Pontifications: ATR, Q400 replacement not any time soon

By Scott Hamilton

June 5, 2017, © Leeham Co.: The prospect of a new generation turboprop airliner remains as elusive as ever.

This is the clear conclusion from Media Days I attended Tuesday through Friday with Pratt & Whitney and Embraer at their respective Florida operations in West Palm Beach and Melbourne.

There are just two major manufacturers, ATR and Bombardier—and the latter is fading fast. ATR now has about 80% of the backlog. Bombardier is down to about two dozen unfilled orders.

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Embraer adds range to E190/95 E2s

June 2, 2017, © Leeham Co.: Embraer today announced enhancements to its new E190-E2 and E195-E2 adding range to the 195 and improving hot-and-high and challenging airport performance for the 190.

John Slattery, president and CEO of Embraer Commercial Airplanes, revealed the improvements during its media days at its Melbourne (FL) facilities.

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Embraer aggressively pursues private jet market

June 2, 2017, © Leeham Co.: Embraer is aggressively growing in the private jet market, offering a range of clean-sheet designs to business jet versions of its venerable E-145 RJ and its E-Jet.

In a pre-Paris Air Show press briefing at EMB’s Melbourne (FL) facility, the Phenom and Legacy private jets took center stage. Both jet families, currently two and three members respectively, are assembled here at this growing facility.

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Embraer’s US footprint spans 31 states

June 2, 2017, © Leeham Co.: Embraer is best known as a Brazilian company, but its US footprint and economic contributions are surprising for those who don’t delve into these sorts of things.

Gary Spulak, president, Embraer Aircraft Holding US, outlined EMB’s US presence on the first day of two days of pre-Paris Air Show briefings at the company’s Melbourne (FL) engineering, production and corporate aircraft center.

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Pontifications: No sale for Boeing in Bombardier complaint

By Scott Hamilton

May 29, 2017, © Leeham Co.: I’m having a really hard time buying into Boeing’s arguments in the complaint about alleged price dumping by Bombardier in its deal with Delta Air Lines.

I say this despite the fact that Boeing lawyers at least four times directly and twice indirectly cited “trade publication” Leeham News and Comment in support of its case. While flattering to be used as an authoritative source, Boeing’s testimony doesn’t support the claim that Bombardier acted improperly, in my view (nor that of AirInsight, which also reviewed the testimony). There are, of course, scads of exhibits and confidential information not available for public review that could, if available for public dissemination, might change opinion.

The thing is, Boeing is known among journalists and analysts for its occasional descent into hyperbole. Or, as one reporter I talked to put it, this is an example of Cirque du Soleil acrobatics. It is with some amusement that I note Cirque du Soleil is, like Bombardier, headquartered in Montreal.

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Bombardier-Delta deal can put Boeing out of business, company claims

May 25, 2017, © Leeham Co.: Boeing says its very future, and that of US aerospace industry, is at risk if Bombardier’s deal with Delta Air Lines for 75 CS100s and 50 options is not fined for price dumping.

That’s the claim company officials made in testimony before the US International Trade Commission May 18.

Boeing filed a complaint with the ITC and the US Department of Commerce April 27, charging that Bombardier sold the CSeries to Delta for $19.6m, a price so far below production costs that it constitutes “dumping” under legal definitions.

Bombardier and Delta deny the price and Bombardier denies the over-arching dumping claims.

LNC reviewed the 290-page transcript of the May 18 hearing.

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Delta shoots down Boeing’s CSeries dumping claim

May 23, 2017, © Leeham Co.: Delta Air Lines shot down Boeing’s claim that Bombardier “dumped” the CSeries order, in testimony last week before the US International Trade Commission.

Boeing filed a complaint April 27 that Bombardier sold the CS100 to Delta for $19.6m, well below its production cost, a price that constitutes “dumping.”

Bombardier CS100.

Boeing seeks tariffs of nearly 80% on the importation of the airplanes to Delta.

Boeing’s complaint is that the Delta deal made it impossible for Boeing to offer the 737-700 at a competitive price.

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Paris Air Show Preview

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Introduction

May 22, 2017, © Leeham Co. The Paris Air Show begins June 17, and few in the industry expect much in the way of orders this year.

The order cycle is on the downward side of the bell curve. Sustaining the 2,000, 3,000 or nearly 4,000 gross orders announced 2011-2013 simply couldn’t be achieved. The “order bubble” had to break, and it did. Last year, Airbus and Boeing reported some 1,400 orders between them.

Airbus guides that it will tough to achieve a 1:1 book:bill this year. Boeing is running about 1:1 book:bill so far but it also guides conservatively. Still, LNC thinks Boeing might surprise this year–and some of this could be at the Paris Air Show.

Leeham Co.’s new publication, Commercial Aviation Report, provides a Focus Report on the Air Show. This encompasses the expectations for Airbus, Boeing, Bombardier, Embraer, COMAC, Irkut, Mitsubishi, CFM, GE Aviation, Pratt & Whitney and Rolls-Royce into one easy-to-read package.

The pre-airshow press briefings by the OEMs begin next week. We don’t expect any earth-shattering news from these and we wanted to get our views out ahead of these briefings.

Summary
  • Boeing wants to launch the 737-10 MAX at the Paris Air Show. This could spur a group of orders that would give Boeing a rare win in the headlines vs Airbus on the latter’s home ground.
  • Mitsubishi plans to have its MRJ90 at the Air Show. One airplane entered the paint shop for ANA colors–this might be the one making the appearance.
  • Embraer expects to have its KC-390 there. Will the E195-E2 also make an appearance?

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Regional aircraft for US Scope clause operations. Part 3.

By Bjorn Fehrm

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Introduction

May 18, 2017, © Leeham Co.: In the second article about the US regional aircraft market, we looked at the cabins for the regional aircraft we examine. We started with looking at the typical classes and their seat ratios for the mainline aircraft the regional aircraft are feeding to/from. Then we mimicked that on the regional aircraft.

We filled the cabin with domestic First-class seats, then Premium economy and finally Economy until we got 76 seats or the cabin said stop.

Now we complete the picture by comparing the economics of the aircraft after which we summarize our findings.

Summary:

  • The benchmark aircraft for the US scope clauses is the E175 from Embraer. It was designed for the scope clause market.
  • It’s larger dimensions means the operating costs are slightly higher than the CRJ900.
  • A scope clause-bound operator can compensate the Bombardier CRJ900’s tighter cabin with more seat pitch. It has the longest cabin of all compared aircraft.
  • The MRJ70 and CRJ700 are too short for scope clause flying with 76 seat cabins and the MRJ90 is too heavy for the 86,000lb maximum weight limit.

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Regional aircraft for US Scope clause operations. Part 2.

By Bjorn Fehrm

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Introduction

May 11, 2017, © Leeham Co.: In the first article about the US regional aircraft market, we described the special rules that apply for outsourced regional airlines, operating for a mainline carrier. The mainline pilots limit the outsourcing via Scope clauses in their Union agreements to aircraft with 76 seats and 86,000lb Maximum Take-Off Weight (MTOW).

We identified potential aircraft that fit these restrictions in the first article. Now we examine their load carrying capability.

The MTOW limit sets a hard limit on how large aircraft can be used to house 76 seats. The mainline carriers want the regionals to mimic their domestic cabin classes in their aircraft. There shall be no disruption for a First class or Premium economy passenger whether on a mainline flight or on a feed flight to/from the hub.

The challenge is to accommodate the seating standard in the aircraft that come in question.

Summary:
  • Mainline airlines want to replicate their three class cabins for all sectors of a network.
  • This means the regional aircraft cabins shall offer First class, Premium economy and Economy sections.
  • Only the larger aircraft we study can offer a three class cabin with 76 seats.
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