For all practical purposes for commercial aviation geeks, the air show is over. Even John Leahy left.
There was one significant order today, from Virgin America for 40+20 Airbus A320s with options to convert to A321 and to use sharklets.
Boeing announced a minor order swap involving three airplanes. Bombardier didn’t announce any CSeries orders, but then, we knew by July 12 this was unlikely.
Below are the orders through Day 4, minus a couple of minor ones due after we left the field to wrap up our reporting before going home. Over the course of the next week or so, we’ll pick write some additional stuff.
Note: We have updated the Tuesday posting at the end of that column.
Update, 8:00 PM BST: Day 3 orders are now included toward the end of this post.
Another day, another set of aircraft orders are expected. From the buzz, it sounds like this could a Boeing day.
But the speculation continues hot-and-heavy about the failure of Bombardier to announce an order from Qatar. As many news stories report, Qatar’s Abkar Al Baker said there is an issue with Pratt & Whitney yet to be resolved and, from our discussions, we know there is and have a general idea what it’s about.
Alas, we were told off the record (damn!) and cannot share it here.
Updated, Wednesday 05:00 BST
We’ve updated this posting after all the text with orders completed through Day 2,
Tuesday will be another day where orders are expected to be announced. See our Monday posting, updated at 4pm for this information.
Pratt & Whitney
We will be attending a breakfast hosted by Pratt & Whitney; perhaps we can get some information about the issues Qatar reports in connection with its potential CSeries order. Or perhaps not. OEMs are loath to talk about customers. But we shall see.
Updates throughout the post, 415PM BST.
Here is a look ahead for Monday at the Farnborough Air Show and what might be expected for news and orders in the coming week. We’ll update this post at the end of the day.
John Leahy on Saturday predicted at least 130 orders will be announced this week. Boeing thinks that if Leahy is predicting 130, he’s got a lot more up his sleeve. Leahy also predicted orders from leasing companies, signaling improving economies. See individual companies below.
We’re at the Farnborough Air Show and on Saturday attended the day-long EADS media briefings. We filed reports exclusively for KIRO TV (CBS) in Seattle. These stories are:
These stories are below the jump.
Separately, word leaked from Farnborough that Boeing will get an order fo 20 777s, but this is a swap from the failing DAE Capital of Dubai. Here is this story.
A second aerospace analyst has weighed in with the opinion that Boeing is likely to choose a replacement for the 737 rather than a re-engine solution.
Heidi Wood of Morgan Stanley published this note today, as Boeing’s investors’ day begins.
The bottom line – Another New Plane Ahead – BA’s Going To Do A New Single Aisle: We believe Boeing will be announcing a new narrowbody replacement to the well-worn and highly popular 737 instead of the less costly, but inferior solution of re-engining.
This means a $13B-type R&D effort ahead in lieu of a possible $2-3B R&D for re-engining, which was previously in our model. We are now lowering outyear estimates to reflect a projected new narrowbody 2012 launch and 2017-2018 entry into service (EIS, first delivery). We believe consensus earningsexpectations will be revised down significantly on higher R&D.
Why An All New Plane? We expect Airbus to announce an A320 re-engining sometime before yearend; BA will likely announce its plans around the same time. It is not generally known, but on a re-engine to re-engine equivalent basis, we believe the Airbus A320 ends up w/ a 8-10% better fuel burn than the 737, rendering the $3B R&D cost to re-engine largely ineffective. The 737 has been refreshed three times already since its first inception in 1967. And with 5 low end single aisle competitors ~mid-decade, we think BA is prudent to be pre-emptive with an all-new airplane.
Joe Nadol of JP Morgan and Joe Campbell disagree, thinking a re-engine is more likely.
So does Boeing rival Airbus, where COO-Customers John Leahy suggests all the talk about a replacement 737 is Boeing disinformation aimed at muddying Airbus’ waters.
Day 2 summary after the jump.
We’re at the Airbus Innovation Days and here are some highlights:
Aviation Week has a good piece entitled “Embraer at Crossroads,” that discusses how the company evolved from nothingness to a major player in the industry. Faced with a threat from Bombardier’s CSeries and emerging competition from China and elsewhere, Embraer has to decide what it is going to do.
Although Bombardier’s CSeries continues to faces challenges, AvWeek makes it clear that the CSeries and Pratt & Whitney’s GTF engine are influencing decisions pending by Airbus, Boeing, Embraer and airlines.
Boeing is leaning toward a new airplane to replace the 737 rather than proceeding with a re-engining program, an aerospace analyst wrote in a report issued today.
Richard Safran of the boutique Buckingham Research came away from Boeing Capital Corp’s annual investor’s update with an analysis that is a potentially paradigm-shifting conclusion that Boeing will forget about the widely-assumed plan to re-engine the 737 to meet an expected decision by Airbus to re-engine the A320 family–itself a decision largely driven by competition from Bombardier’s CSeries.
This is our quick take because we’re really busy.