NMA is a briar patch, top Airbus salesman says

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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.

Left unsaid it Airbus doesn’t want to have to launch a new airplane of its own.

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.”

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Airbus has the “rock” and “hard place” for Boeing NMA

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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.

So says Christian Scherer, chief commercial officer of Airbus, who made the declaration at the first day of the Airbus Innovations Days pre-Paris Air Show briefings today.

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.

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Latest engine problem means NMA EIS slides

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Introduction

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 grounding of the 737 MAX March 13, which is likely to continue well into the summer, will delay any launch of the program—should Boeing proceed.

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.

Summary
  • CFM is considered the favorite to power the NMA.
  • All four engine makers remain under stress and recover modes.
  • Rolls-Royce dropped out of NMA competition in December.
  • LNA reported in March 2018 the engines needed to be the focus for the NMA launch. See here and here.

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From the sidelines at the MRO Americas conference

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.

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Delta Tech Ops 5-year goal to double revenues

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Ed Bastian, Delta Air Lines CEO.

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.

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Pontifications: Fluid, dynamic events upend MAX story

Special Edition

By Scott Hamilton

March 20, 2019, © Leeham Co: I’ve been covering or employed in commercial aviation since 1979. I’m an aviation historian buff.

I’ve read all about the groundings of the Douglas DC-6, Lockheed Constellation, Martin 202 and de Havilland Comet. I read about how the Federal Aviation Administration didn’t ground the Lockheed Electra, choosing operating restrictions instead.

I lived through the grounding of the McDonnell Douglas DC-10 and Boeing 787. As a reporter, I walked through the debris of the American Airlines DC-10 crash that led to the grounding. I went to the crash scene of the Delta Air Lines Boeing 727 at D/FW Airport and I’ve covered many, many crashes through reporting and as a commentator.

I’ve never seen anything evolve in air accidents as has evolved in the Boeing 737 MAX investigations.

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Rolls cites timing, analysts cite poor financial condition for NMA withdrawal

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Introduction

March 4, 2019, © Leeham News: Rolls-Royce last week announced it had withdrawn from competition for the Boeing NMA engine provider, citing a mismatch in timing between its Ultra Fan being ready and Boeing’s desired entry into service.

Warren East, the RR CEO, glossed over other reasons, but they were there: the program making commercial sense and the impact of the Trent 1000 engine challenges.

Aerospace analysts interviewed by LNA and whose research notes were provided have other reasons.

Summary

  • After dissecting RR’s financial statements, with special charges, accounting changes and Free Cash Flow analysis, some analysts concluded the company simply doesn’t have the money to develop the engine for the NMA.
  • Although CEO East glossed over the Trent 1000 issues, some analysts feel this was more important than let on.
  • CFM, according to one analyst (and many observers), believes it is the favorite for the NMA engine selection, so RR bowed out.

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Transcript: RR told Boeing before end of 2018 it’s out of NMA competition

Feb. 28, 2019, © Leeham News: The announcement today by Rolls-Royce that it has withdrawn from the competition to provide an engine for the Boeing New Midmarket Airplane came as a surprise.

Warren East, CEO of Rolls-Royce. Source: Youtube.

This leaves CFM and Pratt & Whitney as the remaining competitors.

RR’s withdrawal wasn’t the only surprise.

CEO Warren East revealed Boeing had been notified shortly before the end of 2018.

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Airbus appears poised to launch A321XLR

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Introduction

Feb. 25, 2019, © Leeham News: The longer Boeing dithers on launching the New Midmarket Airplane, the harder it is to close an already difficult business case.

News last week that Airbus finally, at long last, is appears about to launch its Xtra Long Range A321XLR this year is overdue. Doing so will make Boeing’s NMA business case more difficult to close.

The aircraft should have been launch in late 2017, an insider told LNA recently. But the corruption scandals enveloping Airbus disrupted plans and drove executives to indecision. Launching the A321XLR was put on hold.

Summary
  • Killing the NMA.
  • A321XLR details.
  • Narrow market.
  • Engine down select soon.

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Pontifications: March is a critical month for engine OEMs

By Scott Hamilton

Feb. 25, 2019, © Leeham News: Even as Boeing put off a decision whether to launch the New Midmarket Aircraft until 2020, next month could be an important milestone—not only for the program but especially for the engine makers.

Unless delayed, engine down-select is supposed to be made in March.

This is a critical decision that could have huge implications to one of the engine OEMs—Rolls-Royce.

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