Leeham News and Analysis

Market, other factors emerging, creating Boeing 787 concern

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Introduction

Jan. 4, 2017, © Leeham Co.: Despite a rosy picture painted by Boeing about the future of the 787 and the ability to recover more than $29bn in deferred production

Boeing photo.

and tooling costs, there are signs that cause concerns over the next 3-5 years.

Summary

Near-term production outlook solid, weakness begins in 2020, big gap in 2021.
Boeing doesn’t see wide-body sales recovery until next decade.
Company foregoes increasing 787 accounting block; sales won’t support it.
Market talks about deferring 787s.

2 Comments

Posted on January 4, 2017 by Scott Hamilton

Airbus, Airlines, Boeing, Etihad Airways, ExIm Bank, Leasing, Leeham News and Comment, Lessors, Premium

787, 787-10, 787-8, 787-9, A330ceo, A330neo, A350, Airbus, Boeing, China, Donald Trump, Etihad Airlines, ExIm Bank

Pontifications: Embraer, contrary to others, looks to momentum in 2017

By Scott Hamilton

Jan. 3, 2017, © Leeham Co.: Airbus, Boeing and Bombardier look toward 2017 as a bit of a punk year, as detailed in our Look Ahead for subscribers only. Not so by Embraer.

In an exclusive interview, John Slattery, the president of Embraer Commercial, said EMB will gain “momentum” this year. This is at a time where sales at the other three of the Big Four OEMs are expected to slow off an already slow 2016.

30 Comments

Posted on January 3, 2017 by Scott Hamilton

Airbus, Boeing, E-Jet, Embraer, Emirates Airlines, Pontifications, Rolls-Royce, Sukhoi

737-900ER, 777, 787-10, 787-8, A330-900, A350-900, A380, Airbus, Boeing, Delta Air Lines, EJet, EJet E2, Ejet-E1, Embraer, John Slattery, Northwest Airlines, Rolls-Royce, Scope clause, SSJ100, Sukhoi

2017: the year ahead

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Introduction

Jan. 3, 2017, © Leeham Co.: The New Year is here and it doesn’t look like a good one for commercial aerospace, if measured against previous outstanding years.

There are some troubling signs ahead, piling on to a slowdown in orders from last year that didn’t even reach a 1:1 book:bill.

This year looks to be worse than last. Airbus and Boeing will give their 2017 guidance on the earnings calls this month and next. Bombardier and Embraer earnings calls are a ways off, when each will provide its guidance.

But LNC believes the Big Two in particular will be hard pressed to hit a 1:1 book:bill this year and may even struggle to match 2016 sales.

Boeing’s year-end order tally comes Thursday. Airbus’ comes on Jan. 11.

Summary

Wide-body sales remain weak.
Narrow-body backlogs and low oil prices continue to inhibit sales.
China, Middle East concerns emerging.
United Aircraft MC-21 and COMAC C919 begin flight testing.
Airbus A330neo, Boeing 787-10, Embraer E195-E2 and Mitsubishi Aircraft MRJ-70 roll-out and begin flight testing.
Airbus A321neo and Boeing 737 MAX 8 EIS.

1 Comment

Posted on January 3, 2017 by Scott Hamilton

Airbus, ATR, Boeing, Bombardier, CFM, Comac, CSeries, E-Jet, Embraer, Etihad Airways, Farnborough Air Show, GE Aviation, Irkut, Leeham News and Comment, Middle of the Market, Mitsubishi, Pratt & Whitney, Premium, Rolls-Royce, Sukhoi

Airbus, Boeing, Bombardier, CFM, Comac, Embraer, GE Aviation, Irkut, Mitsubishi, Pratt & Whitney, Rolls-Royce, Sukhoi

Airbus, Boeing Top Customers mix of stable, risk and reward

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Introduction

Dec. 22, 2016, © Leeham Co.: When it comes to comparing backlogs of Airbus and Boeing, the latter likes to point to what it calls a better quality of customers.

The fact is, both companies have large orders with airlines that may be characterized as less than top quality, or which appear to have over-ordered.

Summary

Airbus is more risk-reward oriented than Boeing.
Airbus appears more aggressive in emerging markets.
Airbus and Boeing share risky and quality customers.
Many of the shared top customers are roughly balanced between Airbus and Boeing.

1 Comment

Posted on December 22, 2016 by Scott Hamilton

Airbus, Airlines, Boeing, Premium

Airbus, airlines, Boeing, Lessors

Boeing announces 2017 job cuts

Dec. 20, 2016: Boeing yesterday announced a new round of job cuts, hoping that these will come from retirements voluntary buyouts–but it did not rule out involuntary layoffs.

No number was given by Boeing for the workforce reduction.

Just a week ago, LNC predicted more job cuts would be coming at Boeing–and at Airbus.

Boeing’s message to employees is below.

50 Comments

Posted on December 20, 2016 by Scott Hamilton

Airbus, Boeing

Airbus, Boeing, Kevin McAllister, Ray Conner

Pontifications: Leeham News’ approach to the news

Leeham News and Comment will be on holiday Dec. 24, 2016, through Jan. 2, 2017, barring major breaking news. Merry Christmas and Happy New Year.

By Scott Hamilton

Dec. 19, 2016, © Leeham Co. Two thousand sixteen is almost over. This will be my last Pontifications of the year.

We approach our job with a little different perspective than the daily newspapers and aviation trades. They have greater resources than we do and have a greater ability to report the news. So LNC tries to bring news with perspective that those outlets don’t.

Analysis, economics, forecasts

We provide analysis of events and of aircraft economics and performance. Not even the trades do the latter. We also make our own forecasts of trends and production rates. Sometimes it takes a few years to be proved right or wrong. So far, we have a good track record of being right.

We’re also not afraid to take on controversy—and be controversial. And we don’t hesitate to call bullshit when we see it.

This gets often us into hot water with the subjects of the controversy.

This is what sets LNC apart.

28 Comments

Posted on December 19, 2016 by Scott Hamilton

Airbus, Boeing, Pontifications

737 MAX 200, 777 Classic, 777X, 787, A321LR, A321NEO, A330, A350, A380, Airbus, Boeing

The Boom SST engine challenges: Summary

By Bjorn Fehrm

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Introduction

December 19, 2016, ©. Leeham Co: It’s time to round off our article series around the engine for a Supersonic Transport Aircraft (SST). The series was triggered by Boom Technologies’ plans to launch a business class-only SST with Virgin Atlantic signing up to buy the aircraft if Boom succeeds.

Our initial articles described the problems involved in making a Mach 2 SST. We singled out the engine with nacelle as the most difficult challenge.

Figure 1. Boom Technologies’ Mach 2.2 airliner with 45 business seats. Source: Boom.

Subsequent articles focused how to select an engine for such an aircraft. The requirements are pretty unique and forces design choices which are contrary to a normal airliner engine.

Today, the words “low bypass ratio” and “low overall pressure ratio” are nonexistent in engine OEMs’ brochures. Yet this is what we need for our SST. Having covered the cruise phase in Part 4, we now close with take-off/landing and what else to think of when propelling an SST.

Summary:

An SST aircraft needs low bypass engines with a low overall pressure ratio. This is contrary to all normal airliners’ needs.
The engines need to be housed in nacelles with variable inlets and outlets.
As a consequence, a configuration with three engines is questionable. A two engine layout would be more optimal.

1 Comment

Posted on December 19, 2016 by Bjorn Fehrm

Uncategorized

Boom SST, Concorde, Virgin Atlantic

US appeals WTO ruling over prohibited subsidies

Dec. 16, 2016: The US filed a notice of appeal today of the WTO ruling that Washington State tax breaks granted to entice Boeing to locate a wing plant for the 777X and assemble the airplane at Everett ((WA) was a prohibited subsidy.

The move was expected.

At issue were $8.7bn in tax breaks.

12 Comments

Posted on December 16, 2016 by Scott Hamilton

Airbus, Boeing

Airbus, Boeing, World Trade Organization, WTO

Bjorn’s Corner; Turbofan engine challenges, Part 7

By Bjorn Fehrm

December 16, 2016, ©. Leeham Co: After the turbine comes the engine’s exhaust system. This is where the thrust characteristics of the engine are formed. It is also the environment that defines the back pressure for the fan and turbines. It’s therefore more high-tech than one thinks.

For the very high bypass airliner engines of tomorrow, the common fixed bypass exhaust of today (Station 18 in Figure 1) will not be acceptable. Variable exhaust areas will have to be introduced.

Figure 1. GasTurb principal representation of a three shaft turbofan like our reference Rolls-Royce Trent XWB. Source: GasTurb.

On engines that function in high supersonic speed, it gets really complex. Not only is the exhaust area variable, it must have a dual variation exhaust, a so-called Con-Di nozzle.

Leeham News and Analysis

There's more to real news than a news release.

Leeham News and Analysis

Market, other factors emerging, creating Boeing 787 concern

Introduction

Summary

Pontifications: Embraer, contrary to others, looks to momentum in 2017

2017: the year ahead

Introduction

Summary

Airbus, Boeing Top Customers mix of stable, risk and reward

Boeing announces 2017 job cuts

Pontifications: Leeham News’ approach to the news

Analysis, economics, forecasts

The Boom SST engine challenges: Summary

US appeals WTO ruling over prohibited subsidies

Bjorn’s Corner; Turbofan engine challenges, Part 7

Top 10 Leeham News stories of 2016

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