It is our understanding that CFM’s LEAP is coming along according to plan. The program has had no unusual events to cause either OEMs or any concerns. The promise of the LEAP is to deliver 15% improved fuel burn and 50% margin on NOx as well as a substantially lower noise footprint.

The LEAP has a tough act to follow; CFM promises the LEAP is going to offer the comparable maintenance costs to those of the CFM56. The CFM56 is the most popular turbine engine in use among single aisle airliners. Take a look at this table to see what we mean.

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CFM is at pains to point out that it has a for delivering on spec on the CFM56 and intends to do that again on the LEAP. Looking at the orders for the 737MAX and the A320neo, that confidence is accepted by the lessors and which have placed orders. When looking at the engine orders for the forthcoming MAX and C919, CFM is exclusive and 100%, and on the competitive A320 family, neo program, it has a 55.2% market share so far, albeit 40% of the outstanding orders have yet to chose an engine. These aircraft represent some 90% of the orders for the next generation single aisle aircraft.

Boeing provided their view on the LEAP 1B as follows: “The engine will be optimized for the 737 to offer the best fuel efficiency and lowest operating costs. The core will be lighter and more fuel-efficient than the competition when integrated onto the airplane because the 737 airframe is lighter and more fuel efficient than the A320 family.

Core efficiency and bypass ratio, along with airplane weight, drag and thrust, are all optimized to achieve fuel efficiency. The neo, and the A321 in particular, requires a much larger and heavier engine because the airplane is heavier and requires more thrust, requiring a bigger, less efficient engine/airframe combination.

The two engines are adding about the same improvements, so we will retain the advantage we currently have over the competition with an 8 percent per-seat operating cost advantage on the 737 MAX 8 over the A320 neo.”

The LEAP is deploying innovative additive manufacturing based on GE’s acquisition of Morris Technologies. This allows the firm to develop 3D printing allowing for some parts to be 25% lighter than on the CFM56. In addition using Resin Transfer Molding fan blades and the housing in CRFP have reduced engine weight by 500 pounds compared to the same size fan manufactured using traditional metal components.

CFM’s confidence seems reasonable given its track record. Engine programs delivered for 21 aircraft types on spec and on time. The CFM56 operates at 99.98% dispatch reliability. This is remarkable when one considers these engines are primarily on 737s and A320s flying up to eight to 10 sectors per day. Such activity stresses the engines and should lead to lots more breakdowns.

Next consider the ramp up coming at both Airbus and Boeing. Crucial to this effort’s success will be the delivery by CFM of engines. There is a further wrinkle here – CFM is ramping up the CFM56 production on both current programs and then has to transition to the LEAP at these new high levels of production.

In summary, CFM is facing a daunting task. Its CFM56 has been a very successful engine. It has to deliver a LEAP engine that builds on this history with big improvements at the same cost basis. Were there any doubt on the LEAP we would not be seeing such confidence from the OEMs, and lessors.

The Bottom Line

CFM has historically delivered its promised performance on time, and expects to continue to do that with LEAP.  We spoke with CFM, who confirmed that their program remains on time and on target for performance.  The market has shown confidence in the engine, which we expect will perform well when it enters service in 2016 on the A320neo. It should provide a 15% decrease in fuel burn over the existing CFM-56 with no increase in maintenance costs.

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