Wednesday, August 5, 2015

El Al Files Closer to Buying New 787 Dreamliner Fleet

"New planes are earmarked for medium- and long-distance flights, including New York, Boston, Toronto and South Africa. 

El Al is in advanced negotiations with Boeing and a number of aircraft leasing companies for the purchase of 15 Boeing 787-8 and 787-9 Dreamliner airliners, the world’s most advanced aircraft. The deal will include the option of purchasing 13 additional aircraft and spare engines."

The Second half of 2015 has always been a target time for 787 in 2015. This blog has consistently advanced the notion that part II of 2015 will bring an abundance of orders for the 787 family of aircraft. The news above suggests this will happen before 2015 ends. Combing with Qantas in-the-works for ordering, is shaping up as a bonus 787 Boeing Year over its A-350 competitor. Long ago Winging It established a projection for the 2nd half of 2015 as peak moment for the 787 order book making further separation with the A-350 order book. This bit of news confirms that projection of orders is in-the-works.

The over-all compilation of orders-in-the-works has not yet reached a climax, but from October to December of 2015, Boeing will complete a big order cycle. The Boeing production machine has made this possible, churning out almost 12 a month, which has spurred customers moving sooner rather than later on the order book. While Airbus remains finding its own production legs, having only delivered a handful of A-350 since its first delivery during December 2014. Mainly, Airbus delivering to its clientele favorite, Qatar.

I don't doubt Airbus capability for its A-350 in production or flight performance. However, after hearing Alan Joyce, Qantas, remark, "we have studied the A-350 and find the 787 a perfect fit for our market", or something close to that statement. Making this a strong indication that the post A-350 Rush To Orders (RTO) period is complete. The closing of RTO for Airbus signals a long drawn out effort for its marketing team for its participation in the Airplane Wars. It means Boeing has started reloading its own Order Book in the Post RTO period in the face of delivered A-350's. All participants have now had a chance to weigh both mega builders’ proposals for new aircraft when currently flying its Airbus type, while the 787 is gaining momentum during 2015. Boeing's head start on the production backlog gives it the high ground. 

Boeing's 787 superior performance with 304 models flying, demonstrates a competitive advantage over Airbus in side by route matching battles while exposing its A-330 as a pretender. The A-330 in service has become the retirement aircraft of choice. Qantas will be a good example for that metric, when its orders the 787-9 this fall. 

The RTO period began with Boeing in 2004 and ended 2007. In 2007/2008 Airbus started gaining strength for its A-350 order book while Boeing started its Post 787 Announcement slow period in 2008.

Boeing RTO

* Year To Date On Article Date
Airbus RTO  Period
Boeing Post Airbus RTO Period Market Stability

Note: Boeing has no negative cancellation (netted) on its books, as compared with the A-350. The A-350 shows two negative net years in 2011 and 2014 for a total of 63 net A-350 cancellations. I guess that could happen to anybody, but it happened to Airbus slowing down its RTO surge and essentially stop its A-350 type growth where Boeing is just now gaining new strength from recent Customer leanings towards the 787 family of aircraft.

Airbus A350 orders and deliveries by year

This is roughed in result assigning RTO for Boeing 2004-2007
The Airbus Chart shows an immediate -350 reaction in 2007, and then it settles in with order book cancellation during 2011. It also lost 70 from Emirates in 2014 taking a second negative year during its initial RTO period which ended in 2013.

Note, both Airbus and Boeing open up with 787-10 and A350-1000 ordering during 2013. It’s a transition year for both makers.

Now Boeing is positioned to make a statement at the Next Big Show. It can announce the Post RTO era belongs to the Boeing 787.  Dubai Airshow is next up and may have some surprises at the show if enough notary stamps are available for signing. Prediction: Boeing will go plus 100 787 ordered in 2015, and Airbus will lose lift and stall out? Yes it will! 

'Under the order wing", during last couple of weeks:

  • EVA Air 24-26,  787     In Discussions
  • Qantas  50,      787-9  Under Consideration
  • EL AL    15/13  787     In Discussions almost complete Intent Annonced

Total: 90 787's not including options gained within the 2015 time frame.

Adding the 25 (net) already booked for 2015 could result 
with a 112-115, 787 total order book during 2015. This sales order number could even go higher!