Sunset of the Quads, Part 9, Wrap-up

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By Vincent Valery and Bjorn Fehrm

Introduction  

Oct. 1st, 2020, © Leeham News: Last week, we compared the economics of the A380 against the 747-8 and 777-9 on the Frankfurt to New York route. We now wrap-up our series on the significant passenger quad-jets of the last 30 years and how competitive they were against other quads and the twins that gradually took over the very large aircraft segment.

Summary
  • A resounding success, a respectable career, and three commercial failures;
  • Prospects for a Quad-jet passenger operation in the post-COVID world are slim;
  • The next quads will come as low emission technology drives implementations to smaller propulsive units.

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The engine manufacturers worst hit by the pandemic

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By Bjorn Fehrm

Introduction  

September 28, 2020, © Leeham News: The worldwide COVID-19 pandemic is shaking the air travel and airliner manufacturing industries like no crisis before.

More than 9/11, the oil crisis of 1973 or 2005 or the financial crisis of 2008. The problems for the airlines and the airframe OEMs are on the front pages of the world’s media.

The part of the airliner industry that is not so visible but is perhaps hardest hit, is the engine industry. Its weird business model amplifies the effects of the crisis.

Summary

  • Airframe OEMs lose money on the first hundreds of aircraft produced.
  • When they announce “black numbers”, it means the per aircraft losses stop. It doesn’t mean the aircraft program is positive.
  • For engine OEMs, it’s worse. They never reach ‘black numbers” on engine production. Their only money makers are old engine programs that fly a lot.

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A lost decade for aircraft manufacturers, suppliers

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By Judson Rollins, Bjorn Fehrm & Scott Hamilton

Sept. 21, 2020, © Leeham News: Commercial aviation is facing a lost decade due to COVID.

Yes, most forecasts target 2024-2025 as returning to 2019 passenger traffic and aircraft production levels.

However, LNA in July published its own analysis indicating full recovery may not occur until 2028. Breathless headlines notwithstanding, it will take years for vaccines to be widely available and considered safe by enough of the world’s population. Growing concern about vaccine production and distribution capacity through 2024 underscores this view. Even Southwest Airlines CEO Gary Kelly said earlier this month that business travel might not fully return for a decade.

Indeed, the 2020s may well be a lost decade for aircraft manufacturers and their supply chains.

Summary

  • Debt-laden airlines will have little money to order new airplanes
  • Interest in re-engined 787, A350 likely nil this decade
  • Airbus, Boeing, Embraer have little interest in launching new programs
  • Engine makers too financially stretched to develop new designs
  • Engineering talent, knowledge will be decimated by inevitable job reductions
  • OEMs must “play the long game” at short-term cost to safeguard their futures

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Sunset of the Quads, Part 6. The A340-600 versus the 777-300ER.

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By Bjorn Fehrm

Introduction  

September 10, 2020, © Leeham News: The Airbus A340-600 was designed to challenge Boeing’s hold of the large, long-haul jets. With a capacity 60 seats above the previous largest Airbus jet, the A340-300, and a 7,500nm range, it should put Airbus firmly on the long-haul map.

The A340-600 would be flying its 350 passengers as long and for a lower cost than the 20 seats larger Boeing 747-400, the then-largest long-haul Boeing jet. It would have worked hadn’t Boeing upgraded the 777-300 to the 777-300ER and surpassed the spec. How much better did that make the 777-300ER when it arrived in 2004?

Summary
  • The A340-600 could take almost as many passengers as the Boeing 747-400 and fly these to the same distance.
  • In addition, it loaded more LD3 cargo containers and burned only three-quarters of the fuel of a 747-400.
  • But the advantage of the A340-600 was shortlived. Only two years later Boeing responded with the 777-300ER which bettered the Airbus on almost all accounts.

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Sunset of the Quads, Part 4.

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By Bjorn Fehrm

Introduction  

August 27, 2020, © Leeham News: After presenting Boeing’s and Airbus’ first 300 seater long-range widebodies, the 777-200ER and A340-300 in Part 3, we now fly them both on the route Paris to San Fransisco to understand their economics.

The A340-300 was first on the market, but when the 777-200ER arrived amid changed ETOPS rules, the four holer found the twin a difficult competitor. We use our airliner performance model to understand why.

Summary
  • The A340-300 has about the same payload-range performance as the later introduced 777-200ER.
  • Its economics is competitive with the 777-200ER, yet sales dried up when the 777-200ER became available. We explain why.

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Sunset of the Quads, Part 2

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By Bjorn Fehrm

Introduction  

August 12, 2020, © Leeham News: We deepen our look at the Queen of the Skies and it’s best selling version, the 747-400.

We go through what made it the great aircraft it was and why Qantas replaced it on its trunk routes to the US West coast.

We pick Los Angeles to Sydney as the benchmark route, a route on the range limit for the 747-400, and check how it stacks up economically versus the A380, its replacement.

Summary
  • The 747-400 reigned the skies for 15 years, combining a trans-Pacific range with a good passenger and cargo capacity.
  • Once Boeing introduced the 777-300ER and Airbus the A380, the 747-400’s ruling of the skies was over. It trailed in both capacity and efficiency.
  • It continued in operation until today with many airlines, still a useful aircraft for long and dense routes as long as the fuel prices stayed low.

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Looking ahead for 2020 and 2030 decades: Airbus

First in a series of reports.

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By Scott Hamilton and Vincent Valery

June 17, 2020, © Leeham News: Airbus was riding high in February.

The A321XLR was a clear winner. An important order was won from United Airlines, up to then an exclusive Boeing narrowbody customer. American Airlines selected the XLR. An order was expected from Delta Air Lines.

Each order was another that made it impossible for Boeing to launch the New Midmarket Airplane (NMA).

In one of his first actions, Boeing CEO David Calhoun, taking office Jan. 13, put the NMA on indefinite hold, pending a complete review of Boeing’s product strategy.

The Boeing 737 MAX remained grounded by regulators, with no return to service in sight.

The Airbus A321XLR. This 9-hour capable airplane helps fragment routes–and soften demand for widebody aircraft. Source: Airbus.

Things couldn’t be going better for Airbus.

And then in mid-March, the COVID crisis became a global pandemic. Air transportation fell up to 95%. Airlines required government bailouts. Airbus CEO Guillaume Faury said the very existence of Airbus was threatened.

Summary
  • COVID’s impact.
  • A320 family ‘s commanding lead over Boeing.
  • A220 commands low-end of single-aisle sector.
  • A330neo is the weak link.
  • Looking ahead in product strategy.

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Embraer’s Slattery named CEO of GE Aviation

By Scott Hamilton

June 15, 2020, © Leeham News: John Slattery, the CEO of Embraer Commercial Aviation, was named CEO of GE Aviation, it was announced today.

John Slattery

Arjan Meijer is the new President and CEO succeeding Slattery. Slattery succeeds David Joyce, who is retiring. Slattery’s appointment is effective July 13.

Slattery devoted much of the last year trying to win approval of the proposed Boeing-Embraer joint venture, Boeing Brasil-Commercial. Boeing terminated the agreement April 25, claiming Embraer failed to meet all required terms and conditions. Embraer claims it met the conditions. Both took the dispute to arbitration.

Slattery had been designated CEO of Boeing Brasil. After the deal’s collapse, his departure from Embraer was expected.

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Pontifications: bleak near- to mid-term future for Rolls-Royce engine unit

By Scott Hamilton

June 15, 2020, © Leeham News: The jet engine division of Rolls-Royce faces an uncertain future because of its own problems, exacerbated by the impact of COVID-19 on commercial airlines.

Beset by problems with its Trent 1000, Boeing 787 engine, hampered by a huge error in judgment to withdraw from a joint venture with Pratt & Whitney, beset by the premature termination of the Airbus A380 program and now facing a long-term impact of the coronavirus crisis, Rolls is an engine maker with few opportunities.

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Pontifications: Pratt & Whitney uses COVID crisis to catch up on GTF fixes

By Scott Hamilton

June 8, 2020, © Leeham News: Pratt & Whitney struggled since its new Geared Turbo Fan engine entered service in 2016 to fix technical, reliability and operational issues.

Plagued by premature engine removals as parts, other than the gear box, failed, Airbus A320neos stacked up in Toulouse and Hamburg while new engines were diverted to operators with aircraft out of service.

India’s regulator issued a grounding order of GTF-powered neos. Shop visits for repairs and modifications overwhelmed PW. The mess cost PW parent United Technologies (now Raytheon Technologies, following a merger) billions of dollars.

Working its way out of this mess was forecast to take into 2021.

Now, with COVID-19 impacts grounding airliners by the thousands, PW is using this as an opportunity to speed replacement and reworked engine deliveries.


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Performance Improvement Packages (PIPs) will be ready this summer.

“If there is any silver lining in the environment we’re in today, it is likely around the GTF and the retrofit,” Raytheon CFO Toby O’Brien said during a UBS webcast last week. “We are utilizing available shop capacity to fix the issues in the fleet. Our goal is to have GTF engines with enhancements by the end of the year as the recovery plays out.”

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