After Boeing yields, what’s next for Bombardier CSeries?

Analysis

March 26, 2018, © Leeham News: With the decision by Boeing to let last week’s deadline go by without filing an appeal in the Bombardier trade complaint, eyes turn to “what’s next” for the CSeries.

Source: Bombardier.

LNC broke the news on Twitter that Boeing would not appeal the 4-0 decision finding it suffered no harm in the 2016 BBD-Delta Air Lines order for 75 CS100s and options for 50 more, with conversion rights to the CS300.

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Pontifications: Washington State out to lunch on aerospace–again

By Scott Hamilton

Nov. 13, 2017, © Leeham Co.: Washington State’s top aerospace official, John Thornquist, resigned early this month, complaining that the State Legislature cut the Department of Commerce’s budget 78% over the past three years—making it impossible for Commerce to promote Washington aerospace.

The Puget Sound Business Journal revealed the resignation Nov. 3. The Seattle Times followed later in the day.

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2017: the year ahead

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Introduction

Jan. 3, 2017, © Leeham Co.: The New Year is here and it doesn’t look like a good one for commercial aerospace, if measured against previous outstanding years.

There are some troubling signs ahead, piling on to a slowdown in orders from last year that didn’t even reach a 1:1 book:bill.

This year looks to be worse than last. Airbus and Boeing will give their 2017 guidance on the earnings calls this month and next. Bombardier and Embraer earnings calls are a ways off, when each will provide its guidance.

But LNC believes the Big Two in particular will be hard pressed to hit a 1:1 book:bill this year and may even struggle to match 2016 sales.

Boeing’s year-end order tally comes Thursday. Airbus’ comes on Jan. 11.

Summary
  • Wide-body sales remain weak.
  • Narrow-body backlogs and low oil prices continue to inhibit sales.
  • China, Middle East concerns emerging.
  • United Aircraft MC-21 and COMAC C919 begin flight testing.
  • Airbus A330neo, Boeing 787-10, Embraer E195-E2 and Mitsubishi Aircraft MRJ-70 roll-out and begin flight testing.
  • Airbus A321neo and Boeing 737 MAX 8 EIS.

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UPS order tops off 747-8 line through 2020

UPS Boeing 747-8F. Source: Boeing.

UPS Boeing 747-8F. Source: Boeing.

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Introduction

Oct. 31, 2016, © Leeham Co.: Last week’s order for 14 Boeing 747-8Fs and 14 options by UPS assures continuation of the program through 2020.

If options are exercised, and if previously announced deals with other customers finally are consummated, the program should continue at least well into the 2020 decade.

Summary

  • UPS (but not Boeing) revealed the delivery timeline for the order.
  • The mysterious Volga-Dnepr/AirBridgeCargo that was announced at the Paris and Farnborough air shows for up to 20 747-8Fs still hasn’t been firmed up. Only four are listed on the Boeing website this year.
  • Iran Air will order four 747-8s under the reported terms of the agreement with Boeing. The US government blessed the deal recently.
  • The first of three 747-8s for the presidential fleet is now scheduled for delivery in October 2017, it’s believed.

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Airbus, Boeing agree on NMA–for now

One concept of the middle of the market airplane.

One concept of the middle of the market airplane.

Oct. 12, 2016, © Leeham Co.: It’s rare when Airbus and Boeing agree on product strategy, but officials of the two companies seemed in almost perfect alignment in separate interviews by LNC last week.

Barry Eccleston, president of Airbus Americas, and Mike Sinnett, VP of Product Strategy for Boeing, each said there is no consensus yet among customers for the Middle of the Market airplane (MOMA), also known as the New Mid-range Airplane (NMA) at Boeing.

Eccleston was interviewed on the sidelines of the annual Seattle conference organized by the British American Business Council Pacific Northwest. Sinnett was interviewed on the sidelines of the annual Governor’s Conference organized by the Aerospace Futures Alliance, a lobbying group in Washington State.

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AvWeek obtains Boeing sales targets

Aug. 22, 2016, © Leeham Co.: It’s the kind of leak that drives a company crazy. Aviation Week obtained an internal Boeing sales target list that is well below a book:bill of 1:1 this year. The math shows that Boeing would have a book:bill of just 0.72:1.

Even this may be optimistic.

The sales target data, obtained by Guy Norris, indicates Boeing had a target of 88 777 sales and 88 787 sales this year.

The list does not distinguish between 777 Classics and 777Xs. So far this year, Boeing booked just eight 777 Classic orders.

It’s booked 19 787 orders.

The target list show 14 orders for the 747-8. Four already have been booked.

The order figures above are through August 16. This sales target list is a few months old and may have changed since then.

Boeing’s guidance has been 1:1.

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What’s happened to the VLA sector?

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Introduction

Aug. 15, 2016, © Leeham Co.: Boeing says it may discontinue the 747 program.

Airbus put the A380neo on indefinite hold. Qantas Airways says it doesn’t want its last eight orders. The OEM will reduce the production to 12/yr in 2018.

There haven’t been any Boeing 777X sales since June 2015. There are only six identified customers and there has been a new, identified customer added since July

Boeing is considering a larger 777-10, which will carry 50 more passengers than the 777-9. But is there a market? Boeing photo via Google images.

2014, when ANA ordered the X.

Sales have dried up for the 365 passenger Boeing 777-300ER and only a smattering of orders have come in for its competitor, the Airbus A350-1000.

What’s happened to the Very Large Aircraft sector? What’s happened to the large, medium twin aircraft sector?

Summary
  • The VLA market pioneered by Boeing and pursued by Airbus is virtually nonexistent.
  • Yet there are those in Boeing who want to launch a 450-passenger 777-10 into a dubious market demand.
  • 777 Classic sales dried up, but A350-1000 isn’t doing great, either. Are these too big, too?

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Pontifications: Boeing softens 747-8F recovery

Hamilton ATR

By Scott Hamilton

July 25, 2016, © Leeham Co.: Boeing July 21 announced it is taking an after tax charge of more than $800m against the 747-8 program. It also canceled plans to increase production of the 747-8F from the current 0.5/mo to 1/mo in 2019 on the long-held belief demand for the 8F would recover as 747-400Fs age.

In an email to LNC, a Boeing Commercial Airplanes spokesman wrote, “We have consistently said that while there is a cargo market recovery – it is not as robust as we had expected. Our new long term forecast projects cargo traffic to grow at 4.2% per year over the next two decades. But in the short term, the cargo market continues to struggle.

“The 747-8 is closely tied to the cargo market. There is an opportunity starting around 2019 when many 747-400 Freighters will be retired. Some of that replacement could go to the 747-8F, some to 777F, but some of those airplanes won’t be replaced at all. The decision we announced reduces future risk for the program and the company– and allows us to see how that replacement cycle plays out.”

With that, years of forecasts of a solid recovery for the 747-8F that ran counter to many outside Boeing was softened considerably.

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Weekly analyst synopsis: Farnborough recap

Analyst SynopsisJuly 20, 2016: Aerospace analysts had somewhat different takes on the commercial aviation portion of the Farnborough Air Show. This week’s analyst synopsis includes some of the analyst reports. Between now and the end of the month, earnings season begins reporting the second quarter results. Airbus reports July 27. So does Boeing. Bombardier and Embraer report after July.

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Farnborough redefines the MOM sector

AirbusNewJuly 19, 2016, © Leeham Co.: If anything came out of the otherwise dull Farnborough Air Show, it was that the Middle of the Market airplane debate is as muddled as ever.

Boeing didn’t launch, or even say much, about the prospective 737-10, a slightly larger version of the MAX 9 intended to close the gap between the 9 and the Airbus A321neo. Boeing illustrates the 737-8-based MAX 200 as a separate model in its product line up. The 737-10 will slot in above the MAX 200, if built.

Boeing increased the demand in its 20-year Current Market Outlook for the small, twin-aisle airplane by 5%–a move Airbus claims is aimed at the Boeing Board of Directors to entice it to approve launch of the New Mid-range Aircraft, or NMA as Boeing now calls the MOM aircraft.

Boeing LogoAirbus said the MOM sector ends at 240 seats (single class) and only a single-aisle airplane makes sense. This is a shift from long-standing messaging that the A321neo covers the lower end of the MOM sector and the A330-200/800 covers the upper end. This message was advanced as recently as the Airbus Innovation Days at the end of May.

With the rhetoric changing a bit, is it time to redefine the MOM sector?

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