Farnborough: NMA business case appears to weaken, evidence at air show indicates

Analysis

July 18, 2018, © Leeham News, Farnborough: The biggest, longest-running story at this year’s Farnborough Air Show is about an airplane that doesn’t exist: the prospective Boeing New Midmarket Aircraft (NMA or 797).

And the underlying story that’s emerging from the buzz on the sidelines and interviews with key observers and industry participants is that Boeing’s business case for the airplane appears to be getting weaker, not stronger.

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Boeing, Embraer tie-up key to NMA development

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Introduction

July 9, 2018, © Leeham News: When Boeing and Embraer announced last week the Memorandum of Understanding to form a joint venture between Boeing and Embraer Commercial Airplanes, writers and analysts jumped on the bandwagon that LNC pointed out as far back as last year.

Summary

This is:

  • A strategic play;
  • About Embraer’s engineers and low-cost production in Brazil;
  • About tapping Embraer’s resources for development of the potential Boeing New Midmarket Aircraft; and
  • About EMB’s potential lead in developing a new single-aisle aircraft to replace the 737, among other things.

Additionally, a Boeing partisan sees new trade complaint against C Series.

Related stories:

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Southern state coalition bid likely for Boeing NMA assembly site

June 27, 2018, © Leeham News: A coalition of four Southern US states that joined to win the US Air Force tanker contact site location for Mobile (AL) will likely link up again to bid for the assembly line of the prospective Boeing New Midmarket Aircraft, officials of three of the states said yesterday.

The Aerospace Alliance includes Florida, Alabama, Mississippi and Louisiana.

An official of an economic development commission for Charleston (SC) said Charleston will also likely throw its hat into the ring.

The comments were made at the Leeham Co./Airfinance Journal Southeast Aerospace & Defence Conference yesterday in Mobile. The conference continues today.

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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.

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Pontifications: Growing aerospace in the US Southeast

By Scott Hamilton

June 24, 2018, © Leeham News: We’re a week away from the partnership between Airbus and the Bombardier C Series program becoming effective.

Beginning tomorrow, Leeham Co. and Airfinance Journal hold the Inaugural Southeast Aerospace & Defence Conference in Mobile (AL), where Bombardier will be a C Series Final Assembly Line.

The US Southeast will also be a competitor for the site selection of the FAL for the New Midmarket Aircraft (NMA) should Boeing decide, probably next year, to proceed with this new airplane.

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IAM may be playing with fire in SC union vote

June 20, 2018, © Leeham News: The International Association of Machinists may be playing with fire.

Puget Sound’s IAM 751 may be burned in the process.

The Charleston Post and Courier reported that the IAM will file a labor grievance over Boeing’s refusal to recognize certification of a “micro-union” while the company appeals the legality of its creation.

“Boeing ignores us at their own peril,” the newspaper quotes a union official.

The union may be pursuing this at its own peril.

At stake is where Boeing will assemble the prospective New Midmarket Aircraft, or NMA (aka 797).

The New Midmarket Aircraft site selection will be discussed at the Southeast Aerospace & Defence Conference next week in Mobile (AL). Click here for more information.

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Air Canada sees secondary airport need for NMA

Special to Leeham News

 By Olivier Bonnassies

Airfinance Journal

April 16, 2018, (c) Airfinance Journal, Montreal: Air Canada sees the potential of a new midsize aircraft (NMA) in its fleet to avoid congested airport.

“There is a difficulty in getting slots at key airports in key times,” Calin Ravinescu, Air Canada president and chief executive officer, said at the Innovation Aerospace Forum in Montreal.

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American A330neo loss casts shadow over sales prospects

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Introduction

April 9, 2018, © Leeham News: Even as Airbus touted the new 251t A330-800 and optimism that aging A330-200s will kick start a replacement cycle in 2020-21, the

Airbus A330neo. Photo via Google images.

concurrent loss of a campaign to sell the model to American Airlines casts a shadow over the model and the entire program.

Airbus had just come off the cancellation of the only A330-800 order, by Hawaiian Airlines, which flipped to the Boeing 787-9. As the sole customer for six A330-800s, the cancellation was expected.

Airbus hoped that an American order, for 20 -800s, would prove to be the endorsement of the program that was needed to spur worldwide sales.

Boeing was just as adamant that, like Hawaiian, American order the 787. In this case, Boeing had the leg up: the 787 was already in AA’s fleet (37 of 42 previous orders were already delivered). American wanted to simplify its fleet, not add another type. And airline officials were skeptical of the -800 for the very reason Airbus was so in need of AA’s order.

Summary

  • American’s order would have been the boost needed for the A330neo program.
  • It would have been an endorsement of the A330-800.
  • The 251t, 8,150nm version of the -800 makes a good, niche long-haul airplane.

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Boeing’s strategy to de-risk design, production

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Introduction

April 2, 2018, © Leeham News: Boeing’s painful experience the with the development, design, production and grounding of the 787—costing billions of dollars in overruns and penalties with a delay of nearly four years—led to a major effort to de-risk future airplane development.

The 787 experience led to a pause that resulted in pursuing derivatives of the 737 MAX and 777X instead of developing new airplanes to replace these aging platforms and leap ahead of Airbus.

Now, poised to launch its first all-new airplane program in 15 years, Boeing continues to de-risk its production.

Summary
  • De-risking production means diversifying supplier base, bringing work in-house.
  • De-risking is changing the fundamental design-production nexus.
  • De-risking is innovating and cutting costs to meet new competition.

The Southeast Aerospace and Defence Conference will examine the transformation in production. Click here for more information.

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Boeing’s NMA decision entering final stretch, Part 2

By Bjorn Fehrm

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Introduction

March 26, 2018, © Leeham News: Boeing’s NMA or 797 is taking final form ahead of a decision to essentially launch the program with an Authority to Offer (ATO), widely believed to be later this year.

In the first article, we looked at the key characteristics of the design. We also looked at the engine situation in a couple of articles.

Now we round up the series with analyzing the potential economics of the aircraft. 

Figure 1. The first sketch of the smaller 797-6X with 224 seats. Source: JonOstrower.com

Summary:

  • The projected 797 would have competitive Cash Operating Costs compared with a modern Single Aisle aircraft like the Airbus A321LR.
  • The challenge is the capital costs. The A320/A321 and Boeing’s 737 MAX models are produced in numbers passing 10,000. An NMA would be successful if produced in 1,000 units. This leads to higher production costs for the numerically smaller series.
  • The focus from Boeing is therefore on lowering Production costs and on finding Services revenue which can help the 797 business case.

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