Commentary
May 1, 2017, © Leeham Co.: Boeing’s complaint against Bombardier’s CSeries transaction with Delta Air Lines, and a request for millions of dollars in antidumping and penalties might be coming at a bad time.
Was the Boeing 787 program marked by “launch customer pricing” or “dumping”? This may depend on program or unit accounting. Boeing photo.
“Boeing requests that the Department initiate an antidumping investigation and impose antidumping duties on Aircraft from Canada in an amount sufficient to offset unfair pricing above.”
If Boeing is successful in its request of the US government and International Trade Commission to impose duties before the first CS100 is delivered to Delta next year, the cost of the airplane will balloon from the $19.6m Boeing calculates (and which BBD denies) to at least $33m.
It’s unclear from the complaint who would pay this penalty—Bombardier, maintaining the price to Delta, or would Delta have to pay the reset price?
Regardless, this kerfuffle can’t be welcome news to Delta, which already has a ruffled relationship with Boeing due to its opposition to the ExIm Bank and orders for Airbus aircraft.
Read more
Boeing-Bombardier complaint could affect competition in coming Delta neo-MAX RFP
Commentary
May 1, 2017, © Leeham Co.: Boeing’s complaint against Bombardier’s CSeries transaction with Delta Air Lines, and a request for millions of dollars in antidumping and penalties might be coming at a bad time.
Was the Boeing 787 program marked by “launch customer pricing” or “dumping”? This may depend on program or unit accounting. Boeing photo.
“Boeing requests that the Department initiate an antidumping investigation and impose antidumping duties on Aircraft from Canada in an amount sufficient to offset unfair pricing above.”
If Boeing is successful in its request of the US government and International Trade Commission to impose duties before the first CS100 is delivered to Delta next year, the cost of the airplane will balloon from the $19.6m Boeing calculates (and which BBD denies) to at least $33m.
It’s unclear from the complaint who would pay this penalty—Bombardier, maintaining the price to Delta, or would Delta have to pay the reset price?
Regardless, this kerfuffle can’t be welcome news to Delta, which already has a ruffled relationship with Boeing due to its opposition to the ExIm Bank and orders for Airbus aircraft.
Read more
24 Comments
Posted on May 1, 2017 by Scott Hamilton
Airbus, Boeing, Bombardier, CFM, CSeries, Delta Air Lines, Embraer, Leeham News and Comment, Pratt & Whitney
737 MAX, 737-10, 737-900ER, 787, 7M7, A320ceo, A320NEO, A321ceo, Airbus, Boeing, Bombardier, CFM, CS100, CSeries, Embraer, LEAP, Pratt & Whitney
Boeing Services expansion wise, necessary move
Subscription Required
Introduction
March 6, 2017, © Leeham Co.: Boeing CEO Dennis Muilenburg wants the company to participate in the aftermarket aircraft services business and set a goal of $50bn in revenue in the coming years.
He looks at Boeing’s current business, the former Boeing Commercial Aviation Services (CAS), and sees a single-digit market share in a worldwide trillion-dollar market potential. Muilenburg understandably wants a greater share of this.
But LNC believes there is an additional driver: the intensely competitive commercial airliner business faces even greater competition in the coming years. Prices are under pressure today. China is developing its own aerospace industry, which will eat into sales by Boeing (and Airbus) in the home market. Russia has ambitions to renew its home-market airliner industry.
Boeing’s new Global Services unit is a hedge against the prospect of falling profits at Boeing Commercial Airplanes as these factors converge.
Summary
Read more
Leave a Comment
Posted on March 6, 2017 by Scott Hamilton
Airbus, Boeing, Bombardier, China, Comac, Embraer, Irkut, Mitsubishi, Premium
737 MAX, 737-10, 737-7, A320NEO, AeroDynamic Advisory, Airbus, Boeing, Bombardier, CS300, Dennis Muilenburg, Embraer, Kevin Michaels, Mitsubishi
Assessing ATR future
Subscription Required
Introductions
Feb. 27, 2017, © Leeham Co.: ATR today holds an almost monopolistic position in the large turbo-prop market with 87% of the backlog at YE2016. Bombardier, once the dominant turbo-prop manufacturer, has a mere 13%.
China and Russia are not included above.
ATR had a backlog of 212 aircraft vs Bombardier’s 31. In addition, ATR had options for more than 400 aircraft and LOIs for about 70 more. BBD had options for just 12 Q400s at the end of last year.
Summary
Read more
Leave a Comment
Posted on February 27, 2017 by Scott Hamilton
Airbus, ATR, Bombardier, Embraer, Premium
Airbus, ATR, ATR-42. ATR-72-600, Bombardier, Christian Scherer, CRJ, CSeries, EJet, Embraer, Fabrice Bregier, Patrick de Castelbajac
Assessing the SSJ100 future
Subscription Required
Introduction
Feb. 20, 2017, © Leeham Co.: Sukhoi is Russia’s attempt at reentering the commercial airliner business. The SSJ100 regional jet is, by most accounts, an attractive
SSJ100 in CityJet colors. CityJet is one of two Western operators for the Russian-made airplane. Photo: Superjet International.
and efficient aircraft.
But it’s hampered by erratic production and questionable product support (largely due to the overhang of the Putin politics).
The aircraft was grounded briefly in December when a fatigue issue was found in the tail section during a routine inspection.
Summary
Read more
3 Comments
Posted on February 20, 2017 by Scott Hamilton
Bombardier, China, CSeries, Embraer, Mitsubishi, Premium, Sukhoi
Bombardier, C929, China, CRJ900, CS100, E175 E2, E175-E1, E190 E2, E190-E1, Embraer, Mitsubishi, MRJ70. MRJ90, SSJ100, SSJ130, Sukhoi
Brazil files WTO complaint against Canada-CSeries deals
“Brazil notified the WTO Secretariat that it had requested WTO dispute consultations with Canada regarding alleged subsidies provided to Canadian aircraft manufacturer Bombardier,” the WTO announced today. Coincidentally, today it was also revealed the federal government will provide C$372m in loans to Bombardier. Most will go toward the Global 7000 corporate jet program but some will go to the CSeries, which competes with Embraer’s EJets.
Read more
12 Comments
Posted on February 8, 2017 by Scott Hamilton
Bombardier, Delta Air Lines, Embraer
Bombardier, CSeries, EJet, Embraer, World Trade Organization, WTO
Assessing Embraer’s EJet future
Subscription Required.
Introduction
The E175 E2 exceeds the 86,000 lb weight limit in the Scope Clause. Unions declined last year to adjust this limit upward. The next round of contract talks begins in 2019.
Summary
Read more
2 Comments
Posted on February 2, 2017 by Scott Hamilton
E-Jet, Embraer, Premium
Assessing Bombardier commercial programs
Subscription
Introduction
Jan. 30, 2017, © Leeham Co.: Bombardier hopes to land a major, blue-chip order for its CSeries this year but otherwise isn’t counting on significant orders for its flagship airliner.
The future of the aging CRJ could get a boost from recalcitrant Us labor unions who refuse to alter the 86,000 lb aircraft weight limit under the Scope Clauses. These make the Embraer E175-E2 and Mitsubishi MRJ90 too heavy for the regional airlines providing contract flying for the US majors.
The future of the Q400 turboprop looks bleak.
Summary
Read more
2 Comments
Posted on January 30, 2017 by Scott Hamilton
ATR, Bombardier, E-Jet, Embraer, Mitsubishi, Premium
ATR, Bombardier, CRJ, CRJ1000, CRJ700, CRJ900, CS100, CS300, CSeries, E175 E2, E175-E1, EJet, Embraer, Q400
Pontifications: Airbus, Boeing single-aisle production rates solid
By Scott Hamilton
Jan. 23, 2017, © Leeham Co.: The global economy is softening and airlines are deferring airplanes, but we don’t see Airbus or Boeing trimming aircraft production for their single-aisle airplanes.
Over-sales and rising fuel prices support today’s A320 and 737 production rates and the increased rates previously announced by Airbus and Boeing.
While oil prices are low compared with the pre-Great Recession levels, Embraer’s John Slattery noted that fuel costs went up more than 48% last year alone. Fuel now costs more than $50/bbl. West Texas Intermediate Crude was selling at $51.08 Thursday, off $1.40. There will be ups and downs, but the trend is up.
Slattery, the president of Embraer Commercial airplanes, believes “fuel efficient fleets will become more critical in the coming years,” he wrote in a Tweet Jan. 7.
Read more
66 Comments
Posted on January 23, 2017 by Scott Hamilton
Airbus, Airlines, Boeing, Embraer, Pontifications, United Airlines
737 MAX, 777 Classic, 787, A319neo, A320NEO, Airbus, airlines, Bernstein Research, Boeing, Doug Harned, Embraer, John Leahy, John Slattery, Southwest Airlines, United Airlines
The regional market and scope clauses
By Bjorn Fehrm
January 17, 2017, ©. Leeham Co: Union contract Scope Clauses–the provision limiting the weight, capacity or number of aircraft operated by airlines for major carriers–are unlikely to be modified any time soon, panelists at the Air Finance Journal conference in Dublin said.
The restrictive Scope Clauses are predominate in the US. These limit the ability of small airplane manufacturers to sell aircraft in the US. Most affected are Embraer, Bombardier and newcomer Mitsubishi.
Contract negotiations in December, concluded before Christmas, resulted in no changes, surprising some. This will impact planned purchases of aircraft.
We sat with Bombardier’s Ross Mitchell, vice president of commercial operations, to understand why the scope clauses are so important and why they did not change. Read more
36 Comments
Posted on January 18, 2017 by Bjorn Fehrm
American Airlines, Bombardier, E-Jet, Embraer, Mitsubishi, Pratt & Whitney
Bombardier, CRJ900, E175, Embraer, Mitsubishi Aircraft Corporation, MRJ70, MRJ90, Pratt & Whitney, Ross Mitchell, Scope clause
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.
Read more
36 Comments
Posted on January 16, 2017 by Scott Hamilton
Airbus, Boeing, Bombardier, Embraer, Pontifications
777-200ER, A318, Airbus, Boeing, Bombardier, CRJ-700, E170, Embraer
Email Subscription
Associations
Aviation News-Commercial
Commentaries
Companies-Commercial
Companies-Defense
Engines
Resources
YouTube
Archives