The 737 Heated Up At Farnborough

It's no accident that Boeing dominated this year's air show at Farnborough. It booked 564 737 types at this year's show surpassing its long-standing arch-rival, the Airbus company. Already, Boeing has firmed a prior Viet Jet MOU/LOI commitment into a firm order today pushing Boeing's firm order upward by 100 units. This would be a firm up for 80 of its Max 737-8's and then 20 Max 737-10's. The Boeing MOU/LOI dividend is already paying off.

Time is the key metric for this Boeing onslaught at the airshow.   Both the NEO and the Max have had time in the marketplace under the operational condition and customers haven't missed the memo that the 737 Max beats the A320NEO. Viet Jet ordered 100 Max and 50 A320's in a head to head decision for single-aisle types. What this means is Viet Jet is leveraging both makers into the lowest price possible under a competitive environment and it already firmed its 100 737 Max ordered just only days after the show.

Timing may have sped along the finances and early firm order signing, but it does show Viet Jet has done its homework and the Max is a pretty good deal from initial costs through operational efficiencies beating the A320NEO. The important takeaway is that Boeing has become aggressive because it has a winner in the Max and other customers are watching this competitive drama unfold in the most lucrative single-aisle market. 

Now the Farnborough play reflects Viet Jets signing for its Max. Airbus booked 304 A320's having a firm, MOU, or LOI designation. It is interesting to note, that too is almost a two to one Boeing advantage with its Max over the single-aisle NEO at the show over-all. Airbus by day four only had a total of 93 firm orders booked for all commercial product at that time.

It also is important to note, Boeing had booked 350 single-aisle and widebody orders at the show giving Boeing a four to one advantage with firm show orders. The Viet Jet confirmation for 100 Max increases Boeing's current market hold by a hundred more aircraft pushing the Boeing /Airbus show disparity above four to one sales ratio for this year's show. Boeing made serious headway over its market share status for single-aisle at the show and it could increase by year's end. In only two weeks we all should see the Boeing.com total 2018 order numbers within its publication. 

Currently, Airbus has about a 1,000 unit lead over Boeing but the market trend from the show encourages Boeing for closing the gap in numbers by year's end. It will not make up the single-aisle shortfall with Airbus but Boeing will make Airbus nervous with this Farnborough order surge and may close the gap between the two giants by 500 units instead of 1,000 single-aisle order gap.

Embraer Could Be Single Aisle Division For Boeing

It is possible that Boeing is taking so long with its impending 797 launch announcement because it may be reorganizing its airplane family to include an Embraer built the single-aisle family of aircraft where Boeing will become a dual aisle master of aircraft. There is room for Boeing to fill a gap with its 797 concepts with perhaps three different models at the start of a launch for the 797. It is also possible for Boeing expanding Embraer's horizons with a continued family from the ERJ 135 through the 737-9 models. The 737 Max 10 would morph into the 797 series with Boeing as a dual-aisle aircraft starting the series with 220-240 seats. The next 797 step would become a 250 seat dual aisle 797 and finally, the 270 seat 797 would cross continents with a regional bent.

The lessons learned from the 787-300 concept was too soon to fill the gap because customers didn't get it. Since Boeing was too experimental with the 787 plastic ideas at the time and new airplane risks were off the charts. However, it was a natural gap filler needing its own family as much as the top end of the Single-aisle member, the 737 Max 10 in order to respond well in the market. 

Embraer fell into Boeing's lap and that changed everything for the Boeing thinking cap. Renton Washington could build everything 797 instead of the Max family. Embraer can now knit its own family together from 50 seats to 175 seats without threatening Boeing's family of single-aisle aircraft by a 2030 clean-sheet. The 797 family starts off right where the 737-10 left -off at $130 million list price and then go North to $200 million with a 270 seat 797. The gap would close and have Airbus at the game, set, and match.

Boeing would be dual-aisle and Embraer would be single-aisle. The lucrative 737 Max book would slide forward to Embraer by 2030 and after which Boeing has firmly entrenched with its 797 families and Embraer gains the know-how for a whole new single-aisle design. 

Boeing would co-star in a design team effort for a new single-aisle concept as indicated previously. The year 2030 is just a milestone in aviation's evolution and it would be a natural fit for a Brazilian/US joint venture of resources and markets. The customers would have to catch this vision as well. They would have plenty to say on a new single-aisle design. Embraer would fill the single-aisle market with what customers want and what Boeing could do for them (Embraer or customer).

The risks are high, but the reward is higher if managed well. The key is if Boeing has found a 4,000 aircraft market without disrupting the 787 golden goose. The world keeps growing in numbers and dual-aisle is a natural design for more passengers. If Boeing data indicates 4,000 is a low number for the 797 type of aircraft, it is because pundits haven't considered the broader gap where populations need moving just like it goes today in the single-aisle aircraft as then an NMA reality becomes the reality of a 6,000 unit 797 family of aircraft. The higher NMA numbers is that market realization only after it arrives with its first delivery prompting a 797 dual-aisle market expansion.  The single-aisle market stabilizes with this gap filler. 

All in all, Boeing pauses with the "MoM", using an Embraer alliance for cover. Even as it tries to figure out how both the market and its new partner will fit-in with its own broader scheme for developing the dual-aisle medium aircraft. The 797 should become a permanent upscale from the single-aisle, as the world's travel demand expands.  

Boeing is paused because of this New Medium Aircraft market risk is great when fitting into the broader airplane market with a "super-two" as an adjunct for both the 737 and 787 in the emerging world's marketplace. It just needs to know how many NMA's aircraft it can sell before its new Brazilian partner can build its next version of a single-aisle. Otherwise, Embraer would not have joined with Boeing. A prediction for the NMA family would go as follows:

• 797-800
• 797-900
• 797-1000

A clean sheet Boeing-Embraer single-aisle starting in 2030 may start a B/E family with a 737E-2  named for the lowest seat count (50-75 seats) where it builds up to a 737E-9 (200 seats) before the jump to a Boeing 797-800.
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797 Metal Totally Tubular; Composite Is Ovoid!

The 797 purveyors are guessing what the 797 will be built of and schools of thought are floating the press reports. The Seattle Times reports, Ihssane Mounir, Boeing, Commercial Sales, and marketing VP who stated at Farnborough, "the 797 will go composite", while other Boeing groupies say metal body for Everett, Wa.

“We are committed to continuing looking at a composite structure,” said Boeing sales Chief, Ihssane Mounir. 

This argument is a diversion from reality as Winging It is a reliable source using second-day quips.

A metal body speaks of China stepping up its freight concerns and a composite body becomes an ovoid shape for passenger comfort in North America. Boeing's VP suggest the composite structure is "in" the running during the Farnborough Airshow. 

Winging It thinks maybe both body types are correct. a 220 passenger class metal body for Chinas freight and passengers and a 270 passenger type made of composite with a different shape just for passenger traffic. Everett would build the metal type and Charleston would build the composite type both totaling 2,000 orders in the first 5 years. Let's just say the 787-300 has taken on a different shape to its approach.

The aircraft types would share engines, avionics, and technology advances but would have different designs features which are why Boeing is taking so long to decide on the announcement. It's complicated to make it a simple decision. It’s a crazy world and Winging It enjoys the dog and pony show.

Farnborough Day 4, I Guess (updated I guess: part II)

The official Winging IT guess is Boeing's killing Airbus this year at Farnborough 2018 for orders as the numbers are shown below: The firm orders will add to the annual book for Boeing's "July" reported in August as it updates its own website. The firm Boeing Book Airshow grows in number at a 3-1 order pace over Airbus capping-reporting for July 2018. Even the Commitment/MOU outpaces Airbus at this time. Remembering some big widebody orders not yet firmed by Boeing occurring before the Airshow, it maintains a solid lead over Airbus. It may even beat the Airbus shuffle at year's end 2018.

Winging Its Order Guesstimate Farnborough 2018

Below is an Airshow estimated correction as shown above for Boeing Co., otherwise a tally by type. The list is a compilation of total orders and commitments and is an unofficial amount but does illustrate the potential Boeing order book if all commitments are signed as firm orders.

Corrected view per additional publicized Airshow recap

Notes:
P= passenger type
F= Freight tye

Boeing's 797 Is The Candy Wrapper Boeing Wants Also The Candy Bar

Boeing currently sells its airplanes for 30% of its future cash inflow where it could also market in-house products supporting those aircraft over the next thirty years for 70% more cash intake. Boeing theoretically, has a 70% in-house product margin not yet tapped. It could and now has indicated it will seek ways to move more product line to its core mission.

The following are possibilities and actual implementations:

·      Global services such as ground maintenance and Boeing staffing.

·      Global services such as over-arching training and Boeing proprietary parts supplier

·      Exclusive Supplier Contracts

·      Providing a third party gateway for major systems replacement such as engines, gearing, and electronics.

·      Finally, a nose to tail Boeing product suite.

·      Additionally, worldwide added value accessibility for leading-edge Boeing components

These are a wide-ranging list for what Boeing is establishing for its plus 70%  business model. Selling an airplane is a gateway into the Boeing airplane business catalog. It may become as simple as going to its electronic interface and selecting a preferred service item and a Boeing representative will confirm the service or add value to an airline own business plan. China is home to multiples of start-up airlines. The Boeing emphasis towards the added value model when buying an aircraft expands a customer’s options for its new ventures. Cash-strapped legacy carriers may also identify high-cost areas of its operations and quickly go to Boeing's 70% portion and pull out a plan that is more efficient so it can remain more competitive.

In other words, the 70% realm is created out of the one-stop shop philosophy. Boeing is changing its business model to accommodate rising airline customers at every stage of its growth and offers already mature airline customers’ options in which to lever its operations on-the-fly. The Boeing goal is to capture the financial potential after an airplane is sold by 70% over its next thirty years while in operation with an airline, at a value less than what the same airline could do on its own. Boeing being aggressive with it one-stop-shop business modeling convincing customers while purchasing a Boeing it is eligible for additional Boeing advantages over thirty Years. The over-arching business plan has a name and its called "The Edge".

Boeing Chokes On Its 797 and Says 2019

Winging It has long predicted a 2018 797 launch. The time window is just right for Boeing but its leaders have just now cleared its voice saying, "2019" for the 797 Goldilocks and will launch (hinted) in 2019 because its business case is not yet perfected for the 797. Winging It also believes a concurrent program for the 797 exists. 

In other words, the program has seven years before an official delivery date but in those seven years, Boeing would also concurrently resolve all financial planning concerns. Boeing does have its customers for a launch at this time. It also has its technological bundle for the 797 in a row. The design points are now relegated to an adjustment period where the eraser could change what launch customer would want for a refining design. An observer (Winging It) has no idea what has just occurred with the Boeing 797 prototype but only assumes it will hold 220-270 passengers and fly 5000-mile distance with full loads.

As mentioned before, CFM (A GE joint venture with Safran, jet engine builders) has let this little nuance out of its bag; "CFM" is ready to go with Boeing on a 797 "45,000 lbs thrust range". That is a major concern (having a new engine) for this airplane program and one more year waiting for a launch does not change the 2025 first delivery date but does allow Rolls, PW and GE; a shot of making a solid proposal during 2019. The concurrency has started with an engine builder already "concurrently" working an engine-up by Paris where development is farther along than the press would indicate. Expect an engine proposal coming forward, with Boeing accepting a single source jet engine. Rolls Royce is working at a high pace proposing a 797 jet engine by Paris Air Show, 2019. CFM is working and indicating it is ready for Boeing's 797 and GE is lurking while PW GTF is also a strong contender.

It could announce at Farnborough but won't announce because Boeing has backed down its new airplane development swagger as a corporate policy, thus avoiding all-new airplane woes experienced from the 787 experience. Airbus knows where Boeing is going and Boeing is not in the Airbus rearview mirror. Airbus needs to clean its windscreen several times a day from Boeing splatters at this time. The 797 is the biggest spatter for Airbus, which no wiper could possibly clean in time for the Paris Airshow. Boeing is going to have a huge widebody order book at Farnborough while Airbus will announce several hundred single-aisle A-320's orders. The dollar order value will favor Boeing at Farnborough and beyond.

The KC-46 Takes-Off

Needing a certificate from several agencies and especially the US Air Force, the Boeing corporation exhales as it completes its tanker tests this month. It is ready to start serving the US Air Force with its Boeing built KC-46 tankers going forward. One of the previous key problems for the tanker requiring this final testing was the remote sensing function for the boom hooking up with its flying customer's. Prior to this final test, the tanker's remote sensing would have some occasion to lose contact or scratch and dent the trailer fueling aircraft with its fueling probe. 

The former process for fuel transfer required an airman to lie flat watching the hook-up from the flat position while operating controls for its fueling procedure. The KC-46 now has an airman sitting forward in the aircraft body from this former position conducting this mission on a screen with all the tanker fueling capabilities at his fingertips. The tests for this modernization had some flaws where glare showing from the sensor to the screen blocked a clear view for its operators. 

It went back to the shop for fixing and testing for which it now has passed using software upgrades and possibly some other equipment upgrades. It now works as tests indicate and the tanker can now deliver without operator obstruction of view or loss of fueling probe placement.



KMUW reports:
"The recent tests involved the tanker’s remote vision system and refueling two more types of aircraft. Those results, combined with testing completed in June, made the tanker eligible for delivery, the Air Force said."

The tanker will have first delivery in late October to the Airforce at McConnell AFB, starting the sequence for 18 deliveries by April 2019.

Whew, it's about time and it sounds like a military marvel from all the work done on the program. It will fly the wounded, surveil, and fuel everything the Airforce has with wings except missiles. There are other functions not discussed and remains secret this airplane will do.

The B-21 Northrup Bomber Winner

The DoD has scheduled at least 100 active combat bombers and it could go as high as 164 production deliveries depending on costs and program progress. Northrup won the bidding war partially because it has experience in making a flying wing body bomber like its B-2 bomber.

B-2 Photo from National Interest

Now comes the B-21 Raider from Northrup as it is rapidly approaching the Critical Design Review phase (CDR) depicted below.

LA Times Rendering 

The CDR will report if the B-21 has reached a paper accomplishment of achieving design elements, meeting the Northrup's RFP proposal response before building the first flying prototype. It is an important milestone for the program. The technical paper shows how Northrup will accomplish the B-21 Raider completeness within costs for numbers requested. It may be a wide range CDR including testing and product upgrading during its production cycle.

National Interest Quote:

"We haven’t done CDR yet, we are on our way to critical design review,” Randy Walden, director and program executive officer for the Air Force Rapid Capabilities Office—which is responsible for B-21 program— said during an speaking engagement held at the Air Force Association’ Mitchell Institute on June 25."

It will be a stealth bomber. On another note, the B-52 will incorporate heavy lifting weapons receptacles of 20,000 lbs for its wings. Suggesting a mission change within the shadows of the B-21 future capabilities.

Boeing Orders Up For June

It's a pre-Farnborough order blaze for Boeing totaling 460 net orders. Not detailing the Airbus book of 206 net orders may discourage Farnborough Air Show-goers unless it has held back order announcements until the UK airshow. Boeing will announce more at the airshow. It will be a dogfight for top dog at the ordering booth. The mid-year numbers favor Boeing but an end of 2018 order numbers are yet to come. Boeing's lead having some large MOU's not finalized, will boost the Boeing order book along the way.

Below is a Winging It/Boeing year to date net order synapsis of firmed orders:

  
The Max leads the pack with 347 net orders to date. The widebody group easily outpaces Airbus with Boeing's 141 net ordered. Airbus has only 50 net orders for its widebody this year. The "Airshow" will provide a platform for Airbus to catch-up, but will it? That becomes the question before the big event. Will It?

Making It Difficult For Airbus

Boeing has a plan and it’s the NMA 797. Airbus has a plane and it's the A-321NEO. Boeing would like to launch its 797 as an Airbus killer. In one fell swoop while announcing the 797 Boeing would like to stall both the A-321 and A-330NEO programs. Even though the 797 won't fly as far as the A-330NEO it doesn't have to because the purpose of its design is to land smack dab into the middle of where the market goes to and fro. That is to say, going from coast to coast linking millions. 

Boeing has all the pieces of a 797 from its drawing board to the flight line. It even has an "engine to go". The engine is another story and that's why it asked for engine makers to turn-in its RFP proposals a few days ago within 48 hours of its engine proposal deadline. Boeing has an engine, the proposals are for second place offering. I suppose it’s a CFM/GE with a 45,000 to 50,000 thrust range that it has already tested and is ready for the next step within the next three years. That is to say, flying on a 747 wing. The following are the big checkboxes completed before Farnborough Air Show.

Ø  Engine committed

Ø  Design confirmed

Ø  Customer Acceptance,

Ø  New Technology constrained to Boeing's already proven   technology

Ø  Production constrained by Location, Location, Location.

Ø  Realtors are celebrating at the local Hilton.

Ø  The 797 has a range of 5,200 miles/240 seats or 4,500   miles/270 seats

Ø  Everyone thinks of a Paris announcement with cream cheese   on a crumpet

Ø  Boeing is far removed from Paris as a pound is a pound the   world around 

Boeing's "job one" is to deflect Airbus at every turnstile. Waiting for a 2019 announcement at Paris keeps Airbus talking at the turnstile. Announcing during 2018 when the program is ready is the Boeing prize.

Farnborough UK

Fog glasses with optical sun shades is the complete Farnborough kit.




Choosing the right coat and shoes is next more import clothing on the list. I went for the Sherlock Holmes hunting cap including ear flaps, buttoned over the dome. The tobacco shop didn't have "my" pipe. It only had a Moby Dick style straight pipe. I quickly snatched up the Dr. Watson satchel with a monogrammed gold inlay "Farnborough 2018" on its flap.

Back to the center piece the coat.



I found a high collar London Fogger draping down to mid shin bone. It came with a dark grey neck scarf off-setting the woolen coats tweed design. A Bennedict Cumberbach wannabe. The shoes are personnel and walking silly is the task at hand. I finished with the following Farnborough Airshow look as shown below.




When sneaking around behind the curtains at each pavilion a more formal look was employed the over coat was added.

Farnborough 2018, will introduce a new deduction motor and photographic memory cards.

Dr Watson will of course be manning the Sherlock booth for which I will stalk during the show.

The Purpose Driven 797

The 797 dual aisle is aimed at the pinnacle of the single-aisle market, the 737 and A321. Airbus has had a long run with its A321 holding a baker's dozen and a half times ten going 4,000 miles now Boeing will take aim at building a new replacement for single-aisle travel. The key component is the dual aisle room is more efficient than a single aisle cattle shoot. Boeing added a 737-10 to its family of single-aisle continental flyers but it did not want to infringe upon devouring its single-aisle following with an all-new class of airplane like the 797. 

It wants to leapfrog Airbus' A321 capstone with a new class by not sacrificing its own single-aisle sales book. It doesn't want to harm the 787 range of function as many of that widebody travels under 5,000 miles on a particular route. The 797 is purpose-driven by fitting in and not dividing the Boeing market. It is also a disruptor for the A321 market. In a chess game, its a pawn next to opposition's king where any move by the king puts it into checkmate while the pawn put the King into check-mate at the same time. The 797 is that pawn. Airbus will have to build an all-new pawn to compete with Boeing, but it will also have to compete from behind the chess board's back line.

Boeing's finger is on that 797 pawn about to move one space forward on the corner to the Airbus King. 

Boeing Wrestles With Its 797 Egg Laying Chicken

The old question comes about from what came first? The Chicken or the egg? Boeing's 797 program is about to answer that age-old question with the 797. It says it wants to know how big the market will be for the 797 before it builds said aircraft. The other side says if we build it they will come thus expanding the market so the how big question is a moot point. The never-ending paradox defines Boeing's conundrum. We won't build until we know how big the market will be and the market won't know how big until Boeing makes first 797 delivery, or if it will buy more than Boeing's predictions. The best Boeing case scenario should of have been to keep quiet on the subject in case it's a nogo.

Boeing has climbed too far down that rope for it to climb back up from where it started. Boeing is overcommitted to an uncertain program to back off the 797. Its chicken has a white meat crowd following, and then a wings group who like its eggs easy over. Both groups want to have control of program costs most of the time. Boeing is well positioned to take a roll of its airplane development dice suffering a win-win outcome, and that's what Boeing was positioning itself for in the first place. This chicken is more apt to fly than lay an egg. The risk is Boeing fails to meet 797 expectation and can't recover its trip to the fence rail.

All in all the 797 has gone way past the end of a serviceable 797 rope and it will have to launch before it lays an egg.

Vacation Starts Now

I'm on a personal traveling beat for the next two weeks. If something gets posted its raining somewhere. July 1-14 and so forth. Back for a Farnborough quip though. Enjoy your summer, it flies by too fast.