By Judson Rollins
July 11, 2019, © Leeham News: Boeing is expected to proceed with the New Midmarket Airplane (NMA) once the 737 MAX gets clearance to return to service. News from the Paris Air Show indicates Boeing may launch the larger model, the NMA-7, first.
The 270-passenger version of the NMA is viewed by some—including Boeing—as the airplane that would effectively kill the A330neo.
Twelve years ago, the 787 was supposed to finally kill the A330 once and for all … and we saw how that turned out. But this time may well be different.
July 1, 2019, © Leeham News: Improving supply chain management is one of the many, many key factors in making the business case for the prospective Boeing New Midmarket Airplane.
The highly complex task of managing a supply chain with millions of parts across many product lines can break down quickly with any weak link, be it from a supplier or in the management system itself.
Quality control, security, misrouting, package integrity in shipping are among the key issues. The sheer magnitude of tracking inventory is huge.
Boeing uses Enterprise Resource Planning and is shifting the system to a new, expanded one called Systems Applications Projects. SAP is the next generation of ERP. Even though ERP has been in use for decades, last year there was a breakdown in deliveries that contributed to production interruptions of the 737 NG (late deliveries of the CFM 56 were a bigger problem).
Boeing’s transition from ERP to SAP is taking longer than anticipated, with a 2021-ish target.
With the NMA business case continuing to be difficult to close, Boeing’s need to attack every cost is clear.
By Judson Rollins
June 17, 2019, © Leeham News, Paris: Airbus launched its much-awaited A321XLR today with an initial order of 27 airplanes from lessor Air Lease Corp. ALC also ordered another 23 A321neos, which can optionally be taken as A321LRs. This brings ALC’s total Airbus order count to 387, making it Airbus’s third largest lessor.
Airbus also announced that ALC has ordered 50 A220-300s to be delivered between 2021 and 2026. ALC is the largest lessor to date to order the former C-Series aircraft. ALC executive chairman Steven Udvar-Hazy said, “We believe this aircraft will be a wonderful replacement for aging A319s, 737s, Fokker 100, BAe-146s, and other smaller jet aircraft.”
The order is structured as a letter of intent. ALC chief executive John Plueger said the LoI covers “all commercial business points” but that it will be converted to a firm order once certain terms are firmed on the A220 portion of the order.
Airbus Chief Commercial Officer Christian Scherer declined to discuss catalog pricing for the A321XLR.
June 10, 2019, © Leeham News: Embraer is in a holding pattern of sorts.
It can’t coordinate with Boeing about synergies until these approvals come.
Its leadership is identifying areas that, from its perspective, can lead to synergies.
Some key campaigns for the E-Jet E2 appear to be on hold while customers wait for Boeing and Embraer to join in order to see how pricing may be reset, competition with the Airbus A220 shapes up, what synergies between the E2 and Boeing’s 7-Series product lines might emerge and how Embraer’s Services unit integrates with Boeing Global Services.
By Dan Catchpole
May 30, 2019, © Leeham News: Boeing CEO Dennis Muilenburg said Wednesday steady progress is being made on getting the 737 MAX back in the air following two devastating crashes within a few months of each other. He stopped short of giving a specific time frame, though.
However, a spokesman for the International Air Transport Association said the same day that the trade group does not expect the MAX to be back in service before mid-August.
Speaking at the Bernstein Strategic Decisions Conference, Muilenburg struck an upbeat tone overall and called the crashes a “defining moment” for Boeing. However, he did not indicate that Boeing intends any major changes as a result, and he expressed confidence in the company’s design and certification processes. Though, he did not shut the door to making changes as a result of lessons learned in the wake of the crash.
Muilenburg insisted that the MAX challenges will not affect entry into service for either the 777X in 2021 or the New Midsize Airplane (NMA) in 2025. He also discussed changes to the 737 supply chain, resumption of deliveries and future production rates for the popular single-aisle airplane.
May 21, 2019, © Leeham News, Toulouse: The chief commercial officer for Airbus half hopes Boeing will step into a briar patch and launch its long-discussed New Midmarket Airplane, but the real message is clear: leave well enough alone.
Christian Scherer, the chief commercial officer for Airbus, said he wouldn’t speak for Boeing when asked if Boeing “has” to launch the NMA because of the declining market share of the 737 MAX vs the A321neo and inferior range and field performance of the -9/10 MAXes. He questioned Boeing’s own position about the NMA.
He made these remarks on the sidelines of the annual Airbus Innovation Days pre-air show briefings.
“I’m not sure they have a unified position on it. What I want to say is that we are in a very competitive duopoly, which is great for our customers,” he said. “There’s competition everywhere. You don’t have to dominate one segment or the other segment. There’s quite healthy business in it for Boeing on the 737. There’s quite healthy business in it on bigger airplanes. I’m not sure they have to do anything. Do they want to do something? Yeah, maybe.”
May 21, 2019, © Leeham News: Airbus has a “rock” and a “hard place” facing any manufacturer that might want to bring a new airplane to the market.
He called the A321neo the “rock” and the A330-800 the “hard place.”
His oblique reference to another manufacturer was, of course, Boeing and its prospective New Midmarket Airplane, or NMA.
Boeing was widely expected to announce Authority to Offer the NMA for sale during the Paris Air Show next month. The 737 MAX crisis understood to put off this decision until the MAX is returned to service.
In the Middle of the Market, there “isn’t a one solution fits all. Airbus has by far the most competitive solution,” Scherer said. In this market space, a flexible solution is required,” he said.” The A320/321 offers single aisle economics approaching wide-body range. The A330-800 is re-engined, providing Airbus a left-hook, right-hook solution.
These mature programs give Airbus the pricing flexibility.
April 22, 2019, © Leeham News: If there remains any doubt that Boeing’s prospective New Midmarket Airplane (NMA) won’t be ready for entry into service (EIS) by 2025, it should be dispelled by now.
The Board of Directors is unlikely to approve Authority to Offer (ATO) the NMA for sale as long as the cash flow for the MAX is outgoing and not in-coming.
Although this has its own impact on the NMA timing, it’s not the critical factor.
Last week, it was revealed that the CFM LEAP engine on the MAX (and the Airbus A321neo) has a problem called coking, which led to the contained engine failure of a Southwest Airlines MAX being ferried from Orlando (FL) to Victorville (CA) for the grounding of the Boeing airplane (see here and here). It’s the latest in a long line of engine maker problems with their current generation of powerplants.
This issue is unrelated to the MAX MCAS grounding. It also affects some engines on the A320neo family.
April 10, 2019, © Leeham News: China will be the last country to review and approve fixes to the Boeing 737 MAX, according to the talk here on the sidelines of the Aviation Week MRO Americas conference in Atlanta.
Nobody knows, of course, when regulators will lift the MAX grounding orders. But none is looking for fast action.
And China, the first to ground the airplane, will be the last to lift the grounding, sideline talk here indicates.
April 9, 2019, © Leeham News: Delta Air Lines has the third largest third-party MRO company in North America and aggressively seeks to grow, in sharp contrast to its competitors.
While American and United airlines have limited their own maintenance, repair and overhaul, let alone seek third party business, Delta Tech Ops is a business unit and profit center. Delta CEO Ed Bastian said today that Tech Ops will achieve $1bn in revenues this year and has a goal of $2bn within five years.
Bastian was the lead-off speaker at the Aviation Week MRO Americas conference in Atlanta this week.