Norwegian Airlines Goes Long With $200 Seats To America

A recent delivery of a Boeing 787-9 to Norwegian Air marks the beginning of an onslaught of 29 more 787-9's for its stable of aircraft. More importantly it will overmatch its own 291 seat count found with the 787-8, by the 787-9's additional 53 seats, configured with 35 premium and 309 economy seats, and totaling 344 seats going to and fro in a 787-9. 

The fleet replacement/expansion of 787-9's is also mentioned as 30 units, and would give Norwegian Air 10,320 additional daily seats while adding more destinations to its portfolio. The latest news includes the US to Europe ride for $200 per economy. I would suspect Premium is a value buy for the space given, and should be only a few reasonable dollars more. The eight 787-8's have a total seat capacity of 2,328 seats for service. Counting types, orders and options; Norwegian Air will have 16,088 daily seats when all frames eventually arrive.

It is also an important Norwegian note: Norwegian Air had leased 4 787-9's during 2014, and also has a committed-purchase for 19 787-9's from 2015. However a total of 11 787-9s come from lessor's prior to the Norwegian order for 19 787-9's, making up the 30 ordered with an additional 10 optioned. 

On another note, it had already received its original 3 ordered, 787-8 and then the additional five leased 787-8, since it first ordered in 2005. 

Winging IT's own rough calculation shows 19 787-9's ordered by Norwegian Air. The 30 787-9 comes by ATWonline  calculations for both leased and purchased 787-9's by Norwegian Air.

"Norwegian, Europe’s third-largest LCC, has 30 Boeing 787-9s on order, as well as 100 Boeing 737 MAX, 100 Airbus A320neo and 34 Boeing 737-800 aircraft."

The first ever Norwegian 787-9 comes from MG leasing to Norwegian Air. The aforementioned is from a separate block of 4 leased with MG in 2014. The leased is accounted for; by the "first delivery" of a 787-9 this month, and then a following three 787-9's are in the Boeing build queue under the same MG name. 

The following three will be up for potential delivery during the remainder of 2016. Norwegian Air holds an additional option for 787-9s of 10, thus indicating a high density get-you-there seating arrangement from Norwegian Air's order history. The obvious business model is based on a low seat price going to high priority destinations for Pleasure and secondly for Business in relative premium comfort. 

The 787-10 Has A Spot

Having an airplane line-up from the 737-700 to the 777-9X means you have a complete twin engine travel toolbox. Airlines can carry two different types of tools in that toolbox. The Airbus Tool or the Boeing tool. The most efficient or easiest tool is often grabbed in a subliminal reach when accomplishing a mission. The latest Boeing tools will be the 737 Max, 787-10 and the 777X family of aircraft for an airline's toolbox. Airbus counters with a long list of NEO themed aircraft.

This is a focus is on the 787-10 and who will reach for it. The 787-10 will not go as far as the 787-9 nor will carry as many seats as the 777-8X. The seven thousand mile range is the size of the 787-10 tool. It doesn't go as far the A350 family, but resemble the range of the A330-900. However, it will outperform the A330-900 in its metrics for economy and capacity. People who buy the A330-900 already have the Airbus blood in its corporate veins. Asset bargain value airlines may order the A330 but the future would suggest the 787-10.

The 787-10 niche compliments the 787 family while it retires the smaller 777-200 Boeing type. It's presence in the 787 family causes an extended synergistic role for knitting the aircraft family ties together. Fleet commonality is the most important selling point for "bridge" models like the 787-10. Another "Bridge model” missing in Boeing's lineup, and is hurting single aisle sales. It needs a 757 replacement model. The upgraded 737-900 Max did not fill the Boeing "gap" in spite of Boeing's 737-900 confidence.

The "You complete me" theme is imperative for Boeing amassing marketplace synergy, and hopscotch over Airbus. The end of 2016 will solve Boeing's reluctance because it then can free up the resources for the follow on MAX extender.

Yes the 787-10 has a spot energizing the mid-wide body Boeing suite of aircraft. It allows airlines to fill its skies with sensible sized dual aisle twins. It Completes Boeing. Who will buy the 787-10 is a question easily answer by what airlines have already bought the 787-10. Asianic operations have filled the 787-10. This is a perfect aircraft for China the Gulf States and its neighbors.

Enough Said. KC-10 To KC-46 Success

A milestone check list item was a success on February 13, 2016 when this KC-10 gave the KC-46 a test load of fuel. There are three more refueling test coming for the KC-46 giving fuel to other aircraft types such as the Marine Harrier, A-10 Warthog, and C-17. It was also noted (Flightglobal) that multiple cargo configurations tests on the ground were accomplished having an under two hour time limit. 

Photo Credit: Boeing/Paul Weatherman

Source Credit: Flightglobal (link)

Iran, The New Boeing Frontier

Recently Airbus jumped Boeing adding to annual orders reported by a 214 unit culmination through the auspicious occasion of Iran's desperate need for new aircraft. A US trade blockade has been lifted with Iran. Now, Boeing has received a license from the US government allowing it to trade with Iran. This Middle Eastern country has a pent up need for air travel and trade. Even though the 118 aircraft Airbus order pushed the Airbus book ahead of Boeing, for the time being, any Boeing swing back order has a long journey to go before it will catch up the Airbus/Iran deal.

Boeing and the US governance must meet a mutual understanding on what is allowed within this "permissive" condition. When it comes to buying, then any speculative thought will reach a climax for an Iranian order. The fact that Iran owns a very aged fleet of Boeing and McDonnell Douglas may suggest Boeing could top Airbus in the next order round with Iran.

Any Boeing/Iran deal during 2016 would involve Billions and Billions $US transacted. Iran needs wide bodies’ as well single aisle, even though it placed an Airbus order first. It ordered a half dozen A380's and it isn't done yet until Boeing's turn is complete concerning big aircraft. Iran has to compete with the oil region, as its foremost competitors fly a preponderance of 777's in its fleets or have also ordered 777X when it comes out. A rule thumb in the aviation, “competition starts as far away as its aircraft can fly”. The 777 can fly a long ways.

Prediction:

Iran will order a dozen 777X, two dozen 787, and 12 dozen Max. These of course will come forward over the next decade.  

The A380 Can't Be Everywhere At Once

A report just came out from Oceania (Australia-New Zealand) depicting the A380 weakness. It can't be everywhere at the same time. The second problem, it needs a huge draw on the passenger well to make it a reasonable option, Oceania does not have that deep of a passenger well. In fact the A380 may have a business case for high density routes for under 3,000 miles. A shocking pronouncement but one for consideration.

Boeing forecasts 950 new aircraft for Oceania over next 20 years

Australian Aviation Graphic

The wedge that Boeing built in all of Oceania is with Qantas and Air New Zealand. The numbers graphed above from Australianaviation.com.au. 

Boeing marketing chief, Randy Tinseth, keeps a conservative acknowledgement over these numbers even though he must be thinking Boeing owns the Oceania market space.

The 787-9 is quietly booting out the A330 in the Qantas flight line. Boeing has captured first orders for 787-9's with Air New Zealand. The worry or conservative nature is over the single aisle market and how it will play out for Boeing. Boeing shows some single aisle dominance in this area.

Qantas Fleet

Aircraft	In Service	Orders	Options	Purchase Rights	Passengers					Notes
					F	J	W	Y	Total
Airbus A330-200	18	—	—	—	—	36	—	199	235[83]	International to be refurbished
					—	28	—	243	271[84]	Domestic refurbished
					—	36	—	265	301[85]	To be refurbished
					—	36	—	268	304[86]
Airbus A330-300	10	—	—	—	—	30	—	267	297[87]	To be refurbished
					—	28	—	269	297[88]	Refurbished
Airbus A380-800	12	8[89]	4	—	14	64	35	371	484[90]	Last 8 orders postponed[89]
Boeing 737-800	67	—	8	—	—	12	—	156	168[91][92]	To be refurbished
					—	12	—	162	174[93]	Refurbished
Boeing 747-400	5	—	—	—	14	52	32	255	353[94]	To be retired by 2020 [82]
					—	58	36	270	364[95]
Boeing 747-400ER	6	—	—	—	—	58	36	270	364[96]
Boeing 787-9	—	8	15	30	TBA					To replace 5 Boeing 747-400 from 2017; 15 options and a further 30 purchase rights.[97]
Total	118	16	27	30

Air New Zealand has a similar story for Boeing. However the Single aisle for Air New Zealand is dominated by the A320 family with 15 booked A320-1NEO or classic version undetermined.

A Boeing Max order for Air New Zealand would demonstrate a pivot towards a complete Boeing family for Boeing.

Air New Zealand mainline fleet as at 8 February 2016^[2][74]

Aircraft	In Service		Orders	Passengers					Notes
	Number	Layout		J	P	S	Y	Total
Airbus A320-200	28	15	2	—	—	—	171	171	Launch customer of the sharklet A320 Domestic version
		13	—				168	168	International version Replacement: A320/21neo
Airbus A320neo	—		13	—					Replacing international A320-200. Deliveries 2017-2019. Exact A320/A321 mix undetermined; at least three will be A321.[75]
Airbus A321neo	—
Boeing 767-300ER	5		—	24	—	—	206	230	Retirement: From 2016 Replacement: Boeing 787-9
Boeing 777-200ER	8		—	26	40	54	192	312	All aircraft refurbished with new cabin interior, entertainment systems and Economy (with Economy Skycouch), Premium Economy and Business Premier seating.
Boeing 777-300ER	7		—	44	44	60	184	332
Boeing 787-9	6		6 [76]	18	21	42	221	302	Launch customer
Total	54		20

The 787 Gets Better As The A350 Rolls With Deliveries.

A strange headline indeed. The 787 is in almost every density market. It needs the A350 emergence in those same markets to complete the 787. Seattle/Boeing CEO Dennis Muilenburg thinks so and he preaches the 787 has only just begun an epic ride into the future. 

The Puget Sound Business Journal thinks so  Muilenburg: “Speaking before the Barclays Industrial Select Conference in Miami Beach on Wednesday, Muilenburg was open about the $28 billion in deferred costs on Boeing’s books due to the 787’s difficult early years. But he said he’s not looking back. "

“We invested a lot in 787 up front,” he said. “Deferred production inventory north of $28 billion that tells you we’ve made a substantial investment. That is investment that is now behind us.”

It’s a "Damn the SEC, full money pit climb out ahead" approach. In spite of declaration of an impending SEC audit, Boeing will answer any audit finding with "that's the way we've always done it" answer. I have often heard that response coming from any business floor and going to the top of the heap. How did I respond? I did the audit anyways and as an assigned hit on corporate policy and procedure with recommendations. 

Somewhere in between is the truth. Boeing has always pushed forward its front-end costs of making a new airplane. They have been audited continuously, and were fond essentially, Boeing is within the confines GAAP pronouncements and definition. The SEC is late to this dog fight, and has found in its sample testing an accounting loop-hole, which Boeing has exploited, thus tainting stock value.

In hopes of making a point here, it is important to note there are more than one way to skin a cat and appearance is everything. Boeing subscribed to the "appearance" methodology. It was early on where Boeing determined a spiraling, out of control costs for the 787 program. If Boeing recognizes to its stockholders a deep cost up front for which it incurs a never ending wait on profitability. Boeing will be buried until 2024, when stockholders won't wait that long and will dump Boeing stock with an unfair perception Boeing can't make money on the 787 when it will eventually.

Having said that, Boeing took the perfectly acceptable accounting principal, where "special costs” can be deferred only showing the usual production and materials expenses against every 787 delivered. While those "other costs" are placed in the Boeing 787 $28 Billion dollar money pit called Deferred Costs. These costs in this bucket includes but are not limited to process change, technology development, and production do-overs along the way.

Remember when the battery fix caused Boeing Billions of dollars to fix, "deferred cost". Another instance had delamination occurring on the factory floor. The fasteners during the 787 production onset were inconsistent and did not meet Boeing engineering standards. Production floor changes, streamlines the making a complete 787 as it occurred in the new SC plant. It was a mess in the early years. Those I am sure went into the deferred costs bucket when Boeing was amassing the 28.5 Billion costs recognition.

What the SEC hopes to prove is that some of those development items are not really a development item and should be classified as a part of building each 787, making the costs a recognized production cost, which will annoy the factory bottom line for a long time. Boeing cleared of some those costs off as deadwood from its production books by moving those cost to the aforementioned deferred cost barrel.

Boeing is confident they have used a generally accepted accounting industry practice in this many faceted journey of the 787. The SEC wants Boeing to show these one time or sometime costs up front which would cause Boeing to show all its development losses up front which is not generally accepted by the industry.

The interesting thing is that it will take about 1,300 787 delivered to erase the money pit, whether it’s is recognized in current year financials as a potential 28.5 billion loss up front, or as a deferred cost pit which is amortized over time allowing the 787 shows a cash positive flow going forward. This would be a drastic change to the Boeing Stock value thus taking about to 2024 to recover its stock. When the 1,300th 787 is delivered, it no longer matters how the 787 program was accounted from the beginning. 

This huge digression on the SEC does not address the article's headline.

The A350 entry into service allows the 787 to really shine since the A350 won't compare well with similar scenarios found in the market place.

The A350-900 Wins A PAL Order

A six order with six options is a win for Airbus in a hotly contested wide body market amounts to 1.8 billion dollar order amount using book prices. After much consideration and due diligence PAL agrees to an Airbus purchase commitment for the A350-900 based exclaiming the win based on passenger space, long distance reach with the Trent XWB 700 performance metrics. However an airline slices it, the findings for the A350 sets PAL as an Airbus run operation.

If PAL was hedging its Airbus bet with the 777 family, then a comparison will be forthcoming in the futures years of head to head operations. An important note for any model to model battle is PAL runs a heavy ended single aisle Airbus fleet. Not mentioned in reports is the Airbus Single aisle fleet influence for the wide body purchase since Airbus has a preponderance in its overall fleet. It would have been a greater surprise if PAL had ordered the 787's over the A350's since it had already uses a significant majority of its fleet as a Airbus fleet operation.

Boeing had wanted a greater representation in PAL's fleet with the wide-body suite of 787's and 777's. Further purchase analysis concludes the Airbus additional five inches over a 787's dimensional width and having an operations already based on Airbus tipped the balance, since the A350 range was not really the winning factor for the Airbus offering, even though it mentions range as having an influence in the decision. 

When all things are considered: flying the distance attribute, is close enough between the two competitors for making a decision based on its own current single aisle status; and then it went with the same manufacturer on its wide body choice became the more practical decision for PAL within its corporate vision.

Boeing didn't have a chance concerning PAL's order environment. The argument for Airbus was already made before this competition began.

  

Either by Hose and Drogue or by Boom, KC-46 Scores Success.

The mosquito has a proboscis as it sucks blood through its nozzle on errant flight to your exposed surface skin. However, the KC-46 weighing tons and tons more reverses the blood sucking process with trailing appliances from its wings, tail and undercarriage. The reverse KC-46 process has a stiffer boom for 1,200 gallons a minute, suggests it could refuel long range bombers at will. It can also drop a hose and drogue apparatus and refuel the F/A 18 at 400 gallons a minute.

The KC-46 looks to deploy fuel in a quite the opposite of the mosquito misdeed when it sucks your blood and leaves a welt. The USAF hopes to leave a welt through its warbirds flying the distance. As mentioned earlier in KC-46 related articles by Winging IT Part III, was the refueling accomplishment is the critical step cited as so many different things are in play for fuel management and delivery. Boeing has gone 2-2 at bat while dropping in fuel with different appliances such as the hose and drogue or the "Boom" as a mosquito would prefer to call it proboscis. Since a mosquito can pump out more blood with its boom-like appliance than it would with a flexible hose attachment could allow, the boom becomes the weapon of choice for moving large quantities of fuel. 

DODBuzz Photo

Hose and Drogue Test with F/A18

The KC-46 looks to deploy fuel in a quite the opposite slant from a mosquito's misdeeds when it is sucking your blood and leaving a welt. The USAF hopes to leave a welt through its warbirds flying the distance. As mentioned earlier in KC-46 related articles by Winging IT (see part III below), the refueling accomplishment is the "big" critical step cited, as so many different and critical things are in play for fuel management and delivery using a new system. 

The Boom dispenses on time to another test unit 

Photo: Airforce-technology.com 

Boeing has gone 2-2 at bat while dropping in fuel with its different appliances protruding towards the stern of the KC-46, such as the hose and drogue (above) or the "Boom" as a mosquito would prefer to call it a proboscis. Since a mosquito can pump more blood with its boom-like appliance than it would with a flexible hose attachment could allow. The KC-46 is an engineering marvel as it goes through its paces during testing phase. 

The reverse role from the mosquito to that of the tanker is to pump back fuel to all its clients such as Helicopters, fighter jet multiples, and even to other tankers if needed. The tests coming in the near future will include fueling with a multiple number of aircraft at the same time or one at a time. Boeing is pleased with at least a successful test parameter as it fueled the F/A 18, and as it knocked one out of the park.

Start with the following link and follow reference links found within the related articles:

Part I: Boeing KC-46 Takes Write-off for stock holders, Fixes found during phase 1.

Part II: Develop, Determine and Deliver The KC-46 Phase II

Part III: Key Aerial Refueling Capabilities Should Be Demonstrated Prior to the Production Decision

Will The 787 Succeed On Blue Collar Routes

The Blue collar (BC) routes I am referring about are those inter connectivity routes hauling passengers on business meetings, family gatherings, and everyday work per Bombay to Delhi. Air India, has started switching its 787 fleet towards this airline seat endeavor. After all, it has more than a billion potential customers and "it" wants to up its game. The important item noted is its switch from the Single aisle A320 equipment to the more luxuriant 787 on-board spacing.

It is also important to note the other world airlines have nuanced a high capacity usage with its 787 fleet. However the purpose has centered on the vacation crowd and not the BC crowd. Those airlines are numbered by the likes of Jet Star, Norwegian Air and Scoot Airlines. Notice some on the short list surrounds China's 1.4 billion potential customers. The 787 has already entered the age of customer maximization as it has departed away from the junket terminal with little fan fare. The more the merrier theme is apropo.

Back to the Air India pivot on the A320 going to the 787, remains an on-the-cheap appeal from the airline standpoint. It won't change its currently configured 256 seat 787-8 into a Jetstar like 334 seater. Good news for the contortion challenged Air India traveler. It is also a good template for analyzing if any 787 as is, can be a competitive engine on a swelling customer routes.

When entering the realm of "BC" travel, the fares must align with the customer base. A quick and spontaneous trip suggest a lower air fare offering for those needing a ride. The question remains can Air India make a profit using a lower airfare for a travel enticement within a thousand mile journey? All BC fights are a spontaneously driven flights differing from a vacation or long range business venture. The latter class of travel is powered by months of planning for a needed vacation, and/or its powered from a budget line of any said business. Those flights can offer more passenger amenity than a BC purposed flight.

Air India has come to grips with an untapped market base in India with its billion potential customers. Sometimes people need to travel right now for personal reasons, and AI has assigned the 787 for this mission. The lower airfare price is the motive power for this idea. A full 787 flying under a thousand miles becomes the formula. Air India has seized an opportunity, and it means to please a country with several dozen 787's in operation. The A320 is not suited for this particular mission and is retiring from the arrival of the 787. If this works for AI, more 787-9's will be ordered. 

Last Word On MOM until late 2016 Announcement

Winging It must find a repose talking about MOM, or formally known as "Middle of the Market". An aircraft wedged in between the MAX and the 787 family. The discussion point was put to bed earlier in the week, then Flight Global throws another MOM log on the fire with its today's headlines:

Boeing plans new aircraft go-ahead decision by end-year

All the plans for discussing MOM have now gone up in flames. A sure blog filler goes to rests. My sources are laid -off. Now I have to go back for some new stories and get the goods like I used to, work a problem until it reaches maturation and then discuss it in full page regurgitation just like the big fish do on a slow news day.

The discussion runs amongst the SEC probe, A330 annoyance, or Boeing long term profitability. You would think Boeing is a corporate disaster in a "Herbie Rides Again" movie episode. Then up pops this snippet from Flight Global long after the Winging It is furloughed into Hawaiian vacations. Bonuses are He** but somebody has to do it.

Currently there are no openings in the filing department nor is there a budget for filing away the day. We are currently putting on hold the letter "A" in the file department as the word "assumptions" has clogged the works. The staff will be back in late February and will work diligently on the folder under assumptions. It remains to me to fill-in in the mean-time.

Ouch, I was called up since I am the senior assumer on staff. I got out my intuition manual and reviewed my journalistic notes, "all about aviation intuition". Here in the middle of the notes is written, "Don’t forget about mom tonight!" 

Egad, I'm sunk, that note was from last month, and I had forgotten, I think. Enough with inappropriate commas. Or has Flight Global has stolen my December-January theme and has made the same points that Winging It has made, even when extracting it from my winding sentence structure into a technically written article? This reminds me why I write for Winging It. I like telling information in a story formation rather than in a technical presentation. You may know technical as dull or drab as Dragnet’s mannerisms and a “Winging It” is an off the wall assuming-intuitive story format. The story of Boeing's shenanigans needs to written in a "who done it" style minus all the straight talk. That is why Winging It lives another day. Using intelligent assumptions and technical intuition makes it far better than using actual quotes or company slogans as evidence for an article.

Intuition is right 90% of the time and actual quotes are coming from people who could be fired. A slogan is from the advertising department. Finally, this brings us to the assumption factor. It's a matter of "when and not if" that is wrestled with, using the surefire assumption methodology backed by an intuitive force driving it. We check it twice, as always and then wait for MOM to clean the bedroom and pack our lunch for school.