Observers have been saying for some time that single aisle aircraft buyers like to order the smallest model and then when the time comes, convert the initial order to a larger variant. We asked Boeing about this and they declined to provide us with any data on conversions.
Taking a look at orders and deliveries from 2000 through 2014, we created the following chart. We color coded the NG (solid) and MAX (pattern) models so readers can follow the sizes. Of course orders and deliveries don’t track year to year. That said, we can see what airlines and lessors are ordering and what gets delivered.
There is a sharp decline in both orders and deliveries for the smaller 737s, with some time-lag. Of the smaller models the -700 (and 7MAX) are the most important to watch. 700NG annual orders for this period peaked in 2005 at 125 compared to 414 800NGs ordered that year.
Since 2011 Boeing has seen a sharp rise in interest for the MAX. It looks like initial interest in the 9MAX slowed a lot. Orders from 2011 through 2014 were 338, 75 and then 5. The availability of the 8MAX200 probably crimps 9MAX interest further. In terms of deliveries, the -900 has a reasonable share of deliveries, but with the 9MAX it does not looking like this will remain. Perhaps some of the orders for 900NGs and 9MAXs are moving to the 800NG or 8MAX?
The charts suggest that there is conversion going on. Either customers are right or up-sizing on their own or Boeing is able to move customers to optimal sized aircraft. The drop off in deliveries of 737s with less than 130 seats is remarkable. Orders for this sized 737 are dwarfed by interest in larger variants. The Renton plant seems to be moving towards about 90% deliveries of the 800NG and 8MAX.
This is a very interesting development, I have been watching the 100-150 seat segment for some time, trying to see why the CSeries is not where it had hoped, it is my belief that the market that was once there (ie. DC-9, MD-80, B737-200/300/700, A319, B717’s) is just not there in the big numbers, as airlines have upgauged from that segment.
Bad news for Bombardier which is trying to sell the CS100 and CS300 in the 115 to 160 segment, we already see that only 109 orders have been received for the A319neo and B737-Max7, 1.7% of total B737Max and A320neo orders.
Boeing and Airbus may not even do the Max7 and 319neo !
A similar chart for Airbus would show A321 firmly moving to the starring sales champion position, with – beyond – a trend in time pointing towards the near-term venue of a fifth family member, the even larger A322 … can we give this trend unveiled here to the profession by AirInsight a name ? What about “capacity inflation” ?
Bombardier obviously miscalculated and overestimated the market. The market’s needs and demands were pretty much set and I believe they tried to change it with a plane they claimed was a game changer. It worked well with the RJ program but this time they were really relying on the real star which is the GTF engine which Airbus sold with greater success. Unlike the same circumstances as Dornier 728, ultimately I believe the Cseries will ultimately be sold to the highest bidder. That’s my forecast, and I’m sticking to it.
Concerning the CSeries
If there is a general trend to upsizing, would it then be logical to apply this trend to 90-100 seat regional aircraft, with the consequence that the CS100 could eventually benefit from this trend?
And would it also be logical that potential customers would want to upsize to the CS300 from the smaller Embraer E190/E195 E2?
Why would the CSeries size class be the only one not benefiting from upsizing?
I understand that this reasoning doesn’t apply to North America because of current scope clauses.
From repeated comments emanating from Bombardier Aerospace officials, I have the impression that the CSeries order/commitment book is at the level it is for the reason that BBD has refused to offer huge discounts on this new value-added aircraft. They probably need to deliver 400 in order to recover development costs, and it is almost certain that level will be reached, even with the dubious orders. After that, they will have more flexibility, depending of the state of the competition.
I also know for a fact that when they planned the CSeries, BBD had already anticipated that the A320 and B-737 would be re-engined. Their worst fear was an all-new aircraft in the same class as the CSeries, from either Airbus or Boeing.
Bombardier is in this for the long run. It’s not realistic to consider that they will sell the CSeries program to the Chinese or to Boeing. They don’t need to. They don’t want to.
I had a personal connection with BBD at the time of the first and second offering of the CSeries. They didn’t want to get into a dog fight with the duopoly. They were humiliated by the success of the Ejets which they were dismissing as trivial. When Air Canada purchased them the chaps at BBD almost died. The air was so thick you could cut it with a knife. They sat on their laurels on the success of the RJ and let Embraer pummel them which is still going on.