NMA focus needs to be on engines

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Introduction

March 19, 2018, © Leeham Co.: As the market awaits a decision by Boeing whether to launch the New Midrange Aircraft (NMA, or 797), focus has been on the aircraft’s definition and market demand.

It should be on the engines.

It doesn’t matter whether Boeing designs a fabulous airplane that’s the next best thing to sliced bread. What matters is whether the engines will be ready in time for Boeing’s suggested entry-into-service and if they are, whether they will be reliable out of the box.

The recent track record isn’t all that encouraging. Neither is Boeing’s preferred timing.

Summary
  • CFM, GE, Pratt & Whitney and Rolls-Royce each had problems with their new engines. All continue.
  • The Boeing NMA requires brand new engines, not derivatives.
  • Engine development and certification within the Boeing preferred timeline is sporty at best.

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Pontifications: Boeing faces thousands of retirements in next five years

By Scott Hamilton

March 19, 2018, © Leeham News: Boeing faces thousands of retirements in its engineering and touch-labor force ranks over the next five to 10 years, with a limited worker pool for replacements.

A national economy with a low unemployment rate of about 4.1% exacerbates the challenges of finding talent.

These numbers are important to Boeing’s current higher production rate ambitions.

They are even more important as Boeing looks to develop the New Midrange Airplane (NMA, aka 797).

LNC first discussed the looming shortage of engineers in connection with the potential creation of a new company with Embraer.

The Southeast Aerospace and Defence Conference in Mobile focuses on production transformation. Go to Airfinance Journal for program information.

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A321neo plus a stretch too far for NMA: Avitas

Published 05 Mar 2018 by Airfinance Journal

Special to Leeham News.

March 8, 2018, (c) Airfinance Journal: A leading appraisal firm questions whether Airbus should respond to Boeing’s proposed new midsize aircraft (NMA) simply by enhancing its existing product line.

John Vitale. Source: Airfinance Journal

“There is a gap, a natural gap that needs to be filled, so I am not sure whether the A330 coming down…and the A321 coming up, fills the gap,” said John Vitale, president and chief executive officer of Avitas, speaking on a panel of appraisers at Airfinance Journal’s Korean Airfinance event, adding: “Airbus claims the A321 has all this range and that they can put in as many seats as they are talking about. Well, no you can’t in an equal comfort level.”

However, Vitale acknowledges a possible further stretch by Airbus of its A321neo, the A322, or enhanced versions, such as the ‘A321neo-plus’, or even an ‘A321neo-plus-plus’“pushes out the timing of the NMA aircraft.”

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Retirement wave coming that will boost A330neo sales, says Airbus

March 6, 2018: Airbus is ramping up the messaging for the slow-selling A330neo, reiterating its view that a wave of retirements is coming from current A330 operators that will support new sales.

LNC first reported the message Dec. 6.

Jeff Knittel, the new president of Airbus Americas, reinforced this message yesterday at an industry conference.

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Engine makers “inside the tent” on Boeing NMA, but airframer still ponders provider

March 5, 2018, © Leeham Co.: The three engine makers, CFM/GE, Pratt & Whitney and Rolls-Royce, are the only suppliers that have been brought “inside the tent” by Boeing for the New Midrange Aircraft, a company executive said today.

Launching the program is critical on the engine companies, says Randy Tinseth, VP marketing for Boeing. Boeing hasn’t decided—officially—whether it will have a

Randy Tinseth. Photo via Google images.

single-engine or dual-engine source for the aircraft because the program hasn’t been launched.

Market intelligence tells LNC that Boeing wants two engine choices. Intel also indicates all three engine OEMs view the market demand as sharply smaller than Boeing’s publicly-stated forecast of 4,000 Middle of the Market sector airplanes over the next 20 years.

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Embraer ponders new, smaller jet

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Introduction

March 5, 2018, © Leeham Co.: News emerged last week that Embraer is considering a new jet family smaller than its current E2 line.

This would replace the E170, which Embraer decided not to upgrade to the E2. The E170 hasn’t sold wellin recent years, as the E175 became the preferred airplane in Embraer’s sub-90 seat market.

Embraer recognizes it needs a second family of airplanes to complement the E2. It’s been considering reentering the turboprop market, but demand is limited.

Restarting a sub-76-seat jet is not without risk, however.

Summary
  • Turboprop market is small over 20 years.
  • 60-99 seat market is a bit larger, but with competitors.
  • Business cases for each are challenging.

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Professionals see two types for Middle of the Market sector

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Introduction

March 1, 2018, © Leeham Co. Three industry professionals raised the question whether the Middle of the Market sector requires one aircraft type or two.

One raised the prospect Boeing might have to undertake concurrent aircraft development, as it did with the 757 and 767.

Richard Aboulafia, a consultant with The Teal Group, Ron Epstein, aerospace analyst for Bank of America Merrill Lynch and Kevin Michaels, president of AeroDynamic Advisory, made their remarks at the annual conference of the Pacific Northwest Aerospace Alliance last month in Lynnwood (WA).

Summary
  • Low-cost Embraer engineers may play a role in Boeing’s development of the NMA.
  • One consultant sees two distinct NMA aircraft.
  • Boeing’s vertical integration of the supply chain may make sense only with two concurrent of consecutive airplane programs.

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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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NMA demand skeptics aren’t thinking outside the box, Boeing exec says

Feb. 13, 2018, © Leeham Co.: Skeptics who question Boeing’s market demand forecast of 4,000 airplanes for the New Midrange Aircraft aren’t thinking “outside the box,” says Randy Tinseth, VP Marketing.

Tinseth heads up the team that prepares Boeing’s annual Current Market Outlook for the next 20 years.

Boeing’s CMO forecasts a need for about 5,900 small twin-aisle aircraft (fewer than 300 seats but larger than single-aisle airplanes of more than 200 seats). About 4,000 of these are for the NMA.

Others, including Airbus, Pratt & Whitney, Rolls-Royce and some key suppliers see the market as between 2,000 and 2,500. Leeham Co.’s own estimate is 2,300.

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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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