Leeham News and Analysis
There's more to real news than a news release.
“Optimizing” bad news
You have to hand it to the public relations staff for some real chutzpah.
Air Berlin has been struggling for years, over-ordering aircraft and canceling some of them (Boeing 787s among them). Today the airline deferred Airbus and Boeing airplanes and issues a press release entitled, “AirBerlin optimizes Airbus and Boeing order book.”
Where will MAX be built?
Crosscut Seattle, an on-line only news outlet (and one we consider to be quite good) does occasional in-depth think pieces. Today it has one about the burning question to Washington State: where will the Boeing 737 MAX be built?
We’re alluded to this question and potential sites in several previous posts, including our recent one about the earthquake in San Antonio (TX), which is suggested to us to be on the short list for the MAX site.
Crosscut is known for calling shots as it sees them and it fires one at the King County Aerospace Alliance formed by the county executive with the MAX in mind.
Crosscut’s conclusion is largely correct, but it misses the point: King County government has been AWOL for years in promoting aerospace, a short-coming of previous executives who rested on complacency.
It’s about time the county got in on the action.
747-8 engineer nominated for top honors
Dominic Gates of The Seattle Times has this piece that describes the honor Boeing engineer Pio Fitzgerald has been nominated for at the Dubai Air Show for his design fixing the flutter problem on the Boeing 747-8 that threatened the entire program.
Fitzgerald is just 34 years old. Gates’ story provides an interesting if short bio of this talented man.
Congratulations to Fitz for the nomination. The winner will be honored by Flight Global.
4.6 earthquake in possible 737 MAX site
San Antonio (TX), a potential assembly site for the 737 MAX, was hit yesterday with a 4.6 earthquake.
The city is also the location for 787 finishing work.
Readers will recall that on the second quarter earnings call, CEO Jim McNerney stunned Washington State interests when he said 737 MAX work is not guaranteed for Renton (WA), where the 737 has been assembled since shortly after the program was launched. (The 737 initially was assembled at Boeing Field and moved to Renton.)
A hint of things to come–Lufthansa 787 order?
Lufthansa Technik “is set to become a leading 787 MRO” following a deal with JAL, blares a headline in AviTrader’s current issue of MRO magazine.
The magazine writes:
Lufthansa Technik will become one of the world’s leading 787 MRO providers after concluding a Total Component Support (TCS) contract with
Japan Airlines (JAL) to support its fleet of 787 Dreamliners. The agreement runs for a term of 10 years and will see the MRO provide material
support, including repairs and logistics services, for JAL’s fleet of 35 Dreamliners from the moment its first aircraft is delivered next year. Lufthansa
Technik will supply its customer with materials from Tokyo as well as from its existing material locations in Frankfurt and Hamburg.
JAL has GEnx engines on its 787s, which may give GE the edge in engine selection for Lufthansa.
The German airline has been evaluating the Airbus A350 XWB and the 787 for many months for what would be a huge order, perhaps 150, across the Lufthansa group.
Obama proposes $100 per flight fee and Southwest Airlines objects
No kidding. This article speaks for itself.
This is one of the dumbest things to come out of the Administration yet. The airlines are already over-taxed, more so than so-called “sin taxes” levied on tobacco and alcohol. The airlines support a huge segment of the national economy–the travel industry.
This is an astoundingly stupid idea.
More 787 cancellations likely: Boeing, UBS
Boeing sees more 787 cancellations following the one by China Eastern Airlines for 24 aircraft, according to this news article.
In light of the CEA cancellation due to delays, UBS aerospace analyst David Stauss re-issued his May report in which his team concludes 46 787 customers net over-ordered 500 aircraft of all wide-body types and predicted then that more 787s would be canceled than was true at the time.
UBS concluded that 80% of the 787 backlog was ordered for growth and the remainder for replacement.
UBS didn’t specify what wide-body were over-ordered or would be canceled. Cancellations could come from the 787, Airbus A330, Airbus A350 or the Boeing 777 and the Very Large Aircraft from both OEMs.
But UBS’ point is that in its view, more 787 orders are at risk.
PW gains major wins in Rolls-Royce deals
Here are some additional thoughts about the Rolls-Royce/Pratt & Whitney deal announced yesterday.
PW is a real winner in this set of transactions.
- Buying RR out of the International Aero Engines partnership gives PW far more latitude in making deals for the V2500 engines and the ability to connect V2500 transactions to transitions to Geared TurboFan orders. RR had no incentives to make connected deals, since there was nothing in it for them if a customer ordered the GTF instead of the V2500. CFM had the competitive advantage in offering the CFM56 for legacy airplanes and the LEAP for the A320neo. With PW now controlling the V2500 partnership, PW has come closer to leveling the playing field. Read more
Rolls-Royce, PW join forces for 120-230 seat engine–and to focus on GTF technology
It is a stunning announcement. Not so much the buyout of Rolls-Royce by Pratt & Whitney from the International Aero Engines partnership. This has been expected for more than a year.
What’s stunning in the new partnership RR and PW announced to develop engines in the 120-230 seat market and to focus on Geared Turbo Fan technology.
AirInsight has a commentary on the tie-up.
This is a major shift in the engine competition and a major endorsement of the GTF engine and techn0logy, creating a more formidable competitor to the dominate CFM International.
We’ll have more to say after we digest this a bit and talk with the market.