PW re-delivering GTF to Bombardier CSeries flight test fleet, airborne program likely next month

Pratt & Whitney has completed a design repair for the Pure Power 1500G used on the Bombardier CSeries Flight Test Vehicles (FTVs) and is re-delivering the engines, Leeham News has learned.

Flight tests are expected to resume in September, likely the first half, according to sources close to the situation. BBD will only say flight tests will resume “in the coming weeks.”

A PW spokesman was equally ambiguous. “We continue to work closely with Bombardier to return the CSeries to flight testing,” the spokesman wrote in an email. “I would also note that the fundamental architecture of the Geared Turbofan engine remains sound.”

The FTVs have been grounded since May 29, when a PW engine on FTV 1 suffered a failure in an oil seal, causing a fire and spewing engine parts into the composite wing of the airplane. The wing is undergoing repairs.

Details of the fix for the FTV engines have not been revealed. But one person familiar with the situation told us that the FTV engine repairs enable the test fleet to return to the air, and that the redesign of the affected area of the engine will be incorporated into a production redesign before the CSeries enters service. Bombardier continues to maintain that the CS100, the first of the two-member family scheduled to enter service, will do so in the second half of 2015. Some aerospace analysts believe BBD will be hard-pressed to meet this schedule, and EIS will slip into early 2016. The larger CS300 was scheduled to enter service six months after the CS100, and it’s unclear if this EIS will continue to have a six month gap.

Bombardier is preparing to resume the flight test program with the four FTVs that have been completed; three more are in assembly.

The Pure Power 1100G for the Airbus A320neo, scheduled to enter service in October next year, will incorporate the production redesign, says the source familiar with the situation. No delay is expected in this program.

Odds and Ends: CSeries status; Airbus accident analysis; 737 rate increase; Kenya Air holds Boeing hostage

CSeries Status: Here is an interesting, detailed article from a blogger who follows the Bombardier CSeries more closely than anyone we can think of.

The article pretty well summarizes the issues, although we have this additional color: the fixes have been identified and are being installed and are still in Transport Canada review for approval and the green light to resume flight testing.

Airbus accident analysis: Airbus issued a study that looks at the causes of commercial accidents since 1958. The full report may be found here. The report is intentionally light on text and heavy on charts and graphics, so it’s easy to digest.

737 rate increase: Several media reported yesterday that Greg Smith, CFO of The Boeing Co., told an investors day Boeing is likely to decide this year on a production rate increase for the 737 line beyond the 47/mo previously announced to go into effect in 2017. Well, you read it here first–we reported more than a year ago Boeing was looking at a rate increase to 52/mo and even 60/mo. We’ve had in our estimates the 52/mo by 2018, 2019 or 2020, followed by 60 a year or two later.

Kenya Air: no more Boeings: We know some Airbus customers have long tied route authority to buying Airbus airplanes, and China is notorious for holding Airbus and Boeing orders hostage for political reasons. Kenya Airlines now says it won’t buy more Boeing aircraft unless it gets US route authority, according to this article.

Odds and Ends: Airbus regional A330, IAG orders and Bombardier reviewing options

Airbus A330 regional might get sales after all, Airbus is negotiating a large order with China against local off-sets (assembly or final configuration, the experts are divided) according to Wall Street Journal. We reference Ben Sandilands writeup of the story to avoid the WSJ paywall. As we were told at Farnborough by Airbus the A330 regional is a de-papered A330ceo with an adapted interior. It does not make sense to wait for a neo variant for this aircraft as the fuel costs are a less important factor on sub 5 hour missions. It will be interesting to see if some other market will pick up on this 200 tonne aircraft, to some extent it is back to the roots for the A330-300, it started off as a medium haul complement to the long haul A340-200 and -300 at 206t maximum take-off weight.

IAG has given Airbus a cheer up signal after the bad news around SkyMark. In their second quarter report call IAG CEO Willie Walsh declare their A380 as “fantastic aircraft when you can fill it”, they see 98% load factors on their most popular routes (e.g. LHR-LAX). IAG also announced better results in their Spanish daughter Iberia, consequently it is allowed to order 8 A330-200 (ceos as the neo comes to late) and convert 8 of IAGs A350-900 options to firm orders for their airline.  Right now IAG is satisfied with the 12 A380 they have on order for BA according to Walsh.

Bombardier is re-examining its options for the recently created Aerospace divisions according to FlightGlobal; they want to leverage the Aerostructures divisions capabilities more when Boeing and Airbus looks for further partners for their booming supply chains. They also need to guard their bets on Russia as partner to drive sales of Q400 and Cseries, given the mounting political problems between Russia and the west. This results in renewed activity in the China / Comac discussions, initially for cooperation on the after sales side in addition to the present fuselage deliveries, but come a worsened situation with Russia such talks could find new depth we think.

GE analysis post Farnborough

Our wrap up of Farnborough would be incomplete without looking closer at the world’s leading engine supplier, GE Aviation, which together with partners (like SAFRAN in CFM joint venture) garnered more than $36 Billion in orders and commitments during the show. This figure was only significantly bettered by Airbus ($75 Billion) and it came close to Boeing’s $40 Billion. With such level of business the claim by GE Aviation CEO, David Joyce, that the Airbus A330neo engine business was not the right thing for GE as they have more business than then they know what to do with, was certainly no case of “sour grapes”. Read more

Bombardier woes go beyond CSeries

The news last week that Bombardier reorganized its business units, laid off another 1,800 employees and saw the retirement of Guy Hachey, president and CEO of the aerospace division, was viewed by some media and observers as an indictment of the CSeries program. While it’s certainly true that delays in the program weigh heavily on BBD, the problems don’t stop with CSeries.

Bombardier has 203 firm orders and 310 commitments for CSeries. This delivery stream doesn't include any potential rescheduling as a result of the grounding of the Flight Test fleet from May as a result of the engine incident.

Bombardier has 203 firm orders and 310 commitments for CSeries. This delivery stream doesn’t include any potential rescheduling as a result of the grounding of the Flight Test fleet from May as a result of the engine incident.

Slow sales of the CRJ, Q400 and business jets–as well as program development issues with a new corporate jet–all combined to drag down financial performance and bleed cash. Bombardier doesn’t have the balance sheet strength of Boeing or Airbus, nor strong sales of other airplane family members, to weather the challenges of new airplane development programs.

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Odds and Ends: CSeries schedule; BBD and Russia; MH370

CSeries schedule: An intriguing news item came out of Russia this week concerning the Bombardier CSeries. Lessor Ilyushin Finance Co., which has more orders for the CSeries than any other customer except Republic Airways, claims (according to the article) that BBD sweetened the terms of the final contract following the engine incident in May that results in a grounding of the test flight during the investigation and fix.

The issue was tracked to a faulty oil seal. The fix, according to our sourcing, is relatively easy and straight-forward, but Transport Canada hasn’t green-lighted a return of the test fleet to service yet, and it still may be a few more weeks before it does, we’re told.

BBD maintains that it still plans first delivery in the second half of 2015, but we’re also told all the schedule margin is now gone. And here’s where we get to the heart of the IFC news report.

According to Russian Aviation, IFC has rescheduled deliveries from November 2015 to April 2016, a five month shift to the right. There is no indication, although it is inferred, if this is reflective of a new program delay–or whether this is a rescheduling at IFC’s preference.

  • Bombardier announced a reorganization that saw the retirement of Guy Hachey, president and COO of the Aerospace division. Another 1,800 employees have been laid off as well. BBD continues to burn through cash as delays in the CSeries program mount up.
  • A source familiar with the CSeries flight testing program thinks the flight testing should resume in August.

Bombardier and Russia: More from Russia: The Toronto Globe and Mail reports that Bombardier’s plan to open a Q400 assembly line in Russia has stalled over the crisis in Ukraine.

Boeing and Russia: Boeing has close ties to Russia for its commercial aircraft division, relying on Russia as a large supplier of titanium. The Ukrainian fighting was already affecting the supply chain. The Puget Sound Business Journal has this explanation.

MH370: While the world is focused on Malaysia Airlines flight MH17, Runway Girl Network has an intriguing piece about MH370, the Boeing 777 that disappeared five months ago. She has a video about access to the electronics bay on the 777, a topic that we discussed at the height of MH370’s disappearance. RGN’s article explains the concern as well.

Regional Airline pilot sickout: A campaign is underway to have a US pilot sick-out Sept. 1-5 for regional airlines.

Odds and Ends: Some FAS leftovers–a big CSeries order?; EMB lands 60; and more

Farnborough Air Show leftovers:

Big CSeries order coming? Flight Global reports that lessor Macquarie Airfinance is about ready to sign a deal for 50 Bombardier CSeries. If true, this would be a major departure for the lessor, which historically hasn’t placed speculative orders–and it would be a major boost for Bombardier. The Flight Global report doesn’t say if this would be 50 firm or a combination of firm and options. BBD and MAF didn’t comment for Flight. We reached out to MAF and received this response:

“The Flightglobal release was concocted on a rumour and we don’t comment on rumours. You know how it is with lessors. We’re constantly considering every aircraft type that could provide us with value-adding opportunities.”

Bombardier has been selling the CSeries in small numbers, often to second or third tier, and even start-up carriers, a path Boeing took in the early days of the 737-200 program. Airbus relied heavily on lessors for early A320 orders. Boutique lessor LCI was a launch customer for the airplane, and Falko Regional Aircraft Leasing became a customer at FAS.

BBD now has 513 orders and commitments for CSeries.

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Farnborough Air Show, July 17: Orders summary, reflections of the show

Orders continued to trickle in as the Farnborough Air Show winds down (there could be others not listed here).

  • Airbus: Transaero, LOI for 12 A330neos and eight A330ceos; Hong Kong Aviation Capital firms up an order for 40 A320neo and 30 A321neo aircraft, announced at the Paris Air Show last year. Here is the Airbus wrap up press release.
  • Boeing: Summarizes its performance at FAS with this press release; 201 orders and commitments.

Items of interest:

Overall reflections:

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Farnborough Air Show, July 16: Orders Summary

Here are the orders we’ve seen for today (there could be more); this should pretty well do it for the show, though it does continue through Friday and there probably will be a few more deals:

  • Airbus: Air Mauritius, MOU for four A350-900s.
  • ATR: Myanma Airways, six ATR 72-600s with options for six.
  • Boeing: After saying he was in no hurry to finalize the 777X orders, U-Turn Al (Akbar Al-Baker) did just that–Qatar Airways signed the contract for the 50 announced at the Dubai Air Show last November, with 50 options; Qatar also orders and options eight (4+4) 777Fs; Hainan Airlines, MOU for 50 737-8s; MG Aviation Limited, two 787-9s; Air Algerie, two 737-700Cs.
  • Bombardier: Nok Air converted two previously held options to firm orders for the Q400; Unidentified commitment from an existing customer for five CSeries; Unidentified order for seven CS300s and added six options; now at 513 orders and commitments.
  • CFM: 80 LEAP-1A engines (for A320neo) from Mexico’s Interjet.

Items of interest:

  • Ready for a 12 hour flight in the Bombardier Q400 turbo-prop? It will soon be available. Marshall Aerospace sent us this press release:
    Auxiliary fuel tanks for Bombardier Q400: Marshall Aerospace and Defence Group and Bombardier Aerospace are developing an External Auxiliary Fuel System solution for the Bombardier Q400 turboprop aircraft.The solution, which will be available as an official Bombardier option, will provide up to an additional 10,000lb of fuel in two external pannier tanks allowing the aircraft to fulfill a whole range of missions requiring additional range and endurance, allowing this turboprop platform to be able to sustain operations of up to 12 hours.
  • Although Airbus CEO Farbice Bregier said “no” to an A380neo, reported in The Seattle Times and linked by us earlier, today Aviation Week quotes Airbus COO-Customers John Leahy as saying a decision on the A380neo will come next year–which supports our commentary that we didn’t believe the A380neo issue is dead. Airchive reports that A350 chief Didier Evard hasn’t ruled out an A350-1100, either, just as we also noted in our commentary.
  • GE wanted to be the sole source on the A330neo, reports Aviation Week, which also explains why Airbus chose Rolls-Royce.
  • Flight Global has this story explaining how Airbus plans to be “weight neutral” for the A330neo vs the A330ceo.

Farnborough Air Show, July 16: MRJ program analysis

After a long drought of orders or even LOIs and MOUs, the Mitsubishi MRJ program saw some life at this Farnborough Air Show.

Sales of Japan’s first commercial airplane since the propeller-era’s YS-11 stalled with orders from SkyWest Airlines, Trans States Airlines and Japan’s ANA.

But at the FAS, Mitsubishi announced an MOU with Eastern Air Lines, a US start-up carrier, for up to 40 and a much smaller order for six from Air Mandalay.

The Eastern MOU can fairly come under scrutiny if for no other reason than the company is a start-up. Little is known about its financial fund raising and the business model–to begin as a charter airline and transition to a scheduled carrier in the highly competitive US Southeast–doesn’t instill a lot of confidence. EAL, named after the old trunk carrier that went out of business in 1991, has also ordered the Boeing 737-800 after initially announcing plans to begin service with the Airbus A320.

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