early as today, The Seattle Times reported last week.

Testing will take three days, if all goes well. But Boeing still has a lot of work to do to fully satisfy regulators.

According to The Times, Transport Canada and Europe’s EASA require additional modifications to enhance safety on the MAX. The additional changes may not be required for certification but must be done within a year, the paper reports. The MAX 10 must have the changes before it is certified.

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Looking ahead for 2020 and 2030 decades: Boeing

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Second in a series.

By Scott Hamilton and Vincent Valery

Introduction

June 24, 2020, © Leeham News: “Airbus’ widebody strategy is a mess.”

This is what Kostya Zolotusky, then a VP with Boeing Capital Corp., said a few years ago on the sidelines of a major aerospace conference.

Today, it may be going too far to say there is increasing opinion in the industry that Boeing’s product strategy is a mess. But it’s fair to say it’s seriously challenged.

Even setting aside the 737 MAX grounding, Airbus clearly outpaced the MAX with the A320neo family. The A321LR and XLR thrust Airbus into dominance in the single-aisle, 150-220 seat sector.

Airbus fell into a winner with the acquisition of the Bombardier C Series. Boeing’s 737-7 MAX has captured fewer than 100 orders since the program launch in 2011. Demand for the 777X is weak.

Boeing critics, and there are many, see little but doom and gloom ahead. Even before the COVID-19 crisis, Boeing faced years of recovery from the MAX grounding.

There’s no doubt Boeing has a deep hole to climb out of, exacerbated by the COVID crisis. The question is, what does Boeing do after the MAX is returned to service and the virus crisis is over?

Summary
  • Airbus is clear leader in single-aisle sector.
  • Boeing’s product strategy for New Midmarket Airplane, Embraer role is over.
  • Former CEO Jim McNerney said, “no more moonshots.” But is this just what Boeing needs to regain its position?

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Pontifications: Deferrals, bankruptcies continue; order recovery far off

By Scott Hamilton

June 22, 2020, © Leeham News: Although more passengers are flowing through airports and airlines are adding back service, airplane order deferrals continue.

Airline bankruptcies do, too.

LEVEL’s short haul operation went into bankruptcy last week. LATAM Argentina ceased operations. Lufthansa said it may seek administration if shareholders don’t agree to the government bailout negotiated by the airline.

New orders dried up. And, so far, there is no telling when there might be some placed.

Boeing announced just a handful of new orders last month. Airbus didn’t announce any orders in May.

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Restoring capacity with the A330ceo or A330neo, Part 1

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By Vincent Valery

Introduction  

June 18, 2020, © Leeham News: The Airbus A330-200 has been a commercial success, with  642 deliveries since 1998. The Boeing 777-300ER and Airbus A330-300 are the only twin-aisle variants with more deliveries than the A330-200.

Despite the A330-200 commercial success, its successor, the A330-800, isn’t selling well. The variant officially has 14 orders: eight from Kuwait Airways, two from Uganda Airlines, and four unidentified. Air Greenland did not firm its commitment for a single unit yet. The A330-900 has 319 firm orders.

Airbus did not deliver a single A330neo since February due to the COVID-19 outbreak. Once passenger demand recovers, airlines will have the option to receive delivery of A330neos on relatively short notice. Carriers will weigh the benefits of taking delivery of new A330neos, keep their older A330ceos flying, or source the latter from lessors.

We will compare the Economic performance of both A330ceo and A330neo variants with our aircraft evaluation model. We will start with the A330-200 and A330-800.

Summary

  • A330-200 impact on market after entry into service;
  • Capitalizing on Dreamliner delays;
  • Twin-aisle market slowdown before COVID-19 outbreak;
  • A330-800 suitability for a route network.

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Looking ahead for 2020 and 2030 decades: Airbus

First in a series of reports.

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By Scott Hamilton and Vincent Valery

June 17, 2020, © Leeham News: Airbus was riding high in February.

The A321XLR was a clear winner. An important order was won from United Airlines, up to then an exclusive Boeing narrowbody customer. American Airlines selected the XLR. An order was expected from Delta Air Lines.

Each order was another that made it impossible for Boeing to launch the New Midmarket Airplane (NMA).

In one of his first actions, Boeing CEO David Calhoun, taking office Jan. 13, put the NMA on indefinite hold, pending a complete review of Boeing’s product strategy.

The Boeing 737 MAX remained grounded by regulators, with no return to service in sight.

The Airbus A321XLR. This 9-hour capable airplane helps fragment routes–and soften demand for widebody aircraft. Source: Airbus.

Things couldn’t be going better for Airbus.

And then in mid-March, the COVID crisis became a global pandemic. Air transportation fell up to 95%. Airlines required government bailouts. Airbus CEO Guillaume Faury said the very existence of Airbus was threatened.

Summary
  • COVID’s impact.
  • A320 family ‘s commanding lead over Boeing.
  • A220 commands low-end of single-aisle sector.
  • A330neo is the weak link.
  • Looking ahead in product strategy.

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Embraer’s Slattery named CEO of GE Aviation

By Scott Hamilton

June 15, 2020, © Leeham News: John Slattery, the CEO of Embraer Commercial Aviation, was named CEO of GE Aviation, it was announced today.

John Slattery

Arjan Meijer is the new President and CEO succeeding Slattery. Slattery succeeds David Joyce, who is retiring. Slattery’s appointment is effective July 13.

Slattery devoted much of the last year trying to win approval of the proposed Boeing-Embraer joint venture, Boeing Brasil-Commercial. Boeing terminated the agreement April 25, claiming Embraer failed to meet all required terms and conditions. Embraer claims it met the conditions. Both took the dispute to arbitration.

Slattery had been designated CEO of Boeing Brasil. After the deal’s collapse, his departure from Embraer was expected.

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Narrowbody Aircraft Retirements

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By Vincent Valery

Introduction  

June 15, 2020, © Leeham News: Last week, LNA analyzed the accelerating widebody fleet streamlining by airlines. We now turn our attention to the narrowbody market.

Numerous airlines, including American and Lufthansa, announced the early retirement of single-aisle aircraft since the beginning of the COVID-19 outbreak. However, the retirement of entire narrowbody types has been a rarer occurrence among carriers.

LNA analyzes retirement prospects for Airbus A320, Boeing 737, 757, and MD80/90/717 family aircraft.

Summary
  • A market dominated by two types;
  • More variety among older aircraft in service;
  • Streamlining on core narrowbody fleets;
  • Regional breakdown for the oldest types in service.

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Pontifications: bleak near- to mid-term future for Rolls-Royce engine unit

By Scott Hamilton

June 15, 2020, © Leeham News: The jet engine division of Rolls-Royce faces an uncertain future because of its own problems, exacerbated by the impact of COVID-19 on commercial airlines.

Beset by problems with its Trent 1000, Boeing 787 engine, hampered by a huge error in judgment to withdraw from a joint venture with Pratt & Whitney, beset by the premature termination of the Airbus A380 program and now facing a long-term impact of the coronavirus crisis, Rolls is an engine maker with few opportunities.

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Boeing tells Spirit to pause 737 MAX fuselage production

June 11, 2020, © Leeham News: Spirit Aerosystems, maker of the Boeing 737 fuselages, yesterday said it will lay off 900 workers on the MAX line for three weeks.

“Spirit received a letter from Boeing directing Spirit to pause additional work on four 737 MAX shipsets and avoid starting production on 16 737 MAX shipsets to be delivered in 2020, until otherwise directed by Boeing,” the supplier said in a press release.

“Based on the information in the letter, subsequent correspondence from Boeing dated June 9, 2020, and Spirit’s discussions with Boeing regarding 2020 737 MAX production, Spirit believes there will be a reduction to Spirit’s previously disclosed 2020 737 MAX production plan of 125 shipsets,” the company said.

Spirit also is furloughing workers at two locations in Oklahoma.

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HOTR: Boeing still sees MAX 3Q recertification

By the Leeham News staff

June 10, 2020, © Leeham News: Despite COVID slowdowns, Boeing still expects recertification of the 737 MAX in the third quarter, say people familiar with the situation.

Whether this timetable proves out remains to be seen. But this is the schedule Boeing continues to work toward.

The two key regulators are the Federal Aviation Administration and Europe’s EASA. Other regulators are expected to follow their leads.

Concurrent recertification as conventionally thought of—recertification and everyone authorizes a return to service at the same time—isn’t realistic. After EASA recertifies the airplane, the member states’ own regulators must step up and formally do so. This may take a couple of weeks.

China’s CAAC was the first regulator to ground the airplane. It has its own process. There isn’t a reciprocity agreement with the FAA in place. (There are bilaterals, which aren’t the same thing.)

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