Grand slam

From an orders point of view the show belonged to Airbus with US$72.2 billion worth of commitments for 730 aircraft made up of 418 orders and 312 MoUs. Those numbers were dominated by the A320neo family with 667 commitments valued at US$60.9 billion taking the backlog to 1029 since its launch in December. Commitments were also secured for 11 A330s, six A350s and 12 A380s.

Airbus CEO Tom Enders was lyrical about the company’s performance. “With over 1000 commitments just half a year after launch our A320neo is a real bestseller. I have to admit, I largely underestimated the market demand for neo before this show.”

Just like the Airbus A380’s tug driver underestimated the wing tip clearance of the giant jet, which clipped a hangar on arrival at the show on Sunday resulting in an embarrassing stop and quick exit back to Toulouse for some hasty repairs. By the opening of the show however a Korean A380 had been flown in to fly the colours.

Boeing’s order count was typical of airshows with 138. But of note 51 were for twin-aisle 777s and 747-8Is.

Strategy

On the strategy front Airbus announced that the EIS for the A350-1000 would be pushed out two years to 2017 and unveiled a modified -1000 model featuring a higher thrust – 97,000lb – variant of the Trent XWB engine being developed by Rolls-Royce.

Part of that commitment was the agreement by Airbus for Rolls-Royce to be the exclusive engine supplier for the A350. Additionally, the company delayed A350-800 EIS to 2016 from 2014.
Addressing media on the first day of the show, COO – customers John Leahy noted the manufacturer has had “pretty good” success with A350-900 and -800 orders but has seen “softness” in -1000 sales. Orders for the -900, with a 2013 EIS, total 359, while commitments for the -800 number 140, whereas the -1000 has only notched up 74 sales.

Leahy said that airlines have been asking for “more performance” on the model and whereas the earlier version of the A350-1000 fell short of matching the 777-300ER in terms of performance, the new version will “surpass” the Boeing aircraft, Leahy claimed.

That claim however was not met with great excitement by Emirates CEO Tim Clark who told Australian Aviation that the airline had not been consulted about the changes “as required in the contract” and it still felt that more thrust was required.

Emirates has ordered 20 A350-1000s and is not happy about the changes as it didn’t want an ultra long range model.

Rolls told media that the new version of the Trent XWB will deliver 97,000lb maximum thrust.

“The additional thrust will be achieved by the inclusion of new high temperature turbine technology, increasing the size of the engine core and advanced fan aerodynamics,” it said.

“This will help Airbus to offer increased range and capacity for the A350-1000.” Importantly, the engine’s fan size will not change, meaning Airbus won’t have to make significant fuselage modifications.

Airbus Executive VP A350 XWB program Didier Evrad told media that “we have more time to optimise the [-1000] and the market can wait a little bit for this enhanced aircraft.”

And that aspect didn’t impress Clark either.

“We have planned retirements of aircraft based on the original -1000 schedule,” Clark lamented.

New York-based Bernstein Research also had its doubts.

“The A350-900 is said to remain on schedule for first delivery, but there remains significant risk. It is also uncertain how the changes to the A350-1000 will play out,” Bernstein said in a client report.

On the other hand, it added that “if Airbus can truly deliver on A350 performance within the planned timeline, the company will have a powerful widebody position.”

Airbus insists it will have an EIS of 2013 for the A350-900, but Bernstein is far more cautious, suggesting that the first A350s will be delivered in 2014, and then only eight in the last quarter.
That view is similar to Clark who has pushed Emirates’ first deliveries of the -900 to 2015.

Bernstein believes that Airbus will eventually cancel the -800 which it believes “would be a positive.”

With the A350-1000 and -800 delayed by two years Boeing started the show on a bright note and with bold statements such as a claim that its 747-8 Intercontinental had superior trip and seat-mile economics to the Airbus A380, and backed up its declarations by announcing two new orders for two and 15.

Boeing has now sold an increasingly impressive 50 of the passenger version.

Addressing media Boeing Commercial Airplanes President and CEO Jim Albaugh said the manufacturer is the leader in every market segment but believes its seven year backlog is too great.
“We are working to bring this down to three to four years,” he said.

“We have made plans to increase the 737 rate to 42 a month and the 777 to 8.3 and will build the 787 to 10 a month. And we want to get that to 12. We have to be able to respond to our customers’ needs or they will be forced to make decisions they don’t want to [make].”

Albaugh added that all of Boeing’s financial numbers are in positive territory.

“Our customers are blue chips, our margin is 7.2 per cent and our backlog is $263 billion.”

Going forward, Albaugh said the manufacturer is receiving “strong interest” in the 787-10X, which will be a 5.5m stretch of the 787-9 with a capacity of between 290 and 330 passengers, about 40 more than the 787-9.

Albaugh asserted that the 787-10X’s economics are “brilliant,” with operating efficiency 10 per cent better than the A350-900 and 5 per cent better than the A350-1000.

737 replacement?

On the 737 replacement Boeing appears to be moving toward an all-new solution.

Albaugh said an all-new aircraft would offer “new technology which exists” and could enter service in 2019.

In his remarks, Albaugh was upbeat on the all-new solution rather than re-engining the 737NG. He said that while a new aircraft carried more risk, it “also promised far greater rewards.”
At a separate briefing, Boeing VP advanced 737 product development Mike Bair told Australian Aviation that the manufacturer wants “to tap everything we have learned on the 787” in launching a new aircraft program.

Bair added that the aircraft, dubbed the 797 by Air Lease Corp chairman and CEO Steven Udvar-Hazy, would be of composite construction, but the actual percentage is yet to be determined. However, a major challenge will be the production system.

Albaugh said more work would be kept in-house compared to the 787 program. But with a projected build rate of 60 aircraft per month, understanding and managing the production system will be essential, Bair commented.

If Boeing was to re-engine, the new 737 would surpass the A320neo in terms of operating performance, he claimed. “A re-engined 737 would offer 10 to 12 per cent better fuel burn and an improvement of 6 to 7 per cent in cash operating costs,” Bair asserted, adding that the 737 could be compatible with both Pratt & Whitney’s PW1000G and CFM International’s Leap-X, the two engine choices on the A320neo.

Regarding a potential all-new aircraft, Bair said Pratt, GE Aviation and Rolls-Royce were all working on new engine designs. The improvement in fuel burn would be 20 per cent while the cash operating cost advantage would be a percentage “in the low teens,” he stated.

Very interestingly, when asked about radical new designs and open rotor applications, Bair said that Boeing was negative on the design problems for blade off and saw this problem as a showstopper.

“We cannot envisage a solution,” Bair said.

Udvar-Hazy meanwhile told Australian Aviation that he “had a bias to an all-new family” and, “as a passenger,” he favored the twin-aisle option.

He said that he wanted the aircraft to “be sized between 160 and 230 seats,” adding, “The 737 replacement is the highest priority for Boeing.”

Boeing VP – business development and strategic integration Nicole Piasecki told Australian Aviation that the company would continue to make small but significant improvements to the 737NG going forward and expected to be building the aircraft well into the next decade alongside its replacement.

Piasecki said that the baseline Boeing would protect for a “737 replacement is 125 seats.”

The company is looking at both single-aisle and twin-aisle models as a replacement for the 737. Piasecki said that even at 125 seats, a twin-aisle solution would work.

Bair added that a twin-aisle aircraft would reduce turn times, enabling airlines to add more sectors per day. The twin-aisle would only incur a fuel burn penalty of 2 per cent – 3 per cent compared to a single-aisle, he added.

Piasecki told Australian Aviation that the twin-aisle option is getting strong support in Asia and China.

777 options

Albaugh acknowledged that the two-year delay in the EIS of the Airbus A350-1000 gives Boeing more time to evaluate options.

He said the manufacturer is looking at “two options” for developing a next generation 777 going forward.

“We can do wing and engine improvements” or “a new wing and engine technology, which would take the EIS of the aircraft into the next decade.

Steven Udvar-Hazy opined to Australian Aviation that the 777 does not need replacing but just “some fine tuning.”

Asked if he thought the improvements to the A350-1000 would enable the Airbus offering to match the 777-300ER, Udvar-Hazy said the “final [A350-1000] configuration was yet to be defined,” leaving the question unanswered.

One question that was not left unanswered was the production rate for the 777 which Boeing has pegged at 8.3 per month planned by 2013.

Albaugh said the company was reluctant to move higher because of the significant capital investment required.

But Emirates’ Clark just wishes Boeing would move on the improvements that have been mooted.

“GE have told me they can deliver significant improvements in the sfc on the -115B and I have told Boeing what are you waiting for – there are no excuses!”

CSeries

Bombardier’s CSeries program achieved three milestones as Korean Air signed a letter of intent to purchase 10 CS300s, an un-named European airline ordered 10 and Pratt & Whitney test flew for the first time the PW1500G geared turbofan engine designated to power the aircraft.

Commercial Aircraft President Gary Scott said of the Korean commitment; “This is a marquee customer.” He added that the CSeries had now sold in three key markets of “North America, Europe and from Asia.”

The Korean announcement totals 30 aircraft with 10 options and 10 purchase rights. First delivery is scheduled for the first quarter of 2017. KE Senior VP Walter Cho told media at Paris that the airline plans to take advantage of the options and purchase rights.

The latest order commitments brings Bombardier’s CSeries order book to 123 aircraft. Other firm order customers for the CSeries include Republic Airways Holdings, Lufthansa, Lease Corp International, Braathens Aviation, an unidentified airline and an unidentified “major network carrier”. Korean Air will finalise its order for 10 shortly and there are 109 options.

Pratt flew the PW1524G engine on the first day of the show at its Mirabel Aerospace Centre in Canada. Briefing media Pratt VP – next generation product family Bob Saia said that “first flight went flawlessly.” The 747 test bed aircraft was in the air for about two hours with another hour spent running the engine, while the 747 was on the ground.

“We can show the engine is real, it’s here, it works,” he commented. “The fundamentals of this gear, the fundamentals of this design architecture … have all been validated.” Testing will allow for gathering data that will lead to the “refinement” of the engine, he told Australian Aviation.

The PW1500G test program will comprise eight test engines and last about 18 months. Pratt is targeting engine certification in 2012 with EIS for 2013.

For CFM the show was a huge success with US$11 billion in orders for 910 LEAP-X1A engines to power 455 A320neos.

AirAsia, CIT Aerospace, GE Capital Aviation Services, ILFC, Republic Airways Holdings and SAS also chose the LEAP, with the engine on track for EIS in 2016.

In an interesting development Mitsubishi Aircraft Corporation selected Boeing to provide customer support services for its MRJ family. Boeing Commercial Aviation Services will provide Mitsubishi with 24/7 customer support, including spare parts provisioning, service operations and field services. The support portal will be modeled on Boeing’s customer web portal.
It was an interesting little development that seemed to confirm Boeing is concentrating at the larger end of the narrowbody market where it can better focus its efforts in its on-going battles with Airbus.