Leeham News and Analysis
There's more to real news than a news release.
Airbus’ and Boeing’s Payload/Range for Dual Aisle.
By Bjorn Fehrm
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Introduction
Aug. 17 2015, ©. Leeham Co: In our series over Boeing’s changes to its configuration rule sets, we will now continue with the dual aisle aircraft. Here the differences between Airbus and Boeing are larger. Boeing used to be specifying a three class cabin and Airbus two class. Now Boeing has changed to two class and Airbus is just changing to three class.
There is a bit of difference in the Airbus change to three class and the three class that Boeing had until now. Airbus changes from modern two class to a modern three class with Business, Premium Economy and Economy. Boeing’s change was from an outdated three class with old style First, Business and Economy to a modern two class with lie flat business section.
The new Boeing two class and historical Airbus two class are close in configuration. These end up within a seat or two of each other and also within our normalized two class cabins. As these cabin rules are similar, we use our normalized cabin data to compare the payload range of the aircraft when all apply the new, tougher passenger+bags weight rules and an equalized reserves policy.
Summary:
- Airbus’ two class rules and Boeing’s new two class Standard rules are close in their configurations.
- They are also close to our Normalized rule set. We use our normalized rule set to level the playing field on the cabin side.
- We can then apply the new tougher passenger and bags rules that Boeing’s Standard rule set prescribes for the twin aisle aircraft and see how they compare.
- We also use the same reserves policy for the comparison. Read more
Bjorn’s Corner: Holiday times
By Bjorn Fehrm
14 August 2015, ©. Leeham Co: It is holiday time in Europe and a lot of the European industry is shut down for summer break. This includes the Airbus Final Assembly Line (FAL) in Toulouse. Industrial holiday shut down or not depends a lot on the country’s industrial history.
Traditionally industry has closed shop for the month of July in the north of Europe and August in the south. For production-heavy industries with a lot of personnel in assembly work this is still the case. Examples are manufacturing industries like the auto industry, electromechanical goods industries and also the European aircraft industry.
For raw material industries, it depends if the manufacturing process can be interrupted for the three to four weeks a summer holiday would span. For many process chains, this is not possible. I earned my school summer break money on such an industry, replacing the worker that took his three or four weeks off.
Other parts of the world do not have summer breaks where the industry closes the doors and things go quiet. An example is the US, where, for example, Boeing produces aircraft 12 months of the year. Available vacation days are less than in Europe, typically two to three weeks against the typical four or five weeks in Europe. US vacations are usually taken spread over the year and the company normally doesn’t shut down production during the summer period. Read more
Airbus’ and Boeing’s Payload/Range for Single Aisle
By Bjorn Fehrm
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Introduction
Aug. 13 2015, ©. Leeham Co: Boeing this month changed the way it presents its aircraft in important areas like seating, weight and performance configurations, in short its “rule set.” After using a standardized but old rule set for 20 years, it updated all data around how far its aircraft can transport a standardized payload.
Airbus at the same time is also changing how it presents its aircraft. Right now the dual aisle wide bodies are going from a two class to a three class cabin in its rule set. While Boeing is leaving three class for two class, Airbus is going in the other direction.
Why these movements and are there any common themes in these conflicting changes?
We go behind the scenes to decipher the changes and decode what it all means when one want to compare Boeing and Airbus products. We start with the single aisle aircraft this week.
Summary:
- Airbus and Boeing had rather small differences in their rules and how they characterized single aisle aircraft up until this month.
- From now on Boeing is using higher average passenger+bags loads and have added additional equipment to the aircraft’s empty weight specification.
- We show what these changes mean for the aircraft’s performance. We also use our model to show Airbus single aisle aircraft’s range should they use the same rules as Boeing’s aircraft.
Mitigating risk, lessons learned as Boeing heads into MAX, 777X production
Aug. 12, 2015, © Leeham Co. Mitigating risk and taking lessons learned from across the entire 7-Series families are key to improving productivity, cutting costs and
Greg Smith, chief financial officer of The Boeing Co. Source: Boeing.
preparing for the transition from the 737NG to the MAX and from the 777 Classic to the 777X, the chief financial officer of The Boeing Co. said today at the Jefferies Global Industrials Conference.
Greg Smith told the conference, which was webcast, that putting all new airplane development under one department enables a common understanding of what’s going on across the product lines and therefore the new product lines benefit to reduce risk and create efficiencies.
The lessons learned from the 787 lines in Everett and Charleston “are very encouraging,” Smith said. “We are getting better learning from those efficiencies that transition to other parts of the business.”
Boeing is shutting the 787 surge line in Everett because production on the line is more inefficient than the main Everett and Charleston lines.
“The surge line has reached a point where it’s more inefficient than efficient,” Smith said. “We’ve reached a point of maturity in production where it’s clearly not needed. Getting the maturity of those two lines up gives you the confidence to shut down the surge line.”
B/E Aerospace sees “flat” widebody deliveries through 2016
Aug. 12, 2015, © Leeham Co.: Widebody deliveries are “flat as a pancake” and will remain so through 2016 before going up, driven by the Airbus A350, says a major 
supplier.
Officials of B/E Aerospace appeared yesterday at the Jefferies Co Global Industrials Conference, making the near-term forecast. B/E is best known as a seat supplier but also supplies galleys and lavatories.
With passenger load factors now routinely running around 85% and traffic growing, B/E’s backlog is greater than ever and the OEMs, pressured by airlines for on-time deliveries, likewise pressure suppliers. B/E competitor Zodiac had difficulties meeting demand late last year and early this year.
“You cannot image how much stress is created cannot deliver an airplane on time and the reason is a supplier,” a B/E official said. B/E has been able to keep up with demand.
Blockbuster deal for PCP: analysts’ first take
August 11, 2015: Berkshire Hathaway’s blockbuster $37bn acquisition proposal for Precision Castparts (stock symbol NYSE:PCP) takes one of the aerospace 
industry’s major suppliers out of the public trading and into one of the scores of Warren Buffet’s stable of companies under the Berkshire name.
PCP–we’ve always been amused by this stock symbol that shares initials with an illicit drug–is a major supplier to Boeing and other aerospace companies. PCP has grown through acquisitions of its own in addition to organic growth. PCP is a supplier to other industries besides aerospace.
Aerospace analysts have this first take on the acquisition, which is subject to shareholder and regulatory approvals:
C Series: challenges ahead
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Introduction
Bombardier CS300 (L) and CS100 (R). Click on image to enlarge. Photo via Google images.
Aug. 10, 2015, (c) Leeham Co. Bombardier came away from the Paris Air Show with positive reviews after finally displaying its new C Series. The CS100 was present in launch operator Swiss International colors and the spacious interior installed. The larger CS300, in house colors, was also on display and performed flying maneuvers, impressing the crowd with the quiet of the Pratt & Whitney P1000G Geared Turbo Fan engines, also a new product. Once airborne and circling around the runway, the engines could not be heard over the loud speakers of the show’s announcer.
BBD officials came away encouraged by response to the airplanes and they said potential customers were stopping by the chalet with new and renewed interest in the program.
But there remain formidable challenges ahead for the program. There were no sales announced at the Air Show, although BBD officials were clear in advance none was expected. None has been announced in the six weeks since the Air Show. Whether there will be any of substance by year end, and to whom, remains to be seen.
Focus is on execution: getting the aircraft certified by year end and preparing for delivery to Swiss in the first half of next year.
But the customer base remains of iffy quality and a number of the deliveries scheduled 2016-2018 fall into Leeham Co.’s Yellow and Risk Risk Assessment.
Summary
- Of nearly 200 deliveries scheduled 2106-1018, more than half fall within our Yellow-Red risk assessment.
- Country and region risk are concerns.
- A major customer has a changing business plan that puts deliveries into a Risk Assessment.
Pontifications: Talk about government interference in private industry; book review of United “Flight 232”
- There are many topics on which to comment, n one of which requiring a full Pontification, so today’s column is going to be a bit of a free association.
By Scott Hamilton
August 10, 2015, (c) Leeham Co. Government interference: While right wing Republicans and Tea Party members decry supposed ExIm Bank interference with private industry, there is now a bill in Congress to sell millions of barrels of oil from the USA’s Strategic Oil Reserve in order to raise $15bn.
Unlike the ExIm Bank’s participation in the global capital markets, Congress’s action–if it passes–won’t create jobs. It will compete with jobs and companies trying to sell oil in the global market place. It will help drive prices down.
Once more, the hypocrisy of Congress is glaringly evident.
Bombardier: Pierre Beaudoin should have left Bombardier last February when he relinquished the title of president and CEO to Alain Bellemare instead of assuming the chairman’s title. This is the opinion of a few people with whom I’ve talked just in the last week.
Furthermore, the Beaudoin family needs to step out of the company entirely and give up its voting control (it has 54% of the voting stock) if BBD wants to attract new investors, says one Canadian aerospace analyst who hasn’t written any of this publicly.
“I can’t even see how they’re going to raise money for BT. I can’t imagine European investors would like subordinate shares either. Equity markets won’t be supportive unless the Family gives up control,” this analyst wrote me.
Bjorn’s Corner: Why is the real range of an airliner always shorter then what the OEM says?
By Bjorn Fehrm
07 August 2015, ©. Leeham Co: Now that we have explained the range consequences of weight and fuel limited airplane operations, we might as well explain the last important part of the range of an airliner: Why the practical range is always shorter than what the OEM says.
When an airliner OEM gives the design or brochure maximum range of an aircraft, they do that with an aircraft in a “show-room” configuration and which is loaded with a filled cabin only; no cargo is included in the calculation. Further, in the cargo area, there is only bulk-loaded passenger bags. Container loading of the bags would have cost tare weight for the containers used and weight is to be avoided when stipulating the maximum design range.
In practice, we would have to consider tare weight for bags containers and possible cargo when discussing what practical range an airline can plan for a certain aircraft model. But this is far from the whole story. Here is what has to be considered in addition.
MH370: “Presumption” becomes “high presumption,” but little else
August 5, 2015: French authorities said today there is a “high presumption” that the flaperon found last week on La Reunion Island east of the African coast is from Malaysia Airlines flight MH370, a Boeing 777-200ER.
The prime minister of Malaysia was more certain, saying the wing part was definitely from MH370.
When the flaperon was found and identified by photos as coming from a 777, the presumption then was that it was from MH370. Now it’s a “high presumption.”
Beyond this, there is nothing new.