Pontifications: Planes nobody wants

By Scott Hamilton

Jan. 16, 2017, © Leeham Co.: Airbus and Boeing continue to offer planes that nobody wants.

Well, almost nobody.

The aircraft remain on the published price lists of both companies, for reasons that passeth understanding. Nobody ordered the aircraft for years.

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Bjorn’s Corner: Geared turbofans

By Bjorn Fehrm

January 13, 2017, ©. Leeham Co: The time has come to go through the reasons why some turbofan engines are designed with a gearbox between the fan and the low pressure shaft.

The principle design is shown in Figure 1. It’s a graphical representation of a geared turbofan from the engine analysis software GasTurb.

Figure 1. GasTurb principal representation of a geared turbofan. Source: GasTurb.

The base idea is to have the low pressure spool of the engine to run at a considerably higher RPM than the fan. Read more

Aircraft list prices largely unchanged (Updated)

Update: Airbus Jan. 11 announced a 1% list price increase. The chart has been updated.

Jan. 10, 2017: Aircraft list prices are largely unchanged for 2017, the airline industry demand cools for new aircraft.

Sales in 2017 were down for the Big Two, Airbus and Boeing. Boeing announced orders for 688 aircraft, well off of last year, which also was a major decline from the year before.

Airbus announces tomorrow, with sales expected to be in a similar range.

Bombardier and Embraer announce later this month or next.

LNC compiled the current list prices from all the manufacturers, detailed in Figure 1 below.

Airbus and Boeing discounts typically range from 40% to 60%, depending on the customer, the airplane and the size of the order. BBD and EMB discounts may also be steep, depending on the campaign.

The balance of this article is for Subscribers only.

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Deferrals grow as airlines fight to keep bottom line

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Jan. 09, 2017, © Leeham Co.: Airlines have deferred or are thinking about deferring more than 400 airplanes in the near term, a review of decisions and deliberations  that have been made during the last 12 months.

LNC tracked announcements last year of deferrals and statements by airlines that they are thinking about doing so.

We began identifying macro-level issues last week in our posts about emerging concerns for the 787 and LNC’s Outlook for 2017.

Reasons vary widely for the deferrals, these reports indicated. Low oil prices. Slowing economies. Declining financial results. Worries about two of the three top Middle Eastern carriers. A capital squeeze in China. Pressure on long-haul carriers from the emerging sector of low cost, long-haul airlines. Preserving capital expenditures to keep the bottom line in the black.

Today we detail the deferrals we tracked.

  • Deferrals of single aisle aircraft are less worrying than for wide-body aircraft
  • For wide-bodies, it depends on the program. For the Airbus A380, deferrals turns the program back into the red. For the A350, deferrals can help with delivery commitments.
  • For the Boeing 777, deferrals spells trouble, especially for the present generation.
  • The 787 is more resilient but the slow sales make the program sensitive longer term.

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2017: the year ahead

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Jan. 3, 2017, © Leeham Co.: The New Year is here and it doesn’t look like a good one for commercial aerospace, if measured against previous outstanding years.

There are some troubling signs ahead, piling on to a slowdown in orders from last year that didn’t even reach a 1:1 book:bill.

This year looks to be worse than last. Airbus and Boeing will give their 2017 guidance on the earnings calls this month and next. Bombardier and Embraer earnings calls are a ways off, when each will provide its guidance.

But LNC believes the Big Two in particular will be hard pressed to hit a 1:1 book:bill this year and may even struggle to match 2016 sales.

Boeing’s year-end order tally comes Thursday. Airbus’ comes on Jan. 11.

  • Wide-body sales remain weak.
  • Narrow-body backlogs and low oil prices continue to inhibit sales.
  • China, Middle East concerns emerging.
  • United Aircraft MC-21 and COMAC C919 begin flight testing.
  • Airbus A330neo, Boeing 787-10, Embraer E195-E2 and Mitsubishi Aircraft MRJ-70 roll-out and begin flight testing.
  • Airbus A321neo and Boeing 737 MAX 8 EIS.

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Top 10 Leeham News stories of 2016

 Dec. 15, 2016, © Leeham Co.: The story about a Boeing official who asserted that the Airbus widebody strategy is a “mess” proved to be LNC’s most read story of 2016.

Our second most-read story is why the 787-8 is no longer favored by Boeing.

We list our Top 10 posts each year as we head for a wrap. LNC plans to finish 2016 on Dec. 23, returning Jan. 3, unless there is major, breaking news.

Here are the Top 10 LNC posts in 2016:

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Resurgence for ERJ-145

Note: Nov. 24 and 25 are Thanksgiving Holidays in the US. Our next post will be Monday.

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Nov. 23, 2016, © Leeham Co.: The 50-seat regional jet market is dead.

That’s the conventional wisdom.

Well, not quite.

Embraer ERJ-145 is finding new life with regional airlines.

Embraer ERJ-145 is finding new life with regional airlines.

Piedmont Airlines, a unit of American Airlines, is adding the 50-seat Embraer ERJ-145 to its fleet. Eleven joined so far and next year the company plans to add 24 more.

CommutAir, an operator for United Airlines, is adding the same aircraft type to its fleet. Forty of them.

Why the mini-resurgence?

Low fuel prices and cheap airplanes.

  • 50-seat regional jets were considered economically obsolete with high fuel prices.
  • Sustain low prices provided a boost to the Embraer ERJ-145.
  • Bombardier’s CRJ-200 hasn’t seen a similar resurgence.

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US, EU ignore Chinese, Russian subsidies

Nov. 15, 2016, © Leeham Co.: Government subsidies to commercial aircraft companies appear to be increasing despite the 12-year disputes before the World Trade Organization between Europe and the US over Airbus and Boeing aid.

Yet the US and Europeans appear to be doing little to try and curb the subsidies to new competitors.

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CSeries out of London City Airport, Part 2

By Bjorn Fehrm

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November 14, 2016, ©. Leeham Co: In the last article about operating the Bombardier (BBD) CS100 from London City Airport (LCY), we could see that the runway is about half the length of an international airport’s runways. This will have a significant impact on the Take Off Weight (TOW) that can be used when commencing a route from London City.


Figure 1. London City airport, housed in the docklands of London’s east end. Source: Wikipedia.

The manufacturers have data in their aircraft brochures that state that one should be able to takeoff with e.g. the CS100 at Maximum Take Off Weight (MTOW) from a runway which is 1,463m/4,800ft long. London City Airport’s runway is 1,508m/4950ft long, so then things should be fine?

No, the figures from the OEMs is the actual runway used when taking off with both engines running at full thrust. The planning scenario for the pilots is different. They must safeguard that a takeoff can be done when an engine goes missing at the most inconvenient moment. This changes the takeoff performance calculation considerably.


  • London City Airport puts special requirements on the aircraft serving it.
  • The most stringent requirement is for the takeoff. Here the requirement for a safe takeoff with an engine going inoperative will restrict the takeoff weight significantly.
  • We use BBD data and our performance model to present what routes can be served with a CS100 from the London City Airport.

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Bombardier 3Q2016 earnings: revenue down, performance up

Nov. 10, 2016, (c) Leeham Co.: Bombardier reported 3Q2016 and nine months results reflecting lower revenues as downsizing businesses and cost-cutting took effect.

Revenues for the current quarter were $3.7bn vs $4.1bn. For the nine months, revenues were $12bn vs $13.1bn. Earnings Before Interest and Taxes (EBIT), and before special items, were $87m vs $75m for the quarter. Losses are special items were $94m and $4.9bn.

For the nine months, EBIT was $323m this year vs $538m last year. Losses after special items were $722m and $4.66bn.

BBD burned through $320m in cash in the quarter vs $816m a year earlier. For the nine months, the cash burn was $1.56bn vs $2.37bn.

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