Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Bjorn’s Corner: Air Transport’s route to 2050. Part 25. June 6, 2025
- New RISE powerplant benefits from decades of GE research and development June 5, 2025
- Engine makers emphasizing durability, reliability June 4, 2025
- Boeing CEO: Lessons learned are key to certification of 737-7/10 and 777X June 2, 2025
- Digital twin is a key to JetZero’s hopes for Blended Wing Body entry June 2, 2025
Southwest could solve its MAX 7 woes … by buying Breeze?
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Now open to all readers
By Judson Rollins
Introduction
May 6, 2024, © Leeham News: Southwest Airlines, still awaiting the certification and delivery of the Boeing 737 MAX 7 as a replacement for its aging 737-700s, might have an unorthodox alternative: acquire startup Breeze Airways for its Airbus A220 fleet – and, more importantly, its order book.
Source: Orlando International Airport via Simple Flying.
Launched in 2021 by serial airline entrepreneur David Neeleman, Breeze operates 23 A220-300s, 10 Embraer E190s, and six E195s to 47 airports across the US. It focuses on connecting larger airports to smaller cities, including a handful of transcontinental routes.
Ironically, the Utah-based airline achieved its first-ever monthly operating profit in March. It recently announced plans to operate the A220 exclusively by the end of this year.
According to a January update from database provider Cirium, Breeze has between 11 and 13 A220s scheduled for delivery each year through 2028. No options are listed.
Market intelligence says Airbus Commercial Aircraft CEO Christian Scherer visited with Southwest executives in Dallas and Breeze leadership near Salt Lake City in mid-April. This was well after Breeze’s February order for 10 additional A220s.
Summary
- To deliver or not to deliver the MAX 7?
- Southwest’s aging 737-700 fleet has few replacement options
- How a Breeze acquisition might play out
- Azorra Aviation is likely a key partner in helping Southwest get A220s
Bjorn’s Corner: New engine development. Part 6. Open Rotor
By Bjorn Fehrm
May 3, 2024, ©. Leeham News: We do an article series about engine development. The aim is to understand why engine development now has longer timelines than airframe development and carries larger risks of product maturity problems.
To understand why engine development has become a challenging task, we need to understand engine fundamentals and the technologies used for these fundamentals.
We have in previous Corners discussed geared versus direct-drive turbofans. Now the time has come to discuss Open Rotor engines.
Figure 1. The GE 36 Open Rotor engine, the father to today’s CFM RISE. Source: GE Aviation.
A350-1000 or 777-9? Part 4
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By Bjorn Fehrm
May 2, 2024, © Leeham News: We are doing an article series comparing the capabilities of the Airbus A350-1000 and the Boeing 777-9. We looked at the development history of the aircraft and then their capability and fuel economics.
We could see that the 777-9 is trailing the A350-1000 in payload range, partly because we compare the base version of the 777-9 with a further developed A350-1000. Now, we investigate what the 777-9 performance would be should we include a typical future development of the Maximum TakeOff Weight (MTOW).
Summary:
- The A350-1000 has a clear payload-range advantage over the standard 777-9.
- With an in-service Maximum TakeOff Weight (MTOW) development like the A350-1000, the difference is reduced.
Pontifications: Tombstone mentalities and Fantasy Land
By Scott Hamilton
Analysis
By Scott Hamilton
April 30, 2024, © Leeham News: David Calhoun, the CEO of The Boeing Co., put this right at the top of an employee message and the
1Q2024 earnings call last Wednesday:
“Since Jan. 5, more than 70,000 of you have participated in Quality Stand Downs across more than a dozen Boeing sites. From those, we’ve received more than 30,000 ideas on how we can improve. And this year, we’ve seen more than a 500% increase in employee Speak Up submissions compared to 2023. We are taking all ideas collected and prioritizing them as we further enhance our factory disciplines and overall quality standards. Our people know better than anyone the actions we must take to improve, and we are listening and acting on their feedback.”
It’s obviously a statement intended to assure everyone interested in Boeing that it’s taking positive steps to increase safety protocol and listen to employees.
I had two reactions.
First: Why was this necessary? Supposedly after the 2018-19 737 MA X crisis, Boeing upped its safety protocols, its employee Speak Up program, and it was forced into a new relationship with the Federal Aviation Administration (FAA).
The Jan. 5, 2024, accident involving Alaska Airlines flight 1282 made it crystal clear that the post-2019 MAX crisis changes were largely window dressing.
Second: Reading Calhoun’s statement reminded me of a long-held axiom in commercial aviation of what’s derisively called the Tombstone mentality. This is tied to the belief that the FAA doesn’t take drastic safety action until after someone dies in an accident.
Unfortunately, recent history renders this parallel to The Boeing Co.
Sadly, failure to assure safety is indeed Boeing’s No. 1 priority will go down as David Calhoun’s legacy as CEO of The Boeing Co.
Related articles:
- SPEEA, Boeing at impasses over safety proposal
- Boeing unlikely to meet the FAA’s 90-day deadline on safety plan
- Boeing defends against whistleblower allegations
- Boeing must meet FAA quality plan before raising production rates (Reuters)
Boeing Financial Analysis – Inventory Q1 2024
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By the Leeham News team
April 29, 2024, © Leeham News: The Boeing Co (BA) released its financial results on April 24 for the first quarter of this year. BA relies heavily on Program Accounting to determine what amount of expenses are to be deducted against income, which is a major feature of the system.
The company also reveals the latest information about deferred program balances. This is closely related to Program Accounting.
A Quick Primer
Boeing describes program accounting in its financial statements:
Boeing Commercial Airplanes (BCA) develops, produces, and markets commercial jet aircraft principally to the commercial airline industry worldwide. Revenue on commercial aircraft contracts is recognized at the point in time when an aircraft is completed and accepted by the customer.
With respect to each of our commercial aircraft programs, inventoriable production costs (including overhead), program tooling and other nonrecurring costs, and routine warranty costs are accumulated and charged as cost of sales by program instead of by individual units or contracts.
Source: Boeing Financial Statements
As such, expenses reported for the sale of aircraft during the reporting period are not what was paid, but what BA estimates the average cost will be over the remaining orders and aircraft to be sold. Any overages are noted as an increase in Deferred Production Costs and are held in Inventory.
Bjorn’s Corner: New engine development. Part 5. Turbofan design problems
By Bjorn Fehrm
April 26, 2024, ©. Leeham News: We do an article series about engine development. The aim is to understand why engine development now dominates new airliner development when it comes to the needed calendar time and risks.
To understand why engine development has become a challenging task, we need to understand engine fundamentals and the technologies used for these fundamentals.
We discussed geared versus direct-drive turbofans last week. Now, we’ll examine some design problems for these engines.
Figure 1. The Pratt & Whitney PW1100G geared turbofan, with its unique aluminum fan. Source: Pratt & Whitney.
Airbus 1Q2024 results: Airbus CEO: “A350 in-service experience drives positive reputation and orders”
By Bjorn Fehrm
April 25, 2023, © Leeham News: Airbus has presented its results for the first quarter of 2024. The strong order flow continues, with a pickup on the widebody side, especially for the A350.
Airbus has, therefore, canned the rate 10 target for 2026 and aims for rate 12 in 2028, with a stronger mix of A350-1000s.
The company has a net cash position of €8.7bn and €30bn liquidity. Guidance for 2024 is unchanged, with 800 commercial aircraft delivered, an EBIT adjusted of €6.5bn to 7 bn, and a Free cash flow of €4bn.
A350-1000 or 777-9? Part 3
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By Bjorn Fehrm
April 25, 2024, © Leeham News: We are doing an article series comparing the capabilities of the Airbus A350-1000 and the Boeing 777-9. We looked at the development history of the aircraft and compared their size and payload capacity.
Now, we use our Aircraft Performance and Cost Model (APCM) to fly the aircraft on a typical route and compare their performance. We also look at their stage of development and the potential for future upgrades inherent in the design.
Summary:
- The A350-1000 has got its Maximum TakeOff Weight (MTOW) increased four times since entry into service.
- The latest MTOW hike to 322t gives the A350 a clear payload-range advantage over the 777-9. Any increase in the 777-9’s MTOW will have to come after type certification.
Boeing CEO promises company is turning around…again
By the Leeham News Team
April 24, 2024, © Leeham News: Boeing burned about $3.9B in free cash and posted a loss of $1.13 per share during the first quarter, the company reported on Wednesday. It also reported its first quarter-over-quarter revenue decline since 2022.
Even so, the bleeding was substantially less than expected by Wall Street, which had a consensus forecast of -$1.63/share (and a range of -33 cents/share to -$3.16/share). Boeing Commercial Airplanes’ financial performance suffered from the downturn in 737 MAX production since the Jan. 5 accident involving Alaska Airlines Flight 1282, when an emergency exit door plug blew out as the plane climbed out of Portland.
The company’s quarterly finances were bolstered by Boeing Global Services and Boeing Defense.
Boeing CEO David Calhoun continued to assert that company executives are proactively cleaning up an inconsistent safety culture and addressing production woes from their corporate offices on the Potomac. The company’s planned acquisition of Spirit AeroSystems is taking longer than expected, and it could be wrapped up by mid-year, he told investment analysts during a conference call on Wednesday.
Fuselages for the 737 MAX program from Wichita have fewer and fewer defects, and the program’s production rate will increase in the second half of the year, Calhoun and Boeing CFO Brian West said during the call.
Solid start for stand-alone GE Aerospace despite cuts to LEAP output
By Tom Batchelor
Apr. 23, 2024, © Leeham News: GE Aerospace enjoyed a “solid start” to 2024 with double-digit growth across orders, revenue and operating profit, the engine maker said as it published its Q1 results – the first since becoming a standalone aerospace company.
The Ohio-headquartered supplier reported “significant profit and cash growth” and raised its full-year forecast following the recent spin off of its aviation and energy businesses.
Aerospace orders grew by 34%, to $11bn, with revenue up 15%, to $8.1bn, helped by pricing, spare parts volume, and increasing deliveries in widebody and defense.
That pushed operating profit to $1.5 billion, an increase of 24%. Operating profit margins reached 19.1%, up by 140 basis points.
In its updated forecast for the full-year 2024, GE Aerospace said operating profits were expected to climb to $6.2-6.6 billion, up from the $6-6.5 billion that was listed in earlier guidance. Read more