Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
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- Pontifications: A Personal Note June 19, 2025
For Airbus and Boeing, it’s about Alabama, Alabama, Alabama
US Sen. Jeff Sessions (R-Alabama) is President-Elect Donald Trump’s choice for US Attorney General. He’s a close ally of Airbus. Photo via Google images.
Nov. 29, 2016, (c) Leeham Co.: When it comes to the prospect of imposing trade sanctions or retaliatory tariffs on Airbus for airplanes ordered by US customers, the European manufacturer has some advantages over Boeing few people apparently have thought about.
Alabama, Alabama, Alabama
One is called Alabama. It’s where Airbus is producing A320 family members for US customers.
Alabamans voted by 1.76-to-1 for Donald Trump. Sixty-three percent to 35%.
Donald Trump tapped Sen. Jeff Sessions of Alabama to be his Attorney General. Sessions was one of the first in Congress to endorse Trump. He served as an advisor throughout the campaign.
Sessions is a big supporter of Airbus.
Sen. Richard Shelby, the other Alabama Senator in Congress, is also a big supporter of Trump. And of Airbus.
It’s highly likely that Sessions and Shelby will bend Trump’s ear in favor of not levying tariffs on Airbus planes.
Airbus, Boeing claim victory in today’s WTO ruling over Washington State tax breaks
- Airbus claims “knockout blow.”
- Boeing claims “complete victory.”
- WTO Summary of findings and ruling.
- All the WTO documents are here.
- Opinion: No sanctions will be levied on Airbus or Boeing.
- Seattle Times on why nothing will happen with this ruling.
- Airbus YouTube: WTO disputes in 3.5 minutes.
- Scott Hamilton’s column in Forbes.
Nov. 28, 2016, © Leeham Co.: Airbus claims that in a huge blow to Boeing and Washington State, the World Trade Organization (WTO) ruled today that the $8.7bn tax subsidy package Gov. Jay Inslee and the state Legislature approved for the 777X program is a “prohibited subsidy.”
This is the most onerous finding of illegal subsidies under WTO rules, and one that is rarely determined.
Boeing said the WTO “today rejected virtually all of the European Union’s challenges to the Washington state tax incentives” and declared a “complete victory.”
Full Airbus, Boeing statements on WTO ruling
Nov. 28, 2016: Here are the full statements from Airbus and Boeing about the WTO ruling today finding Boeing received prohibited subsidies from Washington State for the 777X development:
Pontifications: A fresh perspective at Boeing Commercial is sorely needed
By Scott Hamilton
Nov. 28, 2016, © Leeham Co.: Boeing last week named an outsider, Kevin McAllister, as the chief executive officer of Boeing Commercial Aircraft (BCA).
I think this has the potential to be an invigorating move.
McAllister comes to BCA from his position as CEO of GE Aviation Services.
I don’t know McAllister and have no opinion whether he will be good, bad or mediocre. But I do like the idea of bringing an outsider in to run BCA. (My insider favorites were Stan Deal and Beverly Wyse.)
Here’s why.
The Boom SST engine problem
By Bjorn Fehrm
Subscription required
Introduction
November 28, 2016, ©. Leeham Co: We covered Boom Technology’s and Virgin Atlantic’s plans to offer supersonic business class passenger traffic over the Atlantic in recent articles. In the first article, we focused on the problem areas that Boom technology must master.
The most difficult area is to find a suitable engine for the aircraft. Engines for long-range supersonic flight are quite different animals than the normal subsonic airliner engine. We will go through why the engines are different and give an example of how such an engine could look.
Figure 1. Boom Technologies Boom Mach 2.2 airliner with 45 seaters. Source: Boom.
By creating a concrete example of an SST engine for an aircraft the class of the Boom SST, it will be possible to understand if Boom’s claim that suitable cores are available holds water, and how realistic is it to make an SST engine from these.
Summary:
- An SST engine is very different from a modern engine for a long-range airliner.
- A high-performing long-range engine for a normal airliner has a high bypass and pressure ratio.
- A high-perfoming long-range SST engine for a supersonic airliner has a low bypass and pressure ratio.
- Intakes and exhausts on subsonic engine nacelles are simple.
- Intakes and exhausts on supersonic engine nacelles are not simple.
- Considering all these factors, we will design an engine system for the Boom SST to get a deeper understanding of the challenges involved.
Resurgence for ERJ-145
Note: Nov. 24 and 25 are Thanksgiving Holidays in the US. Our next post will be Monday.
Subscription Required
Introduction
Nov. 23, 2016, © Leeham Co.: The 50-seat regional jet market is dead.
That’s the conventional wisdom.
Well, not quite.
Embraer ERJ-145 is finding new life with regional airlines.
Piedmont Airlines, a unit of American Airlines, is adding the 50-seat Embraer ERJ-145 to its fleet. Eleven joined so far and next year the company plans to add 24 more.
CommutAir, an operator for United Airlines, is adding the same aircraft type to its fleet. Forty of them.
Why the mini-resurgence?
Low fuel prices and cheap airplanes.
Summary
- 50-seat regional jets were considered economically obsolete with high fuel prices.
- Sustain low prices provided a boost to the Embraer ERJ-145.
- Bombardier’s CRJ-200 hasn’t seen a similar resurgence.
Emirates feels low-cost, long-haul competition
Note: Nov. 24 and 25 are Thanksgiving Holidays in the US. Our next post will be Monday.
By Bjorn Fehrm
23 November 2016, ©. Leeham Co: Emirates Airline president Tim Clark says the carrier “has to change its approach to long-haul pricing to combat increasing competition” after presenting a half year 2016 profit which plunged 64% on 9 November.
The reason is that traditional mainline carriers are entering the low-cost, long-haul market in addition to the established LCC entrants: Norwegian Air Shuttle, AirAsiaX and Wow Air.
Figure 1. Emirates long-haul A380. Source: Emirates.
Emirates will add new low-cost fares to keep its growing fleet of Airbus A380 and Boeing 777 filled. Clark states this is necessary and that the airline will not back down on its plans for additional aircraft. It will be a period “of fierce competition as more and more international network carriers are entering low-cost, long-haul,” declares the COO.
What has changed? Isn’t Emirates the Kings of competitive long-haul travel? Read more
UBS puts Sell rating on Embraer
Nov. 22, 2016: UBS resumed coverage on Embraer (NYSE: ERJ) today, rating the stock a Sell. It is the only Sell rating among seven analysts previously covering the 
company; six are Buys and one is Hold. UBS rated ERJ Neutral prior to suspending coverage.
Boeing aims to triple services unit; exec changes support goal
Kevin McAllister, the new CEO of Boeing Commercial Airplanes. Boeing photo.
Nov. 22, 2016, © Leeham Co.: Boeing hopes to triple its global services businesses from $15bn in revenues to nearly $50bn in the next five years. A corresponding increase is targeted in market share from today’s 7% in commercial aviation and 9% in defense.
Two moves in the executive ranks yesterday are clear signals of the increasing importance of services to The Boeing Co.’s business strategy, revenue growth and profits.
Boeing’s Conner steps down, successor named from GE Aviation
Kevin McAllister, the new president and CEO of Boeing Commercial Airplanes. Boeing photo.
Nov. 21, 2016: Boeing today announced that Ray Conner will retire as CEO of Boeing Commercial Airplanes well ahead of his Dec. 31, 2017, contract date.
Kevin McAllister of GE Aviation Services was named as his successor.
Boeing said Stan Deal was named president and CEO of Boeing Global Services, a new business unit “to be formed from the customer services groups within the company’s existing commercial airplanes and defense, space and security business units.”
Conner’s message to employees is below.