The all-important cabin. Part 4

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By Bjorn Fehrm

June 20, 2024, © Leeham News: We do an article series about the all-important cabin for an airliner. We have looked at different airliners and their cabins and how the seating differs widely depending on what market and customer segments the aircraft addresses.

If an aircraft is configured for the domestic market the seating increases by almost 50% compared with an international long-range aircraft.

We now look at what cabins to use for aircraft economic evaluations. These are not necessarily the same cabins that an airline would later use after selecting an airliner type.

Summary:
  • The evaluation cabin must not be the same as the cabins the airline plans to use.
  • Evaluation cabins are designed to minimize the skew that OEMs can introduce by making cabin rules fit “their” candidate especially well.

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Aircraft production woes stretch far beyond Boeing

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By Judson Rollins

June 17, 2024, ©. Leeham News: Estimating airplane delivery rates isn’t much more than a guessing game nowadays.

While many headlines point fingers at beleaguered Boeing and Spirit AeroSystems, aviation’s production woes are much more complex. Even in 2024, the labor shortage legacy of COVID-19 and raw material shortages exacerbated by the Russia-Ukraine war loom large over the industry.

Airbus struggles to deliver airplanes on time, and engine makers also see their deliveries constrained by supply chain issues.

Source: AFP via Aviation Week Network.

Summary
  • Boeing commercial production is far below advertised rates.
  • Airbus deliveries suffer from shortages of seats, other parts.
  • Embraer says deliveries would be higher without supply chain issues.
  • COMAC’s disruption opportunity is dampened by likely trade conflict.
  • Pratt and GE Aerospace slowly ramp up delivery of redesigned components.

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Elliott’s plan for Southwest: new governance, curbed costs, monetize passengers

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By Judson Rollins

June 13, 2024, © Leeham News: Elliott Investment Management announced an activist shareholder campaign against Southwest Airlines’ board and management earlier this week.

The airline’s share price has declined 50 percent in three years and sits near its April 2020 value, one month into the COVID-19 pandemic. Elliott says this is due to poor board governance and day-to-day management.

Source: Elliott Investment Management.

“Southwest’s [board] has failed to hold management accountable for poor execution and has been unable to catalyze (or permit) the necessary strategic evolution,” Elliott wrote in a letter to the Southwest board.


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“Instead, the [board] has reinforced an insular culture and outdated thinking in the face of indisputable evidence that change is required.”

To gain a deeper insight into Elliott’s proposed ‘Stronger Southwest’ plan, LNA studied the firm’s letter and accompanying presentation and spoke with sources familiar with the situation.

Summary
  • Elliott blames subpar returns on insular, stagnant board and management.
  • Keys to restored profitability include curbing cost growth, passenger monetization.
  • New board, CEO with industry experience would drive business change.
  • Employee resistance is a likely headwind; will improved profit sharing help?

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Freighter market faces turmoil while passenger sector gets the headlines

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By Scott Hamilton

June 10, 2024, © Leeham News: Delivery delays of widebody airplanes are causing disruptions in freighter conversion plans as feedstock is retained for passenger operations.

IAI Bedek Boeing 777-300ER P2F. Photo: IAI Bedek.

Demand for passenger airplanes also is slowing Airbus’ plans for the A350 freighter, according to market intelligence.

Softening of the cargo market since the end of the COVID-19 pandemic also impacts the immediate need for converting airliners to freighters, sources say.

Although Boeing’s delays with the 787 and 777X get most of the blame, Airbus also gets some credit for the A350 program. Already, say potential cargo airplane buyers, the A350 freighter is looking at a delay beyond the 2026 entry into service (EIS) date. Uncertainties among Middle Eastern carriers Etihad and Emirates over the A350-1000 Rolls-Royce engine durability are also causing officials to rethink retaining Boeing 777-200LRs and 777-300ERs in service.

Certification of the IAI Bedek 777-300ER freighter conversion program is taking longer than expected. The reason: the negative halo effect dating to the Federal Aviation Administration (FAA) certification crisis with the Boeing 737 MAX.

It took Boeing 21 months to recertify the MAX after its grounding began in March 2019. The MAX 7 and MAX 10 still aren’t certified and aren’t expected to be until sometime next year.

Certification of the 777X, also affected by the negative halo effect of the MAX crisis, isn’t certified. EIS was intended to be in 1Q2020. Boeing has yet to receive Type Inspection Authorization (TIA) from the FAA, one of the final steps required before certification. Boeing officially hopes certification will occur next year. But quietly some within Boeing now don’t think TIA will come until 1Q2025. Emirates and Lufthansa Airlines, the first scheduled operators of the airplane, openly say they don’t expect deliveries until 2026.

The upshot: feedstock of the 777-300ERs for conversion companies is drying up.

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The all-important cabin. Part 3

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By Bjorn Fehrm

June 6, 2024, © Leeham News: We do an article series about the all-important cabin and its seating for an airliner. We have looked at different narrowbody cabins and how the seating differs widely depending on the market and customer segments the aircraft addresses.

This week, we focus on why widebody aircraft have relatively low seat counts compared with single-aisle aircraft, like the A321neo.

We use the cabin generator in our Aircraft Performance and Cost Model (APCM) to configure widebody cabins and compare these with the narrowbody equivalents.

Summary:
  • The widebody cabins are configured for longer flight times, resulting in them taking more space.
  • When a widebody is configured for domestic flights, its seating per cabin area is closer to that of a narrowbody.

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Analyzing Boeing’s 90-Day Plan

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By the Leeham News Team

Analysis

June 3, 2024, © Leeham News: There is no timetable for Boeing to gain approval to boost production rates of the 737 MAX. And there is no timetable for the beleaguered company to regain “ticketing” authority for certification of its 737s or 787s. The Federal Aviation Administration (FAA) will be calling the shots indefinitely.

Boeing last week presented the FAA with its plan to improve safety. The long PowerPoint, said FAA Administrator Mike Whitaker in a press conference on Thursday, wasn’t released to the public. But press releases from the FAA and Boeing, and an 11-page Executive Summary released by the manufacturer, were in many ways recitations of what’s already been done.

“All those highlighted bullet points posted below were all being done when I worked as a delivery manager 14 years ago,” a retired Boeing employee emailed LNA after reviewing the Boeing press release and Executive Summary.

“Eliminate defects? They’ve been saying that for 100 years. Of course, we want zero defects. The KPIs are nothing new. Been there done that. Nothing’s changed. Nothing.”

KPI stands for Key Performance Indicators. Boeing, and Whitaker, highlighted these in statements. There are six KPIs:

  • Employee proficiency measures share of employees who are deemed proficient in core skills.
  • Notice of Escape (NoE) rework hours measures time performing rework in Boeing’s final assembly facilities to address non-conforming work from its fabrication division and external suppliers.
  • Supplier shortages measures shortages per day from Boeing’s fabrication division and external suppliers.
  • Rework hours per airplane measures time spent performing rework in Boeing’s final assembly facilities.
  • Travelers at factory rollout measures unfinished jobs traveling from Final Assembly
  • Ticketing performance measures quality escapes per ticketed airplane prior to delivery.

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The Boeing 90 day executive summary to the FAA: An analysis

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By the Leeham News Team

June 3, 2024, © Leeham News:  Boeing and the Federal Aviation Administration last week released summaries of the company’s plan to fix its safety shortcomings following the Jan. 5 accident of Alaska Airlines Flight 1282.

That’s the day a 10-week-old 737-9 MAX saw a door plug blow out at 16,000 ft on take-off from Portland (OR). Nobody died but there were some injuries and damage throughout the cabin and the cockpit occurred. The flight crew made an emergency landing at Portland.

Following this accident, the FAA on Feb. 29 gave Boeing 90 days to come up with yet another plan to address safety and production failures. (Boeing developed plans after the 2018/19 737-8 MAX crashes that killed 346 people.)

In a three-hour meeting on May 31, Boeing CEO David Calhoun and other senior executives outline its latest plan. The FAA’s press release afterward largely was a reaffirmation that it will hold Boeing’s feet to the fire until it is satisfied the safety culture at Boeing changes. There is no timeline for Boeing to implement changes—at least none that was announced.

Boeing released an 11-page Executive Summary that largely outlined steps it has taken to improve safety, and which ones continue. The detailed PowerPoint presentation given to the FAA was not released. Through a spokesperson, the FAA declined to make FAA Administrator Mike Whitaker available for an interview.

A key element of the go-forward plan is a requirement by the FAA that a voluntary Safety Management System (SMS) is now mandatory.

The FAA and Boeing statements released last week drew immediate criticism for lack of detail, repetitive nature of steps already taken, and—given the steps taken in 2019 and 2020—why this is necessary today.

LNA’s news team, which includes former Boeing employees whose duties included safety, reviewed the information announced last week. This is the analysis.

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The all-important cabin. Part 2

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By Bjorn Fehrm

May 30, 2024, © Leeham News: We will do an article series about the all-important cabin and its seating for an airliner. The cabin layout and its comfort are the most important part of an airliner for the passenger. For an airline it’s its face to the customer.

We will look at the different types of cabins used and how these use the airliner’s real estate, what the cost is, and what the weight is. With the weight, we can also predict how different cabins affect the aircraft’s performance.

Summary:
  • The configuration of the cabin has a large influence on total seating, weight, and cost.
  • The relationships change up to 500%.

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Big hurdles for COMAC to become serious challenger to Airbus, Boeing

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By Scott Hamilton

May 27, 2024, © Leeham News: A flurry of orders by China’s Big Three airlines finally began to balance announced deals for the COMAC C-919 mainline jet.

Until the recent orders from Air China, China Eastern, and China Southern, the vast number of the announced transactions were concentrated among Chinese lessors. The imbalance was not a good thing.

Airbus and Boeing prefer speculative orders by lessors amounting to 25% to perhaps 35% of the order book. (Lessors in recent decades often accounted for 40% to 50% of the in-service fleet, but the differences were from sale/leasebacks of orders originally placed by airlines.)

Boeing and Airbus have different views toward lessors. Airbus, especially under then-Chief Commercial Officer John Leahy, viewed lessors as an extension of the Airbus marketing arm. Lessors broadened Airbus’ market penetration, especially during the early years of the A320’s entry into service.

On the other hand, Boeing viewed lessors as a necessary evil, preferring to deal with a select few rather than a large number. Both viewed lessors to some degree as competitors to direct sales.

Before the Big Three orders, COMAC’s tally was around 760+ for the C919. More than 70% of the announced orders were for Chinese lessors. No lessor outside China was a customer and only Indonesia’s Trans Nusa (partly owned by Chinese lessor CALC) was a customer outside China.

Following the Big Three orders, about 46% of the orders are from airlines—a much better mix than before but still overweighted with lessors.

With Airbus’ A320 family sold out into the 2030 decade and Boeing’s MAX production and delivery schedules in disarray, what alternatives do customers have to the Big Two OEMs? COMAC is the most likely, but the challenges are immense.

COMAC’s challenges

COMAC has big challenges ahead if it wants to become a major global player in commercial aviation.

  • Gaining credibility for the C919 inside and outside China.
  • Economic competitiveness to the A320neo and 737 MAX.
  • Ramping up production.
  • Global product support.
  • Geopolitical concerns.

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The all-important cabin. Part 1

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By Bjorn Fehrm

May 23, 2024, © Leeham News: We will do an article series about the all-important cabin and its seating for an airliner. The cabin layout and its comfort are the most important parts of an airliner for the passenger.

Most of the time, the traveler doesn’t know what type of aircraft he is flying on, but he will have a clear understanding of the cabin and whether it meets his expectations.

The cabin is where the airline can expose its branding and set the flight experience for the passenger. It’s thus an area that is updated to new cabin concepts for the fleet more often today than 10 years ago, especially for mainline carriers.

The cabin is also important in evaluating airliners, as the characteristics of the aircraft (fuel consumption, operational costs) are evaluated per seat. OEMs have become experts in maximizing the seating of their aircraft to gain an advantage during an evaluation. Sometimes, in a non-transparent way. We will explain the typical tricks and how to guarantee an apples-to-apples comparison when evaluating airliners.

Summary:
  • The cabin and its seats mean different things to a passenger, airline, and evaluation expert.
  • We go through the different priorities, and how they affect the end product.

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