Leeham News and Analysis
There's more to real news than a news release.
IAM members throw down gauntlet to Boeing, overwhelmingly back strike
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By the Leeham News Team
July 22, 2024, © Leeham News: Boeing’s (BA) largest union in Seattle, the International Association of Machinists and Aerospace Workers (IAM) District 751 – voted overwhelmingly to authorize a strike if contract negotiations fail.
Thousands of members attended a rally at T-Mobile Park, home of the Seattle Mariners baseball team, during which “nearly” 99.9% voted to empower the union to strike, according to IAM representatives.
Workers in Washington State are seeking a 40% pay increase in an attempt to claw back concessions previously given to the company by the union. The Local represents over 30,000 members in the region, which includes the plants in Renton and Everett, where the 737 Max and 777 aircraft are assembled.
The current labor contract will expire on Sept. 12, 2024. With a successful mandate granted by the rank and file, leverage will be applied to Boeing in upcoming negotiations. “We want the company to take our proposals seriously and bargain earnestly,” said Jon Holden, President of IAM District 751.
It’s been 10 years since the last contract was approved. The basic contract was entered into after a 57-day strike in 2008. Boeing’s CEO at the time, Jim McNerney, then demanded concessions the following year in return for locating a second 787 assembly line in Everett (WA), the assembly plant for widebody airplanes. The IAM offered concessions, which Boeing said were inadequate, and the second line went to the production facility in Charleston (SC).
Boeing sees traffic recovery from pandemic, growth for future in latest forecast
By Scott Hamilton
July 19, 2024, © Leeham News: Boeing sees airline traffic recovery to near-pre-COVID pandemic levels in its latest 20-year forecast for aircraft demand.
It also sees growth through 2043 along similar lines announced by Airbus last week in its 20-year forecast. The numbers between Airbus and Boeing are inconsequentially different. Boeing includes regional jets in the 70-90 seat sector; Airbus doesn’t forecast the RJ market. Over the next 20 years, Boeing forecasts deliveries of just over 1,500 RJs—a market that has been shrinking for years.
Embraer, the sole manufacturer outside of China and Russia of RJs, hasn’t announced its 2024 forecast (this usually comes during the international air shows—Farnborough is next week). Nor does it break out the RJs in its forecast, which is for single-aisle jets up to 150 seats.
In its 2024 20-year forecast released last month, the Japan Aircraft Development Corp. (JADC) forecasts deliveries of 1,584 new RJs in the 61-100 seat sector—very close to the Boeing number for RJs and the Boeing and Airbus numbers overall. The JADC forecast is the only one to provide details for sub-sectors within the RJ, single-aisle, and twin-aisle markets.
Aircraft Certification: How the Max crashes changed everything
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By the Leeham News Team
The Airbus A321XLR got caught up in the new aircraft certification environment created by the Boeing 737 MAX crisis. Source: Airbus.
July 18, 2024, © Leeham News: Much of the attention in the airline industry has recently been focused on the production issues faced by both major OEMs, Airbus (AB) and Boeing (BA). Supply chains are snarled, airlines had to re-jig their fleets, keeping less efficient aircraft in service longer than they planned and financial performance suffered.
LNA recently drilled down and detailed the long-term effects on Southwest Airlines, which is dealing with jet certification delays and must make do with a less-than-ideal fleet mix.
One of the overlooked aspects are the consequences of the Boeing 737 Max 8 accidents and subsequent Alaska Airlines 737 Max 9 door plug blowout is the effect it is having on getting new, more efficient variants certified into service to replace older aircraft.
Both OEMs have been affected. Airbus had to push back the introduction of its A321XLR by about a year, but a detailed inspection by LNA reveals that Boeing is suffering more from the increased scrutiny of the FAA and Congress.
Airbus sees 3.8% growth in new aircraft deliveries through 2043 vs last year’s forecast
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By Scott Hamilton
July 15, 2024, © Leeham News: Airbus boosted its 20 year forecast for new aircraft deliveries by 3.8% compared with last year’s Global Market Forecast (GMF).
Single aisle mainline aircraft (ie, no regional jets) deliveries edge up by 880 aircraft in the new forecast. Widebody passenger and freighter deliveries also edge up, by 700 aircraft.
GMF forecast 2024-2043
Airbus summarizes:
- Initial average traffic growth rate of 8.4% CAGR until 2027 as it recovers growth lost during the pandemic;
- Long term trend: average annual passenger traffic growth of 3.6% per year from 2027 to 2043, and 3.1% for freight;
- China and India, and more generally Asia-Pacific as a whole, will power growth, further shifting aviation’s center of gravity’ towards Asia;
- The projected 2043 world Fleet-In-Service will be 48,230 in 2043 vs. 24,240 beginning of 2024.
Demand for 42,430 new passenger and freighter deliveries (vs. 40,850 GMF2023) in the 2024-2043 period;
- Of these: 33,510 Single aisle (v 32,630 GMF2023); 8,920 Widebodies (v 8,220 GMF2023);
- This is 1,580 more (v GMF23) reflecting one extra year of growth
- Freighter demand: 2,470 deliveries of which 940 are new-build, the rest coming from P2F conversion; and
- Growth primarily driven by GDP increase (+2.6% 2023-2043), middle class expansion, first time fliers, and growing trade (+3.1% 2023-2043 CAGR vs. +2.9 % GMF23).
Airbus does not specify sub-categories of the single- and twin-aisle sectors. It’s not possible to delineate sub-sectors such as 100-150 seats or 151-240 seats or similar designations within the twin-aisle sector with the information available.
But in the first half of 2024, the A321neo accounts for 93% of the A320 family orders. The A320neo won 6.5% (there was one order for the A319neo.) There were no orders for the A220.
To what extent can the A321XLR replace the Boeing 757, Part 3
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By Bjorn Fehrm
July 11, 2024, © Leeham News: We are comparing the Airbus a321XLR to the Boeing 757 to understand to what extent it can replace the 757 on the longer routes it operates for major airlines like United, American, and Delta.
We have looked at the development and operational history of the aircraft, their Apples-to-Apples capacity and range. Now, we use Leeham’s Aircraft Performance and Cost Model (APCM) to compare the operational costs of the aircraft.
Summary:
- The Boeing 757-200 has the same passenger capacity as the A321LR/XLR and a larger cargo capacity.
- Its range can compete with the A321LR but not the XLR. Both beat the 757 on operational economics.
Embraer’s outlook improves as supply chain stabilizes, near-term availability drives demand
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By Judson Rollins
Introduction
July 8, 2024, © Leeham News: Embraer is on track for a relatively upbeat Farnborough Airshow later this month, having been spared most of the supply chain headwinds plaguing Airbus and Boeing.
It is expected to reveal updates to its E-Jet family at Farnborough, including lower maintenance costs, cabin upgrades, and more.
Source: Embraer.
In May, the Brazilian OEM reaffirmed its target of 72-80 commercial deliveries this year, citing the stabilization of its global supply chain. It doesn’t disclose its commercial production rate. But its peak production reached 96 E-Jets per year pre-COVID.
Embraer’s reported backlog as of March 31 was the highest in company history: 187 E175s, 12 E190-E2s, and 178 E195-E2s. The company has since taken orders for 10 more E190-E2s and 13 E195-E2s, and has delivered approximately 18 E2s overall, according to Planespotters.net.
Most previous-generation E175s are being built for major US airlines subject to pilot “scope clause” or regional airlines operating on their behalf. Scope clause restricts how many aircraft can be flown below a certain number of seats (generally 76-80) or 86,000 lbs MTOW to protect mainline pilots from having their work outsourced to lower-paying regional airlines.
Summary
- E2 delivery slot availability is a key advantage.
- E195-E2 economics favor smaller markets, while the A220 is better suited to longer routes.
To what extent can the A321XLR replace the Boeing 757, Part 2
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By Bjorn Fehrm
July 4, 2024, © Leeham News: We are comparing the Airbus A321XLR to the Boeing 757 to understand to what extent it can replace the 757 on the longer routes it operates for major airlines like United, American, and Delta.
After Boeing didn’t do the obvious 757 replacement, the NMA and Airbus gradually eked out more range and seats on the A321; the A321LR/XLR is the only game in town to replace the 757, especially as the Boeing 737-10 availability continuously slips to the right.
Summary:
- The A321LR/XLR has the same passenger capacity as the 757-200.
- The 757-200 has the range of the A321LR but can’t match the A321XLR.
Boeing is fighting fire with fire in reacquiring Spirit Aero (Updated)
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By Dan Catchpole
Analysis
July 1, 2024, © Leeham News: This is an analysis of Boeing’s reported $4.7 billion purchase Spirit AeroSystems, as Reuters reported Sunday.
First, let’s set the frame.
Boeing seems incapable of doing anything right these days. Even a pre-Farnborough Airshow media briefing by the aerospace giant last week resulted in a reprimand from the National Transportation Safety Board for sharing information about its investigation into the panel blowout on an Alaska Airlines flight on Jan. 5.
The company is bleeding money in its commercial and defense divisions. Boeing could turn around its balance sheet if it could straighten out production for its cash cows—the 737 and 787. Yet somehow, both programs are still struggling.
Boeing’s pissed off the Federal Aviation Administration, the NTSB, key members of Congress, some of its biggest customers, and the Machinists union in Washington and Oregon, among others. Its current CEO is a lame duck who helped create the crises overwhelming the company. Potential successors have said they don’t want the job. Among the front-runners to succeed David Calhoun is BCA’s new CEO Stephanie Pope, who has no production or product development experience and has had few public appearances since she took over BCA in March. There are plenty more problems, but you get the point.
Spirit AeroSystems has been floundering since the COVID-19 pandemic threw the aviation industry into chaos. Since 2020, it has recorded $3.2 billion in net losses, including $617 million posted in the first quarter of this year. Boeing has helped keep the company afloat with financing and price changes.
In short: Boeing is fighting countless fires, and it just bought another one.
Can Boeing fight fire with fire?
To what extent can the A321XLR replace the Boeing 757, Part 1.
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By Bjorn Fehrm
June 27, 2024, © Leeham News: The Airbus A321XLR, the extra-long-range version of the A321neo, will start operational service with IBERIA on the Madrid-Boston trans-Atlantic route later this year. It’s the type of thin, long-range route the Boeing 757 has served to date.
We will use our Aircraft Performance and Cost model (APCM) to examine to what extent the A321XLR can replace the 757 on world routes. What is the difference in capacity and range, and what improvement in operational economics can be expected?
Summary:
- The Boeing 757 was the original MOM/NMA (Middle-Of-the-Market / New-Midmarket-Airplane).
- It had unique characteristics, which Boeing would have followed up with the NMA project.
- Boeing hesitated, and Airbus developed the A321XLR to fill this role. Has it succeeded?
Trent 7000 reliability under the spotlight
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By the Leeham News Team
June 24, 2024, ©. Leeham News: The Rolls-Royce Trent 7000 is the exclusive engine for the A330neo and the seventh in Rolls Royce’s Trent series.
Having entered into service in early 2019, the engine has already surpassed one million flying hours.
The powerplant – which is the Trent 1000 but with bleed air features vs the electrically-based Trent 1000 – features efficient hollow Titanium fan blades enabling a fuel burn improvement of 14% per seat compared to previous iterations of the A330.
Launched by Airbus in July 2014, the A330-900 Neo is powered exclusively by Trent 7000 engines. Credit: Airbus
However, there have been issues relating to the reliability of the Trent 7000 which have complicated the A330neo’s early years of service.
Industry insiders have told LNA that operators of the A330neo faced lower than expected time-on-wing for the powerplants, as well as a lack of spares that has impacted maintenance and return to service.
Experts say the protective coatings on the engine’s turbine blades have reportedly been a factor.
But RR strongly denies there have been any reliability issues with the engine.
A RR spokeswoman said: “Our fleet of Trent 7000 engines is performing exceptionally well, and has delivered industry-leading levels of reliability to our customers over the last 18 months.” Read more