Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- AIN Media Group Agrees to Acquire Leeham News & Analysis June 17, 2025
- Five for Five: Air India crash points to systemic problems at Boeing that CEO Ortberg must fix June 15, 2025
- Airbus sees Boeing as medium-term competitor, with Comac next June 14, 2025
- Boeing bullish on 20-year forecast, despite short-term headwinds June 14, 2025
- Embraer’s 20-year market forecast under 150 seats: fewer turboprops, jets about the same June 14, 2025
Bjorn’s Corner: Analysing the Lion Air JT610 crash, Part 4.
By Bjorn Fehrm
November 22, 2019, ©. Leeham News: We continue the series on analyzing the Lion Air JT610 crash by analyzing MCAS in more depth before we go to the final part of the flight.
We look at what was wrong with the initial version of MCAS, the augmentation system that caused JT610 to crash and what has changed in the updated version.
Read more
Can the DHC 8-400 compete with the CRJ550 for the 50 seat Scope Clause market? Part 2.
By Bjorn Fehrm
Subscription Required
Introduction
November 21, 2019, © Leeham News: Last week we started our analysis of the De Havilland Canada’s DHC 8-400 as a replacement for US Scope Clause 50 seat jets like the Bombardier CRJ200 or the Embraer ERJ-145.
We compared a newly produced and adapted DHC 8-400 with United’s CRJ-700 conversion to CRJ550, a 50-seater version of the larger jet. After looking at the airplane dimensions and cabin spaces last week we now go deeper into the configuration of the aircraft and their economics.
Summary:
-
- The DHC 8-400 is offered as a 50 seater and 65 seater variant to fit the US Scope Clause market.
- The Turboprop has a cost advantage over the jet at the cost of a 20% longer trip time.
Airbus: We should fly like geese to save fuel and CO2
By Bjorn Fehrm
November 19, 2019, ©. Leeham News: Airbus presented a real innovative idea yesterday at the Dubai Air Show to reduce the environmental footprint of civil air transport. In the future we should fly like geese, it saves both fuel and CO2 emissions.
The airframer is starting a program to explore how the geese reduce their energy consumption while flying long distances. They fly in each other’s up-wash. This is to date the most innovative idea in the airframer’s quest to reduce air transport’s environmental footprint. Is it the most unrealistic? Perhaps not.
Figure 1. An A350 follows an A380, flying like the geese to gain from the upwash of the A380. Source: Airbus.
A tangled web at the HNA Group
Subscription Required
Now open to all readers.
By Vincent Valery
Introduction
Nov. 18, 2019, © Leeham News: The HNA Group, a Chinese conglomerate with a heavy focus on aviation, has been in the spotlight for a few years as its financial condition deteriorated.
Its current state came from its debt-fueled global acquisition spree, then the challenges in deleveraging.
At some point, the group owned stakes in 20 airlines in Mainland China and abroad. Other notable acquisitions include lessor Avolon, Swissport, Servair, SR Technics, and stakes in two foreign airports.
The HNA Group does not publish accounts. LNA went through the financial statements of its flagship subsidiary Hainan Airlines, since 2000, with the goal of better understanding the group structure and assess the airline business profitability.
Summary
- HNA’s relentless growth;
- A buying spree bites back;
- Domestic and foreign airline ownership model;
- Hainan Airlines accounting.
Pontifications: A new setback for Boeing
By Scott Hamilton
Nov. 18, 2019, © Leeham News: Boeing suffered another setback last week, and this time it’s unrelated to the 737 MAX.
Boeing abandoned a robotic riveting/fastener system awkwardly called Fuselage Automatic Upright Build, or FAUB, intended to speed production.
Bloomberg first reported the abandonment. The Seattle Times has an extensive story detailing the history and objectives.
Doing these processes manually is incredibly labor intensive. FAUB, when it works, dramatically cuts the time, improves the accuracy and reduces injuries.
FAUB is but one element of a production transformation Boeing has been doing for years under the code name Black Diamond.
Converging technologies in NMA
Various automated and digital processes technologies have been in place on various 7-Series programs for years. FAUB, as The Seattle Times reported, was added to the 777 Classic line ab0ut six years ago. Part of the mission was to de-risk FAUB for application to the 777X.
Then, FAUB and the other processes were to converge for the first time on one Boeing Commercial Airplanes program with the New Midmarket Airplane, or NMA.
Boeing CEO Dennis Muilenburg said on several earnings calls that the NMA was as much about production as it was about a new airplane program (or words to this effect).
But Boeing couldn’t make FAUB work.
Why not?
This is a good question and one for which there isn’t a clear answer.
It works elsewhere
FAUB, or a system very similar, is used by Airbus and other aerospace companies. It works for them, says Jessica Kinman, a senior manager for Dassault Systemes.
Kinman spoke Friday at a seminar sponsored by the Pacific Northwest Aerospace Alliance (PNAA) at North Seattle College about advanced manufacturing and other transformative production processes. This was just two days after the Boeing FAUB news broke.
Among the processes illustrated: robotics working on an upright fuselage. In other words, FAUB—although this was not identified as Boeing’s FAUB.
With the NMA business plan relying in part on Black Diamond processes, of which FAUB is an element, losing FAUB isn’t going to help an already-struggling business case.
But, then, NMA is on hold at Boeing until the MAX returns to service and cash flow resumes. So, from this perspective, losing FAUB at this time isn’t especially critical.
Longer term
But longer term, Boeing needs to understand why it couldn’t make FAUB work whereas Airbus and others can.
It’s all part of the digital factory Dassault and its competitors consult on as aerospace (and other industries) transform in the future.
I’ll have more about this in a subsequent post.
Bjorn’s Corner: Analysing the Lion Air JT610 crash, Part 3.
November 15, 2019, ©. Leeham News: We continue the series on analyzing the Lion Air JT610 crash. We now analyze the initial part of the flight. In the last Corner, we analyzed what went wrong in the aircraft. The left Angle of Attack sensor had a 21° bias failure.
How such a rather limited failure could bring a new Boeing 737 MAX down is what we try to understand in this series. To assist us, we have a detailed final accident report from the Indonesian Safety Board.
Can the DHC 8-400 compete with a CRJ550 for the 50 seat Scope Clause market?
By Bjorn Fehrm
Subscription Required
Introduction
November 14, 2019, © Leeham News: The US mainline airlines have large fleets of 50-seater regional jets that are getting old. The present Scope Clause limits on the number of aircraft with seating over 50 seats stop the mainlines from replacing these aircraft with larger aircraft. So there is a real need for an efficient 50 seater regional aircraft for the US market.
As there are no 50 seater jets in production, United is converting its 70 seater CRJ700s to 50 seaters to fill the gap and calls them the CRJ550. This is where de Havilland Canada sees a change for an adapted DHC 8-400 turboprop. It’s more efficient than a CRJ550 while offering the same comfort, says de Havilland. We check if this is correct and what chances a DHC 8-“550” have in this market.
Summary:
- The US Scope Clauses allow the three mainlines to have more 1,000 50 seater jets, yet no new ones are available to replace the more than 600 in the market.
- The in-production DHC 8-400 would be an alternative when looking at cabin size and dimensions.
Embraer presents 3Q2019 results.
By Bjorn Fehrm
November 12, 2019, ©. Leeham Co: Embraer announced its 3Q2019 results today. The company delivered a report which disappointed analysts regarding revenue, earnings and free cash flow. Commercial deliveries were 17 jets (15 in 2Q2018) but only two of these were of the E2 generation. Total E2 deliveries now stand at eight jets after 18 months of deliveries, a very low figure.
The Joint Venture with Boeing is now delayed as the European Union says it sees a risk for diminished competition in the Airliner market. Embraer will close the carve-out of the Commercial Aircraft division and its services at the end of the year while waiting for final approvals.
Wall Street rewards Boeing with December MAX delivery forecast
Nov. 12, 2019, © Leeham News: Wall Street rewarded Boeing with a $15 spike in its share price after the company said it expects the recertification of the 737 MAX and the first deliveries to begin in December.
Boeing photo.
Actual return to service is not expected until January, following pilot training, Boeing said.
“Boeing rallied 4.5% today in a slightly down market after the company outlined the remaining milestones for the 737 MAX’s return to commercial service,” JP Morgan’s aerospace analyst wrote in a note after the close of the market.
“Boeing’s messaging has now caught up to Street expectations, which is that the MAX can return in early 2020, though the company’s timeline still allows for FAA certification and potentially deliveries before year-end.”
Airlines look toward another peak season without the MAX
Subscription Required
Introduction
Nov. 11, 2019, © Leeham News: Airlines are beginning to make plans for another peak summer season either without the Boeing 737 MAX in their fleets, or a reduced number.
With the recertification of the MAX continually sliding, like an airline’s creeping delay at the airport, this is stating the obvious. Airlines keep shifting the true return to service (RTS) (not recertification) from 2019 into 1Q2020.
Source: Boeing.
American and Southwest airlines, the two carriers with more MAXes grounded than any other airline, now target RTS March 5 next year—just a week short of the global grounding of the airplane.
Boeing’s chairman, David Calhoun, acknowledged in an interview with CNBC Nov. 5 RTS will now fall into 2021.
This was two days before the Federal Aviation Administration and EASA rejected Boeing’s documentation that is required before recertification is granted. According to media reports, this could add an inconsequential number of days to the process or a significant number of weeks.
Concerns are beginning to emerge that recertification may not come until after the first of the year.
All this increases the uncertainty for the airlines.
Summary
- Creating Plan B—no MAX in the peak season.
- Stored MAXes may face a “calendar” deadline, requiring C Checks before RTS.
- Lessors offering new, year-long leases on A320s and 737 NGs.