Are the world’s regional airlines dying?

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By Scott Hamilton

June 17, 2023, © Leeham News: Is the regional airline market across the globe dying?

Ed Bastian, CEO of Delta Air Lines. Credit: CNBC.

Many think so. Certainly, the market demand for the regional jet is shrinking in the 10- and 20-year market forecasts. Bombardier withdrew from the market as demand for its aging CRJ family shriveled. Mitsubishi Heavy Industries killed its RJ SpaceJet program as delays and development costs mounted. Bombardier also exited its turboprop airliner business. ATR is now the sole producer of large turboprops outside China and Russia.

Embraer is now the sole producer of regional jets outside of China and Russia, and it doesn’t even want to call the E-Jet a regional airliner.

Regional airlines in the US face a continuing and growing shortage of pilots. Those in Europe face pressure from environmentalists to the governments to ban short-haul flights in favor of trains.

Despite these challenges and the conclusions of some that the regional airline business is dying, regional carriers take exception to these conclusions.

One regional airline official even took exception to the CEO of Delta Air Lines, who concurred with the dead-and-dying trend.

Speaking at the Aviation Week MRO Americas conference in April in Atlanta, Ed Bastian noted that Delta began trending away from regional carriers many years before.

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The Airbus A220-500, a deep-dive analysis: The launch date challenge

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By Bjorn Fehrm and Vincent Valery

Jan. 30, 2023, © Leeham News: In the previous articles, demand in the Airbus A320 family gradually shifted from the smaller A319 and A320 to the larger A321. This shift is laying the groundwork for the arrival of the A220-500.

Airbus can develop the A220-500 with relatively minor technical modifications that are not extremely challenging. In an aircraft performance analysis, we saw that the light aircraft weight gave the A220-500 an advantage against the A320neo and 737-8.

What is then preventing Airbus from launching the A220-500 now? While most of the attention has been on the cannibalization risk with the A320neo and the lack of urgency given Airbus’ market share lead, other and more critical factors, in LNA’s opinion, are at play.

Being an aircraft OEM is not just about designing airplanes that meet payload-range requirements and satisfy stringent safety regulations. It is also about efficiently building aircraft with millions of parts and consistent production rates. The recent challenges OEMs are facing ramping up after the Covid-19 pandemic show that aircraft production is far from a walk in the park that can be taken for granted.

It is common for aircraft OEMs to spend as much cash nursing production through the learning curve until the first profitable delivery as developing the aircraft itself.

The final article on this A220-500 series discusses why Airbus is rightfully cautious about launching the new variant.

Figure 1. A rendering of an A220-500 that takes 157 passengers. Source; Leeham Co.

Summary
  • Current planned A220 production rates and variants can satisfy demand;
  • Adding the A220-500 brings the program to a new demand level;
  • Several clients would place large A220-500 orders;

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The Airbus A220-500, a deep-dive analysis, Part 2

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By Bjorn Fehrm

Jan. 23, 2023, © Leeham News: Following Thursday’s article about an up-and-coming Airbus A220-500, we now look at the operational cost for the A220-500 and compare it with the A320neo it should replace.

We put the data we discussed in Thursday’s article in our Aircraft Performance and Cost model, fly the aircraft on a typical single-aisle mission and look at the results.

Figure 1. A rendering of an A220-500 that takes 157 passengers. Source; Leeham Co.

Summary:
  • The A220-500 would be a viable replacement for an A320neo.
  • With the changes/improvements we discussed, it beats the A320neo on operational costs. The differences are not of the speculated level, however.

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The Airbus A220-500, a deep-dive analysis

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By Bjorn Fehrm

Jan. 20, 2023, © Leeham News: It’s a question “of when, not if” there will be an A220-500, we conclude in Tuesday’s article.

We have known about the -500 since the Bombardier days. A longer CS300 was part of the original concepts when the CS100 and CS300 were developed to safeguard that no decision on the smaller variants precluded a larger variant.

As Airbus A321 grows its share of the A320 lines’ output, an A220-500 makes sense, but only when the two A220 final assembly lines in Mirabel and Mobile can produce enough A220s to satisfy demand.

What would be the characteristics of an A220-500? We use our aircraft design and performance model to determine what is possible.

Figure 1. A rendering of an A220-500 that takes 157 passengers. Source: Leeham Co.

Summary:
  • The Airbus A220 has the base capabilities for a stretch to an A220-500.
  • Some changes/improvements are needed, but these are limited to detailed changes beyond a fuselage stretch.

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The 717 and A220, Part 2: Operational economics comparison

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By Bjorn Fehrm

Introduction  

December 10, 2020, © Leeham News: Last week, we introduced the Boeing 717 and its closest replacement size-wise, the Airbus A220-100. Delta, a major 717 customer, is accelerating the replacement of the 717 with the A220-100 under the pressure of the COVID19 pandemic.

We use our performance model to understand why. What are the gains when going from the 717 to an A220-100?

Delta Airlines Boeing 717-2BD landing at LaGuardia. Source: Wikipedia.

Summary
  • The 717 version of the DC-9 architecture produced a rugged and well-liked short-haul airliner. It’s five abreast cabin is preferred over the six-abreast Boeing 737 and Airbus A320.
  • It’s size-wise in the same 115 seat bracket as the 15 years younger Airbus A220-100. It’s 40 years old airframe architecture holds up well compared to the modern A220.
  • The engines of the two are also 15 years apart. But the Rolls-Royce BR715 of the 717 was originally designed to fly on fast business jets, necessitating a low by-pass ratio design. This is a handicap when used on lower speed airliners. It shows against the high bypass ratio Pratt & Whitney PW1500G of the A220.

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Airbus integrates the last pieces of the CSeries from Bombardier

September 3, 2020, © Leeham News: Airbus and its subsidiary Satair announced today it has integrated one of the last pieces of Bombardier’s engagement with the A220, the spare parts distribution.

Airbus acquired Bombardier’s part of the A220 aircraft program in January, but Bombardier continued to purchase, stock, sell and distribute the A220 spare parts. From the 1st of July, this is handled by Satair, part of the Airbus group, to give airlines with Airbus aircraft a single point of contact for spares part services.

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European Regionals Face Hostile Operating Environment

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By Kathryn B. Creedy

Third in a Series. Previous articles:

Introduction

Aug. 31, 2020, (c) Leeham News: European regionals face far greater challenges than Covid and, sadly, much of what is happening to the industry is beyond its control. The result is similar to failures seen in the U.S.  Flybe’s recent loss resulted from pre-Covid problems which also led to the pre-Covid failures of such airlines as Flybmi and Cobalt.

The failures illustrate, however, the three reasons why European regionals are so fragile – low-cost competition, geography, and challenging government policy.

 

 

 

 

 

Flybe is just the latest of many regionals to cease operations owing to harsh conditions in Europe.

Summary
  • Government Policies Hardest on Regionals
  • LCC Competition Challenging
  • Consumer Protections Crushing
  • Turboprops Have Large Role

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What’s the gain of flying a smaller single-aisle during COVID-19 recovery?

By Bjorn Fehrm

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Introduction

May 28, 2020, © Leeham News: As flying recommences after country lockdowns, the fill factors for the flights will be low for an extended period.

Airlines and the OEMs are anticipating the low load factors. For instance, Delta has not deferred any Airbus A220 deliveries but is postponing deliveries of larger aircraft. How much of an advantage is a smaller aircraft when opening up the traffic again?

We compare the operational costs of the Airbus alternatives. The cost of flying the A220-300 is compared with the A320neo.

Summary:

  • The A220-300 is about 25 seats smaller than the A320neo. It’s smaller airframe makes for lower fuel costs and airway/landing fees.
  • There are savings on the crew side as well, as both flight and cabin crew costs less.
  • Finally, modern systems, a composite wing, and a fuselage made of advanced materials promise lower maintenance costs than the A320neo.

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How much did the CSeries cost Bombardier?

By Bjorn Fehrm

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Introduction

February 20, 2020, © Leeham News: As we wrote in last week’s article about the A220 flying the Montreal to Toulouse route, the stakes are high in the civil airliner business. If you don’t have a very strong balance sheet you shouldn’t enter the business.

Bombardier learned this the hard way. Its follow up project to its successful CRJ regional jets, the CSeries, brought Bombardier to the brink of bankruptcy and it had to sell the project to Airbus at a fraction of its value. The project cost more to develop and produce than planned despite not running off the rails during development like Boeing’s 787 or Mitsubishi’s MRJ.

We analyze why it cost so much and at what fraction Airbus got the program.

Summary:

  • The CSeries nearly doubled its development costs despite being void of major hiccups. What was the cause?
  • Airbus picked up the program when Boeing forced Bombardier to sell. How much of a bargain did Airbus get?

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Airbus buys Bombardier’s share in A220,  now sole owner together with the Government of Quebec

By Bjorn Fehrm

February 13, 2020, © Leeham News in Toulouse: The news this morning that Airbus is now the sole owner of the A220 (75%) together with the Government of Quebec (25%) is good news for the A220 and for Quebec.

Bombardier is a company in trouble and it was forced to try and save cash in the A220 partnership rather than invest in the future. This potential limitation on the A220 program is now resolved. Airbus gets sole responsibility for future plans and it has in the Government of Quebec a partner that will be positive to the growth of the A220 as it means more business for the Quebec aeronautical industry.

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