Pontifications: More of the same expected at Boeing’s annual meeting

By Scott Hamilton

April 12, 2021, © Leeham News: Boeing’s annual shareholders’ meeting is April 20.

The entire Board of Directors is up for election. Boeing sets terms for one year. In theory, this prevents entrenchment. In Boeing’s case, Board members historically are reelected year after year after year.

There are several members who were appointed after the 737 MAX crisis. Still, there are major gaps in the Board’s makeup.

Read more

Pontifications: Southwest didn’t invite Airbus to bid

By Scott Hamilton

April 5, 2021, © Leeham News: Southwest Airlines didn’t ask Airbus to submit a commercial bid for the A220-300, three knowledgeable sources tell Leeham News.

Southwest conducted an internal technical analysis of the A220-300 vs. the 737-7 MAX. The A220-300 offered better economics. But this competed against the costs of retaining a common 737 fleet.

“Southwest acknowledged the merits of the A220, but there was no competition” for a commercially-based bid, LNA is told.

The airline placed an order on March 29 for 100 737-7s. Southwest said the order was an outgrowth of talks with Boeing for compensation due to the 20-month grounding of the MAX.

Read more

Pontifications: Recovery plans from the pandemic at ATR, De Havilland

By Scott Hamilton

March 29, 2021, © Leeham News: Aviation stakeholders’ attention understandably focuses on Airbus and Boeing as the industry works its way through the COVID-19 pandemic. Embraer gets less attention than the Big Two.

But two other OEMs must be considered as well: ATR and De Havilland Canada.

Outside of China and Russia, whose home-grown industries sell only to these markets, ATR and DHC are the only manufacturers of turboprops in the 50-90 seat sectors.

LNA revealed on Jan. 12 that DHC would suspend Dash 8-400 production after the small backlog rolled off the assembly line. The privately held company delivered 11 airplanes last year due to the pandemic.

About 900 aging regional turboprop aircraft need to be replaced in the coming years.

Read more

Pontifications: Embraer’s China ambitions

March 22, 2021, © Leeham News: Embraer wants to become a big player in China.

By Scott Hamilton

“We see a huge market potential there,” said Arjan Meijer, CEO of Embraer Commercial Aviation, in an interview with Nikkei Asia. The news outlet continued, “The company expects worldwide demand for 5,500 jets with up to 150 seats over the next 10 years. A third of that will come from Asia, with a large part of it from China, Meijer added.”

However, China presents risks and few rewards to companies wishing to gain a significant foothold. This is especially true for commercial aviation companies. China has high ambitions for the commercial aviation industry. Partnering with China in this sector produced more heartbreak than success.

Read more

Pontifications: AerCap and GECAS to combine — assessing the impact

By Scott Hamilton

March 15, 2021, © Leeham News: GE Corp.’s decision to sell its mega-leasing unit, GECAS, to AerCap represents a huge shift in commercial aviation.

For decades, GECAS was the largest lessor in the world. One of GE’s best profit centers, GECAS was a major source of financing to airlines. The lessor purchases and leases back airliners, as do most lessors, as well as initiating leases with orders received directly from the OEMs. GECAS’ scale was a magnitude or two larger than most competitors.

The closest competitor was International Lease Finance Corp., a unit of insurance giant AIG. ILFC’s leadership liked to boast the asset value of ILFC’s smaller fleet was greater than GECAS, which while larger had more older airplanes in its portfolio.

Read more

Pontifications: First flight nears for Berlin Airlift Foundation’s replacement airplane

The left wing of the Berlin Airlift Historical Foundation Douglas C-54E was impaled by a hangar beam during a tornado. Source: BAHF.

By Scott Hamilton

March 8, 2021, © Leeham News: The Berlin Airlift Historical Foundation appears to be weeks away from the test flight for the replacement of the Douglas C-54E that was badly damaged last year in a tornado.

The 76-year old airplane participated in the historic 1948 airlift that brough food, coal and other goods to West Berlin after the Soviet Union initiated a ground blockade. The Soviets tried to starve the West Berliners into submission and force the former World War II Allies (Britain, France and the US) to hand over occupation of West Berlin to the Soviets, who occupied East Berlin deep inside East Germany.

Related Links

Read more

Pontifications: Legislature weighs overdue actions for aerospace

March 1, 2021, © Leeham News: Two bills before the Washington State Legislature intend to create long-term strategic plans to grow the state’s advanced manufacturing sector in general – and the space industry in particular.

By Bryan Corliss

To this we say yes, hell yes and amen.

North America’s largest aerospace cluster has lurched from crisis to crisis over the past 20 years, with elected officials scrambling to meet Boeing’s demands for tax, workforce and labor concessions.

And – much to our dismay – for most of the past two decades, leadership in the state Capitol of Olympia has been content to cobble together ad hoc responses with only the faintest lip service toward any kind of long-range strategic planning for future industry needs.

These bills – Substitute House Bill 1170 and Substitute House Bill 1190 – have the potential to change all of that.

  • Bills contain a lot of what we’ve long advocated
  • Manufacturing bill sets ambitious goals for state
  • Space bill seeks to boost – and capture – fast-growing sector
  • Taxes aren’t on the table — yet
Read more

Pontifications: For Boeing, the future is a new airplane, not the status quo

By Scott Hamilton

 Feb. 22, 2021, © Leeham News: Tunnel-vision pundits, analysts, and even some experts say Boeing shouldn’t launch a new airplane program within the next few years.

Why? They say doing so will cannibalize the 737 MAX 9 and MAX 10. They say it will undermine sales of the entire MAX family.

I say, poppycock.

Boeing has a MAX problem. It’s not the grounding, although the issues from this are obvious. LNA has written about this ad nauseam, but it’s necessary to remind these new airplane-naysayers. The MAX 7 is a sales dud. The MAX 9 isn’t far behind. And the MAX 10 is uncompetitive with the Airbus A321neo family.

The only MAX that has a bright future is the MAX 8. Boeing can’t rely on the MAX 8 for its future in the 125-240 seat sector.

Read more

Pontifications: The New Air Force One: Flying Fortress

Feb. 14, 2021, © Leeham News: Air Force One is, after the national flag, the most recognizable and prestigious symbol of the United States.

By Scott Hamilton

It’s also shrouded in mystery.

A new National Geographic special premiering Feb. 15 lifts the veil, at least partially.

NatGeo was granted unprecedented access to the development of the new airplanes, two Boeing 747-8s, that will replace the 30-year old 747-200s that serve as Air Force One.

Read more

Pontifications: Boeing’s right direction, but don’t get ahead of reality

By Scott Hamilton

Feb. 8, 2021, © Leeham News: Boeing appears to be heading in the right direction: launch a new airplane program to take care of its 737 MAX product weakness. And do something different by pursuing the “NMA Lite” concept: a twin-aisle, three-member family starting at ~185 seats through ~250 seat and up to 5,000nm in range.

But don’t get ahead of ourselves on the NMA Lite. There are a lot of Ts to cross and i’s to dot.

And anything can change between now and a concerted effort to survey customers, prepare the supply chain and ask the Boeing Board for Authority to Offer the NMA Lite for sale.

Importantly, a three member family dramatically expands the potential market. Publicly, Boeing said the market for the NMA is about 4,000. Internally, officials knew it was more like 2,100—with Airbus capturing perhaps half.

With a third member, demand increases by roughly 7,000.

It’s tough to make a business case for 1,050 airplanes. It’s much easier for 4,550.

Still, this is the best news I’ve seen come out of Boeing in years. Even pre-dating the MAX ground. And pre-dating the COVID pandemic.

Read more