Leeham News and Analysis
There's more to real news than a news release.
The Airbus A220-500, a deep-dive analysis: The launch date challenge
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By Bjorn Fehrm and Vincent Valery
Jan. 30, 2023, © Leeham News: In the previous articles, demand in the Airbus A320 family gradually shifted from the smaller A319 and A320 to the larger A321. This shift is laying the groundwork for the arrival of the A220-500.
Airbus can develop the A220-500 with relatively minor technical modifications that are not extremely challenging. In an aircraft performance analysis, we saw that the light aircraft weight gave the A220-500 an advantage against the A320neo and 737-8.
What is then preventing Airbus from launching the A220-500 now? While most of the attention has been on the cannibalization risk with the A320neo and the lack of urgency given Airbus’ market share lead, other and more critical factors, in LNA’s opinion, are at play.
Being an aircraft OEM is not just about designing airplanes that meet payload-range requirements and satisfy stringent safety regulations. It is also about efficiently building aircraft with millions of parts and consistent production rates. The recent challenges OEMs are facing ramping up after the Covid-19 pandemic show that aircraft production is far from a walk in the park that can be taken for granted.
It is common for aircraft OEMs to spend as much cash nursing production through the learning curve until the first profitable delivery as developing the aircraft itself.
The final article on this A220-500 series discusses why Airbus is rightfully cautious about launching the new variant.
Figure 1. A rendering of an A220-500 that takes 157 passengers. Source; Leeham Co.
Summary
- Current planned A220 production rates and variants can satisfy demand;
- Adding the A220-500 brings the program to a new demand level;
- Several clients would place large A220-500 orders;
The Airbus A220-500, a deep-dive analysis, Part 2
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By Bjorn Fehrm
Jan. 23, 2023, © Leeham News: Following Thursday’s article about an up-and-coming Airbus A220-500, we now look at the operational cost for the A220-500 and compare it with the A320neo it should replace.
We put the data we discussed in Thursday’s article in our Aircraft Performance and Cost model, fly the aircraft on a typical single-aisle mission and look at the results.
Figure 1. A rendering of an A220-500 that takes 157 passengers. Source; Leeham Co.
Summary:
- The A220-500 would be a viable replacement for an A320neo.
- With the changes/improvements we discussed, it beats the A320neo on operational costs. The differences are not of the speculated level, however.
A deep dive into the single-aisle market
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By Vincent Valery
Introduction
Jan. 23, 2023, © Leeham News: Boeing’s share of outstanding single-aisle orders has fallen significantly behind Airbus. If we include the order book for single-aisle aircraft seating 100 or more passengers of Airbus, Boeing, COMAC, Embraer, and UAC, the American OEM’s market share is now 37% (Airbus has 58%, COMAC 3%, Embraer 2%, and UAC 2%).
Richard Aboulafia sees a risk that Boeing’s market share in the single-aisle market will dip below 30% without the entry into service of a new aircraft before 2035. Boeing Commercial Airplanes CEO Stan Deal said that it is viable for the American OEM’s single-aisle market share to stay around 40%.
A321neo Credit: Airbus
In the 2022 Boeing outlook, LNA also noted that there are significantly more A320ceo than 737 NG operators. A broader operator base means more opportunities to place new orders with a more diversified group of airlines. In the context of no new single-aisle family entering service in the next 10 years, convincing operators to “flip” to the competition will be the primary way to increase market share.
Exclusively looking at the nominal order books and A320ceo and 737 NG operators does not provide a comprehensive view of Airbus’ and Boeing’s relative positions in the single-aisle market, though.
In their 2022-2041 commercial market outlooks (CMO), Airbus and Boeing indicated that nearly half of all single-aisle deliveries would replace older-generation aircraft. Looking at the existing in-service fleet of older-generation aircraft provides a better picture of replacement order opportunities by the OEM.
LNA investigates in this article the existing order books of the five major OEMs and operator bases to better assess their relative competitive positions and quantify the current replacement order opportunities.
Summary
- A comprehensive single-aisle fleet snapshot;
- Breaking down the order books between replacements and growth;
- Keep track of order choices for older-generation operators;
- Remaining replacement order opportunities;
- A word about single-aisle freighters.
The Airbus A220-500, a deep-dive analysis
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By Bjorn Fehrm
Jan. 20, 2023, © Leeham News: It’s a question “of when, not if” there will be an A220-500, we conclude in Tuesday’s article.
We have known about the -500 since the Bombardier days. A longer CS300 was part of the original concepts when the CS100 and CS300 were developed to safeguard that no decision on the smaller variants precluded a larger variant.
As Airbus A321 grows its share of the A320 lines’ output, an A220-500 makes sense, but only when the two A220 final assembly lines in Mirabel and Mobile can produce enough A220s to satisfy demand.
What would be the characteristics of an A220-500? We use our aircraft design and performance model to determine what is possible.
Figure 1. A rendering of an A220-500 that takes 157 passengers. Source: Leeham Co.
Summary:
- The Airbus A220 has the base capabilities for a stretch to an A220-500.
- Some changes/improvements are needed, but these are limited to detailed changes beyond a fuselage stretch.
Airbus CCO: “When,” not “if” A220-500 comes; a deep-dive analysis
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By Scott Hamilton
Jan. 18, 2023, © Leeham News: Airbus chief commercial officer Christian Scherer has been open: it is a matter of “when,” not “if” Airbus proceeds with a stretched A220-500.
A220-500. Credit: Leeham News.
The A220-500 would be the third member of the A220 family. The A220-100 is a 110-seat airplane in a typical two-class configuration. The A220-300 seats 135 passengers. The A220-500 would seat around 157, competing head-on with the Airbus A320neo at 152 and the Boeing 737-8 at 164.
The -500 was projected by Bombardier as the CS500. Bombardier focused its commercial aviation future on the C Series. In doing so, it neglected sales efforts on the CRJ and Q400 regional jet and turboprop. Development of the C Series, like programs at Airbus and Boeing, ran billions of dollars over budget. Developed concurrently with two corporate jet programs that also ran well over budget, Bombardier was on a path toward bankruptcy.
Airbus purchased a controlling interest in the CSeries program in 2017 and now owns 75% of the program. But so far, Airbus hasn’t stemmed the losses that began under Bombardier. Without the heft of Airbus’ buying power, Bombardier entered costly contracts with suppliers. Airbus has been renegotiating the contracts, with some success, but not enough. Ramping production up to 14 a month by 2025 from the current 6/mo is a key goal. Demand is there and the higher rate will lower costs.
But the A220-500 will compete with Airbus’ own A320neo. So, the plan to launch the A220-500 has this cloud over the decision.
Some believe that the A220-500 will be so much more efficient than the 737-8 that it will “kill” Boeing’s backbone airplane. LNA doesn’t agree.
This article is the first of three that analyzes the A220’s position in the market and the economics of a potential A220-500 vis-à-vis the A320neo and 737-8 MAX.
Summary
- Is the A320neo already on its way out, prompting plans for the A220-500?
- Talk of adding CFM LEAP to provide an engine choice.
- How does A220-500 compare economically with A320neo, 737-8?
2023 outlook for Sustainable Aviation
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By Bjorn Fehrm
Jan. 16, 2023, © Leeham News: In the years from 2015, Sustainable Aviation awareness has grown from “something interesting, but will it be needed?” to “how do we fix the environmental issues we have fast enough.” Scientists saw what happened 20 years ago, but the general public didn’t react until it affected everyday life.
The development of more Sustainable Aviation solutions has taken a similar route. Until 2015 the changes to morph aviation into a more sustainable path were a scientific discussion. At Le Bourget Air Show 2015, Airbus presented the E-Fan (Figure 1) that would cross the English Channel the following month. It started an intense debate about sustainable propulsion concepts for aircraft.
Eight years later, where are we today, and what will happen in 2023?
Figure 1. Airbus E-Fan at the 2015 Le Bourget Air Show. Source: Wikipedia.
Summary:
- The year will witness the “separation of the wheat from the chaff.” Viable concepts will prove themselves, and thin concepts, technically or funding-wise, will fail.
- We have a number of first flights from interesting projects. Several are in the “wheat” category.
Outlook 2023 for China’s COMAC and Russia’s UAC
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By Bjorn Fehrm
Jan. 12, 2023, © Leeham News: China’s civil airliner OEM, COMAC, made significant progress during 2022. It achieved Chinese certification for its C919 158-seat domestic airliner in September last year, with the first delivery to the launch customer, China Eastern Airlines, in December. The first aircraft will be used in trial operations during 2023. The C919 follows the regional ARJ21, which has been in operation in China since 2016.
The progress, after several delays, of the COMAC programs is in stark contrast to the airliner progress of Russia’s UAC. The slow progress for the SSJ100, MC-21, and Il-114 programs has now ground to a standstill since the invasion of Ukraine and the ensuing Western sanctions.
Figure 1. Test flight of the first series delivery C919 of China Eastern Airlines. Source: Wikipedia.
Summary:
- China and COMAC have made significant progress in 2022 and will gradually build a viable airliner industry from 2023 onwards with a regional and single-aisle offering.
- The opposite is true of Russia’s UAC. A once viable airliner industry is now crushed by the Kremlin’s decision to invade Ukraine.
Pontifications: Calhoun’s third year anniversary as Boeing’s CEO
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By Scott Hamilton
Jan. 10, 2023, © Leeham News: In three days, David Calhoun will “celebrate” his third anniversary as the chief executive officer of The Boeing Co.
I put “celebrate” in quotes because I’m not sure Calhoun really is in a celebrating mood. Boeing still has a big hole to climb out of and it’s going to be a few more years at least just to get back to 2019 production levels for the 737. Production levels for the 767/KC-46A are stable with a goal of increasing to 4/mo. Levels for the 777 remain at around two per month, pending certification of the 777X. Production of the 787 won’t get back to its peak of 14/mo, or even 12/mo. But Boeing hopes to achieve a production rate of 10/mo by mid-decade.
In the meantime, things are hardly running smoothly at Boeing Commercial Airplanes (BCA) or Boeing Defense, Space and Security (BDS).
David Calhoun
BCA remains plagued by quality control issues. Inexperienced workers hired to replace those who retired, accepted early buyouts, and normal attrition during the MAX grounding and COVID pandemic have learning curves. Clearing the grounded MAX inventory is slower than hoped. Clearing the 787 inventory will also be a slow slog.
Relations with the Federal Aviation Administration may be better than under Calhoun’s predecessor, Dennis Muilenburg. But Boeing doesn’t have its own “ticketing” (certification) authority restored and another safety investigation is about to begin.
BDS has its own long-standing issues. The Starliner and SLS space programs have been problematic. Losses and delays continue on the KC-46A, Air Force One, T-7, and MQ-25 programs. Legacy programs from the McDonnell Douglas era (the 1990s and before) recorded losses last year.
Boeing Global Services seems to be the only bright spot. Even Calhoun’s announcement on Nov. 2 that BCA won’t introduce a new airplane until the middle of the next decade drew a lot of raspberries from a wide swath of the industry—including, of all things, the Wall Street Journal.
Outlook 2023: Turboprops: Embraer and De Havilland look to future, leaving market to ATR
Embraer’s TPNG turboprop concept. A decision whether to launch the program has been delayed. Credit: Embraer.
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By Bryan Corliss
Jan. 9, 2023, © Leeham News: Turboprops should be having a moment, given all the concern about how the aviation industry is contributing to climate change. Want to cut your fuel burn by 45%? Just retire your fleet of 70-seat regional jets and replace them with turboprops.
Yet even with concerns over the environmental (and monetary) costs of operating regional jets, there hasn’t been a big move toward turboprops. In December, Embraer announced it was putting the development of a 70-to-90-seat turboprop on hold. The reason: Suppliers can’t provide it with components (meaning engines) that will provide enough of a performance increase to make a new plane worthwhile.
Meanwhile, the orphaned De Havilland Dash-8 – now owned by a rebranded De Havilland Aircraft Canada – has been out of production since mid-2021.
That leaves the Franco-Italian consortium of ATR as the only OEM likely to deliver any turboprops to airlines in 2023, 2024 – maybe even beyond.
That could change by the end of the decade, however. Embraer is working on a hybrid-electric aircraft that could be ready as soon as 2030 in 19- and 30-seat versions. And a rebranded De Havilland Canada is taking steps to restart production of the Dash-8 at a new factory site in Alberta.
Summary
- Embraer focuses Energia on two models
- ATR working to certify STOL version of ATR42
- Can Dash-8 come back with new company, factory, workforce?
Read more
Outlook 2023: stabilizing operations at Boeing
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By Vincent Valery and Scott Hamilton
Introduction
Jan. 5, 2023, © Leeham News: LNA wrote a year ago that resuming Boeing 787 deliveries was among the top 2022 priorities for the American OEM. Despite taking longer than envisioned (until August), the resumption of Dreamliner deliveries proved to be the high point of 2022 for Boeing Commercial Aviation (BCA).
The resumption of 737 MAX operations in China has still not materialized, and clearing the inventory of aircraft produced during the grounding is taking longer than envisioned. Boeing does not expect Chinese carriers to take delivery of their 140 737 MAXes for several years.
While Boeing launched the 777-8F, the 777X had another significant entry into service delay. The EIS is scheduled for 2025, around five years later than envisioned at the program launch in 2013. In October, a new problem with the giant GE9X engine emerged. Analysis is underway by GE. Whether there will be any additional impact on EIS remains to be seen.
Certification of the 737 MAX 7 and MAX 10 appears to be on a path for success. In November, Sen. Maria Cantwell of Washington State proposed extending the deadline from year-end 2022 for compliance with legislative requirements to install a new system called EICAS. EICAS monitors the 737’s systems and guides pilots in handling faults. EICAS is not on the already-certified MAX 8 and MAX 9. The legislation was passed with the assumption that the MAX 7 and 10 would be certified before the effective date.
However, the factors that most impacted BCA’s ability to generate cash flows were supply chain issues and labor shortages. Boeing has still not stabilized production on the 737 line at the announced goal of 31 per month.
In light of all the above, what lies ahead for Boeing in 2023?
Summary
- Critical to stabilize aircraft production;
- Financial drag from the Defense, Space & Security division;
- Avoiding more material certification delays;
- EcoAviation and lack of new product developments;
- Competing for orders without launching a new aircraft