Better to bring capacity back with a 777-9 or 787-10 if we fly 777-300ER today?

By Bjorn Fehrm

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Introduction

May 21, 2020, © Leeham News: We looked at the economics of extending the lease of a Boeing 777-300ER or taking an ordered 777-9 here.

If traffic post-COVID-19 on the routes we fly stays down for long, should we change the order to a 787-10? What are the trades between staying with the 777-300ER, taking the 777-9, or stepping down to a 787-10?

We use our airliner economic model to find out.

 

Summary:

  • The 787-10 is the safe choice if the fill level for our routes will stay below its passenger capacity for a longer period.
  • This choice is valid for a JFK to Heathrow route. The 787-10 has a shorter range than the 777-300ER and 777-9, so a 787-10 alternative is only possible for routes within its capacity.

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Better to bring capacity back with a 777X or 777-300ER? Part 2

By Bjorn Fehrm

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Introduction

May 7, 2020, © Leeham News: With the Covid-19 pandemic depressing passenger traffic for years to come, we started an analysis last week on the options the airlines have who wait for their Boeing 777-9. Hold on to their 777-300ER or upgrade to the newer and more efficient 777-9?

We deepen the analysis this week by comparing the economics of a 10 years old 777-300ER versus a new 777-9.

Figure 1. The 777X has 30% larger windows than standard in the class. Source: Boeing.

Summary:
  • The 777X is best seen as a cross between a Boeing 787 and a 777-300ER. It inherits the passenger comfort features the 787 brought to the market like lower cabin altitude, higher cabin humidity, larger windows, and a smoother ride.
  • If a 777-9, with it’s higher capital costs, can compete on operating cost with a used 777-300ER depends on the fuel price.

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Engine OEMs forecast big hit to aftermarket revenue

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Now open to all readers.

By Scott Hamilton

May 5, 2020, © Leeham News: The COVID crisis will damage the aerospace aftermarket in ways that are only beginning to be understood.

As key companies report 1Q earnings, it’s clear that engine aftermarket revenue is going to take a major hit for years to come.

Engine companies like CFM, GE Aviation, Pratt & Whitney and Rolls-Royce, rely on aftermarket sales as the key component of their business plans.

The research and development money that goes into an engine consumes such huge amounts of cash that the OEMs don’t recoup their costs for 10-20 years. The aftermarket for parts, maintenance, repair and overhaul is where they make their profits in the meantime.

But this is seriously threatened by the virus crisis.

“The aftermarket for key programs took 4+ years to return to 2008 levels out of the Great Financial Crisis, and that was with traffic decline at a fraction of the declines today,” Bernstein Research wrote in a May 4 note to clients.

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“We’re sick and tired of new technologies:” Avolon CEO

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Introduction

By Scott Hamilton

March 16, 2020, © Leeham News: “I can tell you from our perspective, we’re kind of sick and tired of new, new technology. It’s not proven to be the home run.”

This blunt assessment comes from the chief executive officer of the big aircraft lessor, Avolon.

Domhnal Slattery

Domhnal Slattery, the CEO, was giving his critique of whether Boeing should launch a new airplane once the 737 MAX crisis is over.

Boeing was on a path to decide whether to launch the New Midmarket Airplane when the MAX was grounded one year ago this month.

Airbus was waiting for Boeing to move before deciding how to respond.

Summary
  • Airbus and Boeing should “stick to their knitting.”
  • Focus on incremental improvements for now.
  • 2030s to 2050s will be the next big advance in technologies.

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Pontifications: 777X certification, MAX market deficiencies, NMA and what’s an insider

  • Certification of 777X will be impacted by MAX crisis.
  • Market sees “deficiencies” in Boeing’s narrow-body product line.
  • Reopening new airplane study doesn’t mean NMA is necessarily dead.
  • The SEC considers Calhoun to be an insider, even if he doesn’t.

By Scott Hamilton

Feb. 3, 2020, © Leeham News: Boeing has said very little about how the MAX certification review will affect the 777X.

The Federal Aviation Administration has said nothing at all.

But David Calhoun, the new CEO of The Boeing Co., gave a hint in a recent call shortly after assuming office Jan. 13.

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Third time is the charm: 777X takes to the sky today

By Scott Hamilton

Jan. 25, 2020, © Leeham News: The third time was the charm.

Boeing 777-9 on the way to what was hoped to be its first flight Jan. 24. As an experimental flight, the airplane had to take off north with a tailwind. The wind throughout the day exceeded the safe level. The flight was scrubbed. The airplane instead took to the sky the following day. Photo by Scott Hamilton.

After being rained out Thursday and scrubbing the first flight Friday due to high winds, Boeing successfully launched the 777X into the air Saturday for its first flight.

The flight left Everett (WA) Paine Field, where the 777 has been produced since the program began in the early 1990s.

After an uneventful couple of hours circling over central Washington State, the 777-9 landed at Boeing Field south of downtown Seattle. Test pilots reported solid controls and flying characteristics.

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First flight of Boeing 777-9 today, weather-dependent

By Scott Hamilton

Jan. 24, 2020, © Leeham Co.: In a year filled with bad news, Boeing finally had something good to crow about.

The 777-9’s first flight is today.

It comes about a year late, due to design issues with the GE Aviation GE9X engine that powers the airplane.

And, as if this weren’t bad enough, when the engines were returned from GE, a hard landing damaged one of them.

Despite rainy and cloudy weather today at Paine Field in Everett (WA), where the 777 has been assembled since the program was launched in the early 1990s.

The 777-9 is scheduled to lift off at 10am PST, depending on the Seattle area’s lousy weather this week.

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Guest Column: Boeing’s Calhoun: Fantastic 9-month CEO or disastrous multi-year CEO?

  • Jan. 12, 2020: David Calhoun assumes his position as president and CEO of The Boeing Co. tomorrow. Richard Aboulafia of The Teal Group has some thoughts about this move.

By Richard Aboulafia

Richard Aboulafia

Vice President of Analysis

The Teal Group

Guest Column

December 2019

Dear Fellow C-Suite Watchers,

Person of the year awards go to people who did something noteworthy in the past year. Instead, why not appoint a person in advance, for the year ahead? That’s more exciting, since that person has yet to do the something for which he or she is being recognized. Incoming Boeing CEO Dave Calhoun is the perfect recipient of this, for the choice he will make. In 2020, he will choose either to be a fantastic nine-month CEO, or he will stay on, becoming a potentially disastrous multi-year CEO. This is a pivotal decision for Boeing, and for the industry.

Calhoun is replacing Dennis Muilenburg because the latter CEO’s year has been disastrous. The company’s communications with Congress, the FAA, international regulators, airline and lessor customers, suppliers, the victims’ families, and pretty much the entire outside world were a master class in bad crisis management. This month’s 737MAX line shutdown, with no guidance at all provided to suppliers, was the final swirl in a downward spiral. The company’s legal department chief, another key player in Boeing’s MAX strategy, has also departed.

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Bjorn’s Corner: Why e in ePlane shall stand for environment, Part 3. Open rotor revisited.

January 3, 2020, ©. Leeham News: We continue our series why e in ePlane shall stand for environment and not electric.

Our target is to lower air transport’s environmental footprint and we can achieve this more efficiently by using established technologies. As an example, I will describe a very promising concept that has fallen out of focus due to the hype around everything hybrid and electric.

Figure 1. The Clean Sky IRON project aircraft with an Unducted Single Fan (USF) propulsion. Source: Clean Sky.

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Several aircraft programs beset by engine woes

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By Judson Rollins

Nov. 25, 2019, © Leeham News: Nearly every manufacturer of jet engines is experiencing problems with various models, which is causing delays for several prominent Boeing and Airbus programs. The Airbus A220, A320neo, A330neo and Boeing 787, 777X are all experiencing engine-related setbacks.

Grounded 787s at London Heathrow. Source: Twitter / Alex Macheras.

Summary

  • Pratt & Whitney geared turbofan (GTF) operational limitations on A220, A320neo.
  • CFM LEAP said to be causing renewed A320neo delivery delays.
  • Multiple new airworthiness directives on Trent 1000, 7000.
  • GE9x component issues causing delays to first 777X test flight.

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