More A350-800 orders vanish

Twelve more Airbus A350-800 orders vanished as Aircraft Purchase Fleet canceled, according to the latest tally from Airbus. APF is the special purpose company set up for Alitalia Airlines, which is a financial basket case and probably couldn’t finance a Piper Cub, let alone an A350. In this case, the -800s were not upgraded to -900s or -1000s, according to the monthly Airbus Orders and Deliveries tally. There are now just 34 A358s in backlog.

The shrinking backlog further suggests the need for a refresh of the A330 with a re-engine, in our view. Without the A350-800, Airbus won’t have a competitor in the 250 seat sector that has any current technology. An A330neo with new engines would at least fill some of this void.

Meantime, Delta Air Lines issued a Request for Proposals for 50 wide-body aircraft to replace its aging Boeing 747-400s and some 767-300ERs. Delta’s CEO has said he could be interested in the A330neo. Delta eschews new technology, preferring “proven” technology, which could work against the Boeing 777X powered by an entirely new engine. By the time Delta would be ready to take delivery of its order, the A350XWB and its new technology will have been in service for many years. Delta has a deferred order for the Boeing 787-8 it inherited from Northwest Airlines, and this technology will be mature by the time Delta would be able to take delivery, so the 787 family could be in the mix. So could an A330neo, which would most likely be powered by one of the 787’s engine options, the GEnx or the Rolls-Royce Trent 1000 TEN. Market intelligence tells us Delta is pushing the GEnx, given its strong relationship with GE.

Rolls-Royce plans for new single-aisle, twin-aisle airplane engines

Rolls-Royce may not be at a cross road but it’s certainly at a fork in the road.

RR sought to be a dual-source supplier for the Boeing 777X, competing with GE Aviation for the privilege; it was generally a given that GE would be a provider. The question was whether it would be the sole supplier or share the platform with another. Pratt & Whitney withdrew, concluding the business case wasn’t there for its proposed big Geared Turbo Fan. RR stayed in the competition, assured by Boeing that it wasn’t a stalking horse to GE.

But GE won the position as exclusive supplier, much to RR’s consternation.

Next, the future of the Airbus A350-800, powered exclusively by RR, is in serious doubt. The backlog is now down to a mere 46 as customer after customer, encouraged by Airbus, up-gauged to the A350-900 and -1000 sub-types. While RR is also the exclusive supplier on each of these models, and the engines are largely common, there has been substantial investment by Rolls on the -800’s application. If the -800 is canceled (as many industry observers believe it will be), RR’s investment is largely down the drain. How does Airbus “make good” to RR for this?

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Repost: Pratt & Whitney GTF program update at PNAA conference, plus Q&A PW, RR and GE

Due to technical issues we don’t begin to understand, the PW GTF engine program update didn’t display the videos, only the links. We are re-posting to correct the situation because we couldn’t fix it within the original post.

Bob Saia, VP of Next Generation Engine development at Pratt & Whitney, provides a program update of the Geared Turbo Fan engine and its prospect of growing into a “Big Engine” serving the twin-aisle market. He appeared at the Pacific Northwest Aerospace Alliance 2014 conference in the Seattle area last week.

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[youtube=http://www.youtube.com/watch?v=CYUUtVEKhIs]

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http://www.youtube.com/watch?v=02RgF1So-X4

Questions and Answers

The following videos are questions and answers of the representatives of the Big Three engine manufacturers. Sound is soft on these two videos; best to use headphones.

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[youtube=http://www.youtube.com/watch?v=nArLnhsMraE]

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[youtube=http://www.youtube.com/watch?v=-Wtqr4FavP0]

Guest column: envisioning the next round of airplanes

By James N. Krebs

Leeham News recently forecast that the next all new Boeing airplane will be a 757 successor with an entry-into-service around 2025, followed by a smaller NSA (New Small Airplane), a 737 MAX/A320 neo successor, in maybe 2027. I believe it will be clear in the next few years that the technology is and can be available here to build a reasonable-risk NSA with 20% fuel savings over the MAXes/ neos (at same seats) for initial service by 2025 (which will demand perhaps 40 more than 162 seats for even better economics). Its production would ramp up over ~5 years or so.

I hope this would be mainly a “Made in the USA” Boeing NSA: American engineering, American manufacturing, American jobs and American competitive edge. If that takes some helpful brainpower and/or investments from NASA, Northrop Grumman, Lockheed Martin, etc, good.

Boeing and Airbus might love to build a combined 100/mo. MAXes and neos “forever,” but technology and market forces aren’t likely to permit this. The companies won’t want to whet any appetites soon but I hope Boeing’s advanced design people are already at work–I’d be disappointed if they aren’t.

Airbus could certainly put an A320neo successor in service 10 years after their 2015 neo. A reengined A330 and a possible A350-1100 aren’t the only new projects they are capable of in the next decade.  The market response to their A320neo family completely surprised Boeing a couple years ago. What’s next?

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Rolls-Royce Trent engines program update at PNAA conference

Bill Boyd, senior vice president of Rolls-Royce, provided a program update of its Trent engines that are being developed for the Airbus A350 XWB. He appeared on a panel with GE Aviation and Pratt & Whitney. He appeared at the 2014 Pacific Northwest Aerospace Alliance conference last week in the Seattle area.

Sound is soft; use of headphones is recommended.

http://www.youtube.com/watch?v=5Ps_BuG1_JQ

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http://www.youtube.com/watch?v=Y2Lgs-oGJYg

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http://www.youtube.com/watch?v=Euo3TJZlQyc

Development of the GE9X for the Boeing 777X

Jason Brewer, general manager of GE Commercial Engines Marketing, appeared at last week’s Pacific Northwest Aerospace Alliance 2014 conference on the Big Engines panel.

Brewer discussed the development of the GE9X for the Boeing 777X, outlining the new technology going into this big engine for Boeing’s latest 7-Series aircraft.

One slide–which is available to the conference attendees–showed a market forecast of 3,000 aircraft in a context that appeared to suggest GE sees a market of this number of airplanes for the 777X. We clarified this with Brewer after the panel; the forecast is for the 350-400 seat sector. Brewer told us that GE hopes to capture 1,700 of these aircraft.

This is the first time we’ve seen this sub-sector broken out–Airbus and Boeing typically forecast for the larger 300-400 seat sector in their 20 year forecasts. Airbus and Boeing have previously indicated they think the demand for the 400-seat aircraft (i.e., the 777-9X) is between 670-780 respectively.

The sound is pretty soft on this. It will best be heard with headphones.

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Updating the A380: the prospect of a neo version and what’s involved

Recent headlines and this column report that Airbus is considering re-engining the popular A330 with GE Aviation GEnx or Rolls-Royce Trent 1000-TEN power plants. A New Engine Option and other changes would improve the A330’s economy by an estimated 10% percent after offsets for increased drag and weight.

But the A330 isn’t the only Airbus airplane being considered for new engines made popular by the A320neo family. Tim Clark, president and chief operating officer of Emirates Airlines, urged Airbus to improve efficiency of the giant A380 with engine technology found in newer generation aircraft.

How feasible is an A380neo? What are the technological issues? Would there be enough of an economic gain? And is there a market for an A380neo?

The A380 of today

The A380 has been hailed as a highly efficient airliner since it went into service 2008, assuming the giant plane can be filled. But only six years later, the first voices have been raised that this will not continue to be the case should the continuous improvements that have been flowing into the airframe not pick up speed.

The launch of the Boeing 777X also brought focus on the state of the A380 come the latter part of this decade when the 777-9X enters flight testing in advance of its planned 2020 entry-into-service. Tim Clark expressed  that “it is time that the A380 gets an injection of the new technology which is now becoming available for the A320/737 in the form of GTF/LEAP and GE9X for the 777X. “

Before we look into what can be done short-to–mid-term to inject improved efficiency, let’s establish the baseline as it exists today. The A380 is considered by some the most efficient way of flying passengers between two long haul points if there is enough of demand. The competition today is the Boeing 777-300ER and 747-8i.  (Qantas Airways is dropping some A380 flights that have 50% load factors, demonstrating the aircraft is inefficient if the demand is insufficient.)

Let’s assume we want to transport passengers between San Francisco and Hong Kong, one of the longer flights which are made non-stop in both directions. Going West, it takes a Cathay 777-300ER 15 hours and going East, 12 hours, the difference being due to prevailing headwinds going West. For our check, we will use the more demanding of these legs, which then works out as the equivalent of flying 7,200nm. To compare the three different aircraft in a fair way, we need to load them to the same payload, in our case passengers with luggage. We will not consider cargo in this initial analysis. The leg chosen is not one which allows much weight for cargo, but cargo certainly belongs to a complete analysis of an airplane and we will point out where it will affect any conclusions.  

When comparing the standard three-class seating numbers between the OEMs, it is clear these are not made to the same standards of comfort. Airbus has admitted that the A380 is too lightly loaded at 525 passengers. The 777-300ER at nine abreast and 365 seats is equipped with a comfortable 18’’ economy class at 32’’ pitch but the business class is modeled with a non-standard 48’’ pitch. The 747-8i at 467 seats is not laid out to any comfort standards comparable to the other two. To ensure an apples-to-apples comparison we have equipped all aircraft with the same three-class cabin with a standard seating consisting of first class at 81’’ pitch, business class at 60’’ pitch and economy class with 32’’ pitch. Seat widths are 37’’, 22’’ and 18’ respectively and the ratios of the different premium seatings vs. economy are kept the same. Here the aircraft are listed with the in-service year and with their respective payload capabilities:

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Looking ahead to 2014

Here’s what to look for in 2014 in commercial aviation.

Airbus

A350 XWB: The high-profile A350 XWB program continues flight testing this year. Entry-into-service has been a sliding target. The program is running about 18 months behind original plan and EIS was intended for mid-year following initial delays. Even this has slipped, first to September and then to “the fourth quarter.” Currently first delivery is scheduled in October to launch customer Qatar Airways, which is slated to get four A350-900s this year. Emirates Airlines is listed as getting two of the total of six scheduled for delivery.

A320neo: Lost in the shadow of the A350 program is the A320neo. Final assembly of the first aircraft is to begin in the spring and first flight, followed by testing, is scheduled for this fall. The Pratt & Whitney Geared Turbo Fan is the initial variant. First delivery is scheduled in the fall of 2015.

Others: Airbus continues to evaluate whether to proceed with developing an A330neo. Based on our Market Intelligence, we expect a decision to proceed will come this year. Concurrently with this, we expect most if not all of the remaining 61 orders for the A350-800 to be upgraded to the A350-900 and the -800 program to be officially rescheduled if not dropped. The -800 is currently supposed to enter service in 2016, followed by the A350-1000 in 2017. But recall that as delays mounted on the A350-900, Airbus shifted engineers to the -900 and the -1000 at the expense of the -800. Salesmen have consistently shifted orders from the -800 to the larger models. We long ago anticipated the -800’s EIS would be rescheduled to 2018, following the -1000. The -800’s economics aren’t compelling enough just justify the expensive list price. So we expect Airbus to upgrade the A330 to a new engine option, using either or both of the Trent 1000 TEN and GEnx with PIPs (Performance Improvement Packages) or with some modifications. EIS would be about 2018. This precludes Pratt & Whitney from offering a large version of the Geared Turbo Fan, which wouldn’t be ready by then.

We also expect Airbus and the engine makers to look at re-engining the A380, driven by desires of Emirates Airlines to see a 10% economic improvement. Emirates announced an order for 50 A380s at the Dubai Air Show but instead of ordering the incumbent engine from Engine Alliance for these, Emirates left the engine choice open. This leaves open the possibility the A330neo and the “A380RE” could share an engine choice.

Boeing

After many years of turmoil, 2014 should be quiet for Boeing (now that the IAM issues have been resolved—see below).

787: Barring any untoward and unexpected issues, Boeing seems at long last to be on an upward trajectory with this program—but we’ve said this before. There are still nagging dispatch and fleet reliability issues on the 787-8 fleet to resolve, but flight testing of the 787-9 appears to be going well. Certification and first delivery should come without trouble this year, to launch customer Air New Zealand.

737: Nothing to report on the Next Generation program except ramp-up to a production rate of 42/mo is to take effect this year. Development continues on the 737 MAX.

Others: The 777 Classic is humming along. Now that the 777X is launched, we’ll be closely watching sales for the Classic; Boeing has a three year backlog but six years to 777X’s EIS. How is Boeing going to fill this gap, and what kind of price cuts will be offered to do so?

The 747-8 continues to struggle, barely holding on. Boeing says it thinks the cargo market will recover this year, boosting sales of the 747-8F. We’re dubious.

The 767 commercial program continues to wind down. The 767-based KC-46A program ramps up.

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A330neo prospect gains traction

Note: The following was distributed to our e-mail list December 23. Last week, American Airlines (as predicted) swapped the A350-800s for A350-900s.

The possibility of Airbus launching an A330 new engine option appears to be gaining ground.

Our Market Intelligence tells us that Airbus is considering a decision soon, probably next year, with a target entry-into-service date of 2018.

A decision to proceed with an A330neo would come after one to drop the A350-800, according to our information. Airbus has systematically switched -800 customers to the larger, and more profitable A350-900 and A350-1000. There are now just 79 A350-800s in backlog.

Customer

Qty

Comments

Aeroflot

8

 

Aircraft Purchase Fleet

12

For Alitalia

Asiana

8

 

AWAS

2

Probably will swap to A359

Hawaiian Airlines

6

Waiting on US Airways

ILFC

6

Probably will swap to A359

Kingfisher

5

Good as gone

Libyan

4

 

US Airways

18

Expected to disappear now that AA merger completed, replaced with A359/A351

Yemenia

10

 

Source: Airbus, Nov. 2013

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 Leeham Co Chart

We identify 37, or 47%, that probably are already at risk of cancellation in favor of the larger A350-900 or A350-1000. These 37 are highlighted in red and pink. Another 10, those for Yemenia, are probably already iffy, according to Market Intelligence. The total of 47 represents 59% of the backlog. We have no information on the remaining customers’ intentions.

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Assessing the Air Canada 737 order: factors that likely played a role

How did Boeing win the Air Canada mainline 150-200 seat jet order when only a couple of weeks ago Flight Global reported the Airbus won the deal?

We, too, heard that Airbus seemed to be the favorite, but the information was soft. We’re not rapping Flight Global—undoubtedly it was confident in its sourcing, but this just shows that a situation can change dramatically and quickly.

We’ve been following the competition for months, behind the scenes, and here are factors we understood that were involved.

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