To Members of the US Congress:
There will be a vote soon on whether to reauthorize the US ExIm Bank. You should do so.
Arguments by some that this is a form of corporate welfare are unfounded. Suggestions that ExIm Bank merely supports The Boeing Co. are misguided.
To be sure, Boeing airplanes received the majority of ExIm Bank commitments and guarantees. This is because Boeing makes the most expensive things ExIm supports. But plenty of small businesses benefit from ExIm as well.
Supporting ExIm for Boeing airplanes creates jobs in America. LionAir of Indonesia ordered hundreds of Boeing 737s. ExIm Bank support was pledged to support this order. LionAir also ordered hundred of Airbus A320s. If ExIm weren’t supporting the 737s, it’s a fair conclusion LionAir would have ordered more A320s instead of Boeing. Why? Airbus gets active support from the ExIm’s equivalent agencies in Europe.
LionAir is but one such example.
Boeing is one of the top exporters (if not the top) of US products. These exports help the US balance of trade.
If ExIm is not reauthorized, Airbus will have an international advantage over Boeing. My market intelligence tells me that Airbus has already used the ambiguity over ExIm’s reauthorization in sales campaigns against Boeing.
If there are specific problems with how ExIm is administered, fix them, but don’t kill the program that has been around–and successfully supporting American businesses–for decades.
ExIm returns a profit to the US Treasury with its fees and other charges supporting its work. How many government programs can say this?
Stop playing games with and holding hostage ExIm Bank. It’s time to grant long-term reauthorization.
Very truly yours,
Scott Hamilton
Editor
Leeham News and Comment
Leeham News and Analysis
Bjorn’s Corner: Flying the Airbus A350
By Bjorn Fehrm
Introduction
22 May 2015, C. Leeham Co: As one of four aeronautical media companies we were asked by Airbus if we wanted to test fly the A350 end of January this year. Airbus was arranging for Media test pilots to come and fly the A350 and we had asked for sampling the A350 through its simulator. Airbus returned with the question if I did not want to try the real thing. They did not have to ask twice!
It was all in the preliminary planning stage at the time but come March things got concrete. I should come to Toulouse on April 22 for a full day in the simulator and then the aircraft. As I did not have previous airline flying experience (mainly military fighters and business aircraft), I started training on the rather different system approach that a civil airliner has to a military fighter for Autopilot and Autothrust. I described this training in a previous Bjorn’s Corner. Publication of this story was embargoed by Airbus to May 22.
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35 Comments
Posted on May 21, 2015 by Bjorn Fehrm
Airbus, Bjorn's Corner, Leeham News and Comment
A350, A350-900, Airbus, Bjorn's Corner
Analysis: First phase of A350 production
By Bjorn Fehrm
Subscription required
Introduction
May 20, 2015, c. Leeham Co. The 27th Airbus A350 has started its journey in the Final Assembly Line (FAL) in Toulouse and one can do a first analysis of how the initial batch of A350s has fared on the final production line. For this purpose, we have been closely monitoring the through-flow times for each of the nine steps that constitute the final assembly of the A350.
Summary
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Posted on May 20, 2015 by Bjorn Fehrm
Airbus, Premium
A350, A350 XWB, Airbus
Open Letter to Members of Congress on ExIm
To Members of the US Congress:
There will be a vote soon on whether to reauthorize the US ExIm Bank. You should do so.
Arguments by some that this is a form of corporate welfare are unfounded. Suggestions that ExIm Bank merely supports The Boeing Co. are misguided.
To be sure, Boeing airplanes received the majority of ExIm Bank commitments and guarantees. This is because Boeing makes the most expensive things ExIm supports. But plenty of small businesses benefit from ExIm as well.
Supporting ExIm for Boeing airplanes creates jobs in America. LionAir of Indonesia ordered hundreds of Boeing 737s. ExIm Bank support was pledged to support this order. LionAir also ordered hundred of Airbus A320s. If ExIm weren’t supporting the 737s, it’s a fair conclusion LionAir would have ordered more A320s instead of Boeing. Why? Airbus gets active support from the ExIm’s equivalent agencies in Europe.
LionAir is but one such example.
Boeing is one of the top exporters (if not the top) of US products. These exports help the US balance of trade.
If ExIm is not reauthorized, Airbus will have an international advantage over Boeing. My market intelligence tells me that Airbus has already used the ambiguity over ExIm’s reauthorization in sales campaigns against Boeing.
If there are specific problems with how ExIm is administered, fix them, but don’t kill the program that has been around–and successfully supporting American businesses–for decades.
ExIm returns a profit to the US Treasury with its fees and other charges supporting its work. How many government programs can say this?
Stop playing games with and holding hostage ExIm Bank. It’s time to grant long-term reauthorization.
Very truly yours,
Scott Hamilton
Editor
Leeham News and Comment
28 Comments
Posted on May 20, 2015 by Scott Hamilton
Airbus, Boeing
737, A320, Airbus, Boeing, ExIm Bank
Dissecting the United A319 deal: implications
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Introduction
May 19, 2015, c. Leeham Co. United Airlines and mega-lessor AerCap announced last week UAL will lease up to 25 Airbus A319s, with deliveries from 2016-2021. The aircraft are currently leased to China Southern Airlines. These are powered by the International Aero Engines V2500, the same engine that powers UAL’s current fleet of A319s and A320s.
UAL said it will use the A319s to replace 70-seat regional jets, freeing these to shift into 50-seat RJ markets. This represents a general up-gauging at the lower end of United’s fleet.
There are also more implications to this transaction.
Summary
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Posted on May 19, 2015 by Scott Hamilton
Airbus, Airlines, Boeing, Bombardier, Embraer, Premium
737-700, A319, A320, AerCap, Airbus, Boeing, Bombardier, China Southern Airlines, CRJ, CRJ-500, CS300, CSeries, E-145, E-175, E-Jet, Emrbaer, United Airlines
Pontifications: Boeing spin
By Scott Hamilton
May 18, 2015: Boeing has always been masterful with spinning its message, but the spin last week strains credibility with its explanation over how it will bridge the production gap for the 777 Classic into production of the 777X.
Leeham News last week examined Boeing’s detailed explanation, emerging from its May 12 investors day. Reports from aerospace analysts recounted Boeing’s assertion that when “feathering” in 777X production on the 777 Classic, because production of the X will be slow (normal for a new model and the ramp-up/learning curve), the X will be the equivalent of producing two or three Classics–and thus today’s production rate of 8.3/mo (100/yr) will be preserved, as claimed from the launch of the X program.
Poppycock. Read more
133 Comments
Posted on May 18, 2015 by Scott Hamilton
Airbus, Boeing
737, 737-9, 737-900ER, 747-8I, 777, 777 Classic, 777X, 787, A320, A321, A350-1000, A350-800, A380, Airbus, Boeing, WTO
Paris Air Show: Bombardier
Subscription Required.
Introduction
March 17, 2015, c. Leeham Co.: Bombardier and air shows just don’t get along.
In 2009, there was wide anticipation at the Paris Air Show that BBD would announce a deal with Qatar Airways for 20 CS300s. The contract was ready. Instead, Qatar ordered a combination of Airbus A319/320neos after the French government pressured the Qatari government to avoid giving the CS300 a major boost on French soil. Given how persnickety Qatar Airways CEO Akbar Al Baker later proved to be with Airbus, Boeing and Pratt & Whitney, Bombardier is probably lucky this deal collapsed.
But subsequent air shows proved no better for BBD. Expectations arose and were inevitably dashed.
One reason: under Canadian law, orders and even letters of intent and MOUs must be announced within 24 hours. But BBD just couldn’t seem to make a sale. We’ve written several times about circumstances that went beyond BBD’s ability to control events, but clearly there was something more fundamentally wrong that this year, at long last, is being addressed through executive changes and corporate restructuring.
What does this mean for BBD at the Paris Air Show this year?
Summary
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3 Comments
Posted on May 17, 2015 by Scott Hamilton
Airlines, Bombardier, Paris Air Show, Pratt & Whitney, Premium
Akbar Al-Baker, Alain Bellemare, Bombardier, Colin Bole, CRJ900, CS100, CS300, CSeries, Fred Cromer, FTV 5, FTV 7, GTF, Henri Coupron, Pierre Beaudoin, Pratt & Whitney, Q400, Qatar Airways
Bjorn’s Corner: China’s civil aviation, from nothing to world’s largest in 2030
Introduction
By Bjorn Fehrm
14 May 2015, C. Leeham Co: In my ISTAT Asia reports, I wrote about how China will overtake USA as largest civil aviation market in 2030. Airbus China Group chairman, Laurence Barron, and I had a chat after his ISTAT presentation where he described China’s evolution as a civil aviation market and how Airbus gradually worked itself from a late and hesitant start to today’s split of the market with Boeing.
Barron provided his slides, some of which we will use to review how China grew from virtually no civil aviation after the Chinese revolution in 1949 to the world’s largest market by 2030. We will also look at what aircraft have made up this growth and finally describe how Airbus progressed from a latecomer in 1985 to sharing the market with Boeing today.
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19 Comments
Posted on May 14, 2015 by Bjorn Fehrm
Airbus, Airlines, Bjorn's Corner, Boeing, China, Douglas Aircraft Co, Leeham News and Comment, McDonnell Douglas
707, A310, Airbus, Boeing, EADS
Boeing details 777 bridge plan
May 13, 2015: For the first time Boeing has detailed how it plans to bridge the production between the 777 Classic and 777X, according to aerospace analysts attending the May 12 investors day.
Boeing previously said it needs to sell 40-60 777s a year to maintain current production rates of 100/yr (8.3/mo) to the introduction of the X. This pledge has drawn a great deal of skepticism from analysts and this column.
Boeing’s detailed explanation, its first, does little to lessen doubts.
Boeing said it will feather the X into current production rates, with the X becoming the equivalent of two or three Classics, thus, it claims, maintaining current rates, according to Wells Fargo.
Boeing also claims that it will maintain rates by managing its skyline, advancing deliveries, according to Buckingham Research.
There are several problems with these claims.
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76 Comments
Posted on May 13, 2015 by Scott Hamilton
Boeing
777, 777X, Boeing
ISTAT Asia day two: home for the elderly
Introduction
May 12, 2015, c. Leeham Co: As you would have guessed we are talking Asian civil airliners, where planning in the region for the fast growing older generations is inadequate. This was the subject of several sessions during day two of the ISTAT Asia (International Society of Transport Aircraft Trading) conference in Singapore.
The problem is new, as up to now a newly established airline fleet in Asia has not had any numbers of older aircraft. But the expansion over the last 20 years is now producing the first transition waves of aircraft and the planning around the problems this generates is inadequate.
The result will be surprising write-downs of airline assets as aircraft being replaced cannot be transitioned out at booked residual values. The scale of the problem was highlighted by a survey of the 500 gathered ISTAT industry experts. The question posed to them was “There are 4700 aircraft coming up for replacement until 2033, has Asian airlines planned adequately for this?”:
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5 Comments
Posted on May 12, 2015 by Bjorn Fehrm
Airbus, Airlines, Boeing, China, ISTAT, Leasing, Rolls-Royce
777, A330, Airbus, Boeing
Boeing investors day
May 12, 2015: Boeing held its annual investors day May 12. Note in particular the Buckingham and Wells Fargo commentary on the 777 bridge to 777X. Read more
5 Comments
Posted on May 12, 2015 by Scott Hamilton
Boeing
747-8, 777, 777X, Boeing, Boeing investors day, Buckingham Research, Canaccord, Credit Suisse, Goldman Sachs, Ray Conner, UBS, Wells Fargo
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