Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Bjorn’s Corner: Air Transport’s route to 2050. Part 21. May 9, 2025
- Does an A220-500 need a new wing and engines? Part 2. May 8, 2025
- Embraer downplays tariff impact on 2025 results May 6, 2025
- JetZero readies effort for private equity fund raising May 5, 2025
- Bjorn’s Corner: Air Transport’s route to 2050. Part 20. May 2, 2025
Boeing eyes tariff risks
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By the Leeham News Team
April 7, 2025, ©. Leeham News: Escalating global trade tensions stemming from newly announced U.S. tariffs could ripple through Boeing’s intricate supply chain and potentially disrupt aircraft production, a senior executive at the company has warned.
Speaking days before President Trump imposed tariffs of 10-50% on U.S. trading partners, Malcolm An, Boeing’s senior managing director, global strategic initiatives commercial sales and marketing, said the aerospace giant was actively working to mitigate any impact, even as the full consequences remain uncertain.
Boeing 787 production line. Credit: Boeing.
“We are monitoring these things which mostly are outside of our control, and on tariffs the situation is fluid, but everyone knows that Boeing has a very complex and big global supply chain. Disruption with the key suppliers could lead to a disruption in our production system,” An warned during an address to delegates at Routes Asia 2025—an annual gathering of airport and airline leaders in the Asia-Pacific region—this year held in Perth, Australia.
“At times, outsourcing makes sense, but also at times [so does] bringing work back in house. On tariffs, in the near term, Boeing is working to mitigate the impact on the global supply chain. That’s our focus.”
The imposition of tariffs that will affect a range of Asian goods have stoked fears of a broader trade conflict between the United States and its key partners in the Asia-Pacific region—a region Boeing counts as one of its most important markets.
With more than 6,200 aircraft in backlog and a continued need to ramp up production, Boeing’s reliance on global suppliers clearly makes it vulnerable to geopolitical disruption. Read more
Boeing at far greater risk of tariff impacts than Airbus
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By Scott Hamilton
April 7, 2025, © Leeham News: Tariffs against the rest of the world announced by US President Donald Trump last week threaten retaliatory tariffs against Boeing at a far greater level than Airbus faces, an analysis by LNA shows.
Trump exempted no part of the world from tariffs where Boeing isn’t at risk for retaliatory tariffs. Airbus faces tariffs only in the US. Critics note that North Korea and Russia aren’t on the list; these two countries already are under steep economic sanctions. Nevertheless, the US had more than $3bn in Russian imports last year. Even Boeing’s domestic US deliveries potentially could be hit with tariffs on foreign-sourced parts, components and engines.
The situation is still fluid, and it is still unknown precisely how US tariffs will be applied to the aerospace industry. This will affect how retaliatory tariffs are applied to Boeing and Airbus, which sources much of its aircraft content (notably engines) from the US.
Accordingly, LNA’s analysis is necessarily highly preliminary. It’s also possible that more airplanes may be listed as at risk to tariffs than the final analysis would conclude.
Boeing potentially has three times more aircraft subject to retaliatory tariffs than Airbus has exposure in the US with its European and Canadian sales to US customers.
How good is the C919? Part 3.
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By Bjorn Fehrm
April 3, 2025, © Leeham News: The COMAC C919 is finding its first customers outside China, which gives us a reason to examine the aircraft.
Last week, we estimated its efficiency versus its Western “look-a-like,” the Airbus A320neo. Now, we look at new variants that have been announced and how competitive these would be.
Figure 1. The C919 and its variants are analyzed by the Leeham Aircraft Performance and Cost Model, APCM. Source: Leeham Co.
Summary:
- The C919, sized like an A320neo, is the first variant in a family of aircraft.
- The next C919 variant is a shorter model for hot and high airfield operation.
- The following variant is an A321neo-sized aircraft.
Airbus launches Book and Claim SAF scheme
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By Scott Hamilton
March 31, 2025, © Leeham News: Airbus last week announced a program to boost Sustainable Aviation Fuel (SAF) called Book and Claim. Its purpose is to buy SAF credits in one location and take credit for them in another.
The buyer can then claim in its corporate reports that it is meeting environmental goals, at least in part.
“This initiative aims to boost both supply and demand for SAF worldwide, providing a flexible and scalable solution to accelerate SAF adoption,” Airbus said at its annual environmental Aviation Summit.
“In simple terms, the book and claim approach allows a buyer to ‘book’ a certain amount of SAF and ‘claim’ the corresponding emission reduction, even if the fuel is used elsewhere. Through a pilot program running throughout 2025, Airbus will leverage this system to improve SAF accessibility for potential customers, particularly those with limited volumes and far from supply points,” the company said.
It’s an admirable effort for an industry that has so far fallen dramatically short of the SAF goals outlined by the International Air Transport Association (IATA) at its 2021 Annual General Meeting in Boston (MA).
However, LNA is skeptical about the effort. Carbon credits, which appear to be a variation, failed when airlines tried them. United Airlines CEO Scott Kirby called carbon offsets a “fig leaf” and “mostly a fraud.”
In land use regulations, Book and Claim sounds suspiciously like wetland mitigation programs. This is where a wetland is filled in for development and a new one may be created miles away, offsetting the environmental damage in the original location. At least this is the theory, and it’s essentially pencil-whipping. Nature doesn’t work this way for wetlands. LNA isn’t convinced it works this way for carbon, either.
How good is the C919? Part 2.
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By Bjorn Fehrm
March 27, 2025, © Leeham News: The COMAC C919 is finding its first customers outside China, which gives us reason to examine it and estimate how efficient it would be operating a typical mission compared to its Western competitors.
We will compare the C919ER version with a 3,000nm maximum range to “its look-a-like”, the A320neo, which served as the C919 design template.
Figure 1. The C919ER is analyzed using the Leeham Aircraft Performance and Cost Model (APCM). Source: Leeham Co.
Summary:
- The C919 consumes more fuel as the airframe is larger for the same seating capacity as the A320neo.
- Due to a lack of airframe maturity, the maintenance costs will also be higher.
- The big unknown will be the capital costs as the pricing or leasing strategy of a state-owned COMAC is hard to predict.
Airbus still struggles to deliver planes on time
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By Scott Hamilton
March 24, 2025, © Leeham News: Airbus continues to struggle to deliver commercial airliners to customers on time, with the A320neo and A350 families now sold out into the early 2030s.
Customers complain that they can’t get their aircraft on time and often can’t get definitive information about delivery times.
Airbus blames the supply chain, including engine delays from CFM and seats from multiple companies. LNA is told quality control issues at the European assembly plants are also problems.
How good is the COMAC C919?
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By Bjorn Fehrm
March 20, 2025, © Leeham News: The COMAC C919 is finding its first customers outside China, with an order from the Brunei-based GallopAir upstart being first with an order for 30 C919 in September 2023. These aircraft cannot be delivered until the Brunei regulator has approved the C919 Chinese certification, which was issued by the Chinese regulator in September 2022.
Deliveries to Chinese airliners began in December 2022, with 2023 mostly spent on route proving with China Eastern Airlines first delivered aircraft. China Eastern took delivery of a further two C919s during 2023. COMAC delivered 13 C919s in 2024 to China Eastern Airlines (8), Air China (2), and China Southern Airlines (3).
The second Air China C919 was the first C919ER version, featuring a 3,000nm nominal range, whereas the others were the standard 2,200nm version.
With deliveries now at around one aircraft per month and the start of marketing to airlines outside China, it’s time to examine the C919 more closely and compare it to the Airbus A320neo and Boeing 737 MAX.
Figure 1. The first C919 delivered to China Eastern Airlines in December 2022. Source: COMAC.
Summary:
- The C919 has now reached series delivery, with 13 aircraft delivered during 2024.
- The first sales campaigns outside China have started.
- How significant a threat will the C919 pose to Airbus and Boeing?
Boeing 2024 Proxy Statement: Executive Compensation includes retirement gifts for Calhoun, Deal; housing support for Ortberg, Pope, and other stuff
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By Karl Sinclair
March 17, 2025, © Leeham News: Boeing’s top executives on average earn 81 times more money than the average company employee, the 2024 Proxy Statement reveals.
And in addition to the usual perks that top executives received, the exit packages for former corporate CEO David Calhoun and the CEO of Boeing Commercial Airplanes, Stan Deal, included unidentified retirement gifts. Deal, 61, received outplacement and unspecified transitional compensation.
Boeing filed its annual proxy statement with the Securities and Exchange Commission (SEC) on March 7, announcing the annual meeting of Boeing shareholders to be held via a virtual meeting on April 24.
In the SEC filing, Boeing detailed the compensation paid to executive officers during 2024.
(BCA: Boeing Commercial Aircraft, BDS: Boeing Defense, Space & Security, BGS: Boeing Global Services). Source: Boeing.
In 2024, more than $69m was spent compensating executives, with $55.4m paid in stock awards and options.
Rolls-Royce’s remarkable turnaround
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By Karl Sinclair
March 13, 2025, © Leeham News: Boeing should take note. In fairly short order, engine OEM Rolls-Royce (RR), under the stewardship of CEO Tufan Erginbilgic, has turned the corner. The company put a very rough stretch of road behind it.
Once described as a “burning platform” by the CEO, it has been turned into a cash-making machine. The company is now planning a £1bn share buyback purchase in 2025.
LNA looks at the factors responsible for this remarkable turnaround and where the corporation is headed.
Related Article:
Boeing faces three labor contracts expiring this year
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By Scott Hamilton
March 10, 2025, © Leeham News: Boeing endured a costly 53-day strike last fall by its largest and most powerful union, the IAM 751. The November settlement provided a 43% wage hike, added benefits to its 401(k) retirement program for employees, cash bonuses, and a commitment to assemble the next new airplane in the greater Seattle area.
The strike cost Boeing around $10bn in lost revenue and other costs. Boeing nearly exhausted its entire cash reserve, which had been depleted after years of crises. Only by raising $25bn in the equity and debt markets did Boeing avoid draining its bank accounts.
However, settling the strike doesn’t mean its labor issues are over. Three more contracts expire this year, including one with a different IAM district.
The next contract expiring this year is with a Teamsters local in Puget Sound (Seattle). It expires next month.
Here is the lineup of expiring contracts:
- April 2025: Boeing drivers (Teamsters Local 174) in Puget Sound. They haul wing components from Auburn and Frederickson north to Renton and Everett. A strike there would seriously impact Boeing production.
- July 2025: IAM 837 assembly workers in St. Louis. (Building T-7s, F-15s and F-18s.)
- October 2025: Boeing welders in Puget Sound. Small group — a few hundred — represented by the International Union of Operating Engineers Local 302. There’s a pretty serious shortage of welders both nationwide and regionally, so they have more leverage than their numbers would indicate. Needed more for plant operations than for production.
- January 2026: SPEEA Wichita Technical and Professional Unit. About 1,600 people are now working for Spirit.
- October 2026: SPEEA Northwest Professional Unit and Technical Unit. Two separate but connected bargaining agreements currently cover slightly more than 17,000 workers in Washington, Oregon, California and Utah.