I'm Guessing I Guess, Etihad will

Currently, Etihad is reviewing its fleet requirements and purchasing commitment with both Airbus and Boeing. The outstanding orders are the talk for both makers. A quick and dirty order round-up show this:

A split fleet with both Airbus and Boeing making headway into the Etihad stable.  Etihad has 62 Airbus A350-900's on order with zero delivered thus reflecting a notation as 62/0. It also has 40 787-9's ordered with 19 787-9's delivered noted as 40/19.

The fleet dichotomy can follow these notations from http://www.etihad.com/en-us/about-us/corporate-profile/our-fleet/

A320- 32/32

A330- 24/24

A350- 62/0

A380- 10/10

787-9     40/19

787-10   30/0

777-ER 22/22

777X's   25/0 

Airbus fleet equals 66 units with 62 undelivered A350-9's

Boeing fleet equals 41 units. with 76 undelivered wide-bodied aircraft

Etihad is stuck with offending one aircraft supplier over the other if it cuts its fleet backlog during its fleet order and reduction mode.

The thoughts on the table have a few questions surrounding those ideas.

Does the A350-900 have an unused range of its current fleet strategy? 

Does the undelivered 787-10 fill the A-350's future purpose?

Can the 787-9 backlog fill the remainder of the A350-900's purpose if it were introduced into its fleet?

There are more questions than plausible answers at this time, but it has already received 19, 787-9's, and that makes it harder for the Airbus A350 portion of its back orders to be delivered when it hasn't taken even one delivery for its type. It can be "assumed", Etihad will trim its widebody backlog with only one airframer. If it does, it will order more frames from the other unaffected airframer who has already delivered. Both Airbus and Boeing have delivered A330 and 787 types. There will be no new A380 orders. The 777X is the lynch-pin in this discussion. Etihad has both the 777-8x and 9X ordered and it signals the Airbus order for 62, A350-900's may go the way of the Dodo bird?

Having yet added the 787-10 and with 21 more 787-9's on the books makes sense Etihad can cover the Boeing spread of types over the market when eliminating the  Airbus A350 order.

Yet to be received from Boeing are as follows:

787-9   21

787-10 30

777-8X  8

7779X   17

Total: is 76 units from 280 seats to 405 seats per unit with the range and efficiency required by Etihad.

Airbus become the loser in this situation as it will become too expensive for Etihad to have 62 More A350's when the Boeing family already ordered can cover an unfilled order gap if the Airbus order for the A350 is canceled. It still can opt for more A330's until Etihad grows into its orders with the 787-10.

A Pound Of Feathers Or A Pound Of Gold?

A question I have is, why does the new technology aircraft just feature passenger service when the less inefficient aircraft become freighters? In this example, the 787's and A-350's are sold by the passenger trainload where the 767-300F and the A330F's are even being sold at all. Fed-Ex/UPS is building a freight fleet out of the 767's and almost no-one wants the A330-200F unless it's converted from its already built passenger status. There are several reasons for a freight business buying older technology airframes. To name a few below:

A 767 will profitably operate with its:

·      Its deadweight capacity 

·      Its space carrying volume

·      Seats removed

·      Service crew removed 

·      Cup holders tossed overboard

Passengers in this example are a pound of feathers requiring environment, supplies, and amenities so the most efficient 787 freight offering would become a wasteland of extravagance. The 767F has space and thrust for dead weight sans overhead bins. A pound of gold is what it needs to haul as a freighter, therefore, a 6,000-foot cabin pressure is not needed. Fuel costs on a 767 are its most deadweight it may carry on any particular trip which is factored into its freight bill of lading costs. The buy price of a 767 freighter must be significantly less than a passenger jet to make the whole scheme work well for the profit-minded.

Boeing's 767 offering for freight commerce seems to be the best choice at this time in the industry because it has space, thrust, and range charging the customer the appropriate amount for the fuel burn. Fuel economy is not listed above because dead weight doesn't complain much about fuel prices. The 767 purchase price is a bargain not requiring electronic window shades. The US military saw an opportunity to make it a freighter-fueler even when the A330 was bidding against it. The A330 was already sold as a military tanker at that time.

Cargo Facts Chart Below:

 

The freight business is becoming back in vogue as we write. Fed-ex and Amazon are the usual suspects with its respective movement of fleets with 767's. The A-380 was built for passengers and not freight. The A330 was built likewise engineered towards passenger service. Boeing always had a duopoly in mind with its aircraft as it built in tandem a 737, 747, and 767. Including those fabulous 777 freight versions. Only the 787 is not destined for the freight haul because it has a $30 billion deferred cost pit it can't climb out of until enough passenger models are delivered. 

A prediction may be coming for a 787F when its program debts are paid-off. However, Carbon Reinforced Plastic process is way too expensive for dead weight. The 767F has just got its freight legs in the meantime.

The ABCVNLHA's of the Navy

Here is an interesting video of what's next for the Navy.

Boeing's 1st QTR 2018 Earnings Call

Caution with optimism as typical as a stockholder wants the long-term stockholder to hear with an early this year pronouncement.

Recap: from The Motley Fool

·      The 777 production is covered without Iran's order.

·      The 797 announcement remains a pipe dream.

·      Boeing lands the 767 KC-36 tankers just over the Rainbow near Seattle (Oz).

·      China who?

·      The Boeing 787-8 becomes plug and play in Boeing's assembly flow.

Winging It, Counter Points:

·      777X development Irons out its stuff slowing its process by six months

·      The 797 will blow your mind at Farnborough

·      Dorothy does land her first tanker at McConnell Air Force Base, Ks.

·      China Buys More 787 because it can.

·      More 787-8 orders emerge as Boeing's rate production increases to 14.

Could Rising Jet A Price Begin A...

... An onslaught of new widebody orders? Low fuel prices became the premise for large older generation airframes for the industry back five years ago thus suffocating buying large wide-bodied aircraft like the 787. Using an opposite rationale could start a surge for new general widebody orders, specifically the 787 families of aircraft in 2019.

The old thought said buy, lease or borrow low priced inefficient aircraft because fuel cost became so low. Now that fuel is rising, a pent-up demand for the 787 could explode on the market scene by 2019 because of airline profit need. Fuel prices are going higher therefore, it is required to own efficient aircraft like the Max or Dreamliner?

Boeing has already considered this market paradigm and it has many orders options on hand just from fuel efficiency demanded with operations from fuel prices climbing.

Boeing's Big Bite, The 797

Boeing has started then stopped and then started the 797 talk over the last several years. Western sensibilities want an aircraft centered on passengers and it luggage requirements. Asian wants are centered on both passengers and freight. The Boeing Company first researched a viable mid-range middle of the market aircraft that became everything the 787-300 was supposed to be but had not enough takers for the concept. That was back in 2010 when the 787-300 went up in smoke.

Now comes the 220-270 type mid-range aircraft were Asia or China holds immense clout over Boeing's design parameters. The 797 is in a holding pattern while Boeing engineering is trying to please both western and eastern sensibilities. China wants the freight function and Boeing wants its 797 design motif to remain intact of a smaller hold than typical. 

China wants passenger density that the 797 concepts is offering, but is squeamish over the Boeing conceptual freight capacity from Boeing's first designs having a smaller freight space than what western sensibility desires with Boeing's initial proposal. This brings the matter to a head. Having a two-body model type 797. One called the "E" and the other called the "W" type 797. 

If Asia can commit to a 250 seat dual aisle 5,000-mile range holding enough freight space they will get an "E" ticket 797 for any Eastern type. If American and United have influence with Boeing (I think they do) then expect a 250 seat slim bodied 797 type called the 797-W for western sensibilities. If Boeing can easily build both types sharing 797 commonalities using same technologies for both types then both types could be built by snapping together its barrels according to the work order submitted at its assembly plant. 

What's taking so long for Boeing to announce the 797? Well, it's going to commit to building what the customer wants or needs first and they must assure themselves it can do it without costing another money pit like the 787 program created with its deferred costs of almost $30 billion. 

The west is west song comes to mind when thinking about this matter. Asia would have to order at least 400 797-E's before Boeing gives in while having a like number 797-W's also in the books from "other" customers like United. Plastics and computer modeling is the answer and that is what is taking Boeing so long. It can and will do the 797 but the order book it has collected on the 797 is governing the manufacturing headache it now faces.

Winging It Made A 787-10 Case Back in 2012

2012: Paraphrased, "The program will start when Boeing books at least 150 orders". They made that number with 171 units booked and have delivered two units six years after the Winging It prediction, to Singapore Airlines.

Winging It has made another prediction true.

150 Breakeven for the 787-10 back in 2012.

View From The Top: of a 777X Flight Deck

Boeing inches closer to the first flight of its proposed 777X airframe and here is proof its design is firmly in engineers hands with a "Go" card pinned to the 777X engineering door. 

Okay, let's go!!!

787 Program Numbers Crunched

Its been a while since numbers have been discussed. Sometimes terminology is used as in "Book to Bill" ratio needs to reach a theoretical "1". Or more commonly described as for every order there is one delivered within the same said period of time. Below is a Winging It Chart of 787 production and orders during the whole program to date not respecting any one year or month, but from the programs start of production/delivery in 2011 when the first 787's were delivered late in that year.

This recap has about 688 units in a backlog status until built and delivered. Program to date reports about 1,365 units ordered making the book to bill program ratio derived from 1365/677 thus equaling 2.02 BB rate. Another interesting note the deliveries are almost equal to it backlog comparing a 50/50 status. Boeing is announcing many more 787 bookings this year as it hopes to match its delivery pace with new orders by year's end in a 2018 BB rate of 1. An optimistic view, indeed. The rate production is jumping to 14 a month or 168 units a year for 2019. That number becomes an indicator it also hopes to match 787 booking by the same number. By year's end, Boeing will be hoping for around 140 units booked for maintaining of "1" BB Ratio by meeting its goal of 140 deliveries.

American Resurgence Of The 787-8

Is Boeing deviously surging the 787-8 brand of aircraft? Is the 787-8 not dead? These questions may come up since Boeing just sold American Airlines 22 of its 787-8's. That's a whole year or two worth of 787-8 sales. It has been quite a while since Boeing last sold that many 787-8's in one day. Since then (that day) it has sold a boatload of 787-9's and 787-10's.

In fact, since the last load of 787-8's were sold, the Boeing company accomplished the last checklist item it needed. Fit the 787-8 together just like the 787-9 fits together. In other words, sections of the 787 and its associated components are built like a 787-9. Back in September 2017 as an example, Boeing announced a Japan Airlines deal for four 787-8's as previous disclosed unidentified customer booked order belonging to Japan Airlines. A slow announcing process for the 787-8, indeed.

The American Airline order just announced for 22 787-8's has the aviation world looking at that order under its scrutiny of why order well beyond the long ended Boeing introductory model. Why is Boeing investing in building the 787-8 efficiently as a 787-9? 

Boeing.com Data from January 2015 to current; Winging It Chart

The takeaway is the 787-8 program was essentially dead until the American Airlines order this last monthly cycle in early April 2018.

Other airlines are in the order mode with the 787-8 which are not disclosed at this time, otherwise, Boeing would not have spent time and money making the 787-8 build process uniform with its other stablemates. 

There were about 60-70 frames yet to be built when the new build process was completed. Bam! then came the American 787-8 order for 22. It signals a resurgence not an end to the program, otherwise, there would be no order from American.

Boeing can build it cheaper at this time and airlines will be filling its aviation gap with the 787-8. The 787-9 is currently the moneymaker with its great airspace rush going on for long-range routes which will end by 2025. The NMA is the next airspace rush and the 787-8 will be in that mix with those fleet offerings. The second rush is for a regional 220-270 passengers capacity where the 797 and 787 will play the central role. American Airline has reawakened this market segment adventure.