Engine industry clamoring for road back

By Bjorn Fehrm

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Introduction

October 13, 2016, ©. Leeham Co: The airline engine industry is like a ticking bomb. Over the years, a business practice of selling the engines under manufacturing cost and planning to recover costs and make a profit on the aftermarket developed. This goes back decades.

The practice was fostered by fierce competition over the engine contracts for aircraft which offered alternative engines. The losses of the engine sales could be made up later by selling spare parts and services at high margins.

trent-7000

Figure 1. Trent 7000 from Rolls-Royce. Source: Rolls-Royce.

These “jam tomorrow” practices have several implications. The engine industry is now confronted with these and wonder how it could put itself in such a bind. How to handle these and what is the way back?

Summary:

  • High competition in engine sales forced ultra high discounts for the up-front engine sale.
  • Aftermarket schemes was created that should recover profits over spare parts and services.
  • But these maintenance practices create all sorts of problems in the used engine market.
  • The engine industry now wants to return to more normal business practices. But how do they find the way back?

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Airline assets and lessor assets

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Introduction

Part 1: The Big Two OEMs

Oct. 3, 2016, © Leeham Co.: There are airline assets and there are leasing assets.

That’s a good airplane but it’s not a good leasing asset.

These are the succinct remarks of just two lessors who decide what aircraft to add to their portfolios.

What do they mean by this and why do they say this?

We’ll take a look today at the thoughts behind these positions.

Summary

  • Not all aircraft, however good operationally they may be, make a good acquisition for lessors.
  • Lessors have requirements that are beyond those for airlines.
  • Lessors play increasing important role in the airline industry.

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Russian-Chinese wide-body: Program responsibilities

By Bjorn Fehrm

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Introduction

September 29, 2016, ©. Leeham Co: We will now finish our series about the Russian-Chinese wide-body with looking at who will have what role in the program.

Russian-Chinese widebody

Figure 1. Concept for new wide-body airliner. Source: United Aircraft.

As we described in the initial article, “Background and outlook,” Russia and China have vastly different competencies when it comes to making a state of the art wide-body aircraft.

Russia has made airliners since the 1930s, including wide-body jets. China did not design its own jet aircraft (military or civil) until the mid-1980s. Most of the aircraft produced still today in China have their origin in Russian designs.

At the same time, we saw in the article about the market demand for the aircraft that the Chinese market is 90% of the home market. This makes for China demanding important parts of the aircraft’s production, and China has the money to invest in production facilities.

All this will influence how different parts of the project will be shared between Russia’s United Aircraft Corporation (UAC) and Commercial Aircraft Corporation of China (COMAC).

Summary:

  • Russia and China enter the wide-body project with widely different knowledge bases.
  • Russia has long time knowledge on how to develop and produce aircraft and their engines.
  • China on the other hand has the market for the aircraft.
  • China also know a lot about serial production and have money to invest. Read more

No sanctions will be levied on Airbus and Boeing in WTO dispute

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Now open to all readers.

Introduction

Sept. 26, 2016, © Leeham Co.: It’s hazardous to use the word “never,” but the US and European Union will never impose trade sanctions or tariffs on Airbus or Boeing airplanes.

No sane president would do so. (Cue Donald Trump.) It would start a devastating trade war and the collateral damage on innocents in the Airbus-Boeing illegal subsidies disputes would be severely harmed.

Summary

  • US tariffs on Airbus aircraft and EU tariffs on Boeing aircraft would hurt engine makers, suppliers—innocents in the illegal subsidy disputes.
  • Some key customers order from Airbus and Boeing. Tariffs on one or the other company risk alienating these customers.
  • Sanctions/tariffs permitted on other companies, industries.
  • Canada, Brazil never imposed sanctions in Bombard-Embraer violations.

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Russian-Chinese wide-body: Aircraft performance

By Bjorn Fehrm

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Introduction

September 19, 2016, ©. Leeham Co: In Part 4 of the article series, we put together an assumed complete Chinese-Russian wide-body aircraft with fuselage, wing, engines, etc. It is now time to understand what kind of performance that can be expected, given the data we have from the wide-body partners, Russia’s United Aircraft Corporation (UAC) and the Commercial Aircraft Corporation of China (COMAC).

Russian-Chinese widebody

Figure 1. Concept for new widebody airliner. Source: United Aircraft.

We will combine these data with the ones we have deduced as plausible to fill the gaps, given the time frame and technology level that UAC and COMAC intend to use.

Out will come a first estimate of what kind of performance such an aircraft can have in terms of efficiency and payload versus range capability.

Summary:

  • We can use all the data we have gathered to make a first estimate of the efficiency of the Russian-Chinese wide-body.
  • We also have enough information to do a first payload-range diagram and to compare that with the diagram for Boeing’s 787-9.

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Russian-Chinese wide-body: The aircraft, Part 4

By Bjorn Fehrm

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Introduction

September 15, 2016, ©. Leeham Co: In Part 3 of this series, we identified the type and size of wing we would have on a new Russian-Chinese wide-body. It’s now time to go through all the considerations around the engines for the aircraft.

Russian-Chinese widebody

Figure 1. Concept for new widebody airliner. Source: United Aircraft.

The aircraft would enter the market around 2025. We would have to decide on what size engine that would be needed, what engines would be available at the time and could this project motivate any new engine developments.

Summary:

  • The Russian-Chinese wide-body as outlined would require engines in the size class of the Boeing 787-9/10.
  • GE and Rolls-Royce have been mentioned as engine suppliers. The question would be: will they offer updated 787 engines or new designs and will Russia compete with its announced engine project for the aircraft?

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Russian-Chinese wide-body; The aircraft Part 3

By Bjorn Fehrm

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Introduction

September 08, 2016, ©. Leeham Co: Having covered the possibilities of reusing parts of the Il-96 fuselage for a new Russian-Chinese wide-body, it’s now time to look at the existing IL-96 wing and how far this is from a modern design.

Russian-Chinese widebody

Figure 1. Concept for new wide-body airliner. Source: United Aircraft.

The intent is not to propose that the existing wing is reused but rather to check the technology level against western designs and how big a leap it will be for the partners to make a modern high performance wing for the aircraft.

Summary:

  • The IL-96 wing is roughly on the technological level of the Airbus A340-300 wing with a bit lower aspect ratio.
  • The dimensions are close to what is needed for the new wide-body but sweep and aspect ratio needs to be changed for a new wing.
  • A wing for a 2025 long range wide-body also need a more modern construction technology than classical aluminum alloys.

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Russian-Chinese wide-body: The aircraft, Part 2

By Bjorn Fehrm

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Introduction

September 01, 2016, ©. Leeham Co: In Part 1, we concluded that the existing Il-96 fuselage cross section would be suitable for a new Russian-Chinese wide-body. This means that a lot of experience and existing designs for fuselage sections can be re-used.

Russian-Chinese widebody

Figure 1. Concept for new wide-body airliner. Source: United Aircraft.

Most importantly, it means that mock-ups and cabin sections can be made early in the project to start work on new and better cabin equipment. This is an area where the partners really lag their western competitors.

We will now look at what aircraft capacities can be conceived with the existing Il-96-300 and -400 fuselages and what changes will be necessary to achieve the targeted sizes that Russia’s United Aircraft Corporation (UAC) and Commercial Aircraft Corporation of China (COMAC) have communicated.

Summary:

  • The IL-96 fuselage can be re-used for a Russian-Chinese wide-body.
  • The existing IL96-300 cabin is on the small side whereas the Il-96-400 cabin is a bit larger than needed.
  • The project will likely choose an intermediate size fuselage to reach the targeted 250 to 280 passenger capacity.

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Pontifications: “Troubled” 787 is a thing of the past

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Hamilton ATR

By Scott Hamilton

Aug. 29, 2016, © Leeham Co.: Faulty engines dominated commercial aviation news last week.

First was ANA’s Boeing 787s were hit by issues with its Rolls-Royce engines. Corrosion was found on key engine parts. ANA cancelled flights to inspect and repair the engines.

Unfortunately, some media characterized the matter as the “latest” to hit the “troubled” 787. The London Telegraph is one example.

This characterization, of course, refers to the history of the 787 with its design and production challenges and later by the grounding from the lithium-ion battery fires.

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Russian-Chinese wide-body: The aircraft

By Bjorn Fehrm

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Introduction

August29, 2016, ©. Leeham Co: We have now covered the capabilities of the joint venture partners for a Russian-Chinese wide-body and its possible market. Now we will look at what kind of aircraft such a cooperation can create, given technology and other constraints.

Russian-Chinese widebody

Figure 1. Concept for new wide-body airliner. Source: United Aircraft.

There have been bits and pieces leaked to media from Russia’s United Aircraft Corporation (UAC) and Commercial Aircraft Corporation of China (COMAC).

We will look at what has been said and combine that with our knowledge of existing and future technological capabilities of the parties to make predictions for what aircraft the project can produce.

Summary:

  • The Russian-Chinese wide-bodywill be made to cover the “small wide-body”market.
  • Initial size will be a 250-280 passenger wide-body
  • The aircraft will be a twin with engines from either GE or Rolls-Royce.
  • Range with 280 passengers will be 6,500nm.

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