Leeham News and Analysis
There's more to real news than a news release.
How competitive is A330neo? Part 3.
By Bjorn Fehrm
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Introduction
June 7, 2018, © Leeham News: In Part 1 we compared the base characteristics of Airbus’ A330-900 and Boeing’s 787-9. In Part 2 we compared the fuel consumptions. Now we continue with the other costs of operation.
With these we form Cash Operating Costs and then add capital costs to get Direct Operating Costs.
Summary:
- The operating costs for the A330-900 and the 787-9 are close.
- The difference can be compensated with lower capital costs. Monthly lease rates for the A330-900 are below the 787-9 lease rates.
- We think there are other Boeing strengths which turn the deals the 787 way.
EU, Airbus saw hope to negotiate end to WTO dispute; US says nothing changed
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Introduction
June 4, 2018, © Leeham News: A report a week ago in the long-running dispute between the US and Europe over Airbus launch aid left the impression the US 
position softened a bit, favoring negotiations over another round in the protracted process.
Airbus and the EU appeared to take comments made by the US Trade Representative (USTR) at a hearing last Monday out of context, grasping at a sliver of hope that negotiations will resolve the dispute.
The USTR’s office told LNC nothing has changed. One source told LNC no negotiations will be undertaken unless Airbus drops launch aid entirely, something the WTO didn’t find to be illegal, but which was implemented improperly.
Summary
- Airbus and the EU claim the violations have been remedied, something the USTR and Boeing reject.
- Airbus claims any harm to Boeing was minimal. The Seattle Times has this story; LNC has this report.
- The EU and USTR filed new statements with the WTO that remain contradictory.
How competitive is A330neo? Part 2.
By Bjorn Fehrm
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Introduction
May 31, 2018, © Leeham News: We continue our analysis why the Airbus A330neo has lost to Boeing’s 787-9 in recent sales campaigns. In the first part of the series, we analyzed the key data of the aircraft, including their weight, drag characteristics and payload capacity.
Now we continue with flying the aircraft over typical routes with our performance model. What’s the route capacity of the of the aircraft and how about their fuel consumption?
Summary:
- The equalized range difference between the aircraft boils down to a maximum of 15-hour routes for the A330-900 versus 17 hours for the 787-9.
- There is also a difference in fuel efficiency between the types.
Countdown to Airbus-CSeries deal: boost needed to backlog
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Introduction
May 28, 2018, © Leeham News: Bombardier and Airbus may clear regulatory approvals next month, allowing for consummation of the latter’s acquisition of 50.01% of the CSeries program.
If all works, this will be well in advance of the Farnborough Air Show that begins July 15. Industry eyes will be on the FAS to see what orders might be announced by
Airbus for the CSeries, which reportedly may be renamed the A210 and A230 for the CS100 and CS300 respectively.
As May fades to June, Bombardier has beefed up its skyline quality, but there are some orders that are in doubt, including a big one for 40 airplanes.
Summary
- No sales since Dubai Air Show.
- Airbus-CSeries deal expected to close next month.
- Three questionable orders affect nearly 20% of backlog.
- Farnborough Air Show will be keen to watch for news.
How competitive is Airbus’ A330neo?
By Bjorn Fehrm
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Introduction
May 24, 2018, © Leeham News: Boeing’s 787-9 has won some important fights against the Airbus A330neo. After Hawaiian Airlines, American Airlines and a possible loss at United, one asks: Is the A330-900 not competitive against a 787-9? The aircraft are similar in size and use the same engines.
We take a deeper look at the A330-900 compared with the 787-9 to understand what’s behind this trend.
Summary:
- The A330-900 and 787-9 are virtually identical in size.
- They are also aerodynamically closely matched.
- Their primary difference is the method of construction, with the Carbon Fiber structure of the 787 giving a lower empty weight.
Boeing 777-9 or Airbus A350-1000 for the Gulf carriers?
By Bjorn Fehrm
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Introduction
May 17, 2018, © Leeham News: The recent agreement between the US and the Gulf carriers limits the expansion of the carriers on the US market. As the premier long-range destination area from the Gulf is the US market, this will influence the lift needed by the three.
All three carriers, Emirates, Qatar Airways (Qatar) and Etihad, have decided on the 777-9 as the mainstay for their long-haul needs. With the change, the question arises, will Qatar increase the buy of the A350-1000 instead of taking the 777-9 and will any of the others reconsider?
To understand what’s involved we compare the capacity and the costs of the 777-9 and A350-1000. How large is the difference? Is the A350 the better choice if the extreme long-haul capacity needs decline?
Summary:
- The maximum range and per seat costs of the 777-9 and A350-1000 are close when compared apples to apples.
- The advantage for the 777-9 at full aircraft disappears quickly as load factors decline.
- If the needed capacity of the long-haul US routes declines, the 777-9 can be too much aircraft for the Gulf carriers.
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Wide-body production rates show mix of strength, weakness
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Introduction
May 14, 2018, © Leeham News: Wide-body production rates by Airbus and Boeing are expected to go up modestly during the next three year, with a jump in 2022—if Boeing 777X production rates head for 7/mo in late 2022, as the company projects.
The supply chain was asked last year by Boeing for a Rate Readiness Assessment that suggests a rate of 5/mo in late 2021 and rate 7/mo a year later.
Airbus is expected to boost production of the A350 to 13/mo as early as late next year. Meanwhile, the A330 production rate is coming down due to soft demand.
These rates omit impacts of the US withdrawing from the Iran Nuclear Deal, in which some 100 Airbus orders, mostly wide-body, and some three-score wide-body Boeing orders disappear with the action.
Summary
- Production rate hikes driven by A350, 767, 787.
- A380, A330, 747, 777 remain weak.
- Is entire twin-aisle market continuing a down-gauging?
Scott Hamilton will discuss production rates at the Southeast Aerospace & Defence Conference next month in Mobile (AL). Click here for more information.
Bombardier refocuses the CRJ
By Bjorn Fehrm
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Introduction
May 10, 2018, © Leeham News: American Airlines last week ordered 30 additional regional jets. Of these, 15 were the Embraer E175. No surprise there. It’s the traveler’s favourite and the market leader among US regional jets. But American Airlines also ordered the same number of Bombardier CRJ900. Why? Isn’t it a bit dated?
There are good reasons for this order and Bombardier sees a new spring for the trusted regional. We use our performance model to understand why.
Summary:
- The CRJ900 is still a good choice for the US Scope Clause regulated regional jet market.
- Is strong economics makes it a favourite with the airline’s bean counters.
- In addition, it has the longest cabin, enabling large First-class and Premium economy sections.
- With programmed updates, it will be competitive for years to come.
Demand supports rate 70/mo for A320, 737
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Introduction
May 3, 2018, © Leeham Co.: With the supply chain confirming last Thursday that Airbus and Boeing are exploring single-aisle production rates of 70/mo, Airbus confirmed it was doing so during its Friday earnings call.
Boeing continues to be ambiguous, saying only there is “upward pressure” on its 737 production rates.
The supply chain, notably the engine OEMs, already has heartburn over the current rate of 60/mo and 52/mo for the A320 and 737 families respectively.
Summary
- Engine makers CFM and Pratt & Whitney continue to have technical and production issues.
- Airbus and Boeing each have “gliders,” though Boeing’s is a handful vs the dozens at Airbus.
- CFM’s partner, Safran, cautions against rate 70.
Production rates will be among the topics at the Southeast Aerospace & Defence Conference next month in Mobile (AL). Click here for more information.