Leeham News and Analysis
There's more to real news than a news release.
Pontifications: Busting the XWB brand; and more about the Boeing-IAG deal
- Dissecting the British Airways-Boeing MAX deal, part 2
By Scott Hamilton
July 1, 2019, © Leeham News: During the Airbus Innovation Days, and in other forums, officials promoted the idea of a 10-abreast coach-class in the A350 XWB.
Compared with the 10-abreast Boeing 777X, officials said the economics of the A350-1000 are unbeatable (along with other claims).
Boeing claims the 777-9 is 25% more economical on a per-seat basis than the A350-1000.
This is an unfair comparison, of course, because the -9 seats about 40 more passengers than the -1000 at nine abreast. Hence, the push for a 10-abreast A350.
All well and good, except a 10-abreast A350 totally busts the XWB brand built up so carefully since it was launched some 10 years ago.
Bjorn’s Corner: New pitch trim issue forces further changes to 737 MAX software
By Bjorn Fehrm
June 28, 2019, ©. Leeham News: “The Federal Aviation Administration has asked The Boeing Company to address, through the software changes to the 737 MAX that the company has been developing for the past eight months, a specific condition of flight, which the planned software changes do not presently address.”
This is the text of an 8-K filing Boeing issued to the stock market two days ago. Here is what it means.
Lessors, airlines seek 1 year lease extensions in MAX groundings
June 26, 2019, © Leeham News: Airlines and lessors are making plans to extend leases by up to one year as the Boeing 737 MAX grounding drags on with no end in sight and carriers scramble to cover their routes, LNA is told.
Shortly after the MAX was grounded, on March 13, airlines began extending leases on airplanes that were to be replaced by the MAX up to six months.
This was until the September-October timeframe.
Now, with estimates that the Federal Aviation Administration may not be ready to lift its grounding order until then—and other regulators may come later—airlines see a need for another lease extension.
Lessors are not interested in another six month extension, however, LNA is told.
The range of Airbus A321XLR
By Bjorn Fehrm
Subscription Required
Introduction
June 27, 2019, © Leeham News: Airbus launched the extended range A321XLR last week at the Paris Air Show.
The range of the aircraft was presented as 4,700nm with an “around 200 seat” cabin. This was 200nm more than the market expected.
We use our performance model to explain what is behind the 4,700nm figure.
Air Lease was the first presented customer for the A321XLR last week. Source: Airbus.
Summary:
- The 4,700nm is with “around 200” passengers and with the Airbus short range rule set.
- We calculate the range of the A321XLR with typical airline rules and with different cabin configurations, including a three class long-range cabin with lie-flat business seats.
Mitsubishi, Bombardier reach agreement to acquire CRJ program
- MHI to acquire CRJ program.
- MHI will acquire the maintenance, support, refurbishment, marketing, and sales activities.
- Deal worth $550m in cash, $200m in assumed liabilities, $180m in a securitization program.
- Transaction to close first half 2020 subject to regulatory approval.
June 25, 2019, © Leeham News: Mitsubishi Heavy Industries and Bombardier today announced an agreement in which MHI will acquire the CRJ 
program, subject to customary shareholder and regulatory approvals. Closing is expected in the second half of next year.
The CRJ program includes the airplane, the global product support and sales force, manufacturing facilities and other assets. A CRJ installed customer base of 1,300 airplanes and more than 130 operators worldwide.
“Bombardier will continue to supply components and spare parts and will assemble the current CRJ backlog on behalf of MHI. CRJ production is expected to conclude in the first half of 2020, following the delivery of the current backlog of aircraft,” the companies said in a statement.
Paris Air Show: notable orders other than A321XLR and 737MAX
By Vincent Valery
June 24, 2019, © Leeham News: The A321XLR launch and IAG’s 737MAX order gathered most of the attention during the 2019 Paris Air Show.
Nevertheless, other significant orders were placed by airlines and lessors.
A321XLR: where airlines will fly the Airbus aircraft
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By Vincent Valery
June 24, 2019, © Leeham News: As widely expected Airbus officially launched the A321XLR on the first day of the Paris Air Show. First deliveries are expected in 2023.
With the Maximum Takeoff Weight increased to 101 metric tons the manufacturer claims a range of 4,700 nautical miles while carrying 200 passengers. This represents an extra 700 nautical miles compared to the LR variant. Accounting for real world airline seating configurations and fuel reserves, the effective range will be lower.
Nevertheless, it will represent a significant improvement over the LR. Serial airline entrepreneur David Neeleman claims that the A321LR does not match the range of the Boeing 757-200. The XLR variant will have meaningfully more effective range than the out-of-production Boeing aircraft.
According to Airbus the A321XLR can fly direct between city pairs such as London – New Delhi and New York – Rome.
Pontifications: Heard around the Paris Air Show
June 24, 2019, © Leeham News: Heard around the Paris Air Show last week:
Airbus
Reporters long used to the entertaining and sometimes acerbic tongue former super-salesman John Leahy wondered how Christian Scherer would compare.
By Scott Hamilton
Scherer’s own sharp tongue began to emerge at the Airbus Innovation Days pre-air show briefing last month and got sharper at the executive round table the Friday before and on Day 1 of the international event.
On Day 2, Boeing and International Airlines Group (British Airways, et al) stunned the world journalists and Airbus with the LOI for 200 737 MAXes. On Thursday, Scherer expressed his displeasure.
The deal wasn’t unprecedented. In the 1990s, Boeing blindsided Leahy with an exclusive deal with American Airlines, followed by Delta and Continental airlines. “I was…pissed,” Leahy told LNA years later.
It seems Scherer is following in Leahy’s shoes in more ways than one.
The launch of the A321XLR was totally expected. The top question: does this kill the Boeing NMA? (LNA’s answer: Nope.)
IAG’s super MAX deal likely means super discounts, services
June 20, 2019, © Leeham News: Boeing gets a Letter of Intent for 200 737 MAXes from International Airlines Group (British Airways, et al), announced Tuesday at the Paris Air Show.
Today, Airbus complained the deal came as a surprise—there hadn’t been a tender, Airbus had no chance to bid.
Christian Scherer, meet John Leahy.
Scherer is Leahy’s successor, and like Scherer, Leahy was blindsided in 1996 when American Airlines signed a 20-year exclusive procurement deal with Boeing.
Then, Delta and Continental airlines did the same.
Leahy complained bitterly that he didn’t know of American’s deal and had had no chance to bid.
Paris Air Show, Day 4: Closing orders, commitments
June 20, 2019, © Airfinance Journal: By day four of the Paris Air Show, most of the OEMs had already wrapped up their deal-making, but there was still time for Airbus to tempt another two airlines and another lessor towards the A321XLR and the A220-300 products.
Airbus and CFM are the manufacturers that will leave Paris the happiest, although ATR was keen to make its case, citing 75 “new orders” at the show. However, in line with the odd phrasing employed by most marketing departments this week, it was difficult to discern what those “orders” meant. ATR said they included “35 firm orders from NAC disclosed on June 18”, but its press release about that deal described only a “letter of intent for 35 firm ATR -600s, with options for a further 35 and purchase rights for another 35.”