Airbus, plagued by “decapitation,” faces tough choices on NMA: consultant

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Introduction

Feb. 15, 2018, © Leeham Co.: Airbus’ plans to respond to Boeing’s prospective New Midrange Aircraft, aka 797, is a mystery to one of the industry’s leading aviation consultants.

Richard Aboulafia of the Teal Group notes that Airbus’ research and development investment overtly disappears after 2018, with the introduction into service of the A350-1000 and the A319neo.

Aboulafia spoke at Day 2 of the Pacific Northwest Aerospace Alliance (PNAA) conference in Lynnwood (WA).

He’s long compared R&D spending between Airbus and Boeing, often praising the former for its level of investment and criticizing the latter for lagging.

Now, Airbus’ level of spending is a question mark while Boeing’s is a comfortable level compared with revenue, Aboulafia says.

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Pontifications: NMA, Boeing-Embraer headline Singapore Air Show

By Scott Hamilton

Feb. 12, 2018, © Leeham Co.: The Singapore Air Show last week produced little in the way of new orders from the Big Four airframe OEMs. ATR announced a few deals and Embraer announced a letter of intent for the KC-390 multi-role tanker-transport.

The headline news revolved around the what-ifs: Boeing and the New Midrange Aircraft and Boeing and the link-up with Embraer.

Let’s look at the NMA first.

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Airbus, Boeing square off with A330neo, 787 in advance of NMA launch

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Introduction

Feb. 8, 2018, Leeham Co.: Boeing hasn’t launched the New Midrange Aircraft (NMA, aka 797) and may not until next year.

But the maneuvering to capture, solidify or preempt moves is already well underway by Airbus and Boeing.

Reuters synopsized this during its reporting at this week’s Singapore Air Show.

This is only the tip of the iceberg.

Summary
  • Boeing 787 production rate increase to 14/mo next year is, in part, a head-‘em-off-at-the-pass maneuver to prevent customers from buying the Airbus A330neo.
  • The 787-8 could see a new lease on life as interim airplane.
  • A330-800 has steep uphill slog.
  • Airbus, Boeing face off 787, A330neo.

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Boeing’s special needs in the next decade may be solved by Embraer

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Introduction

Jan. 8, 2018, © Leeham Co.: Key factors may play into the prospective business venture, however it’s defined, between Boeing and Embraer that have gotten little notice.

Boeing’s need for engineering talent from Embraer has been touched on by many media, including LNC. But a detailed analysis hasn’t been forthcoming, that we’ve seen.

Not discussed yet is the fact that new airplane programs at Boeing and Embraer wind down in 2021-22, leaving both companies in danger of facing the next decade without new products at a time when competition will be emerging.

The lack of new airplane programs endangers the engineering talent pool. For Boeing, this is already going to be critical as more than 5,500 engineers and technicians reach age 65 in the next 10 years.

Boeing’s New Midmarket Airplane, if launched, will address part of the company’s new product requirement after 2020. On the other hand, Embraer has no new product, although officials have discussed potentially launching a turboprop program.

Summary
  • Boeing’s 787 and 737 programs wind down this year and in 2020.
  • Embraer’s EJet-E2 program winds down in 2021.
  • Boeing faces talent drain as engineers and technicians age.
  • Boeing NMA needs engineers and Embraer can supply them.

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Pontifications: 2018 is a year of Transformations

By Scott Hamilton

Jan. 8, 2018, © Leeham Co.: This is going to be a year of transformations.

This might be viewed with puzzlement by some. After all, only minor-modification models will be entering service this year: the Airbus A350-1000, the Boeing 737-9, the Airbus A319neo and the Boeing 787-10. The first flight of the 737-7 should occur.

Flight testing continues for the Mitsubishi MRJ90, the COMAC C919 and Irkut MC-21.

The proposed deal between Airbus and Bombardier should receive government approvals this year. Talks between Boeing and Embraer may or may not result in a combination of some kind.

The Big Deal, however, resides in Everett (WA).

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NMA market sector is small, Airbus’ Leahy says

This is a continuing series of articles derived from LNC’s “retirement” interview with John Leahy, COO-Customers of Airbus. Leahy retires this month.

Jan. 3, 2018, © Leeham Co.: This is the year many expect Boeing to decide whether to launch the New Midmarket Aircraft, also known as NMA or unofficially, the

John Leahy, COO-Customers of Airbus. Photo via Google images.

797, to serve the Middle of the Market.

The MOM sector is broadly defined as above the Boeing 737/Airbus A321 and below the Boeing 787/Airbus A330-200/800.

Others, including LNC define the market more broadly.

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Top 10 aviation stories of the year on Leeham News

Dec. 31, 2017, © Leeham Co.: Airplane development and the whimsicle made the Top 10 stories on LNC in 2017.

The Top 10 are a statistical listing of the most-viewed posts, not some judgment call on the part of LNC.

Here is the rundown.

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Boeing moves EIS target for NMA to 2027: sources

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Introduction

Dec. 4, 2017, © Leeham Co.: Officially, Boeing says the New Midmarket Aircraft (NMA, or 797) entry-into-service will be around 2024-25 if the program is launched.

LNC has learned the target date now being discussed is 2027.

Boeing 797 concept. Source: Boeing.

This means the 737 replacement likewise slips, with EIS after 2030 instead of late next decade or in 2030.

The new NMA target date, which we’ve heard from the supply chain and customer base, gives further impetus to the prospect of restarting the 767-300ER passenger production, a decision that is supposed to be made by the end of this year.

Summary
  • Technology is at the heart of the new target EIS for the NMA.
  • The 737 replacement was always intended to follow the NMA.
  • Supply chain asked for 767 production rate ramp-up feasibility.

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New mission focus seen for NMA

Nov. 8, 2017, © Leeham Co.: A revised mission focus for the the prospective Boeing New Midmarket Aircraft (NMA) is seen by a New York research firm.

Bernstein Research sees the NMA being redefined as a larger aircraft serving the Airbus A320/Boeing737 market rather than a replacement for the Boeing 757/767 “Middle of the Market” sector.

Bernstein has been cool to the prospect of a 4,500nm-5,000nm airplane. The analyst, Doug Harned, likes the proposed size—220-270 passengers in a 2x3x2 ovoid

Concept of the Boeing 797 New Midmarket Aircraft. Source: fs2000.org.

composite fuselage configuration. But he sees a stronger market serving ranges of 1,000nm to 4,500nm.

So far, there is no market intelligence LNC knows of to support any inference Boeing has refocused the mission statement of the NMA, also known as the Boeing 797, though Harned is firm in his view: “The focus is now on the NMA category, which we see as the right positioning,” he writes in a Nov. 6 research note.

Airlines LNC checked with yesterday reaffirm Boeing’s focus at this time to be 4,500nm-5,000nm.

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Boeing-Embraer venture in response to Airbus-Bombardier? Don’t count on it

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Introduction

Oct. 23, 2017, © Leeham Co.: With the tie-up announced last Monday between Airbus and Bombardier for the CSeries, speculation immediately turned to whether Boeing and Embraer will join forces in some fashion in response.

The speculation is natural. Boeing and Embraer have had several commercial agreements, mostly on the defense side but also in eco-research. But as yet, there hasn’t been a tie-up involving the successful E-Jet program.

Embraer E195-E2.

Don’t look for anything soon that would be a meaningful response to the Airbus-CSeries deal.

Summary
  • Boeing needs a response in the 125-150 seat sector in which the 737-7 MAX languishes and with which the CS300 competes.
  • Boeing has no product offering in the 100-125 seat sector. Embraer doesn’t need Boeing’s help here. The E175-E1 continues to sell and it meets US Scope Clauses.
  • The Embraer E2 program’s first delivery is April next year.
  • Embraer isn’t about to proceed with a new airplane program in the 100-150 seat sector, which is Boeing’s product gap.

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