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By Bjorn Fehrm
Introduction
Dec. 16 2015, ©. Leeham Co: Fuel prices at a record low changes a lot of short- and mid-term planning scenarios for airlines. An introduction of a used aircraft with higher fuel burn for a typical lease period of five to six years is possible without endangering the airline’s economics.
The risk of oil prices going sky high in such a period is low, hence the attractiveness of complementing ones fleet with leased older aircraft like Canada’s WestJet has done. It will introduce ex. Qantas 767-300ERs on several traditional 757 destinations like Hawaii and presumably West Europe.
We therefore expand our in dept look of the deployment of used aircraft with a look at the WestJet choice; Boeing’s 767-300ER and compare it to a more contemporary twin, Airbus A330-200.
Summary:
⦁ The 767-300ER is around 25 seats smaller than our benchmark aircraft, the more modern A330-200.
⦁ The A330-200 previously put the 767 under pressure and Boeing responded with the 787-8. We will check if this is still the case when oil is below $40 a barrel and leasing cost for a used 767 is below $300,000.
⦁ We will also check what load-factors an airline like WestJet has to attain on the 767 to reach the same seat-mile costs as for the 757 that the route was up-gauged from.
⦁ We will follow the scheme of the 777-200ER vs. A340-300E comparison, Part 1 compares the aircraft, Part 2 the costs and Part 3 the revenue and margin performance of the aircraft.
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Pontifications: Looking ahead to 2016
Jan. 4, 2016, © Leeham Co. Let’s take a walk through our outlook for 2016.
Boeing is 100
There will no doubt be all kinds of celebrations at the Air Show. To the extent possible, I would imagine Boeing will try to have a whole lot of orders to announce there. There will be all kinds of run-up to the 100th anniversary. Few throw a party as well as Boeing. (Just don’t sing “Happy Birthday;” I never have liked this song.)
It’s a great achievement and we should all celebrate with Boeing for the next seven months.
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101 Comments
Posted on January 4, 2016 by Scott Hamilton
Airbus, Boeing, Bombardier, Comac, Farnborough Air Show, Leeham News and Comment, Mitsubishi, Pontifications, Pratt & Whitney
747-8, 777 Classic, A380, Airbus, Boeing, Bombardier, C919, Comac, CS100, CS300, CSeries, Farnborough Air Show, Mitsubishi, MRJ90, Pontifications, Pratt & Whitney
How good is a used 767-300ER? Part 3
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By Bjorn Fehrm
Introduction
Jan. 4 2016, ©. Leeham Co: Before Christmas we started our Boeing 767-300ER article series around acquiring used twin-aisle 767 aircraft to upgrade Boeing 757-based long haul services. We compared the aircraft’s base characteristics in Part One and then their Cash Operating Cost (COC) in Part Two.
Now we continue by analyzing the Direct Operating Cost (DOC) of the aircraft. This adds capital costs to the other operating costs for the aircraft. As the reason for our renewed interest in the 767-300ER is the attractive prices on the used market combined with low fuel prices, the capital costs are an important part of the overall understanding of the costs for the aircraft.
In our assumptions, the 767 is bought as a 10 year old aircraft and then refurbished. It is then operated on a six year financial lease, as is our 757 that we replace. Our benchmark aircraft, the Airbus A330-200 flying in a mainline airline, was bought new in 2009 and is operated on a 10 year financial lease.
Summary
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Posted on January 4, 2016 by Bjorn Fehrm
Airbus, Aviation Partners Boeing, Boeing, GE Aviation, Pratt & Whitney, Premium, Rolls-Royce
757-200W, 767-300ER, A330, Airbus, Boeing, CF6-80C, PW2040, Trent 700
Mitsubishi delays MRJ90 EIS one year, IDs “issues”
Update, Dec. 25: The Seattle Times reports the MRJ90 doesn’t meet the 150% certification requirement.
Update, Dec. 24: Mitsubishi’s biggest customer for the MRJ90 weighed in on the latest news of a delay and structural issues. From today’s Wall Street Journal:
SkyWest Inc., the largest U.S. regional airline operator by revenue, has as many as 200 of the Mitsubishi jets on order. In advance of Mitsubishi’s news conference Thursday, a SkyWest spokeswoman said the company was sticking with its order, but said it was “dependent on flying contracts, scope and aircraft availability.”
There are enough caveats in that statement to be cause for worry about the solidity of the order. Trans States Airlines of the USA, the second largest customer, could not be reached (it was after hours) by the WSJ for comment. Launch customer and launch operator ANA stood behind the company, the WSJ reported.
Original post:
Dec. 23, 21015: Mitsubishi issued a press release at 4pm Tokyo time Dec. 24 (11pm Seattle Time Dec. 23), announcing a delay of entry into service by about a year from 2Q2017. The press release said “issues” arose during flight testing, but the PR did not identify what these are.
The press conference is going on as this is posted. The press release is below. The short PPT/PDF presentation is here: 20151224_Update on MRJ Development Status
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16 Comments
Posted on December 23, 2015 by Scott Hamilton
Mitsubishi
Mitsubish, MRJ90
Top 10 Stories in 2015
Here are the Top 10 stories on Leeham News and Comment for 2015:
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10 Comments
Posted on December 23, 2015 by Scott Hamilton
Airbus, Airlines, Boeing, Emirates Airlines, GE Aviation, Leeham News and Comment, Malaysian Airlines, MH370
737, 737-8, 737-8ERX, 737-9, 747-8, A320, A321LR, A321NEO, A350-900LR, A380neo, Airbus, Boeing, Emirates Airline, Malaysia Airlines, Singapore Airlines
Boeing stock sell-off on 777-200ER deal over-blown
Dec. 22, 2105, © Leeham Co.: The sell-off in Boeing stock last week tied to the Delta Air Lines purchase (Letter of Intent) of a 777-200ER for $7.7m was overblown.
The stock was off 2.6% Thursday after Delta CEO Richard Anderson Tweeted an LOI had just been signed to buy a 777-200ER. This sell-off, and an earlier one when Anderson said the -200ER could be acquired for $10m, prompted hand-wringing over 777 values and the potential impact on new 777 Classic sales needed to build the bridge to the production of the 777X.
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19 Comments
Posted on December 22, 2015 by Scott Hamilton
Airbus, Boeing, Delta Air Lines, Emirates Airlines, United Airlines
767-300ERF, 777-200ER, 777-300ER, A330-300, Airbus, Boeing, Continental Airlines, Credit Suisse, Delta Air Lines, Emirates Airline, Kenya Airways, Malaysia Airlines, Singapore Airlines, Transaero, United Airlines, Wells Fargo
CS100 certified; We review CS100’s birth with VP CSeries, Rob Dewar
Introduction
By Bjorn Fehrm
21 December 2015, ©. Leeham Co: Bombardier (BBD) received certification of the smaller CSeries, the CS100, by Transport Canada Thursday. Rob Dewar, vice president of CSeries, reflected on the journey to certification in an exclusive interview with LNC.
CSeries VP Rob Dewar with CS100 Certificate. Source: Bombardier.
The interview was done against a backdrop of more than two years of delays, which in turn drained the coffers of BBD. To save the project and let it prove its game-changing character, management sold 49.50% of the CSeries program to the Province of Quebec for $1bn and 30% of its train division to Caisse de dépôt et placement du Québec, for an additional $1.5bn.
Dewar has managed the project from the program launch in 2008. The transcript of the interview follows.
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16 Comments
Posted on December 21, 2015 by Bjorn Fehrm
Airbus, Airlines, Boeing, Bombardier, CSeries, Pratt & Whitney, Rockwell Collins
737 MAX, 737 MAX 7, A319neo, Airbus, Boeing, Bombardier, CSeries, Pratt & Whitney
Pontifications: Potential MRJ safety issue, delay impacts customers
By Scott Hamilton
Dec. 21, 2015, © Leeham Co.: Mitsubishi Aircraft announced last week that its MRJ90 program was undergoing a review following three test flights. A new schedule could be announced as early as this week, but by the end of the month is also possible.
The company didn’t indicate what prompted the review, but the 7news service reported that “safety” issues were involved.
A delay in delivery to the first customer, ANA, slated for 2Q2017, is almost a certainty. This isn’t good news for the program, which is already more than two years late.
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16 Comments
Posted on December 21, 2015 by Scott Hamilton
Mitsubishi
Air Mandalay, ANA, Eastern Airlines, Japan Air Lines, Mitsubishi, MRJ90, SkyWest Airlines, Trans States Airlines
How good is a used 767-300ER, Part 2
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Introduction
By Bjorn Fehrm
Dec. 21 2015, ©. Leeham Co: Last week we started our Boeing 767-300ER article series around acquiring used twin-aisle 767 aircraft to upgrade 757-based long haul services, like Canada’s WestJet has done. We compared the aircraft and looked at the base data for the aircraft in article one.
Now we continue by analyzing the Cash Operating Cost (COC) of the aircraft in a typical long haul configuration, using our normalized seating. We are assuming that the 767 and the 757 are a half-life state between overhauls of engines and airframe.
Our benchmark aircraft is an Airbus A330-200 which is flying in a mainline airline. Here we assume that it is 25% deteriorated since new for engines and airframe.
Summary
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Posted on December 21, 2015 by Bjorn Fehrm
Airbus, Boeing, GE Aviation, Pratt & Whitney, Premium, Rolls-Royce
757-200W, 767-300ER, A330-200, Airbus, Boeing, GE Aviation, Pratt & Whitney, Rolls-Royce
Bjorn’s Corner: Engine efficiency revisited
By Bjorn Fehrm
18 December 2015, © Leeham Co:Part of the discussion following last week’s article around quad or twin engine airliner designs was about engine efficiency and specifically around the engine’s thermal efficiency as a function of Pressure Ratio, PR.
I got the question, if an engine working at a higher pressure ratio was therefore working at a higher thermal efficiency. I knew enough on the subject to know I did not have a good answer without doing a bit of checking; jet engines are no simple contraptions.
I have previously written about turbofan efficiency in a Corner. The article was focused around propulsive efficiency. Now we will have a look at the other part of overall engine efficiency, the thermal efficiency or the efficiency of the core.
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23 Comments
Posted on December 18, 2015 by Bjorn Fehrm
Bjorn's Corner, Boeing, CFM, GE Aviation
737 MAX, CFM, CFM Leap-1B
How good is a used 767-300ER?
Subscription required
By Bjorn Fehrm
Introduction
Dec. 16 2015, ©. Leeham Co: Fuel prices at a record low changes a lot of short- and mid-term planning scenarios for airlines. An introduction of a used aircraft with higher fuel burn for a typical lease period of five to six years is possible without endangering the airline’s economics.
The risk of oil prices going sky high in such a period is low, hence the attractiveness of complementing ones fleet with leased older aircraft like Canada’s WestJet has done. It will introduce ex. Qantas 767-300ERs on several traditional 757 destinations like Hawaii and presumably West Europe.
We therefore expand our in dept look of the deployment of used aircraft with a look at the WestJet choice; Boeing’s 767-300ER and compare it to a more contemporary twin, Airbus A330-200.
Summary:
⦁ The 767-300ER is around 25 seats smaller than our benchmark aircraft, the more modern A330-200.
⦁ The A330-200 previously put the 767 under pressure and Boeing responded with the 787-8. We will check if this is still the case when oil is below $40 a barrel and leasing cost for a used 767 is below $300,000.
⦁ We will also check what load-factors an airline like WestJet has to attain on the 767 to reach the same seat-mile costs as for the 757 that the route was up-gauged from.
⦁ We will follow the scheme of the 777-200ER vs. A340-300E comparison, Part 1 compares the aircraft, Part 2 the costs and Part 3 the revenue and margin performance of the aircraft.
Read more
2 Comments
Posted on December 17, 2015 by Bjorn Fehrm
Airbus, Airlines, Boeing, GE Aviation, Pratt & Whitney, Premium
757-200W, 767-300ER, A330-200, Airbus, Boeing, GE Aviation, Pratt & Whitney
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