Leeham News and Analysis
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A380neo becoming a reality
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Introduction
We last looked at the Airbus A380 economics in February, when the airframer was promoting the giant airplane as a 525 seater. Since then, Airbus recast the airplane as a 555 seater. This changes the economics somewhat. Further, Airbus is floating an 11-abreast coach configuration vs the out-of-the-box 10 abreast.
Tim Clark, president of Emirates Airlines, continues to press for a re-engined A380. In our companion Assessment of the Very Large Aircraft market, consultant Michel Merluzeau believes Airbus will re-engine the airplane.
So do we.
It has been pretty clear to us that Airbus will do an A380neo. The question is when. Emirates’ Clark last month predicted the decision would be taken within six month. Our latest Market Intelligence says he will be right; we understand that Airbus is right now preparing for an A380neo project.
Summary
We thereby see the time ripe for looking into the A380neo again. When we last covered the subject (Updating the A380: the prospect of a neo version and what’s involved, Feb. 3, 2014) we concluded:
• The present configurations for the A380 of 525 seats fills the A380 to a much lower density than is the norm today.
• A cabin configuration of 555 seats would be a realistic three-class configuration with the economy section on the lower deck still in a spacious 10 abreast with seat width at 19 in.
• The efficiency of the A380 filled to that low density was on par with the best per seat benchmarks in the industry, the Boeing 777-300ER with the economy section in a tight 10- abreast, 17- inch configuration.
• The best in market benchmark would move considerably when the Boeing 777-9X enters service 2020. The per fuel seat cost would then we almost 20% lower than today’s A380.
Today our article shows:
• A re-engined A380neo, with other improvements typical in such an endeavor, reclaims the per-seat advantage for the A380.
When re-running the data in our proprietary model, we have more and better data around the likely engine variant, the Rolls Royce Advance, which was announced by Rolls Royce in March. It will be available for an A380neo rolling off the production line 2020. We have also put in more work into our standardized cabins, adjusting the relationship between premium and economy seating to a ratio closer to the one airlines use today. Airbus has also been active on the A380 cabin side. It has had several studies how to better utilize the cabin space in the A380. The results are now presented to the market.
In a recent A380 update, Airbus showed an 11-abreast main economy cabin with 18 in seats, now without raising the cabin floor to fit the seats. By adjusting how the seats interfaces the cabin’s sloping walls, Airbus avoids changing the floor height in part of the cabin.
We will now use this latest data to check where an A380neo would stand in terms of efficiency against the Boeing 777-9X, its most difficult competitor when it comes to the cost of transporting passenger from A to B. In later articles we will look at a more complete cost picture and also look at the A380’s strong side, the revenue and yield when one can fill the aircraft. Read more
Part 1–Boeing 757: An analysis of facts and myths
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By Bjorn Fehrm
Part 1 of 3
Introduction
The Boeing 757 was developed in the late 1970s as a replacement for Boeing’s popular 727 mid-range single aisle aircraft. Starting from the smaller 727, it ultimately grew to 180 to 230 seat capacity and US transcontinental range. With initial orders from Eastern Airlines and British Airways, the aircraft nonetheless had poor sales through most of the 1980s, picking up with a surge of orders in 1988-1990 when major deals were announced from American, Delta and United airlines.
Figure 1. Boeing 757-200 of launch customer Eastern Airlines.
Following the 1991 Persian Gulf War and recession, orders plunged until the mid-decade with a respectable resurgence. After 9/11, sales dried up and Boeing terminated the program.
Summary
- The 757 program had slow sales in its first decade, robust sales for a few years then declining sales through most of the 1990s.
- Sales were respectable in the late 1990s but dried up after 9/11.
- Boeing efforts to boost sales with the 757-300 were a failure–only 55 were sold. 757F sales were a moderate success.
- The 757-200 had strong engines for its time (especially the Rolls Royce equipped models), we dissect if this is still true.
- With the 757 being the only narrow-body with trans-Atlantic range, what is missing from today’s Airbus A321 and Boeing 737 MAX9 to make the cut? What can be done with small changes will be answered in part 2.
- How will a future clean sheet NSA perform compared to these three? How much of a game-changer will a clean sheet design be if it enters service 2025? We look at the answers in part 3.
Embraer’s big bet on its largest airplane yet
Introduction
Embraer is days away from the roll-out of its biggest airplane project yet and one that has the potential to make its biggest inroads yet into the global defense market: the KC-390.
Rendering of KC390 tanking two Embraer AMX fighters. Source: Embraer
The airplane, with a fuselage cross-section the size of the Boeing 767, challenges the Lockheed Martin C-130, a venerable aircraft that has been updated throughout the decades since it first entered service in 1956. Despite this modernization, Embraer believes the time has come for a modern design and a multi-mission capability that far surpasses that of the C-130, with higher productivity of a jet aircraft vs a four-engine turbo-prop.
KC-390 3D view with main data. Source: Leeham Co
Summary
- Embraer sees a market for 728 KC-390s in 77 countries, excluding the US, Russia, China and Europe.
- The KC-390 is half the price of the Airbus A400M and about the size of the Lockheed Martin C-130.
- Launched with paid development and an order for 28 aircraft from Brazil to fulfill the country’s unique requirements.
- Typical mission capabilities will be: Cargo 7 pallets, Displacement of 80 soldiers, air dropping of 86 paratroopers, transporting 1 Black Hawk helicopter or one LAV25 or 3 Humvees, Rescue missions, Air tanking of 2 aircraft or helicopters.
- The KC-390 flies at M0.8 and will therefore finish missions in two thirds the time of the C-130 Hercules (which flies as M0.5). This will also result in more missions flown per day i.e. more airlift capacity.
Odds and Ends: 737 rate hike on cash flow; How the Chicago ATC fire impact unfolded; New PW engine chief
737 rate on on cash flow: The Seattle Times has a good article that described the impact on cash flow the decision by Boeing made to boost 737 production to 52/mo in 2018. The rate hike comes at a time when we believe production rates on the 777 Classic will be bottoming out to perhaps as low as five per month, which of course will negatively affect cash flow at Boeing.
We expect Boeing to further increase production rates of the 737 in 2019. The 777X production will just be in its infancy, with entry-into-service planned for 2020. (Information continues below the picture.)
Later this month, we will unveil a new, updated Leeham News and Comment with a combination of paid and free content. Watch this space for more information.
The decline in production rate of the 777 Classic, which we think will happen in 2017 and a like rate reduction for the 747-8, which we believe will occur as early as 2016, represents the reason why Wall Street analysts are turning more and more bearish on Boeing stock.
Odds and Ends: Comparing Airbus, Boeing 20-year forecasts; A320neo first flight; 787 battery probe fizzles; Mythbusting
Airbus v Boeing forecasts: The Blog by Javier takes its annual look at and comparison of the Airbus and Boeing 20-year forecasts. Airbus issued its new forecast this week; Boeing’s annual update was issued last summer.
Separately, the A320neo with Pratt & Whitney engines made its first flight today. The CFM LEAP neo is supposed to follow by six months. Showing class, Boeing Tweeted a congratulations for a milestone for the industry.
787 battery probe: The US National Transportation Safety Board hasn’t been able to find the root cause of the lithium ion battery failure in the Japan Air Lines and ANA Boeing 787 incidents. Now, the Japanese investigation has also failed to find the root cause of the ANA battery meltdown.
It’s rare but not unknown for investigators to not find root causes of problems, sometimes for years. A Northwest Airlines Boeing 747-400 split rudder hard over during a flight from Anchorage to Tokyo is one example; it took four years to determine the cause. The root cause of Boeing 737 rudder hard-overs, two of which caused fatal accidents, went unsolved for years.
Boarding airplanes: The reality show Mythbusters, an often entertaining look at myths, conventional wisdom, fact and fiction, takes a deep dive into airplane boarding. The article, with an insert to the episode, is here.
The Southwest Airlines style of boarding, with no seat assignments and derisively called cattle-call boarding, is the fastest and the most annoying, according to Mythbusters. Back-to-front is the longest. The Window-Middle-Aisle works best (but for those of us who like the aisle seat, the overhead bins are usually stuffed by then).
ISTAT Europe Conference in Istanbul: Boeing and Airbus slugging it out with some new twists
Airbus and Boeing squared off once again Monday, this time at the ISTAT Europe conference in Istanbul, once again pretty much over the entire product lines.
Boeing’s VP Marketing Randy Tinseth began with two focal points, the 737 with its latest developments and Boeing’s “superior” Twin Aisle line-up. Tinseth claimed Boeing has caught up to the A320neo with the 737 MAX.
After an A320neo head start of a year, Tinseth says Boeing has kept the same sales rate per year for the 737 MAX. The backlog of 737 MAX now stands at 2,300 aircraft and he described why Boeing thinks it is well positioned in this market segment.
Odds and Ends: KC-46A update; A440M in the US; A320neo first flight; Southwest no longer an LCC
KC-46A update: Aviation Week has an update on the status of the Boeing KC-46A tanker. Among other things, first fight has now been moved from June to November at the earliest.
A400M in the US: Airbus thinks it’s possible to sell hundreds of its A400M to the US Armed Forces to replace the Lockheed Martin C-130 and Boeing C-17, according to this article by Reuters.
A320neo first flight: Is the Airbus A320neo first flight going to run behind schedule? Airbus won’t say but Reuters suggests that it might. So does Aviation Week, like Reuters, pointing to an issue with the engine.
Southwest no longer an LCC: Bloomberg writes that Southwest Airlines is no longer a low cost carrier, with Cost per Available Seat Mile now approaching the legacy carriers. Years ago we characterized Southwest as the first legacy LCC, as costs increased, low fares began to disappear (it’s often easier to find a low fare on a competitor today) and routes took it into big city airports previously eschewed.
Leeham News launches Premium plan, companion to free content; engineer joins staff
Free content.
Leeham News and Comment (LNC) today launched a Premium subscription plan as a companion to free content.
LNC has provided news and commentary since February 2008, providing industry-leading information and insightful analysis, principally focuses on Airbus, Boeing, Bombardier and Embraer but also including emerging challengers to the Big Four OEMs, the leading engine manufacturers, suppliers and airline news.
LNC has been a leading resource of news and comment throughout the commercial aviation industry and its professional followers in the aerospace supply chain, investment analysts and the media.
Since the first of this year, LNC increasingly provided more and more technically-based content. This content is valuable and supplements the industry-leading news and reporting that has been provided since 2008. We are pleased to announce the addition to our staff, Bjorn Fehrm, who focuses on technical evaluation and complements the strategic expertise of Scott Hamilton, the founder of LNC and Leeham Co. consultancy.
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Posted on October 14, 2014 by Scott Hamilton
Airbus, Airlines, Boeing, Bombardier, CFM, Comac, Embraer, Irkut, Mitsubishi, Pratt & Whitney, Rolls-Royce, Sukhoi
737-9, 757, 757 replacement, A321NEO, Airbus, Bjorn Fehrm, Boeing, Bombardier, CFM, Comac, Embraer, Irkut, Leeham News and Comment, Mitsubishi, Pratt & Whitney, Rolls-Royce, Sukhoi