Leeham News and Analysis
There's more to real news than a news release.
Airbus Business Line Services ramping up
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Introduction
Aug. 13, 2018, © Leeham News: While Boeing aggressively pushes its new business unit, Boeing Global Services (BGS), on a trajectory for a $50bn revenue target 
in 10 years, Airbus quietly has its own services operation.
Airbus services has a goal to reach $10bn in revenue over the next decade for its commercial services. In 2017, the Airbus Group revenue of $9bn was split roughly evenly between commercial, helicopters and defense.
BGS’ revenue target includes all services.
Unlike BGS, Airbus services are not a separate business unit/profit center. Ironically, the Airbus website describes the airliner-part as “commercial aircraft services.” Boeing’s airliner services operation was called Commercial Aviation Services, or CAS, before CAS merged with the Boeing defense operation to form BGS. The business line is promoted as Services by Airbus in collateral material.
Pontifications: Horizon Q400 theft spurs thoughts about solo pilot idea
By Scott Hamilton
Aug. 13, 2018, © Leeham News: The bizarre theft of a Horizon Airlines Bombardier Q400 at Sea-Tac Airport Friday night by a 29-year old employee will take some time for investigators to unravel.
The employee, a ramp agent, appeared to have no other motive in mind other than a last joy ride before ending his life.
Bjorn’s Corner: Supersonic transport revival
By Bjorn Fehrm
August 10, 2018, ©. Leeham News: The interest in civil supersonic flight has been revived in the last years. Aerion Supersonic is well advanced with its AS2 supersonic business jet and there are several projects looking at restarting supersonic airliner service, 15 years after the Concorde stopped flying.
We will examine the unique challenges facing these projects in a series of Corners.
Figure 1. The latest rendering of the Aerion AS2 supersonic business jet. Source: Aerion Supersonic.
Will rising fuel prices revitalize new aircraft sales? Part 2
By Bjorn Fehrm
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Introduction
August 9, 2018, © Leeham News.: We continue last week’s article about how changing fuel prizes affects fleet plans. Last week we studied how long-term rising fuel prices will favour new, more fuel-efficient single-aisle aircraft.
Now we make the analysis with Widebody aircraft in the segment 250 to 300 seats.
Summary:
- The crossover fuel price where a new generation Widebody is a good investment is slightly different than for the Narrowbody.
- As for the Narrowbody, the maintenance costs for a half-life Widebody and how these are handled influence the crossover fuel price.
777F, 747-8F orders help former’s bridge, solidify Boeing as freighter king
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Introduction
Aug. 6, 2018, © Leeham News: The surge of orders at the Farnborough Air Show for Boeing 777 and 747-8 freighters is welcome news for Boeing, which still had 
production gaps to bridge between the 777 Classic and the 777X.
The 747-8F orders, for five, helps breathe life into this struggling program.
The orders also add to Boeing’s virtual monopoly in new-build cargo aircraft backlogs.
Summary
- 777F orders and commitments now nearly double the remaining 777-300ER backlog.
- Three new-build freighter models swamp Airbus offering of just the A330-200F.
- Airbus pitching UPS for A330-800F.
Pontifications: Supply chain meltdown
By Scott Hamilton
Aug. 6, 2018 © Leeham News: It happened to Airbus. It sort of happened to Boeing. It was bound to happen in a much bigger way to Boeing, and it has.
Some 40 737s are now sitting around the Renton assembly plant in a major supply-chain meltdown.
This follows the highly publicized, two-year long supplier meltdown at Airbus as Pratt & Whitney and CFM fell down on engine deliveries and technical problems for their GTF and LEAP-1A engines, respectively.
Bjorn’s Corner: Largest navigation change since radar, Part 8
August 03, 2018, ©. Leeham News: In seven articles we have discussed the largest change in how air navigation is done since the Second World War when Radar was invented.
It’s time to summarize the changes and what it will mean for how we fly in the future.
Figure 1. Airbus Vahana Air Taxi concept. Source: Airbus.
Will increasing fuel prices revitalize new aircraft sales?
By Bjorn Fehrm
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Introduction
August 2, 2018, © Leeham News.: As outlined in our Monday article the changing fuel price is affecting fleet plans. With increasing cost of fuel one would expect the airlines to order more new fuel-efficient aircraft.
The reaction from some US carriers has been the opposite, deferral of deliveries of new aircraft. While this might be a short-term reaction, long-term rising fuel prices will favor new, fuel-efficient aircraft. The fuel price level when this happens is today’s subject.
Summary:
- There are more factors than fuel and capital costs which influence buy new or keep old fleet, but the fuel and capital costs are the key variables.
- We also explore if there is a difference in crossover fuel price between Narrowbody or Widebody fleets.
Embraer 2Q2018 results: KC-390 problem turns quarter red.
By Bjorn Fehrm
July 31, 2018, ©. Leeham News: Embraer presented its 2Q2018 results today. The company posted a loss as the KC-390 program was reset financially after a prototype was damaged in ground testing during the quarter.
The Military division’s KC-390 problem came on top of forecasted weaker 2018 deliveries in both the Commercial and Business jet divisions. A $110m company profit was turned into a $17.7m loss for the quarter by a $127m KC-390 program charge.
