Boeing displaces Airbus at Hawaiian, wins 787-9 deal; airline cancels A330-800 order

Feb. 20, 2018, © Leeham Co.: Boeing has displaced Airbus at Hawaiian Airlines, winning an order for 787-9s. Hawaiian canceled an order for six A330-800s, the only order on the books for this sub-type.

An announcement could come as early as this week.

The campaign has been underway for months and the outcome was expected. Airbus offered to cut the price on the -800 and also offered the A350-900. The latter always was considered too big by carrier executives.

Boeing’s effort to displace Airbus A330neo at Hawaiian is part of an all-out, hand-to-hand combat campaign by Boeing to kill the A330neo program in advance of the potential launch of the Boeing 797.

LNC detailed the battle here.

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Airbus, Boeing square off with A330neo, 787 in advance of NMA launch

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Introduction

Feb. 8, 2018, Leeham Co.: Boeing hasn’t launched the New Midrange Aircraft (NMA, aka 797) and may not until next year.

But the maneuvering to capture, solidify or preempt moves is already well underway by Airbus and Boeing.

Reuters synopsized this during its reporting at this week’s Singapore Air Show.

This is only the tip of the iceberg.

Summary
  • Boeing 787 production rate increase to 14/mo next year is, in part, a head-‘em-off-at-the-pass maneuver to prevent customers from buying the Airbus A330neo.
  • The 787-8 could see a new lease on life as interim airplane.
  • A330-800 has steep uphill slog.
  • Airbus, Boeing face off 787, A330neo.

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Pontifications: Twelve Years of Turbulence at American Airlines

By Scott Hamilton

Jan. 22, 2018, © Leeham Co.: American Airlines was the last of the big US legacy carriers to enter bankruptcy, in 2011.

Executives put up a valiant battle to avoid being dragged into Chapter 11, despite having two airplanes hijacked on 9/11. One was flown into the World Trade Center, the other into the Pentagon.

Only two months later, American lost a third airplane in an accident.

Delta, Northwest, US Airways and United airlines all filed for Chapter 11 after 9/11; there were several other airlines to do so. Not all survived.

American did, merging with US Airways as part of the former’s bankruptcy reorganization.

AA’s former general counsel, Gary Kennedy, teamed with the aviation reporter for the Dallas Morning News, Terry Maxon, to tell the story of Twelve Years of Turbulence, The Inside Story of American Airlines’ Battle for Survival.

The book is available now.

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Post-hearing briefs in Boeing-Bombardier trade case

Dec. 28, 2017, © Leeham Co.: It’s not often that levity appears in briefing papers in US government trade cases, but Delta Air Lines managed to draw LNC’s chuckle in its post-hearing brief in the Boeing-Bombardier trade case.

Dec. 27 was the deadline for Delta, Bombardier, Boeing and other interested parties to file post-hearing (Dec. 17) briefs and exhibits.

Delta’s introduction was novel to say the least.

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History undermines Boeing claim of C Series impact: analysis

Analysis

Dec. 22, 2017, © Leeham Co.: Boeing blames a subsidized, price-dumped Bombardier C Series for the poor sales of the smallest member of the 737 family, the -700 and the 7 MAX, but history doesn’t support the claim.

The US Department of Commerce clearly ignored sales evidence that the 737-700 has been “done” for many years and the 737-7 MAX was an unattractive design

Boeing 737-7 MAX. Rendering via Google images.

that hasn’t been fixed with a redesign; airlines simply don’t want the airplane. Commerce levied tariffs amounting to 292% on C Series imported into the United States in the future.

The US International Trade Commission is currently awaiting post-hearing briefs from Dec. 18 testimony from Boeing, Bombardier, Delta Air Lines and other parties to determine whether Boeing suffered “harm” by the C Series deal with Delta and a near-miss with United Airlines.

If the ITC concludes Boeing suffered harm, the DOC tariffs stand. If not, the DOC action is moot. The loser at ITC is expected to appeal.

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Alabama plant goes ahead regardless of outcome in trade case, says Bombardier

Dec. 19, 2017, © Leeham Co.: Bombardier will build a C Series final assembly line (FAL) regardless of the ruling from the US International Trade Commission on whether Boeing was harmed by the order from Delta Air Lines for 75 CS100s and options for 50 more.

This is what Bombardier officials told the ITC, under sworn testimony, in the “harm” hearing Monday, according to a transcript.

Boeing officials argued that the plans for a US FAL at Mobile was a feint and that the line wouldn’t be built, claiming it doesn’t make economic sense.

Delta, for its part, said it’s negotiating a contract revision with Bombardier to accept deliveries assembled only from the Mobile plant.

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Airbus’ strategy for the A330-800

By Scott Hamilton

Dec. 6, 2017, © Leeham Co.: The A330-800 entered the final assembly line last week at the Airbus production plant in Toulouse, France, amid doubts in the industry that the airplane will be produced beyond the prototype.

The first A330-800 is on the Final Assembly Line at Airbus. Source: Airbus.

There is only one order for the sub-type, six from Hawaiian Airlines—and Hawaiian is expected to cancel the order. The airline is running a competition between the Airbus A350-900 and the Boeing 787-8/9, according to market intelligence.

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Boeing moves EIS target for NMA to 2027: sources

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Introduction

Dec. 4, 2017, © Leeham Co.: Officially, Boeing says the New Midmarket Aircraft (NMA, or 797) entry-into-service will be around 2024-25 if the program is launched.

LNC has learned the target date now being discussed is 2027.

Boeing 797 concept. Source: Boeing.

This means the 737 replacement likewise slips, with EIS after 2030 instead of late next decade or in 2030.

The new NMA target date, which we’ve heard from the supply chain and customer base, gives further impetus to the prospect of restarting the 767-300ER passenger production, a decision that is supposed to be made by the end of this year.

Summary
  • Technology is at the heart of the new target EIS for the NMA.
  • The 737 replacement was always intended to follow the NMA.
  • Supply chain asked for 767 production rate ramp-up feasibility.

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Leahy reflects on 33 years at Airbus

John Leahy will retire in January and stay for a short transition to help his successor, Eric Schulz, who was named EVP, Chief of Sales, Marketing and Contracts. Leahy is Chief Operating Officer-Customers. During his three-decade long tenure at Airbus, the company moved from a single-digit market share to surpassing Boeing for more than a decade in sales. Leahy spoke with LNC about his retirement.

John Leahy, right, with William Franke, CEO of Indigo Partners at a history-making deal for 430 A320neos, announced at the Dubai Air Show. Photo via Google images.

Nov. 28, 2017, © Leeham Co.: John Leahy was a salesman at Piper Aircraft, a small general aviation aircraft producer when he received a call from a headhunter to join Airbus North America as its top salesman.

Leahy was head of marketing at Piper. With a pilot’s license, he would take various Piper aircraft to conventions or air shows and on sales calls for demonstration.

“It was great fun,” he said. “It was really an enjoyable job.” Leahy said Piper was consolidating everything in Vero Beach (FL) and he wasn’t sure he wanted to move there. He wanted a more direct sales role and accepted a position with Piper in Geneva, Switzerland, as Director of the Eastern Hemisphere. “I felt that was pretty cool.”

Before moving, the headhunter called.

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Boeing’s good year for wide-body orders

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Introduction

Nov. 27, 2017, © Leeham Co.: Officials from Airbus and Boeing each said this year that wide-body orders, languishing for the past couple of years, should pick up by the turn of the decade as the in-service fleet reaches 20-25 years old.

Aerolineas Argentinas plans a wide-body competition for deliveries around 2020-2021. Photo via Google images.

But Boeing has had an exemplary year through Nov. 21, the most recent update of its Orders and Deliveries website. The company reported 160 net orders for the 767, 777 and 787, with 88 for the latter. Commitments for 40 more at the Dubai Air Show are not included, as these have not yet been firmed up.

Airbus hasn’t done nearly as well: just 56 net orders for the A330 and A350 families through October, its most recently reported data.

Have Boeing’s results indicated a sooner-than-expected uptick in orders?

Summary
  • Not enough data to draw definitive conclusions, but uptick may be arriving early.
  • Aerolineas Argentinas and Thai Airways are looking at wide-body aircraft orders. See the stories here and here.
  • Early this year, 5-year slump was seen. By August, strong market seen.

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