Winging It Takes A Break

It’s time to slow down Winging It air traffic. After a run from November 2011 until the end of January of 2017 totaling 5.3 years. This will be a notice for the readers “Winging It will not produce multiple articles a week, but will go to a sporadic issue using monthly summaries or articles for some other momentous occasion of writing about Boeing Commercial aircraft and military stuff.

Linda with "author" Andrew, and the spirit of a Winging It's Grizzly

A new chart has been started showing the air war for world’s largest air framer comparing units of Airbus and Boeing 2017 progress and value. At the end of each month this chart will update whose relative position of being world’s largest airplane maker.

It’s been a fascinating experience and a joy to write almost every other day or in some cases daily. Keep watching for new articles but don’t expect more than about two articles a month using summary content or exceptions in the news cycle to appear.

Even though at times, grammar is not been the strong suit of the blog, it is in light of my current condition. When I started I couldn’t type and if I did type it was only brief sentences. I had to relearn everything, as I couldn’t remember much from a brain injury.

The early blog sometimes had monstrous presentations where an editor could red ink the whole page with corrections for word usage, spelling, and sentence structure. Winging It was only after sharing information and opinion at the sacrifice of the English language. Gradually, improvement was made. Even though today there are flaws, they're are much fewer in number.

My thinking has improved greatly as compared with the beginning of the assignment. Even though, at that time, my thinking was excellent but motor skills and memory suffered. The blog was the assignment to improve those motor skills and memory. It’s not 100% today, but has taken a journey where the road has come to an end as a writing assignment.

In conclusion, there will be month ending numbers for the 787 program as always provided by Winging It and then another article featuring the World’s largest airplane manufacturer with an Airbus-Boeing competition chart. It will close out week one of February 2017. After that, the occasional offering as mentioned at the top of this article.

Boeing 787 Program Recaps

Boeing's 787 production is fast out of the gate for the first time since delivery started during 2011. This is the January where Boeing has not given to a paltry production number for the 787 like years past when Boeing would deliver only seven or eight during January. The backlog shrinkage for 2017 is only a -5 since it has already booked seven orders for the 787 family of aircraft.

Fig. 1 

The 90 day moving average has fallen a tick inspite a robust January delivery effort of twelve 787's. The outlook will maintain an average of 12 a month during the next 90 days.

Fig. 2

The program summary below once again demonstrates little backlog reduction from the 12 delivered and seven ordered during January. This will be an important number to watch for year ending status.

  

Fig. 3

Fig. 4

Fig. 5

Boeing Sees Lower Order Year In 2017

Boeing is taking a conservative position, signaling insightful knowledge about its upcoming product introduction with the Max and first flight of the 787-10.  Both events could move the buy needle if and only if there are no bumps encountered. Airbus suffered A320-NEO woes with its Pratt and Whitney GW-1000 engine maker who had a few problems to iron out for the NEO. Boeing needs a first delivery Max win and a clean testing outcome for the 787-10 until the end of 2017.

A Stalled Market Pace??

The 787-10 also needs to follow on the 787-9 example by going through its testing checklist without hesitation or any minor mishaps such as a broken seat recline. If and only if these things happen will Boeing make headway in 2017 while setting the table with a robust order year for 2018.

Analyzing the Boeing order year during 2017 suggests the best prediction is the opportunity quotient for Boeing's 2017 buy outlook. That is to say purchases from customers may come in close to 2016's outcome of 668 aircraft orders placed with Boeing. The company says 2017 a lower sales count is predicted as the "buy" market slumps, but opportunity exists as Airbus logjams its backlog.

Boeing Data 2016-2035:

·      Total New Airplanes 39,620

·      Value ($B) 5,930

Astounding numbers projected where Airbus will take a slice of that pie. Winging It projection numbers indicate a straight line estimation in units, reveals a 1980 units per year market potential each year from Boeing's 20 year prognostications. If Boeing can maintain a 50-50 split with Airbus in units the market could absorb 990 aircraft each year for Boeing in purchases. The Value would be 148 billion averaged each year in sales. Boeing sold about 94 billion during 2016 and expects a drop for 2017. 

Several conclusions can be assumed by this financial relationship of proportional sales. 

·      Fifty-Fifty is not a realistic market over the next 20 years. A-B 55%  A-B 45% split is more likely as backlog impediments will move the buying market towards having immediacy of delivery for its class of airplanes. Long waiting periods for delivery harms the buying customer.

·      Superiority of product moves the ratio off the 50-50 assumption pushing buyers towards a superior product in a gradual buying preference.

The conclusion can be reached Boeing has an opportunity to at least match 2016 in numbers, but necessarily not in value. Boeing has been conservative for its 2017 orders placed guess. A great Max introduction and successful 787-10 tests will move the needle for 2017 Boeing Orders. The projection of increased production capacity matching the 20 year demand will increase order placing by two fold each year over the next 10 years. This year maybe a pausing order year, but it should keep pace, as the competitor can't and won't take on more backlog from its customer's orders placed; since the customer needs immediacy of delivery in its corporate planning periods. The tangled web of what will happen starts with the 20 Year forecast of market needs as projected by Boeing.

What is a "Trumpette"?

Noun, Adjective:

Synonym: “Power”

Antonym: “DNC”  

Definition:

A "Trumpette" is a "statement" for the purpose of drawing a line in the sand hoping it is only necessary going half that distance or implementing half its measure as a solution, reaching a negotiated benefit for whom he represents. It establishes a negotiation point for which President Donald Trump seeks.

"Once again Trump, Trumps a Trumpette when closing trade negotiations with Mexico with a Twitter." 

Otherwise, his Trumpette is an expression of where he would like to start talks from exerting great power for that discussion making it a "Trumpette".

Not to be confused with the musical instrument trumpet but has same sound volume.

Trumpette use from the Twitter-verse: “I will build a wall and Mexico will pay for it!!”

Topics Already Trumpetted below:

·      F-35

·      AF1

·      Walls

·      Deals

Airplane Wars Has A Battle Going The 737-10X

Boeing needs to stop the bleeding at the single aisle level. Confronted with costs it proposes the Max 737-10X as the weapon of choice hoping to supersede the A-321 NEO success.  230 seats with a higher stance protecting its tail during take -off and the CFM basis for engines mounting. It could hang the CFM in a wider diameter improving fuel consumption. 

What is not known, is the multi billion dollar question. How far will it fly? The key statistic moves Euro-American airlines to the Max. Boeing hasn't set the target range even though it has built the paper airplane. The second question arises, will there be a “True Middle of the Market (MOM)” or is this a stop gap planning for the next ten years?

The MOM isn't dead having the 737 MAX-10X. Boeing will not violate the MOM market potential from its single aisle with multiple sizes fits all family of aircraft. Boeing is closer to building this 737-10X than a true MOM, as it has an immediate confrontation with the A321-NEO since it robs market share away from Boeing each month.  A stop gap shim is needed sooner rather than later and a 737-Max-10X could change the single aisle dynamics before any 737 expansion thoughts becomes a lost cause.

Boeing knows this and will announce soon, perhaps suggesting why there was no end of 2016 year announcement for a new MOM type. This concept is in motion will address building more value into the 737 family with a less expensive R&D costs associated with any new clean-sheet aircraft. The True MOM will wait. If a new dual aisle follows after the 757 it becomes a 3.0 version. Therefore, a 737 Max-10X is version 2.5 coming from the single aisle class.

In order to win this battle with Airbus, a 737-10X must fly further and more efficiently than the A-321NEO, having the same passenger capacity. If they don't achieve a design superiority or customer appeal over Airbus, then Boeing must regroup its plan going 10 years out while Airbus keeps mopping up the large end of single aisle. Boeing will counter punch with a fighter’s chance in this match.

Boeing Can't Decide Who's Max on First What's on Second

Having not posted about "Launch Customer" over the last six years, it has come a time to do so while explaining who’s on first what's on second in a drivel of insight from Winging It. In December 2011, Southwest Airlines placed its launch customer order for 150 737's Max types. The line in the sand is drawn on that date. It is Boeing's launch customer for the 737 Max PERIOD! 

Now comes “who’s on first” and “what's on second”, portion of this discussion. Norwegian Air bunted its way to first (January 2012) thus Moving Southwest to second. It still remains for Southwest to score first from second after getting on first before Norwegian batted second. 

After following the above drivel in a concise manner, "Southwest" is the first up as Launch Customer and about to score this summer as Boeing's Max launch customer. It must score from second after the Norwegian Air bunt. However, Norwegian stole home on an "I don't know" play from third, suggesting it was launch customer, because it started from "First". 

However, Southwest, standing on second looked at "I don't know third". It's really messed up as Boeing loaded the bases on walks and sent Southwest home on a walk at the plate coming from its going first and receiving it's first customer copy by October 2017, where Norwegian slides in during June of 2017 ahead of Southwest's Max delivery schedule.

Norwegian has a 737 batting average of 108 737 Max ordered and Southwest has a batting average of 200 Max ordered. In a trade deal Southwest is waiting for some players to be retired before moving its pieces around the game board and Norwegian got a "six 737 card for 2017", putting them at home plate in  "Monopoly" fashion. The game changed to Monopoly before Southwest could trade off some its players while making room for the Norwegian Max 8's to steal home (pass go) using a draw card. "Baseball plus Monopoly" is the fastest growing board game this year. Southwest got to first, first, and then is delivered second, with an "I Don't Know" play from third. 

If you have questions post them here and a crack team of operators will answer them. Ask for Bud Abbott or Lou Costello because "I don't care" who scored "first" or why it’s "second".

Key:

• First base: Who
• Second base: What
• Third base: I Don't Know
• Left field: Why
• Center field: Because
• Right field: Nobody
• Pitcher: Tomorrow
• Catcher: Today
• Shortstop: I Don't Give a Darn

Boeing And The Razor's Edge

It has been known in Hollywood and now it is realized in the aviation world. Three "bombs" and you're out. Three bad movies in a row and an actor can't get a gig. They are relegated to the golden parachute of obscurity in some mansion estate in their favorite local. Boeing, every day walks that razor's edge from being relegated to obscurity. The same is true for Airbus. Walk the line without doing somersaults on the way. Do not fall, do not fail is the motto hanging in executive's minds. 

Now comes the critics as they seek some superior knowledge about everything smart and insightful. The Boeing Corporation did a somersault on the razor's edge with its 787; then jumping to the Max without losing its balance and onto the 777X without sticking its landing as of today. Anyone of these projects would relegate the company to a "B" movie status and off the aviation's "A" list. "Two Bombs" would irreparably sink the company backwards to some back lot in Canada or Brazil. A third "idea mishap" would send the Boeing execs to their favorite real estate compound somewhere around Puget Sound.

However, every paragraph should start with "However, therefore, or in addition, types of words. The blog has settled on however, However…

Therefore, Boeing has mastered the beast of new technology where Airbus follows with vigor and the A350. It follows the 747 with its three -late-zero double decks. It reaches after the 777X counting on executing its own A(nother)- three, Cinco, zero dash 1 times 000's. Does these antics resemble a somersault or a jump on the razor's edge? They are timid bold moves in Europe while back on the farm in America, Boeing is seen as a frontier's man using a knife, hatchet, and musket for its tools (plus a few beaver traps).

The traps come with an ever changing strategy for which Airbus must adjust using a series of timid bold moves every time Boeing succeeds with an idea. "If Boeing Does It", then Airbus knocks off the shelf a reasonable facsimile using customer pleasing renditions of the same. Don't confuse biggest with bestest because pigs don't fly for very long. Boeing may be five inches narrower with a 231 inch wide 787 cabin compared with 236 Airbus A350 inches, but as a ratio it breaks down as a 2% difference or the length of a writing pen's worth of space. Or in this example a finger's width difference in the seat spacing making the A-350 XWB up. Do you have a wide body then fly Airbus?

The musket is GE's engines while the knife and hatchet tend to sculpt superior wings. Make it wider is the Airbus response for those XWB's whom are standing in line.

The gate should have two lines. One for wide bodies and one for typical passengers. Sarcasm is a useful writing tool.

Will 5 inches more tip Airbus off the Razor's edge? That remains to be seen. If fuel prices meet the laws of supply and demand and fuel is a finite source, then the ever increasing demand of passengers will drive prices up over time. Yes, fuel efficiency matters using the jetway’s pricing at the gate.

Back to the razor's edge and retirement issues. Boeing has demonstrated nerve and calculated means for escaping its chance to fall. Airbus is using a trampoline and ladder for its routine. The three “bombing” bounce is likely for Airbus, as Boeing should fly higher making its somersaults on the razor's edge a common place occurrence.    

Wide Body Demands Comes From Cheap Tickets Not Fuel

Currently, the bent on buying a wide body is high fuel prices, thus suggesting the wide body market is saturated and will derive fewer sales going forward. However the secret is not low fuel prices but hauling more passenger through the incentive of lower seat prices. Several European carriers have stocked up with 787-9's, such as Norwegian Air offering incredible deals for the traveler.

Cheap fuel only goes so far on an old frame or airplane type such as the 767 or A330, as most airline customers are considering during this low fuel price siege. Norwegian lists on its website a Paris to JFK flight for only a $199. Quite astounding for going transoceanic from a major point to point.

Economy cabin All fares per person in EUR						Premium cabin All fares per person in EUR
Departure	Arrival	LowFare		LowFare+		Flex		Premium		PremiumFlex
02:05 PM	08:30 PM		199.80		274.80		741.70		441.50		796.30
Paris-Orly	New York-John F Kennedy							Premium on parts of route		Premium on parts of route

The example is a low fuel price buster using the wide body aircraft instead of old equipment. In order to be competitive the price of fuel does not have to rise. Qantas is currently re-configuring its fleet with long range 787-9's going all the way from Australia to London because it can! 

The second note is the old inventory has a narrow shelf-life and the airlines inventory will need replacing within the next few years where placing a wide-body order in 2017 is advantages no matter where the fuel price goes. If fuel does rise up there will panic driven orders for the 737Max, 787 and 777X types churning a ripple effect in the seat pricing. Either way the low fuel price status quo will no longer drive how airline buy its inventory. Competition is the key driver at this point in time. 

The US pipeline from Canada was approved by President Trump and it will suppress fuel prices a little while longer even if the Trans Continental Pipeline had not been approved by the President.

This is not a game changer for buying new generation wide bodied aircraft vs buying in the surplus market. The older bodied option is drawing nigh as those fleets will age faster than an Airline can write it off the books.

Boeing Chart on Its Cash Engine

It was just delivered, The Boeing Financial Report for 2017. In that report are the delivery numbers floated among all the billions reported. Below is a quick and dirty yet incomplete of financial sources from product delivered. These are big ticket items suggesting how Boeing may build and deliver 760 aircraft from its commercial division during 2017.

Furthermore, it gives us a sense of the proportionality from its military division. Keep in mind, Boeing is actively seeking added F/A 18 orders and its 2017 introduction of the KC-46 at military bases near you. The goal is for 18 KC-46 tankers from the 767 frame-works starting in 2017. 

Seeking Alpha has the complete Financial Summary Report

The Boeing Company and Subsidiaries

Operating and Financial Data

(Unaudited)

  

Deliveries		Twelve months ended December 31						Three months ended December 31
Commercial Airplanes		2016			2015			2016			2015
737		490			495			122			120
747		9		(3)	18		(3)	1			5		(2)
767		13			16			3			2
777		99			98			26			21
787		137			135			33			34
Total		748			762			185			182
Note: Deliveries under operating lease are identified by parentheses.
Defense, Space & Security
Boeing Military Aircraft
AH-64 Apache (New)		31			23			6			5
AH-64 Apache (Remanufactured)		34			38			7			5
C-17 Globemaster III		4			5
CH-47 Chinook (New)		25			41			8			6
CH-47 Chinook (Renewed)		25			16			2			10
F-15 Models		15			12			4			4
F/A-18 Models		25			35			5			7
P-8 Models		18			14			5			4
Global Services & Support
AEW&C					1						1
C-40A		1			1			1
Network & Space Systems
Commercial and Civil Satellites		5			3			2			2
Military Satellites		2			1

Boeing prosperity is projecting a dozen more aircraft in total for its cash flow over its 2016 results.