Leeham News and Analysis
There's more to real news than a news release.
A350 replacing A340-300 / 777-200ER, still on with lower fuel prices?
By Bjorn Fehrm
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Introduction
June 7, 2015, c. Leeham Co. We have just rounded off a series of articles around how A350 is to fly, its systems approach and lastly the conversion of Finnair’s A340/A330 pilots to A350. Finnair will replace the airlines A340-300 with the A350-900.
A question that comes up is how much more efficient is the A350 that is delivered to these airlines, and does the investment still make sense with today’s lower fuel prices? To get an answer we took the two customers that will get their A350 within the next months, Vietnam Airlines and Finnair, and we compared A350-900 to the aircraft that it will replace in their fleets, Boeing 777-200ER for Vietnam Air and Airbus A340-300 for Finnair.
We used our proprietary model to fly these aircraft over some typical routes for the airline’s, for Vietnam Airlines Saigon-London and for Finnair Helsinki-Shanghai.
Summary:
- The present aircraft are over 20% less efficient than A350 on these routes.
- For the A340 it is the engines which are the culprit, for the 777-200ER the wing.
- With a realistic fuel price for the planning period the differences in efficiency are large enough to motivate the switch.
A changing Airbus
By Bjorn Fehrm
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Introduction
June 3, 2015, c. Leeham Co. Airbus, the commercial aircraft part of Airbus group, is in a change period which in terms of its results will be as profound as the many restructuring programs “Power 8”, “Power 8 plus” and “Future EADS” were in unifying and restructuring Airbus after the A380 problems.
The change is taking place in a very different environment. Airbus and Airbus group are no longer plagued by national infighting and severe duplication of resources, the drivers for the previous programs. Rather it is a necessary change for a company that goes from focusing on getting large new aircraft developments out the door and expand market share, to a company which needs to focus productivity and how to avoid complacency.
Widebody sales prospects this year
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Introduction
June 3, 2015, c. Leeham Co. Sales of widebody jets have slowed going into the Paris Air Show in under two weeks. Airbus sold six A330-200s, four A330-200Fs and
Boeing hopes to make a sale to Emirates Airlines later this year for the 787-10, giving a boost to this program and acing out Airbus in the process.
25 A330-900s, or 35 widebodies. No A350s. No A380s. Boeing sold three 747-8s, one 767, 25 777 Classics and (net) 34 787s, or 63 widebodies.
But we expect sales to pick up for the second half of the year, propelled by what appears to be enticing hints by Airbus that it may have finally achieved sales from China for its long-stalled A330ceo Regional airliner.
But the big prize, the Emirates Airlines order for 50-100 Airbus A350s or Boeing 787-10s (the number varies), is likely a late-in-the-year deal. There are a couple of others of decent size being competed as well.
And then there is the prospect of the launch of the Airbus A380neo.
Summary
- Airbus looks to Air Show to boost orders
- Boeing continues to hope 777F will save the day on the Classic
- Deals by year-end hoped for.
- Next big opportunity: the Dubai Air Show.
Paris Air Show: Qatar and others
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Introduction
June 1, 2015, c. Leeham Co. It could be called the Qatar Airways Air Show.
Qatar Airways plans to have five airliners on display at the Paris Air Show in two weeks: the Airbus A319, A320, A350, A380 and the Boeing 787. The carrier hasn’t 
announced whether it will provide an aerial display as it has at previous air shows, but Qatar may well have more airliners there than Airbus or Boeing.
As for manufacturers other than Airbus and Boeing, we don’t expect anything of consequence from these.
Summary
- Irkut, COMAC, Mitsubishi, Sukoi and ATR are other major aircraft producers that will be at the Paris Air Show.
- Engine makers CFM International, GE Aviation, Rolls-Royce, Pratt & Whitney and Engine Alliance will also be there.
- An update on Airbus expectations.
Analysis: First phase of A350 production
By Bjorn Fehrm
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Introduction
May 20, 2015, c. Leeham Co. The 27th Airbus A350 has started its journey in the Final Assembly Line (FAL) in Toulouse and one can do a first analysis of how the initial batch of A350s has fared on the final production line. For this purpose, we have been closely monitoring the through-flow times for each of the nine steps that constitute the final assembly of the A350.
Summary
- Initial serial production was done without a dedicated station for post certification rework. This was introduced from the third production aircraft as station L70.
- From initially spending up to four months in this station, the rework situation has improved fast.
- FAL production times are now stabilizing and when rework is no longer needed the profile of a learning curve can be seen.
Paris Air Show: Boeing
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Second in a Series of Previews for the Paris Air Show.
Introduction
May 10, 2015, c. Leeham Co. Don’t expect Boeing to come away from the Paris Air Show next month with a ton of orders. It never does; this is Airbus’ home turf.
Although Boeing has said over and over and over again that it doesn’t hold back orders to announce at air shows, the fact is that it does, both for its own public 
relations value and at the behest of customers. Is this as aggressive as Airbus? No, but we know from talking with customers and with
Boeing’s own personnel that Boeing is just as aware of the air show PR value as is Airbus.
That being said, what can we expect from Boeing at the air show? A little bit here. A little bit there. But not a whole lot. The order cycle has flattened (though it’s certainly not collapsed) and the wide-body campaigns that are underway probably won’t be ready for Paris.
Summary
- Look for “Unidentifieds” to be revealed to bolster air show numbers, though this will be strictly a PR exercise;
- Watch the 737 MAX 200–so far only Ryanair has ordered this variant;
- Closely watch whether new orders for the 777 Classic are forthcoming; last week’s Swiss order, for three, were already accounted for in the Unidentifieds;
- 777 Classic production gap is much larger than generally recognized;
- Don’t expect much in the way of 777X orders; there are active campaigns but these probably won’t be ready by Paris;
- It’s doubtful if there will be many 787 orders; the backlog stream is just too far out to prompt airlines to commit right now; and
- Nothing on the Middle of the Market airplane or (probably) the 747-8I.
Boeing 777 production gap remains challenging
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Introduction
May 5, 2015: c. Leeham Co. The order for 10 Boeing 777-300ERs last month by United Airlines was a welcome addition to the backlog for the Classic line, but it remains a struggle for Boeing to obtain enough orders, or convert options and LOIs, to bridge the production gap to the entry-into-service for the 777-9, currently planned for 1H2020.
Boeing would like to advance the EIS to late 2019, but this may be challenging.
Boeing currently has a backlog of 271 Classic 777s (including the UA order). Through the end of 2019, Boeing needs to deliver 466 Classics if it is to maintain the current production rate of 100 per year. Boeing is sold out this year, largely sold out next year, half sold out in 2017 and some delivery slots are taken up in 2018, according to CEO Jim McNerney.
But the need for more Classic sales doesn’t end on 12/31/19 because of the normal production cut-over and ramp-up of a new airplane type.
Summary
- Through 2019 Boeing needs to sell and/or convert options for 195 777 Classics, or an average of 43 per year from May 1.
- “Feathering” in production from the Classic to the 777X increases the challenge.
- Production rate cut remains inevitable, in our estimation.