Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Boeing CEO promises company is turning around…again April 24, 2024
- Solid start for stand-alone GE Aerospace despite cuts to LEAP output April 23, 2024
- SPEEA, Boeing at impasse over safety program, union says April 23, 2024
- Better transparency needed on Boeing’s 1Q earnings call April 22, 2024
- Bjorn’s Corner: New engine development. Part 4. Propulsive efficiency April 19, 2024
Pontifications: “Sully” sullies NTSB
By Scott Hamilton
Sept. 12, 2016, © Leeham Co.: Sully, the movie about the miracle of the successful water landing of US Airways 1549 on the Hudson River in New York City, sullies the National Transportation Safety Board.
Apparently not content with the gripping drama of the flight’s emergency itself and the dramatic rescue of all 155 souls on board, the movie gins up an NTSB out to hang Capt. Chesley Sullenberger (Sully) and co-pilot Jeffrey Skiles.
Pontifications: Odds and Ends to end the summer
By Scott Hamilton
Sept. 5, 2016, © Leeham Co.: August was unusually slow, so today is sort of an Odds and Ends clean-up of the summer.
There was the Southwest Airlines engine incident and the reports that ANA’s Boeing 787s have engine issues, but I wrote about these last week.
Today, the Odds and Ends include more on the Mitsubishi MRJ; Airbus deliveries; sales campaigns and other stuff.
Pontifications: “Troubled” 787 is a thing of the past
LNC has been beset by technical issues since Aug. 17 that interferes with e-mail notification as well as links to Twitter, Facebook and Linkedin. We’re working on it with Wordpress.
By Scott Hamilton
Aug. 29, 2016, © Leeham Co.: Faulty engines dominated commercial aviation news last week.
First was ANA’s Boeing 787s were hit by issues with its Rolls-Royce engines. Corrosion was found on key engine parts. ANA cancelled flights to inspect and repair the engines.
Unfortunately, some media characterized the matter as the “latest” to hit the “troubled” 787. The London Telegraph is one example.
This characterization, of course, refers to the history of the 787 with its design and production challenges and later by the grounding from the lithium-ion battery fires.
Pontifications: Mitsubishi ramping up flight testing for MRJ
By Scott Hamilton
Aug. 15, 2016, © Leeham Co.: Mitsubishi Aircraft Corp. (MAC) is about to dramatically ramp up its flight testing of the MRJ-90.
Media has been alerted to an all-day event next month, complete with a tour of the Moses Lake (WA) facility, where test airplanes will be based.
The program is two years behind schedule for the brand new design, the first commercial airliner produced by Japan since the YS-11 turboprop more than 50 years ago.
Pontifications: Twelve new designs in 10 years spurred orders
By Scott Hamilton
Aug. 8, 2016, © Leeham Co.: The book:bill for Airbus and Boeing this year will be hard-pressed to reach one. Airbus has a better shot, given lower production rates. But the recent years of record-setting orders are over for now.
Unlike some, this doesn’t represent a bursting bubble to LNC. Rather, it’s a natural progression of the cycles that are historically seen.
It’s necessary to put some context into the recent years of these unprecedented number of orders.
Pontifications: Boeing is back
By Scott Hamilton
July 4, 2016, © Leeham Co.: It’s looking like all the pain and agony of the 787 development is behind Boeing. (Except for the deferred production costs, of course.)
Boeing is back into airplane development mode.
To be sure, only one of these is a new airplane. The others are derivatives. But at least Boeing seems to be on the move after slowing the train (to mix the metaphors) considerably following the 787 debacle.
Pontifications: Time to calm down from last week’s news cycle
By Scott Hamilton
June 27, 2016, © Leeham Co.: Last week turned out to be one of the busiest in aviation in quite some time.
- Details of the Iran Air Boeing “order” emerged. Everyone overlooks that this is really a “Memorandum of Agreement,” which is subject to who-knows-how-many contingencies.
- Frothing occurred over news that Volga Dnepr (Air Bridge Cargo) may firm up 10 orders for the 747-8F, an MOU announced at the Paris Air Show last year, at this year’s Farnborough Air Show. This, along with the Iran Air “deal,” was viewed as savior for the 777 Classic and 747-8 lines. Not so fast.
- Southwest Airlines announced it’s deferring 67 Boeing 737 MAX deliveries until well into the next decade. This prompted some to claim this is a harbinger of bad things to come for Boeing.
- Brexit was viewed as a disaster for the global economy, Airbus, Boeing, Europe’s airlines and all mankind.
As you can see from my sarcasm, I disagree with each of these. Here’s why.
Pontifications: Airbus CXLs A320, A350 August vacations
By Scott Hamilton
June 20, 2016, © Leeham Co.: Airbus officials canceled the annual August vacations in Europe for the A320 and A350 production lines.
The A320neo and A350-900 are backing up on the delivery lines because of supplier issues with the Pratt & Whitney GTF for the former and galley and lav issues from Zodiac for the latter.
Qatar Airways Airbus A320neo awaiting new-production Pratt & Whitney GTF engines with fixes incorporated. Photo via Google images.
The delays and issues are well documented in the press and for aerospace analysts.
“I cannot confirm that rumor for you,” an Airbus spokesman wrote LNC in an email. “I can tell you that we are putting in place extra resources to deliver on our 2016 commitments and objectives in terms of deliveries, but we are not going into detail on what that looks like at this stage.”
Pontifications: GTF faces steep learning curve on costs
By Scott Hamilton
June 13, 2016, © Leeham Co.: The current cost to build the new Pratt & Whitney Geared Turbo Fan engine is $10m per engine.
Greg Hayes, CEO of United Technologies. Photo: Hartford Courant via Google images.
This has to come down by a factor of five, said Greg Hayes, the CEO of United Technologies, parent of PW.
This also illustrates the learning curve experienced by engine OEMs, a topic frequently discussed by the airframe OEMs but not so much by the engine manufacturers.
Hayes made the remarks at the UTC Media Day in Hartford (CT) last week. UTC is the parent of Pratt & Whitney, United Technologies Aerosystems (UTAS) and other non-aviation companies.
Pontifications: The Bottom Line isn’t always about The Bottom Line
By Scott Hamilton
June 6, 2016, © Leeham Co.: Sweetheart deals to win strategic aircraft orders are nothing new in commercial aviation.
John Leahy, COO-Customers for Airbus, last week poked Bombardier for its order from Delta Air Lines. Citing a reported airplane sales price of $22m, which Leahy estimated cost BBD $7m per airplane, Airbus’ chief salesman—known for his barbs and quips—said if BBD sold more C Series faster, the company would go out of business quicker.
Set aside for the moment the numbers he cited as unknown quantities. LNC has different figures we’ve reported and in two posts on my column at Forbes, here and here, there are other aspects to the Delta deal that affect economics.
It’s undisputed that BBD took a US$500m charge against the Delta, Air Canada and AirBaltic deals. The second Forbes post explains why. It’s all about the learning curve. Airbus and Boeing know about this: the first A350s are being chalked up to big losses and the 787 has $29bn in production costs. But it’s not to their benefit to acknowledge this when criticizing the C Series deals.
All this is neither here nor there, however. Airbus, Boeing and McDonnell Douglas all have (had) done deals that don’t seem to make commercial sense when key, strategic transactions were necessary.