Tuesday, December 15, 2015

Toilets Tank Airbus A350 for Several Months

Arch rival Airbus has a problem coming to a head. Its toilets are from Zodiac, supplier of all things reclined. The several month delay on getting its Zodiac toilets unplugged won't be an Airbus game changer. They will get it right eventually during a sixty day window of time for airing out the critical passenger station. Airbus expected 15 of its A350's built and delivered by year's end. However, a supplier delay of product not meeting Airbus configurations for the A350's exist, and by years end it is in a stall at an undisclosed Toulouse location. They will hit maybe 14 Airbus delivered and Airbus expects another 60 A350's to be delivered in 2016 where its counterpart in North America, Boeing, will rack up another 130 plus 787 wide bodies into customer's' hand exceeding any Airbus A350 production with an over 100% output advantage for this type.
The supplier issue is still the critical show stopper for any program, especially for Airbus at this time, as it turns on its wide body production pace in an attempt at matching Boeing's head start considering its propensity of having an incredible two plant delivery pace. The Boeing 787 backlog will slip under the Airbus backlog before 2016 ends. Boeing is near the Airbus net 764 unit wide body backlog for the twin aisle and twin engine type. Boeing is at 784 net Backlog for the 787 family of aircraft, having 1143 orders booked and 359 delivered. Boeing will catch Airbus backlog by end of first Quarter 2016, if all things stay the same on the order books.

In 2017 when the 787-10 will show up on the floor, suggest a buying spree for 787's will be ripe, as the diminished backlog with Boeing positions them within the magic five year plans of most airline operations for a delivery window. Boeing can now manage order syncing with a customer's five year plan maintaining a 750 unit, 787 backlog. A shrewd strategy from Boeing five years past; "get that 787 backlog under the five year production mark!" Airbus is yet three years away from that distinction, as it will try with supplier cooperation matching Boeing WB output in the next three years. Boeing is capable of taking on more orders and delivering faster than its combative competitor for the foreseeable future. 

Delivery timing matters for every customer in the industry. Many a customer bloated its WB orders earlier when it could, as a hedge against not having the best aircraft in its respective fleet sooner rather than later. Now customers can order in stride with business opportunity without worrying about missing out on delivery slots for a seamless fleet renewal plan, because it can take deliveries within its own five year corporate window from Boeing. 

The long order book wait period is rapidly shrinking for Boeing even though they have booked at least 1,142, 787 orders with 354, 787 already delivered. They are on par with the Airbus' order book backlog. However, considering its a "late" Airbus production ramp-up, even as Airbus had a sub 800 order book at the start of its initial production cycle starting in late 2014. With this consideration, "That my diligent friends is the Boeing order book high ground!"

Boeing continues to add to its WB order book as Airbus A350 order intake languishes over the last three years compared with Boeing. Now that the 787-10 has taken on more orders (EVA air), after two soft years from the initial 787-10 order period, Airbus is gasping for help in this segment and it isn't coming soon. Boeing can deliver sooner than Airbus within the proverbial "Corporate Golden period", or a customer's five years of planning and opportunity period. Boeing has taken in a net of  294, 787 orders since January 2013 where Airbus has netted 193, A350 orders sine January 2013 where these last two years are a minus 37 net A350's removed from the books.