HOTR: About those 737 MAXes in inventory….

By the Leeham News staff

July 29, 2021, © Leeham News: Boeing said yesterday that it delivered about 130 737 MAXes since the recertification of the aircraft last November.

It won’t reveal exactly how many came from the inventory of nearly 450 airplanes that were produced but which went straight into storage during the grounding.

Filings with the Securities and Exchange Commission paint a misleading picture.

At December 31, Boeing reported that there were about 425 MAXes in inventory. At March 31, this figure was 400. On June 30, the number was 390. The aggregate reduction is 60, suggesting 70 deliveries were new production airplanes.

Not so, as it turns out.

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HOTR: Boeing’s backlog market share vs Airbus falls below 40%

By the Leeham News Team

July 14, 2021, © Leeham News: Six months into 2021, Boeing is delivering 737 MAXes, clearing MAX inventory, and taking orders.

Airbus isn’t matching Boeing orders for the A320 family, so far. But as the industry struggles to return to normal, it’s worth taking a six month look at how Airbus and Boeing compare.

In terms of total backlog, Airbus has a 62% market share vs. Boeing’s 38% share.

This includes all single- and twin-aisle aircraft. It also includes freighters—a Boeing exclusive right now—and air force tankers, where Boeing also has an advantage.

Airbus has a 65% share of the single-aisle backlog vs Boeing’s 35% share. Airbus includes the A220 and A320 families.

Boeing has a slim lead in the wide-body sector, boosted by its exclusive backlog in freighters and the larger backlog for the KC-46A tanker vs the A330 MRTT: 52% to 48%.

Boeing’s backlog is adjusted for the accounting rule ASC 606, which eliminates orders no longer considered firm but which aren’t canceled. Airbus doesn’t publish the European equivalent of iffy orders, so the market share is somewhat skewed. Regardless, it isn’t an encouraging picture for Boeing.

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HOTR: 500 “destinations” for Boom goes bust

June 4, 2021, © Leeham News: “Overture can connect more than 500 destinations.”

That’s what United Airlines said in its press release this week about its “commercial agreement” with Boom Supersonic. UAL “ordered” 15 Overture airplanes with an option for 35 more.

“More than 500 destinations” leaves a lot of room for interpretation. LNA understands this to mean 500 cities. If UAL and Boom meant “city pairs,” then this commonly used term should have been used.

The common dictionary definition is “the place where someone is going or where something is being sent or taken.”

Examples used in the definition are, “The Virgin Islands are a popular tourist destination,” or a “holiday destination.” More on point, one example used is quite common in airline lingo: the term “final destination.”

So, this lends to the interpretation “500 destinations” means 500 “cities.”


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HOTR: Ryanair’s O’Leary pissed, but wants 737 MAX 10

By the Leeham News Team

May 25, 2021, © Leeham News: Michael O’Leary may be royally pissed as Boeing, but he’s nevertheless in negotiations for a large order of 737-10 MAXes.

In the year-end earnings call last week and in an appearance on CNBC, O’Leary unloaded on Boeing’s Seattle management team over delivery delays for the 737-8200.

O’Leary, the CEO of Ryanair, didn’t mince words—he never does. This is, after all, the guy who at a press conference talked about his potential trans-Atlantic low fare operation providing blow jobs to business class travelers. Sitting next to him was his female translator, who clearly was nonplussed. (You can look it up on YouTube.)

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HOTR: Porter confirmed as customer in E195-E2 deal

By the Leeham News Team

May 19, 2021, © Leeham News: Embraer got a big boost for its E-Jet E2 order book in April when it announced a firm deal for 30 E195 E2s.

“On April 23, the Company signed a firm order for 30 E195-E2 jets with an undisclosed customer, with deliveries starting in 2022. The 30 firm orders will be included in Embraer’s second quarter backlog,” Embraer said in its April 29 earnings release.

Embraer delayed E-Jet deliveries because of the COVID-19 pandemic. Thin backlogs for the E2 pre-date the pandemic. This order, with deliveries starting next year, illustrates Embraer’s thin skyline.

Airfinance Journal on May 13 first reported the customer is Canada’s Porter Airlines. Porter, pre-pandemic, operated De Havilland Dash 8-400s exclusively from Billy Bishop Airport, Toronto’s downtown in-city airport. AFJ cited multiple sources. Porter Airlines denied it ordered the airplane or that it had signed lease deals to acquire the E2. The carrier told the Toronto Globe and Mail it isn’t going to “switch” fleet types.

However, LNA confirmed this week that the airplanes are going to Porter. Porter declined to answer any questions from LNA.

“Our response to this speculation has been provided to others and published. We do not have anything further to add,” Porter said in an email.

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HOTR: Boeing’s “historic” production advance

By the Leeham News Team

May 18, 2021, © Leeham News: Boeing’s Defense unit last week said it joined the front fuselage of the first Boeing-SAAB T-7A Red Hawk trainer with the aft section “perfectly,” in less than 30 minutes.

It was, Boeing said, an “historical moment.”

It was “a testament to the digital heritage of the U.S. Air Force’s first ‘eSeries’ aircraft and witness to the benefits of model-based engineering and 3D design,” Boeing said. “The digital splice was completed in 95% less time than traditional splices and with substantial quality improvements.”

Why is this a big deal for Boeing Commercial Airplanes?

Because the T-7A, along with the MQ-25 unmanned aerial refueler for the Navy, are Boeing’s pilot programs, if you will, for production of the next Boeing commercial airliner.

This is in part what former Boeing Co. CEOs Jim McNerney and Dennis Muilenburg and current CEO David Calhoun alluded to each time they talked about advanced production.

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HOTR: Airbus’ view on recovery from COVID; why Southwest stayed with MAX 7

By the Leeham News staff

May 11, 2021, © Leeham News: Domestic traffic throughout the world is returning to 2019 levels, but at different rates, according to an Airbus analysis.

Robert Lange, Head of Business Analysis and Market Forecast, said today that the fragmented cross-border travel regulations and uneven vaccinations continue to inhibit passenger traffic recovery from the COVID-19 pandemic.



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HOTR: Annual Reports give hint to MAX return in China

By the Leeham News Team

May 4, 2021, © Leeham News: Annual reports from some Chinese airlines give an indication when Boeing can expect to resume deliveries of the 737 MAX there.

China Southern’s report issued this week indicates 48 MAXes will be delivered next year. Another 44 are shown to be delivered the following year. This compares with five A320 series this year and none next year. Only 15 A320s were delivered in 2020.

Five 787s and one 777s are scheduled for delivery to China Southern this year. Four A350s are scheduled for delivery this year and next.

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Etihad’s fleet simplification

By the Leeham News Team

Apr. 27, 2021, © Leeham News: Etihad Airways’ CEO Tony Douglas announced that the carrier would be grounding its A380 fleet indefinitely and retire its 19 777-300ERs by the end of 2021.

The Abu Dhabi carrier has become the latest to terminate A380 operations. Etihad took 10 Superjumbos over 2014-2017, which featured “The Residence” seat. After the aggressive and luxury expansion of the early 2010s, transformation towards increasing efficiency is the order of the day.

The carrier intends to retire its 777-300ER a little more than a year after announcing a sale and leaseback transaction with Altavair and KKR. LNA does not know whether Etihad could terminate the leases early and whether there were penalties associated with the move.

The move will add another 19 777-300ERs on the market looking for a new home. There are currently large numbers of 777-300ERs coming off lease.

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HOTR: Compensation wins Southwest order for MAX

By the Leeham News Team

March 29, 2021, © Leeham News: Southwest Airlines today announced an order for 100 Boeing 737-7 MAXes.

The order was expected. The carrier also considered the Airbus A220-300. But any prospect of diverging from the 50-year relationship with Boeing was at best a crapshoot.

Despite the flowering language in the press release, the key reasons are buried.

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