Pontifications: Writing had been on the wall for years for Q400 sale; CRJ is next

By Scott Hamilton

Nov. 12, 2018, © Leeham News: The writing had really been on the wall for the past few years, regardless what the corporate line was: Bombardier was one day going to sell the Q400 program or shut it down.

Better to sell it and get at least some money out of it, no matter how small.

Bombardier agreed to sell the program to British Columbia-based Viking Air for a mere $300m–$250m, net of fees.

Ditto the CRJ program. It’s on life support. It’s a design dating to the 1980s, the passenger experience has long been eclipsed by the Embraer E-Jet and it will be also by Mitsubishi’s MRJ when this jet finally comes on line in 2020. Read more

Bombardier announces sale of Q400 program, exploring options for CRJ

Nov. 8, 2018, © Leeham News: Bombardier today announced the sale of its slow-selling, aging Q400 turboprop program to Canada’s Viking Air.

  • The press release from Viking’s parent company is here.

Viking previously purchased out-of-production Bombardier/de Havilland aircraft programs, including the Twin Otter, Beaver and CL-415 firefighting bomber.

Viking Air previously purchased the Bombardier de Havilland Twin Otter program and restarted production. Now, it’s buying the slow-selling Q400 program for a mere $300m. Photo via Google images.

Twin Otter production was restarted. The Beaver was not an is not in the cards to be restarted. The CL-415 was limping along, and no longer a contributor to Bombardier’s cash flow and profits.

“The Company entered into definitive agreements for the sale of the Q Series aircraft program and de Havilland trademark to a wholly owned subsidiary of Longview Aviation Capital Corp. for approximately $300m,” Bombardier said in a press release. It also announced the sale of other assets for $800m. The two deals are expected to close in the second half of 2019.

The low price reflects the struggles the Q400 has had for years. Bombardier lost money on the Q400 in recent years.

Bombardier also said it is considering its options for the aging, struggling CRJ program. Read more

Bombardier squeezed by ATR, Embraer, Mitsubishi

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Introduction

Oct. 22, 2018, © Leeham News: Bombardier has a firm backlog of 67 Q400 turboprops. ATR has a backlog of 256 through Oct. 20, according to the Airfinance Journal Fleet Tracker.

This is an 80% market share for ATR.

Bombardier has 83 CRJ jets of all models in backlog. Embraer has 442 orders for all E-Jet models. Mitsubishi has 213 firm orders for its MRJ70/90.

This is just an 11% market share for the CRJ.

These figures illustrate why the market doubts Bombardier’s long-term future in commercial aerospace.

Summary
  • The Q400 and CRJ are aging aircraft designs.
  • Minor enhancements don’t address the underlying issues.
  • New competition is squeezing BBD.

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Pontifications: Market Intelligence from NY

By Scott Hamilton

Oct. 22, 2018, © Leeham News: I was in New York City last week for a series of meetings. Here’s what “the street” is talking about. I make no judgment calls about whether the thoughts are on target or not. Read more

Assessing A320 production rate interest in >70/mo

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Introduction

Sept. 17, 2018, © Leeham News: With the supply chain under major stress and Airbus and Boeing trying to recover from scores of “gliders” sidelined at airports without engines, each company nevertheless continues to study production rate increases for the A320 and 737 families.

Airbus publicly has said it’s looking at rate 70/mo. Boeing publicly acknowledges it’s looking at rate 63/mo.

Supply chain sources tell LNC Airbus is studying an even higher rate, into the “70s,” at early as 2020—a date that most consider out of the question.

Boeing is known to be considering a rate of 70/mo for its most profitable program.

Today, LNC looks at the A320 scenario. A future post will examine the 737.

Summary
  • Airbus is scheduled to deliver more A320 members in 2019 than production capacity. Some of these may be parked backlog airplanes.
  • 2020-2021 sold out at rate 60/mo, 2022-2023 nearly so.
  • Rate increase to 70/mo opens opportunities for Airbus, pressure on Boeing.

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Mitsubishi shouldn’t be worried over support following Boeing-Embraer deal: BGS chief

July 18, 2018, © Leeham News, Farnborough: Mitsubishi’s MRJ will be supported even if Boeing and Embraer complete a deal to form a new company in which Boeing is an 80% shareholder.

Embraer’s E175 and E190 jets will compete with Mitsubishi’s MRJ70 and MRJ90 respectively. Boeing entered into a product and parts support agreement with Mitsubishi when the MRJ program was launched.

Stan Deal, CEO of Boeing Global Services, said in an interview with LNC that despite the competition, BGS will honor the Boeing commitment to Mitsubishi.

BGS already supports Airbus aircraft, which of course fiercely compete with Boeing.

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MRJ’s GTF flameout traced to manufacturing issue

Editor’s note: The Farnborough Air Show begins next week. Mitsubishi is expected to have a flying display of the MRJ90 at an international air show for the first time. This is the last of three stories from Mitsubishi’s MRJ program update in Moses Lake (WA) last month.

By Dan Catchpole

July 10, 2018, © Leeham News: An engine flameout in August 2017 that left the Mitsubishi Regional Jet (MRJ) test fleet grounded for several weeks was caused by a manufacturing quality issue on a component in the Pratt & Whitney geared turbofan’s accessory gearbox, according to a Mitsubishi executive.

Source: Mitsubishi.

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MRJ program chief Alex Bellamy said the manufacturing quality problem caused a machined component to suffer a durability issue, leading to flameout.

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Laser focus for MRJ program

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By Dan Catchpole

July 3, 2018, © Leeham News: It’s been two years since a small army of Japanese aerospace workers landed in Moses Lake, a sleepy former Air Force base town in rural Central Washington. The Mitsubishi Aircraft Corp. (MAC) will be in Moses Lake for another four or five years as it nudges its new regional jets—the MRJ70 and MRJ90—into service.

Japan’s All Nippon Airways is the launch customer and first operator for the Mitsubishi MRJ90. Source: Mitsubishi.

The first Mitsubishi Regional Jet, the MRJ90, originally was supposed to enter into service in 2013, but myriad develop delays have dogged the sleek jet, which now is slated to deliver to launch customer All Nippon Airways in mid-2020.

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Delays over for MRJ program, execs insist

By Dan Catchpole

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July 3, 2018, © Leeham News:   Mitsubishi Aircraft Corp. executives insist the MRJ90 is past the seemingly endless delays that have dogged its development. It is on track toward type certification and first delivery in mid-2020.

MRJ90 flight test vehicles at Mitsubishi’s Moses Lake (WA) flight testing facility. Source: Mitsubishi.

The problem is when it arrives, the 81-seat MRJ90 will be the wrong fit for the US market. Program executives praised the plane’s advanced design during media briefings at the MRJ flight test center in Moses Lake (WA), but when they spoke about market opportunity, it was for the smaller MRJ70, which is at least three years away from entering service.

Starting in 2022, Mitsubishi expects a wave of 50-seat regional jet retirements in the North American market. And North America—specifically the United States—”is the most important market for us to make this business successful,” said Yugo Fukuhara, Mitsubishi Aircraft vice president and general manager of sales and marketing.

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Farnborough Air Show: No NMA, unlikely A321 Plus, no Boeing-EMB tie up

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Introduction

June 25, 2018, © Leeham News: Little in the way of excitement is expected at the Farnborough Air Show next month.

There won’t be any launch of the oft-talked about Boeing New Midmarket Aircraft (NMA, aka 797).

Airbus continues to be coy about its response to the NMA. Studies about an A321neo Plus or Plus-Plus have been talked about almost as long as Boeing has been discussing the NMA. More recently, now there’s talk of an A321 XLR.

Summary

  • Expectations for incremental airplane orders at the show should be low.
  • No NMA program launch.
  • Doubtful if Airbus launches A321neo enhancements.
  • Airbus-C Series makes its debut—but to what end?
  • Mitsubishi to showcase MRJ.
  • Bombardier renews emphasis on Q400, CRJ.
  • Embraer looks for order boost.

Read more