Leeham News and Analysis
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Leeham News and Analysis
- Bjorn’s Corner: Air Transport’s route to 2050. Part 25. June 6, 2025
- New RISE powerplant benefits from decades of GE research and development June 5, 2025
- Engine makers emphasizing durability, reliability June 4, 2025
- Boeing CEO: Lessons learned are key to certification of 737-7/10 and 777X June 2, 2025
- Digital twin is a key to JetZero’s hopes for Blended Wing Body entry June 2, 2025
Bjorn’s Corner: What did we learn in 2015; engines
By Bjorn Fehrm
15 January 2016, ©. Leeham Co: Last week we looked back on what happened in 2015 on the airframe front. We finish the retrospective by looking at what turbofan engine technology came to market in 2015. New engine technology is vital, as it is on the engine side that the quest for higher fuel efficiency has the largest successes.
While advances on the airframe side might bring an additional 5% per generation, the engines typically increase their efficiency per new generation with up to three times that value. Fuel efficiency per delivered thrust unit was improved with a whopping 15% over the engine it replaces for the Pratt & Whitney Geared Turbofan (PW GTF). It was certified for use on the Airbus A320neo in Q4 2015
The competing CFM LEAP-1A shall deliver the same improvement level to the A320neo once it is certified in the summer of this year. This engine has a smaller sister that started ground tests last year, the LEAP-1B, which is developed for the Boeing 737 MAX series.
The engine that is easily forgotten is the Rolls Royce Trent XWB. It entered service on the Airbus A350-900 during the year. It brings an improvement level of around 10% compared to the engines of the aircraft that the A350 replaces (Airbus A340/A330ceo and Boeing’s 777-200 range).
Airbus annual press conference 2016
By Bjorn Fehrm
Introduction
12 January 2016, ©. Leeham Co: Airbus held its annual press conference in Paris today against a backdrop of record 2015 deliveries. The year that went past was consequently a good one for Airbus. Orders were at a record high for the third year in succession and deliveries exceeded previous years for the 13th year in succession.
But the Airbus sky wasn’t totally cloud free; the large A380 only got sales by having ANA mop up the mess after Japan’s Skymark bankruptcy and production of the new A350 was hindered by a sole source lavatory supplier.
The result was that Airbus missed two 2015 delivery targets, the 15 per year for A350 (delivered 14) and the 2016 delivery of the first A320neo. The latter was because of “paperwork issues” related to certain things being “late to finish” ahead of certification. Read more
Bjorn’s Corner: What did we learn in 2015?
By Bjorn Fehrm
08 January 2016, ©. Leeham Co: It’s the first Corner for the year and a look at 2015 as a year of technology advancements is due. 2015 will be remembered as the year when three clean sheet airliners passed important milestones. This will not happen for many years to come, so it will be worth to look at what they brought to world of aviation.
I’m thinking of Bombardier’s (BBD) CSeries getting certification for its first variant; the Mitsubishi MRJ doing its first flight’ and COMAC’s C919 being rolled out. Going forward, we will only have derivatives progressing through such milestones for years except for the roll-out of United Aircraft’s MS-21 single aisle airliner in 2016.
The Airbus A320neo was certified in 2015 and Boeing’s 737 MAX rolled out, but these are derivatives of in-service aircraft.
Embraer’s E-Jet E2 will roll out in February but this is a further development of today’s E-jet and Airbus A350-1000 is a variant of the in-service A350-900.
It will be a long time before we see so much new in a year, so it can be instructive to look at to what extent did these new aircraft bring the state of the art of airliners forward.
How good is a used 767-300ER? Part 4
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By Bjorn Fehrm
Introduction
Jan. 6 2016, ©. Leeham Co: We now finish our series of acquiring a used Boeing 767 aircraft to upgrade a Boeing 757-based long haul service. The 767 went out of favor recently as it has higher fuel consumption per seat than competing aircraft like Airbus A330-200.
With today’s low fuel prices and favorable used prices, a well kept 767-300ER is once again an interesting long haul aircraft. In previous articles, we looked at different aspects of the 767-300ER compared with the A330-200. First we compared the aircraft’s characteristics (Part one), then Cash Operating Costs (Part two) and finally Direct Operating Costs (Part three).
We now finish the series with a revenue and margin analysis. First we establish the competitor’s payload carrying capabilities over a trans-Atlantic network. Then we calculate their revenue capabilities using standard yields (revenue per load unit). The revenue and cost data then gives us the operating margins for the aircraft.
Summary
- The 757 has the lowest costs but is considerably more limited in its payload and range capability than the 767 and A330. Its lack in capacity is augmented by a lack of cargo handling facilities.
- The 767 has a cargo handling concept, unfortunately with the wrong container standard, LD2. The alternative is pallet based freight, which works well for the 767.
- The A330-200 has the best passenger and cargo transporting capability. This compensates for its higher Direct Operating Costs but the low fuel prices keeps the 767 in the hunt.
How good is a used 767-300ER? Part 3
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By Bjorn Fehrm
Introduction
Jan. 4 2016, ©. Leeham Co: Before Christmas we started our Boeing 767-300ER article series around acquiring used twin-aisle 767 aircraft to upgrade Boeing 757-based long haul services. We compared the aircraft’s base characteristics in Part One and then their Cash Operating Cost (COC) in Part Two.
Now we continue by analyzing the Direct Operating Cost (DOC) of the aircraft. This adds capital costs to the other operating costs for the aircraft. As the reason for our renewed interest in the 767-300ER is the attractive prices on the used market combined with low fuel prices, the capital costs are an important part of the overall understanding of the costs for the aircraft.
In our assumptions, the 767 is bought as a 10 year old aircraft and then refurbished. It is then operated on a six year financial lease, as is our 757 that we replace. Our benchmark aircraft, the Airbus A330-200 flying in a mainline airline, was bought new in 2009 and is operated on a 10 year financial lease.
Summary
- The low capital costs of the 767-300ER makes it cost competitive in the fuel scenarios that are likely within its six year lease period.
- The 757-200W has fractionally lower direct seat mile costs than the 767, but it has lower capacity and its more limited range reduce its operational usefulness.
- The A330-200 has the best operational flexibility but its higher capital costs makes it the most expensive aircraft to operate in the period of interest.
- In a final article, we will add the revenue capability of the aircraft. This is where the A330-200 gets the chance to show if it can cover its higher direct costs with its higher earnings capability, thereby generating more value for the airline.
CS100 certified; We review CS100’s birth with VP CSeries, Rob Dewar
Introduction
By Bjorn Fehrm
21 December 2015, ©. Leeham Co: Bombardier (BBD) received certification of the smaller CSeries, the CS100, by Transport Canada Thursday. Rob Dewar, vice president of CSeries, reflected on the journey to certification in an exclusive interview with LNC.
CSeries VP Rob Dewar with CS100 Certificate. Source: Bombardier.
The interview was done against a backdrop of more than two years of delays, which in turn drained the coffers of BBD. To save the project and let it prove its game-changing character, management sold 49.50% of the CSeries program to the Province of Quebec for $1bn and 30% of its train division to Caisse de dépôt et placement du Québec, for an additional $1.5bn.
Dewar has managed the project from the program launch in 2008. The transcript of the interview follows.
How good is a used 767-300ER, Part 2
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Introduction
By Bjorn Fehrm
Dec. 21 2015, ©. Leeham Co: Last week we started our Boeing 767-300ER article series around acquiring used twin-aisle 767 aircraft to upgrade 757-based long haul services, like Canada’s WestJet has done. We compared the aircraft and looked at the base data for the aircraft in article one.
Now we continue by analyzing the Cash Operating Cost (COC) of the aircraft in a typical long haul configuration, using our normalized seating. We are assuming that the 767 and the 757 are a half-life state between overhauls of engines and airframe.
Our benchmark aircraft is an Airbus A330-200 which is flying in a mainline airline. Here we assume that it is 25% deteriorated since new for engines and airframe.
Summary
- The 767-300ER and A330-200 differ in fuel and crew costs per seat mile but are close in most other cost items for COC.
- The 757-200W has lower fuel operating and crew costs than a 767 for the sectors it can perform. It is more expensive in maintenance and landing/underway fees on a per-seat basis.
- Overall the 767 is sufficiently within range of the A330-200 for cash operating costs so that when we add capital costs, it could be close to a draw.
- Finally, we will look at the earnings capabilities of the aircraft by adding standard yields for the payloads the aircraft can carry.
How good is a used 767-300ER?
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By Bjorn Fehrm
Introduction
Dec. 16 2015, ©. Leeham Co: Fuel prices at a record low changes a lot of short- and mid-term planning scenarios for airlines. An introduction of a used aircraft with higher fuel burn for a typical lease period of five to six years is possible without endangering the airline’s economics.
The risk of oil prices going sky high in such a period is low, hence the attractiveness of complementing ones fleet with leased older aircraft like Canada’s WestJet has done. It will introduce ex. Qantas 767-300ERs on several traditional 757 destinations like Hawaii and presumably West Europe.
We therefore expand our in dept look of the deployment of used aircraft with a look at the WestJet choice; Boeing’s 767-300ER and compare it to a more contemporary twin, Airbus A330-200.
Summary:
⦁ The 767-300ER is around 25 seats smaller than our benchmark aircraft, the more modern A330-200.
⦁ The A330-200 previously put the 767 under pressure and Boeing responded with the 787-8. We will check if this is still the case when oil is below $40 a barrel and leasing cost for a used 767 is below $300,000.
⦁ We will also check what load-factors an airline like WestJet has to attain on the 767 to reach the same seat-mile costs as for the 757 that the route was up-gauged from.
⦁ We will follow the scheme of the 777-200ER vs. A340-300E comparison, Part 1 compares the aircraft, Part 2 the costs and Part 3 the revenue and margin performance of the aircraft.
4-engine single-aisle airplanes could make comeback, says technology VP
Dec. 15, 2015, © Leeham Co: LNC’s Bjorn Fehrm started a firestorm of discussion last Friday with his Corner about twins-vs-quads column. His focus was on the Very
Could a four-engine, single-aisle airliner make a comeback? It’s something that might be possible. Photo via Google images.
Large Aircraft sector. Overlooked in all of the discussion was a piece of information LNC wrote April 6 from an interview with Alan Epstein, VP of technology and environment of Pratt & Whitney, in which he mused that quads could make a comeback—on smaller airplanes.
The original article was behind our Paywall, but the Summary with this reference was in the freewall portion. We’ve now opened the article to full freewall and it may be found here.
Pontifications: Looking ahead to 2016
Jan. 4, 2016, © Leeham Co. Let’s take a walk through our outlook for 2016.
Boeing is 100
There will no doubt be all kinds of celebrations at the Air Show. To the extent possible, I would imagine Boeing will try to have a whole lot of orders to announce there. There will be all kinds of run-up to the 100th anniversary. Few throw a party as well as Boeing. (Just don’t sing “Happy Birthday;” I never have liked this song.)
It’s a great achievement and we should all celebrate with Boeing for the next seven months.
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Posted on January 4, 2016 by Scott Hamilton
Airbus, Boeing, Bombardier, Comac, Farnborough Air Show, Leeham News and Comment, Mitsubishi, Pontifications, Pratt & Whitney
747-8, 777 Classic, A380, Airbus, Boeing, Bombardier, C919, Comac, CS100, CS300, CSeries, Farnborough Air Show, Mitsubishi, MRJ90, Pontifications, Pratt & Whitney