Volume 1 Issue 2 September 2014

ON THE BOEING FRONT

Solid Long Term Demand for Commercial Airplanes Will Help Long Term Prospects for Boeing

Contrary to the doomsayers and financial analysts, who keep knocking the company and its stock down, steadily growing global economy, increasing trade and expanding labor force are growing demand for air travel.

Boeing forecasts global airline passenger traffic to rise by around 5% per year through the next 20 years. Boeing anticipates the global airline fleet to rise from around 21,000 airplanes currently to over 42,000 by 2033.

After accounting for airplanes that will retire during this period, the company forecasts that airplane makers will deliver 36,770 airplanes to airlines worldwide. Boeing commercial airplane product portfolio is more extensive and better positioned, than Airbus. Together these two companies control the majority of the global commercial airplane market.

The difference in the portfolios of these two airplane makers stands out most in the wide-body segment, which includes airplanes that seat more than approximately 230 passengers.

In this segment, Boeing offers more airplanes than Airbus. Starting with the 787-8 Dreamliner, it seats 240 passengers in a typical three-class seating arrangement. Boeing offers three variant models of its 787 Dreamliner, three variant models of the 777 and two 747 variants that comprehensively cover the entire wide-body segment.

In comparison, Airbus with its A330, A350 and A380 models, does not cover the entire wide-body segment comprehensively.

The A330 and A350 models from Airbus provide strong competition to Boeing’s 787 Dreamliner and the smallest 777-8X model.  However, Airbus is yet to produce a competitor to Boeing’s 777-9X which seats approximately 410 passengers in a three-class cabin.

Source : Forbes/Ed’s Research

 

ON THE AIRBUS FRONT 

The First A320 neo is Getting Ready for its First Flight

The A320 neo is another step closer to taking flight. The first aircraft is designated MSN6101 in the company’s numbering system is powered by Pratt & Whitney PW1100-JM engines and is the first in Airbus A320 neo family developmental fleet.

It is equipped with extensive flight test instrumentation for handling quantities, performance and engine tests, along with high-altitude and hot-and-cold-weather campaigns.

In total, Airbus’ NEO flight test fleet will comprise eight aircraft. This includes two A320 neos, one A319 neo and one A321 neo for each of the new engine choices: Pratt & Whitney’s PW1100-JM and the CFM International LEAP-1A.

Source : Airbus/Airbus Photo

BUSINESS/REGIONAL NEWS

Bombardier CSeries customer declines Launch Operator Spot

Swedish company Braathens Aviation has told Bombardier it no longer wants to be the launch operator of the CSeries 100s .

Bratthens’ domestic unit, Malmo Aviation, said it was the planned launch operator. But in its second quarter/first half financial results statement, Braathens said “increased uncertainty” about the CSeries program and the possibility of a further delay of entry into service has prompted it to reconsider.

“An engine-related incident on one of the CSeries test aircraft was reported by Bombardier in late May. It has subsequently emerged that this may cause another delay to the CSeries introduction. We have informed Bombardier that we will not assume the role of formal launch operator of the aircraft type. Due to increased uncertainty, we are discussing other possible changes to the aircraft delivery schedule with Bombardier,” Braathens said.

Finally Bombardier returned the aircraft into the air on September 7th after a 100-day grounding with FTV-2.

Source: ATW

OTHER AVIATION NEWS

Turning to New Design and Material for the GE9X Fan Blade

The GE9X engine for the Boeing 777X aircraft will feature fewer and thinner composite fan blades than any GE wide-body engine in service. To do this, GE is designing a new composite fan blade using next generation carbon fiber composite material.

“It has been a decade since GE designed a new composite fan blade for the GEnx engine,” said Bill Millhaem, general manager of the GE90/GE9x engine programs. “Carbon fiber composite material has advanced in those 10 years, and advancements enable GE engineers to design a thinner GE9X blade, which is just as strong as our current composite blades. Fewer, thinner blades will enhance the airflow and make for a lighter, more efficient fan that will help with the GE9X engine’s overall performance and fuel burn.”

The new material incorporates a higher stiffness carbon fiber and new epoxy resin. The leading material will also be modified from titanium to steel alloy to further enhance the blade’s strength.

Last year GE engineers received positive results from material testing on full-sized GEnx blades. Testing of the new material continues in preparation for next year’s testing on the new GE9x blade design.

The first full core test is scheduled for 2015. The first engine will test in 2016 with flight testing on GE’s flying testbed anticipated in 2017. Engine certification is scheduled for 2018.

Source: GE Aviation/ Speednews

Southwest Airlines Unveils New Look for Its Planes

heartone_print014

Southwest Airlines put a new paint job on its planes, adding a splash of bright color as it enters middle age and faces many changes.

The airline introduced its new livery on Monday September 8th, during an event in a hanger at its headquarters next to Dallas Love Field.

Blue is still the dominant color, but the planes will also have red, yellow and blue swooshes on the tail and wing tips. Southwest calls it ”Heart One”.

The change comes in a year during which 43-year-old Southwest has begun international flights, expanded in New York and Washington, D.C. and is freed from longtime government limits on its Dallas Schedule.

Source : keranews/Photo Southwest

British Airways to Revamp Its 747s

british-airways-747-400-syd-rf

British Airways is rolling out cabin upgrades across 18 of its Boeing 747-400s, which will be equipped with improved inflight entertainment and modern interiors.

The cabin refresh, which will be performed by British Airways’ engineers in Cardiff, will bring the aircraft more in line with its A380s and 787s.

“Our customers love our new aircraft and we wanted to refresh the 747s in line with them,” British Airways aircraft cabin interiors manager Kathryn Doyle said. ”These improvements will be really noticeable to our frequent flyers.”

Universal power sockets and USB points will be installed throughout the World Traveller Plus cabin, plus the curtains and carpets will be replaced in both World Traveller and World Traveller Plus.

Source: ATW

San Miguel To Sell PAL Stake back To Tan

Philippines conglomerate San Miguel is reported to have signed a USD$1 billion deal to sell its stake in Philippine Airlines (PAL) back to Tan, the group from which it bought the stake more than two years ago.

San Miguel and a group owned by billionaire Lucio Tan have signed an agreement of intent to complete the sale, Reuters news agency reported a person with knowledge of the matter as saying. The deal covers the conglomerate’s industry held shares in the airline,equal to nearly half of the carrier, plus loans and advances.

The agreement is subject to conditions set by San Miguel, including delivery of the total payment amount of USD$1 billion in a week, said the person, who spoke on condition of anonymity.

San Miguel owns 49 percent of the parent of listed holding company, PAL Holdings,that in turn controls around 90 percent of the airline, which has a market value of about USD$3.4 billion .

Source : Reuters

China Eastern Airlines Introduces New Livery, Logo

china-eastern-new-livery1

China Eastern Airlines has unveiled a new look after 25 years, which includes a new logo featuring the shape of a swallow consisting of two capital letters, C and E, the initial of the carrier’s name. The design retains the red and blue colors on the carrier’s original logo.

Chief designer Liu Tao said the new logo uses more curves and circles compared to the old one, giving a more international flair.

The Shanghai-based carrier said the new logo and paint job will be applied to a Boeing 777-300 ER to be delivered during this month.

China Eastern is scheduled to take delivery of four 777-300ERs this year and will introduce 10 more between 2015 and 2016. By 2018, it is expected to have 20 of the type,more than any other carrier in China.

The carrier will operate the 777-300ERs on transpacific routes between China and North America, which will be a major market for China Eastern over the next three years.

Source : flightglobal/Photos China Eastern

LATEST NEWS IN BRIEF  

 

  •     Intrepid Aviation and KfW IPEX- Bank have closed a commercial financing transaction for one Airbus A330-300.The     aircraft was delivered on Aug.30th and was leased to Cebu Pacific.
  •     Ryanair has taken delivery of the first of 180 new Boeing 737-800 Next Generations on  order.
  •     Nok Air takes delivery of the first high-capacity Q400.Nok has firm orders for six Q400s.

              yourfile

 

  •   Jiuyuan Airlines Chinese low-cost start-up Jiuyuan Airlines has taken delivery of its first two aircraft as it gears towards launching operations.yourfile
  •   Irkut MC-21 Russian deputy Prime Minister Dmitry Rogozin has announced the Irkut MC-21 will begin flight tests in April 2016.
  • Ryanair European low-cost carrier commits to order 100 737 MAX200 that can accommodate 200 seats.
  • Air New Zealand on September 12th, AirNew Zealand retired its last 747 with a flight from San Francisco to Auckland.

 

Air Cargo

 

Atlas Air Reports Improved Cargo Demand

Atlas-big

Atlas Air Worldwide Holdings announced adjusted net income of US$15.9 million (11.8 million euros) for the second quarter, compared with US$20.4 (15.2 million euros) for the second quarter of 2013.

“We are off to a good start in 2014.  Airfreight demand is improving, and we are encouraged about our full year outlook,” William j. Flynn,president and CEO, said. “Atlas is an entrepreneurial company. Our second quarter results illustrate the positive contributions being generated by the investments we’ve made and the initiatives we’ve undertaken. In the face of an uncertain airfreight market and anticipated decline in military cargo demand, we have diversified our business mix.”

Freighters have played a part on the results of Atlas Air, a provider of outsourced aircraft and aviation operating services. ”Results within ACMI segment are benefiting from modern 747-8 freighters,” Flynn said.  “in Dry Leasing, the investments we’ve made since early 2013 in attractive

777 freighters on long-term leases with strong customers are driving a significant increase in contribution from highly predictable revenue and earning streams.”

Profitability in Atlas Air’s ACMI business reflected an increase in 747-8F revenue, but revenues were affected by a decline in block-hour volumes related to the return of three 747-8Fs from IAG cargo in April and early May.  This decline was partially offset by the placement of two of the 8F’s with DHL Express in May, the Start-up of ACMI -8F flying for BST Logistics in February 2014 and Etihad in May 2013, as well as the start-up of ACCMI 747-400 flying for Astral Aviation in September2013.

In Dry Leasing, revenue and profitability grew following the addition of three 777F aircraft in January of this year and two in July 2013, which raised Atlas Air’s 777F fleet count to six. Each of these aircraft are leased to customers on long-term basis.  Atlas Air said air freight volumes continue to improve.

Source: Air Cargo World/Picture Atlas Air

 

Researched and Compiled by : Ed Kaplanian                                                            Commercial Aviation Advisor 

Contact Ed at ed@kaplanianreport.com

Volume 1  No. 1 August 2014

Volume 1 No. 1 August 2014

ON THE BOEING FRONT

Boeing Beavers Away on 787-10 Dreamliner

53be6ce90028438faf7f5c8e767f2254-boeing-787-10-dreamliner-920

Boeing has only just delivered its first 787-9 to launch customer Air New Zealand but the aircraft manufacturer has already begun detailed design work on the final member of the Dreamliner family, 787-10 ahead of its first flight in 2017.

The 787-10, which will be longer against the stretched 787-9 in order to carry around 320 passengers depending on how airlines configure the jet. “The -10 is a much simpler program” than its predecessors says Mark Jenks, Boeing’s vice president for 787 development.

“When you look at all the learning we had on the -8, all the improvements and new technology we’ve put on the-9, that was a big job” Jenks told Australian Business Traveller during the delivery flight of the world’s first Boeing 787-9 from Everett to Auckland for launch customer Air New Zealand.

“The -10 is very different” Jenks said.”We’ve had a team doing the up-front work on the 787-10 for the better part of a year now, it’s very simple stretch and very low risk.”

It’s so low-risk that while first 787-10 test flights are slated for 2017 ahead of delivery to its launch customer in 2018, this Dreamliner could achieve something few all-new airplane types have ever done, and delivered ahead od schedule, Jenks admitted.

Boeing is currently pushing 10 of the 787-8 and 787-9 variants a month, across three assembly lines, with the goal of taking this to 14 airplanes per monthly the end of the decade.

The 787-10 accumulated 132 orders, however Boeing has yet to reveal which airline will be the launch customer.

Singapore Airlines was the first airline to commit to the largest Dreamliner, signing up for 30 of the jets at list price of US$289 million each, Etihad Airways has placed an equal order alongside its order of 41 of the 787-9s.

Source : Australian Business Traveller/Boeing Photo

free vector 09

ON THE AIRBUS FRONT

Dissecting the A330neo

09d938b833

With much fanfare, the re-engined A330neo(new engine option) family was launched on the first day of the Farnborough Airshow with a memorandum of understanding (moU) from Air Lease Corporation (ALC) for 25-900neo aircraft, which alongside its smaller sibling-800neo succeed the 295-seat -300 and 253-seat-200, respectively.

Airbus chief executive Fabrice Bregier confidently proclaimed that the European plane-maker would garner 100 orders for the aircraft by the end of the week, which will have an entry into service in the fourth quarter of 2017, with potential orders coming from the likes of long-haul low-cost carrier Air AsiaX, lessor CIT and more.

The centerpiece of the upgrade is the 112-inch Rolls-Royce Trent 7000 engine which is based on the Trent 1000-TEN (Thrust Efficiency and New Technology) powering the 787 Dreamliner and provides an 11% specific fuel consumption.  While the Trent 7000 is considerably larger than the 97-inchtrent 772 engine on the existing A330, which along with strengthened engine pylons lead to increased weight and drag,thus creating a 2% and 1% respective fuel penalty.  These are going to be offset by the 4% reduction in block fuel burn achieved by the installation of an A350-styled shark let and other aerodynamic clean-ups.

Monday’s launch immediately sparked a war of words between arch-rivals Airbus and Boeing, with the former saying the A330neo will be offered at a 25% lower capital cost than today’s A330 while featuring improved avionics, interior and share a 95% commonality; the latter claims the A330neo weighs heavier and cannot have the same fuel burn per seat as the 787 Dreamliner which is lighter, technically superior aircraft. The A330neo, Boeing asserts,is a deja vu of the original commonly know as the A350 Mk 1.

The A330neo serves as a useful indication that with significantly cheaper cost, the aircraft could have a feasible business case for few operators which clamor for fuel efficiency more readily available than the 787 Dreamliner whose production slots are sold out until 2019 and 2020 at the earliest.  Though Boeing is undoubtedly going to contest this, with rising production rate to 12 a month by 2016 and 14 a month by 2020 improving its availability and delivering superior capability at every stage length.

Source : Aspireaviation/Ed’s Research/Airbus Photo

 

free vector 09

BUSINESS/REGIONAL NEWS

EASA Certifies the ATR’s New Pratt& Whitney Canada 127N Engines 

0

The European Aviation Safety Agency (EASA) has certified the ATR72-600 aircraft for the use of new PW127N engines. Following in the PW127M’s flight path with over 10 million hours of operation, the PW127N provides a 4.5 power increase of Maximum Take-off ratings, thus enhancing performance in hot and high operating conditions. The PW127N will be rolled out progressively to Avianca’s ATR fleet throughout 2014 and 2015.

The First ATR72-600 of Avianca equipped with the new PW127N engines has already been delivered in late June. This will enable the airline to get better performance at take-off on airports in altitude like their hub in Bogota, Colombia.

The new PW127 N engines recently obtained certification from Transport Canada(TC), the Canadian Airworthiness Authority and now the EASA certification as well.

Source: ATW

free vector 09

 COMMENTARY

Farnborough Boeing/Airbus Orders – The Clear Picture

Following all the sales activity at the Farnborough Air Show last month, Boeing ended July with a commanding lead over European rival Airbus in both orders and deliveries. Boeing booked 324 orders in July, the largest sales figure it has ever booked in a single calendar month.  This gives the jet maker a total of 823 net orders so far this year. But the disparity is greater than those top-line numbers suggest, because Boeing has an extensive lead in sales of bigger and much more expensive wide body aircraft. Boeing has booked firm orders for 273 wide body aircraft. That included two large orders from Gulf carriers Emirates and Qatar for a total of 200 of the new 777-9X (not counting options for another 100 options for both airlines)- orders that had been announced last fall at the Dubai Airshow, but were made firm only in July.

In contrast, because in the past two months Emirates canceled 70 Airbus A350 wide bodies and Skymark of Japan canceled six A380, Airbus’s net tally of wide body aircraft orders so far this year is negative-a deficit of 27 orders.

At Farnborough, Airbus launched  the A330neo, and announced commitments(Memorandums of Understanding)from airlines and leasing companies to buy 121 of them.(These are not confirmed orders yet).When these orders are confirmed, they will help Airbus win back some ground in the widebody-sales race.

In another boost for Boeing, data released on Thursday, August 7th, by the company, show that United traded up a previous order for seven 787-8s for seven of the larger, more expensive 787-10s.

Based unreal market pricing data from aircraft-valuation firm Avitas, that switch is worth nearly $200 million to Boeing.

In the narrow body aircraft sector, both plane makers plan upgrades to derivative models with more fuel-efficient engines.   Airbus customers have canceled orders for 113 of the current narrow body A320 aircraft so far this year.  Boeing has had 54 cancellations of its corresponding 737 aircraft family .

In 2014. Boeing commitments from China totaled 205 so far.  These include 25 737s from Donghai Airlines, 50 737s; from Shandong Airlines; 50 from Nine Air and 80 from China Eastern Airlines.  In addition to these commitments Monarch Airlines committed to order 30 737s at the Farnborough Airshow which have not been confirmed yet.

In summation,  there is a big difference between gross and net orders; the key to orders taken by Airbus and Boeing are the net orders.  They are not the gross orders, which many financial analysts on Wall Street use to distort facts.

Source : Ed’s Research

free vector 09

 

Other Aviation News

Mitsubishi Mounts Engines on First MRJ Test Aircraft

MRJ-Engines-Mounted-0614a

yourfile

Mitsubishi Aircraft has mounted the Pratt & Whitney PW1200G engines on its first MRJ regional flight test aircraft. This comes shortly after the Japanese airframer completed the wing-body join of the regional jet.

Installation of other equipment, wiring and piping works are being carried out, says Mitsubishi. The MRJ is scheduled to take its first flight in the 2Q 2015.Mitsubishi has also rolled out its first ground test aircraft in preparation for static strength tests.

Source: ATW/Ed’s Research

free vector 09

Emirates Tops World for First Class Business Capacity

Emirates Airlines is the number one airline for premium capacity measured in international seat kilometers, clocking 876 seat kilometers per week, according to flight data firm OAG.

OAG said popularity of the Dubai-based airline’s Business and First Class cabins is primarily due to long haul nature of Emirates fleet deployment.

Earlier this month, the airline received delivery of its 50th A380, configured with 90 First and Business seats.  Thus further adding to Emirate’s average weekly capacity of over 191,000 premium seats.

Tim Clark, President of Emirates Airlines said: “When we signed up for the A380, we had a clear vision of how we would deploy these aircraft.  At the same time we also saw a tremendous opportunity to take the flying experience to whole new levels”.

Over 27.5 passengers have flown on Emirate’s A380s since 2008, with premium overall seat factors on the A380 fleet consistently outperforming the network.

Globally, Emirates’ First Class capacity grew by six percent over the last year, while First Class passenger traffic increased by eight percent.

Across the network, First Class demand is strong, particularly on routes to Europe, Africa and the Middle East, recording consistently high load factors of over 70 percent.

Emirates is in advanced stages of developing a new First Class “bedroom concept” for its A380 and now new Boeing 777 fleets. Customers can expect fully enclosed rooms and all the touches and amenities common to luxury hotels and yachts, including room service.

Emirates operates the world’s largest fleet of A380s,with 50 in service, and another 90 pending delivery.  It also operates the world’s largest fleet of Boeing 777s with 139 in service and another 205 on its order books.  It recently received the 500th 777 produced by Boeing.

Source: Aviation Business /Ed’s Research

 

free vector 09

Budget Carrier Jin Air Makes Inroads into Long-Haul Market

South Korea’s budget carrier Jin Air, a subsidiary of Korean Air, announced in June that it will become the country’s first low-cost carrier.  It is due to start budget long-haul service as early as the end of this year, armed with wide-body aircraft and newly allocated international air routes.

The carrier will also double the size of its passenger jet fleet from 11 to 20 by the end of 2015.

Top management of Jin Air unveiled the growth strategy at a press conference in Seoul to mark its sixth anniversary.

To offer long-haul flight services at affordable prices, Jin Air will acquire a 777-200 wide body that can fly from Seoul to parts in Europe and North America in December.  Then two more of the model next year for its new long-haul venture.

The firm plans to have a fleet of 20 aircraft by the second half of next year by adding nine aircraft, including a 777-200 ER and 737-800.  By the second half of this year, Jin Air will increase its flight routes to 17 from 13 with at present with new routes to China, Japan and Malaysia.

The 777-200Er aircraft will be used initially for flights to Guam and Hong Kong, with services to destinations like Hawaii to be offered after the second batch of wide body aircraft arrive.

Source : The Korea Herald

free vector 09

 

MTU Aero Engines Takes Stake in GE9X Engine Program

 ge9x_jet_engine_cutaway_0_1

MTU Aero Engines will take a 4% workshare in General Electric GE9X program. MTU will manufacture and assume design responsibility for the engine’s turbine center frame. Take over the life of the program, the workshare will be worth around $5.5 billion in revenue for MTU.

The new engine will be designed to exclusively power the Boeing 777X, which is slated to enter service around 2020. Thee hundred aircraft are already on order plus options. The contractual details still need to be finalized between the parties to the deal.  MTU will participate in the engine’s sales and profits in proportion to its program share.

“Our stake in the GE9X program gives us significant market share in one of the most important next generation engines in the upper thrust category.  At the same time, it helps us further balance the mix of our product portfolio,” MTU CEO Reiner Winkler said.  “ Some 30% of today’s active aircraft have MTU modules on board.  We are going to increase this share in the worldwide engine fleets appreciably over the next five to ten years”

Source : ATW

free vector 09

LATEST NEWS IN BRIEF  

  •     The Japanese Government plans to obtain two Boeing 777-300 Er aircraft to replace a pair  of 747-400s used for the VIP transport mission.
  •     Leap-1A the first Leap-1A engines for the A320neo enter production.
  •     Vistara Airlines Tata SIA Airlines has announced that its New Delhi based carrier will be named Vistara,with the carrier scheduled to start operations in October.

             Vistara-620x310

  •   Ethiopian Airlines has added its ninth Boeing 787 Dreamliner to its expanding fleet
  •   KLM has signed a long-term contract with Air Lease Corp.(ALC),covering a pair of new build 777-300ERs.
  • ANA finalized an order for 40 wide body Boeing aircraft comprised of 20 777-9Xs, 14 787-9s and 6  777-300ERs.
  •   Scoot the wholly-owned low-cost,long-haul subsidiary of Singapore Airlines,has selected UTC Aerospace Systems to provide asset management & repair services on its 787 aircraft.

free vector 09

Air Cargo

Summer Brings Cherries Jubilee for Some Cargo Carriers

Sea-TacCherries

 

Virtually all phrases that incorporates the word “cherries” donate something happy and positive.  That is certainly the case this summer for cargo carriers serving the Pacific Northwest, as the banner cherry crop has been the cherry on top of the sundae.

This has been especially true for cargo carriers serving Seattle’s Sea-Tac International Airport and Vancouver International Airport in British Columbia.

Tom Green, senior manager for air cargo operations and development at Sea-Tac International Airport, says when the last cherry is picked in a few weeks.  It will likely be the second strongest crop on record for the region.  The crop is running ahead of forecasts and is huge compared to last year, when poor weather resulted in reduced tonnage.  Cherries are the top perishable cargo shipped out of Sea-Tac.

Cherries-med

It has been a bonanza for air cargo carriers, both those with freighters in their fleets and those who only carry the sweet fruit in their bellies. It has become the summer of the Cherry charter at Sea-Tac.  China Eastern and Nippon Cargo have both added weekly charters, while Polar Air Cargo has flown three weekly charters.  In addition EVA has added three weekly flights, Asiana has added two flights, China Airlines has added six and Korean Air five weekly flights.

Seven of the carriers with freighters serve Asian destinations, while Cargolux brings Washington cherries to Europe. Air Canada is another belly-cargo carrier benefiting from the cherry bounty with flights from both Seattle and Vancouver, British Columbia.

Source: Air Cargo World

 

Researched and Compiled by : Ed Kaplanian  Commercial Aviation Advisor

Contact Ed at ed@kaplanianreport.com