Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
- Boeing CEO promises company is turning around…again April 24, 2024
- Solid start for stand-alone GE Aerospace despite cuts to LEAP output April 23, 2024
- SPEEA, Boeing at impasse over safety program, union says April 23, 2024
- Better transparency needed on Boeing’s 1Q earnings call April 22, 2024
- Bjorn’s Corner: New engine development. Part 4. Propulsive efficiency April 19, 2024
Boeing should “dual source” 737 fuselage work–right here in Puget Sound
Boeing’s 737 line suffered a second disruption when a train carrying fuselages from Spirit AeroSystems derailed in Montana, sending three of six down an embankment and into a river.
Source: PBS.
The disruption may be short-lived, but nonetheless highlights the issue of relying on Spirit as a sole-source supplier for 737 fuselages. This is the second time in two years there has been a disruption for the 737 line. A tornado struck the Spirit plant in 2012, closing the facility for a short time. Damage was slight, but had the twister been more of a direct hit, the impact on Boeing would have been severe.
With Boeing planning to bring production of the 737 line to 47/mo by 2018 and pondering rate 52 and even rate 60, the company should consider creating a second fuselage production line–and it should be right here in Puget Sound.
Boeing’s production gap challenge for the 777 Classic
Wall Street aerospace analysts are becoming increasingly concerned that Boeing will fall short of its goal to maintain 777 production rates at the current 8.3/mo through the introduction of the 777X, planned for entry-into-service in 2020.
One analyst predicts a rate reduction from 8.3/mo to seven and then to five as 2020 gets closer. Others are beginning to hint that they won’t be far behind in lowering expectations. But don’t tell this to Randy Tinseth, VP Marketing for Boeing.
“We have things in the pipeline and we’re working on those,” he told us July 1. “We’re confident the sales will come home and we’re confident we’ll bridge the gap.”
Alaska-Delta Battle in Seattle comes at the expense of United, Southwest
National media and trade magazines are paying attention to the increasing battle between Alaska Air Group (Alaska Airlines and Horizon Airlines) and Delta Air Lines (including its regional airline partners) in the Battle in Seattle as the latter dramatically increases its presence here, but the focus appears to be on the wrong parties.
While the headlines and stories point to the “Delta challenge” to Alaska, a review of the traffic statistics and market share data provided to us by Sea-Tac Airport yesterday show that Alaska and its regional sibling, Horizon Air, and Delta with its regional partners are growing at the expense of United Airlines and Southwest Airlines.
The struggling Boeing 747-8
News reports that Boeing is promoting the 747-8I to Emirates Airlines prompted some to leap to conclusions that the struggling program is about to get a sorely needed shot in the arm. We don’t think so.
For one thing, Emirates president Tim Clark immediately poured cold water on the idea. In the process, in the same report, he said the 747-8 can’t match the Airbus A380 economics.
For another thing, we believe Emirates is trending toward a two-aircraft type fleet for which there is no room for a third–whether it is the Airbus A350 or the 747-8I. It’s clear the Emirates business model is built around the A380 and the Boeing 777-300ER/777X.
New airplanes nearing fruition? A330neo, 757RS buzz increasing
Development of two airplanes–the Airbus A330neo and a replacement for the Boeing 757–may be pushing to the forefront, according to two news articles yesterday.
Reuters reports that a decision whether to proceed with the Airbus A330neo could come before the Farnborough Air Show, even if a formal launch isn’t announced at the international event next month.
Bloomberg reports that Boeing may be nearing the launch of a 757 replacement sooner than expected.
A330neo
We’ve written extensively about both prospective airplanes, with the A330neo concept one of many subjects from the Airbus Innovation Days. The Reuters article reports what we have been hearing for some time: the airplane could be announced at Farnborough–but it might not be, either. What is new is the increasing likelihood Rolls-Royce will become the sole-source supplier. Aviation Week originally reported this prospect.
Odds and Ends: MH370 Update: Australians think hypoxia most likely, others still point to pilot misdeeds; and more
MH370: Australian investigators, having reevaluated evidence of missing Malaysian Airlines MH370, conclude that crew hypoxia may be the most likely reason the flight disappeared. But even within the Australian government, this is not a unanimous conclusion, and it’s certainly not within the international community. The captain of the flight is the chief suspect, according to other reports.
Boeing cost cuts: Ray Conner, CEO of Boeing Commercial Aircraft, explained Boeing’s cost-cutting approach in Washington State and with suppliers and plead for understanding, reports the Seattle Times. Conner also termed the potential loss of ExIm Bank funding as a “huge blow,” should Republicans in Congress succeed in killing the program. Closing ExIm would give Airbus a major advantage, he said.
Airbus funding: Airbus and a company in the Middle East have created an Islamic funding structure to help finance Airbus aircraft in the region. With the Middle Eastern carriers becoming more and more important in global aviation, expanding this area as a funding source naturally follows. Islamic financing is not new, but it’s been a narrowly-based source of funding.
Asiana crash finding implicates Boeing somewhat, but our view is this is a pilot issue, plain and simple
The National Transportation Safety Board (NTSB) yesterday lay the Probable Cause of the crash of the Asiana Airlines Boeing 777 last year at San Francisco as pilot error, but in the process implicated a “complex” auto-throttle system as a contributing factor.
Not surprisingly, Boeing disagreed (“respectfully” so), nothing that 55m flights in the 777 had occurred without incident.
While we are not at all surprised at Boeing’s position (we would have been surprised had it been otherwise), we side with Boeing on this one.
We will grant that perhaps the auto-throttle system might be tweaked to make a safe airplane and safe system even better, incorporating an aural warning when necessary. And perhaps the training procedures could be made better and more clear. But in the end, it remains the responsibility of the cockpit crew to monitor instruments and speak up when things aren’t as they should be.
In this case, the flight was also under visual flight rules (VFR). So, the pilots should have been:
- Looking out the window to visualize the approach;
- Monitoring the airspeed and altitude instruments, among others; and
- Speaking up. Most importantly, the third pilot did see something was wrong but didn’t say anything. Culturally, it is common in Asia for subordinates to defer to the Captain. But it’s lousy Cockpit Resource Management.
If the pilots had been doing their job, the plane almost certainly would not have crashed. The auto-throttle may have led the pilots to a false sense of security, but in the end they didn’t fly the airplane.
That’s was caused the crash.
Southwest Air’s expansion to resume next year, says CEO
Southwest Airlines plans to complete the integration of AirTran by the end of this year, positioning the carrier to resume expansion into new markets, says CEO Gary Kelly.
In an interview last week at WN’s Dallas headquarters, Kelly said the last of AirTran’s Boeing 717s will exit service by year end, leaving Southwest with a fleet of 690 Boeing 737-300s, -700s and -800s. There were 56 737-700s, 52 -800s, 30 -7 MAX and 170 -8 MAX on order at December 31 with more than 220 options for all types.
Challenge 777X tax breaks, “correct” US ExIm Bank Boeing funding, says Airbus CEO
Challenge Boeing 777X tax breaks and adjust the US ExIm Bank rules.
This is the view of Airbus CEO Fabrice Bregier.
We had the opportunity for what amounted to a one-on-one, on-the-record discussion with Bregier during the Airbus Innovation Days media briefings two weeks in Toulouse. We sat at Bregier’s dinner table, which although filled with media, was in a noisy setting, allowing us to have some elbow-to-elbow conversation on a variety of topics that couldn’t be heard in the din.
Southwest sticks with continuous hub/point-to-point as core business strategy
American Airlines plans to shift from continuous hubbing at three of its major cities–an operational process where flights flow throughout the day–to return to traditional peak-and-valley hubbing. But Southwest Airlines, despite many significant changes to its business model over the years, will stick with continuous hubbing which has been at the core of its business model since the airline was founded in 1971.
After attending the American Leadership Council Wednesday in Dallas, we went across town on Thursday to talk with Gary Kelly, CEO of Southwest Airlines. One of the first things we asked him was about the American shift, which we wrote about yesterday.