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
Boeing faces 737 production gap: analysis
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Introduction
Sept. 2, 2015, (c) Leeham Co. Boeing faces a production gap for the 737, based on an analysis of the delivery streams of the 737NG and the 737 MAX.
There’s a production gap for the Boeing 737 more than 100 airplanes, according to a Leeham Co. analysis. Boeing photo.
While focus of Boeing production gaps has been on the 777 Classic and, to a lesser extent, the 747-8, few have analyzed the production gap for the 737 line. Boeing announced rate increased from 42/mo to 47/mo in 2017, the year the MAX enters service, and again to 52/mo the following year. The company is studying taking rates even higher, to 60/mo, by 2020. Boeing cites a large backlog and continued demand for the 737 for boosting production rates.
But Market Intelligence indicates emerging concerns about the gap.
Summary
- We see a gap of perhaps 100-200 737s in 2017 and 2018, even as the 737 MAX is “feathered” into production of the 737NG.
- Beyond 2018, the apparent gap depends largely on the delivery stream of Unidentified MAX customers accounting for nearly 600 orders identified by the Ascend data base. Boeing lists just over 1,000 Unidentified 737 orders through July (August figures aren’t out yet), sharply higher than the Ascend data base.
- The current low fuel price environment is a concern.
Boeing’s 767 revitalized as a MOM stop gap, Part 2
By Bjorn Fehrm
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Introduction
Aug. 31 2015, ©. Leeham Co: Last week we started to look at Boeing’s 767 to see if it can serve the passenger and range space which is not well covered by modern aircraft: the 225 passenger/5,000nm sector. Boeing calls this the Middle of the Market or MOM. Boeing recently said that there is some increased interest for the 767. We analyze why and what can be done to increase any chances of it having a new life as a passenger aircraft.
We started with comparing the 767’s different variants to the most likely MOM aircraft from our series “Redefining the 757 replacement requirement for the 225/5000-sector”. We will now continue and look at the 767 in detail, its strong suits and its less efficient areas. We will also discuss what can be made to address the less efficient areas.
Summary:
- Boeing’s 767 has the right cross section for passenger transportation in the 225 passenger/5,000nm segment.
- It also carries cargo containers, not as efficiently this time. We show what the consequences are.
- Finally the wing is not the slender wing of the modern aircraft. We show what impact it will have on overall efficiency.
- Combined with engines from the 1990s, this gives less than stellar fuel economics. We investigate what can be done about this and how much of an impact it will have in today’s low fuel prices.
Boeing’s 767 revitalized as a MOM stop gap?
By Bjorn Fehrm
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Introduction
Aug. 27 2015, ©. Leeham Co: In our Monday article, “Boeing sees healthy future for 767,” Boeing’s spokesperson said, “We are continuing to explore additional capabilities and improvements” for the 767. It was not clear what these improvements were other than a 0.5% engine performance improvement package (PIP) that was introduced earlier in the year. With lower and lower fuel prices, existing aircraft get more and more viable as a stop gap to cover market segments that today are not part of the plans for the OEM’s modern products.
We will therefore examine the 767 deeper to understand what can be improved further and how well such an improved model would serve as a stop gap replacement for the lack of a modern Middle of the Market (MOM) aircraft. We explored how a MOM aircraft should look like in our series, “Redefining the 757 replacement requirement for the 225/5000-sector”.
The 767 has several of the attributes that we found optimal for a MOM aircraft, one having a seven abreast cabin cross section. In the 767 variant that is being produced for the US Air Force tanker program, the 767-200ER, the overall fuselage dimensions are also close to the ones we found desirable for a MOM aircraft.
With fuel now well below $2.00 per US Gallon (about $1.35), we will compare the 767 to our MOM specifications and try to understand where there is a fit and what would needed to be changed to improve the 767’s efficiency so that it could serve as a MOM stop gap. Finally, we will check if such changes can be economically viable in different fuel price scenarios.
Summary:
- Different to the 757,the 767 is still produced for the foreseeable future, thanks to the US Air Force tanker program.
- Boeing 767 is the only produced aircraft that has the desired seven abreast cabin, which we found optimal for a MOM aircraft.
- How does the 767 fuselage and wing compare to the ones we found desirable for the MOM?
- Is the cargo capability of the 767 acceptable for a MOM role?
- We explore the primary characteristics in our first article today. We will go deeper with technical and economical analysis in subsequent articles.
Six year turnover in sale/leasebacks put supply-demand balance at risk
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Introduction
August 24, 2015, © Leeham Co. When airlines like Indigo of India, Air Asia, Norwegian Air Shuttle (NAS) and Lion Air have outstanding orders for Airbus A320s and
Boeing 737s that number in the hundreds, far more than operations and growth appears ready to support, the deals raises the natural question: What are they thinking?
As LNC’s Bjorn Fehrm explained Friday, one aspect of these big orders is to “flip” the aircraft every six or seven years, a time that roughly coincides with the maintenance holiday/warranty period. Sale/leasebacks are used to finance these huge purchases.
The practice is hardly new. The USA’s JetBlue Airlines, Ryanair and others practiced this flip for years.
Carriers like the new LCCs mentioned above not only plan to do so to avoid major maintenance costs, but also to fuel their growth. In the case of Lion Air and NAS, these companies also plan to lease out aircraft to other airlines.
But there remain risks involved for the companies and for the industry.
Summary
- The growing practice of flipping aircraft every six or seven years presents risks to lessors.
- Indigo Airlines has 96 aircraft in service, 430 on order.
- Select LCCs in Asia, Europe, India have 1,000 A320s, 737s on order.
Airbus’ and Boeing’s Payload/Range for VLAs
- Bloomberg reported this week that Airbus is now offering the A350-900LR to Singapore Airlines to reopen ultra-long haul US direct routes. We predicted July 14 that Airbus would offer the LR. We offered some high-level analysis about how Airbus could achieve a long range version of the A350-900; the Bloomberg piece confirms our analysis.
By Bjorn Fehrm
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Introduction
Aug. 19 2015, ©. Leeham Co: We will now finish our series over Boeing’s changes to its configuration rule sets by looking at how this affects the Very Large Aircraft (VLA) segment.
Airbus and Boeing used to describe the VLAs in their line-ups using three class cabins, albeit with different standards. Now Boeing has changed its standard to a modern three class seating while Airbus has changed to a four class cabin, including premium economy.
We have enough information of the A380 equipped with a three class cabin to be able to make a comparison using three class rule sets. We will therefore apply a three class cabin to the A380 and 747-8 that will have modern seating standards and pair that with Boeing’s tougher payload weights and enroute reserves.
Summary:
- Boeing’s new Standard rules three class cabin and our normalized three class cabin for A380 and 747-8i are close in their configurations.
- We use our knowledge of these standards to create a level playing field on the cabin side.
- We also apply the new tougher passenger and bags rules + the tougher reserves policy that Boeing’s new Standard rule set prescribes.
- It used to be that A380 had a range advantage at max passenger payload. We check if this remains under the new rules.
Airbus’ and Boeing’s Payload/Range for Dual Aisle.
By Bjorn Fehrm
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Introduction
Aug. 17 2015, ©. Leeham Co: In our series over Boeing’s changes to its configuration rule sets, we will now continue with the dual aisle aircraft. Here the differences between Airbus and Boeing are larger. Boeing used to be specifying a three class cabin and Airbus two class. Now Boeing has changed to two class and Airbus is just changing to three class.
There is a bit of difference in the Airbus change to three class and the three class that Boeing had until now. Airbus changes from modern two class to a modern three class with Business, Premium Economy and Economy. Boeing’s change was from an outdated three class with old style First, Business and Economy to a modern two class with lie flat business section.
The new Boeing two class and historical Airbus two class are close in configuration. These end up within a seat or two of each other and also within our normalized two class cabins. As these cabin rules are similar, we use our normalized cabin data to compare the payload range of the aircraft when all apply the new, tougher passenger+bags weight rules and an equalized reserves policy.
Summary:
- Airbus’ two class rules and Boeing’s new two class Standard rules are close in their configurations.
- They are also close to our Normalized rule set. We use our normalized rule set to level the playing field on the cabin side.
- We can then apply the new tougher passenger and bags rules that Boeing’s Standard rule set prescribes for the twin aisle aircraft and see how they compare.
- We also use the same reserves policy for the comparison. Read more
Airbus’ and Boeing’s Payload/Range for Single Aisle
By Bjorn Fehrm
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Introduction
Aug. 13 2015, ©. Leeham Co: Boeing this month changed the way it presents its aircraft in important areas like seating, weight and performance configurations, in short its “rule set.” After using a standardized but old rule set for 20 years, it updated all data around how far its aircraft can transport a standardized payload.
Airbus at the same time is also changing how it presents its aircraft. Right now the dual aisle wide bodies are going from a two class to a three class cabin in its rule set. While Boeing is leaving three class for two class, Airbus is going in the other direction.
Why these movements and are there any common themes in these conflicting changes?
We go behind the scenes to decipher the changes and decode what it all means when one want to compare Boeing and Airbus products. We start with the single aisle aircraft this week.
Summary:
- Airbus and Boeing had rather small differences in their rules and how they characterized single aisle aircraft up until this month.
- From now on Boeing is using higher average passenger+bags loads and have added additional equipment to the aircraft’s empty weight specification.
- We show what these changes mean for the aircraft’s performance. We also use our model to show Airbus single aisle aircraft’s range should they use the same rules as Boeing’s aircraft.
C Series: challenges ahead
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Introduction
Bombardier CS300 (L) and CS100 (R). Click on image to enlarge. Photo via Google images.
Aug. 10, 2015, (c) Leeham Co. Bombardier came away from the Paris Air Show with positive reviews after finally displaying its new C Series. The CS100 was present in launch operator Swiss International colors and the spacious interior installed. The larger CS300, in house colors, was also on display and performed flying maneuvers, impressing the crowd with the quiet of the Pratt & Whitney P1000G Geared Turbo Fan engines, also a new product. Once airborne and circling around the runway, the engines could not be heard over the loud speakers of the show’s announcer.
BBD officials came away encouraged by response to the airplanes and they said potential customers were stopping by the chalet with new and renewed interest in the program.
But there remain formidable challenges ahead for the program. There were no sales announced at the Air Show, although BBD officials were clear in advance none was expected. None has been announced in the six weeks since the Air Show. Whether there will be any of substance by year end, and to whom, remains to be seen.
Focus is on execution: getting the aircraft certified by year end and preparing for delivery to Swiss in the first half of next year.
But the customer base remains of iffy quality and a number of the deliveries scheduled 2016-2018 fall into Leeham Co.’s Yellow and Risk Risk Assessment.
Summary
- Of nearly 200 deliveries scheduled 2106-1018, more than half fall within our Yellow-Red risk assessment.
- Country and region risk are concerns.
- A major customer has a changing business plan that puts deliveries into a Risk Assessment.