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Commercial Aviation Analysts

The big two OEMs are facing an interesting situation.  Wide-body demand is down for several models, causing production cutbacks, while narrow-body backlog is at record levels.  The result is that the OEMs are relying on narrow-body sales for cash flow in the near term, and both OEMs will increase production rates to levels we believe will be unsustainable through the next decade.

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Airport congestion is coming to an airport near you. The A380, as at London Heathrow, may be the solution for peak period operations. The question is how congested must airports become before airlines are forced to move to very large aircraft such as the A380 at airports other than Heathrow?

London’s Heathrow Airport just released its operational figures for 2016, and 10% of all travelers through LHR arrived or departed on an A380, an increase from 8% in 2015 and 6% in 2014.  A380s are expected to carry 12% of LHR traffic this year (2017), and if the trend continues, will carry 20% of Heathrow traffic by 2021.

Nine airlines currently fly the A380 to LHR, including BA, Emirates, Etihad, Korean, Malaysia, Qantas, Qatar, Singapore and Thai. That’s nine out of 13 A380 operators. On a busy morning at LHR, the A380 seems to be becoming almost as ubiquitous as its… Continue reading

Ceramic matrix composites (CMCs) are being introduced into aircraft engines because of their ability to resist heat, as well as their ability to resist dust and debris in difficult environments, such as those in the Middle East. Although CMCs have been utilized on military aircraft engines, GE is pioneering the use of CMCs on commercial aircraft with the GE9X for the 777X. The GE9X, which will be used on the Boeing 777X, has a larger diameter than the fuselage of a Boeing 737.

What is a CMC? CMC parts are made from silicon carbide ceramic fibers aligned in a ceramic matrix that are then covered with a proprietary heat-resistant coating — essentially a ceramic fiber reinforced ceramic. These lightweight components, which have one-third the density of typical metal alloys, are more heat resistant and require less cooling air. This enables higher temperature operations and increased thermal efficiency for an engine,… Continue reading

The A320neo has been a very popular aircraft program.  Airbus has won 3,626 A320neo orders (over 5,000 neo models ordered) for the program since it was first offered.  How has the aircraft been doing in US service so far?  We looked at data on the US fleet.

Here is what we know about the number of flight hours of the nine US-based A320neos flying through January 25th 2017.

Continue reading

[Update: Each MAX seat will have both AC power (with an international outlet) as well as USB. No news on neo fleet yet]

American Airlines will not install seat-back IFE screens on its 737 MAX fleet. The first four MAXs are due later in 2017.  The airline plans to offer free entertainment via Wi-Fi (powered by ViaSat) which will enables passenger personal device connectivity. American will provide access to its movies and TV show libraries and live TV.  Not all the content access will be free, but some will be.

“We know in-flight entertainment is important to our customers, which is why we’ve committed to offering free, streaming high-quality movies and music, and to investing in fast satellite-based Internet access and power at every seat across our domestic fleet,” the airline said in an employee statement. They went on to say: “More than 90 percent of our passengers already bring… Continue reading

Recently we posted a premium article on single aisle backlogs that elicited some debate.  This is welcomed because the subject is important and views will vary.

The essence of our view is that we find the OEM target of a rate of 60 single aisles each per month difficult to comprehend.  The view is primarily based on oil prices. The next chart illustrates the influence oil prices have played on single aisle fleet decisions.  The oil price spikes clearly impacted decisions.  It is during this period that we saw the arrival of the CSeries (initially pitched as a fuel saver) and then came the fuel saving A320neo and 737 MAX.  High oil made airlines and lessors jump at fuel saving aircraft. Continue reading

Earlier this week, at the Airline Economics Growth Frontiers conference in Dublin, AerCap’s CEO Angus Kelly indicated that “we see big deferrals in the wide body market.”  He indicated that in the short-term, there is over-ordering, and that some of the big airlines are chasing the same passengers.

He implied that the order books at Airbus and Boeing don’t reflect "what is going to be delivered" and that some airlines may not take their orders.  We’ve recently seen Airbus cut A380 production and Boeing cut 777 production, and defer an increase in 787 production as wide-body orders have cooled.   While Mr Kelly's forecasts large-scale order deferrals and doesn’t trust the official backlogs from the OEMs, he cites that fundamentals such as traffic growth continue in the right direction, and he is not concerned about the number of overall passengers - the question will be who is… Continue reading

[UPDATE – MRJ PDF]

The news was expected.  But even so, it is frustrating to read the following from MITAC: “Mitsubishi Heavy Industries, Ltd. (MHI) announced today that MHI and Mitsubishi Aircraft Corporation will adjust the first delivery of the Mitsubishi Regional Jet (MRJ) from mid-2018 to mid-2020.  The change is due to revisions of certain systems and electrical configurations on the aircraft to meet the latest requirements for certification.”

The aircraft was meant to enter service in 2014.  These delays are troubling to say the least.  Reports suggest that technical issues with the positioning of the aircraft’s electronics forced a design review. The MRJ90’s type certification is delayed to the fall 2019.

Program delays are not unusual – they happen at the biggest and best OEMs.  But for MITAC the news must be a big undermining of customer confidence.  For example launch customer ANA will retain its 737-500s… Continue reading

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