Remembering Paris 2017

The Paris airshow had so many MOU's 737-10's ordered and now the year is closing to its end. The chart below has been updated as best  as possible from the information provided by Boeing's order book postings. The remaining MOU's should be closed off by year's end and here are a list of Paris orders not yet firmed . There remains about 85 aircraft in MOU status from the Paris Airshow for an estimated list value for about $10 billion US. The key to this is the number and value of aircraft which could be added to Boeing's purchase haul for 2017. Today an order for from Avolon was firmed for 75 Max which numbers 55 Max 8's and 20 Max 10's. The order/MOU originated from the Paris Airshow last June and now $11 billion has been added to Boeing's books which will be recorded at a future date by Boeing.

Remaining MOU's from Paris Airshow 2017

Dubai Summary And Conclusion

The Dubai Airshow is completed for 2017. Numbers and opinions remain in some sort of sandstorm sweeping in after the show, when every maker claims victory per its respective PR department. No one's opinion is valid, this case becomes clear. Over a $ hundred billion of aircraft were sold having a 1990's style annual order book total emerging in just one single show.

What can be said, Airbus took in more orders in units and value over Boeing. Boeing stole a customer from Airbus for the tune of 15.1 billion dollars. Airbus did not book wide body orders. Boeing stretched its wide body order book out by another 51 units ordered. The Airbus mega order caught everyone's wind from its breath. The single aisle show dominated the attention of cursory watchers.

The real show from all the Airbus showmanship was the Boeing/Emirates deal indicating a change in the region had occured. Even though Airbus caught up its single aisle order book to Boeing's single aisle order book with one customer and one order, Boeing still leads Airbus with its 2017 single aisle sales. It also leads Airbus with duo aisle sales. Many other MOU/LOI's for both makers will have completion before the end of the year. 

Boeing lost a battle in the middle of its own 2017 order surge. Airbus is losing the 2017 order war and is likely the defeated during 2017. An important observation is the momentum going forward into 2018. Boeing has that momentum. One Airbus order and one Airbus customer is not a long term solution for Airbus's order plight. Boeing has laid a strong Middle East connection for its family of Aircraft which Airbus just lost. The flydubai single aisle deal was more important than the Indigo Partner order. Even though the Indigo Partner has multiple customers in its portfolio and risk is spread out among its own customers, there remains a likely hood several or one of its customers will cancel out from it order burden. Not all business models will succeed and not all orders will be completed. The 430 A-320's orders may shrink over time. On the other hand, flydubai has a ripe market and financially sound benefactor supporting its regional plan. It's not saying all 225 orders will be filled but the risk of order reduction is considerably less for flydubai  than Indigo Partner's position.

The main focus of the show is on the Emirates order as it once again rebuffs Airbus when choosing Boeing's offering of 787-10's. Emirates said no to its first order for 70 A-350-900. It would review  the Airbus case extensively before reopening the order conversation with Airbus. It has been many years since that cancellation for 70 and Airbus has much time to address Emirates concerns. With that, Emirate can talk to many Airbus owners over how the A350-900 is working for them. Boeing only had a testing model for the Emirates comparison when proposing its wide body. In the end the 787-10 beat out the A-350-900 the during the second time for the A-350-900. The reason why is multi faceted but the main reason it the 787-10 was built for high density flying going 6-7,000 miles with the cheapest seat mile expense ratio in the market. The A-350-900 was over built for the Emirate mission. It wasn't a hard decision by the UAE but was a respectful decision as it had promised Airbus long ago, a second look which it gave will honestly as a Airbus solution. Boeing won the world wide body market with this order. 

"flydubai" Saves Boeing's Day With 225 Max Ordered

The slug fest has started with an Airbus 430 Single Aisle order for 49 Billion at list prices. Boeing counter punches with an order from "flydubai" worth $27 Billion ordering 225 of its Single aisle Max aircraft. A Winging It hint was given last week this would be a single aisle sales event.

Winging It November 12: 

"The show is just starting, it ain't over yet!"

Winging It:

November 7, 2017:   “Dubai and the Tip Of The Wing”

Quote:

"The show remains a mystery for orders where Boeing should pick up a sampling of wide body orders rather than having a domination of orders coming from one or two customers. The dark horse is the 737 Max family where a surprising number of the single aisle orders could come in as it is overdue for some more Middle Eastern love."

This prediction did not include an Airbus huge announcement by a previous unknown player to this story. More research and development work is needed by this writer. 

Bloomberg Scoops Dubai With Massive Order News

Airbus is pulling another rabbit out of its hat with a massive single aisle order with Indigo Partners indicating 430 single aisle A-320's. It will be announced in about two hours of this posting.Can't say I saw this coming but it absolutely steals the Dubai show from Boeing if it holds true.

Bloomberg Reporting

Does The Dubai Forty Mean Something?

Emirates placed an order for 40 787-10's at the Dubai airshow. Another clue came forward recently from a remark about the 787-10's testing suggesting Emirates is fond of its flexibility.

Quote from the Charleston Regional Business Journal:

“Emirates has displayed immense confidence in the South Carolina-built 787-10s and has seen the maturation of the airplane during testing as well,” said Saj Ahmad, chief analyst with StrategicAero Research, in an email. “Coupled with Boeing’s rate hike to 14 airplanes a month, this is not the only sizeable 787 [order] we’ll see. There are others almost certainly ready to be revealed if they aren’t in the bag already.”

This brief comment suggests Emirates was walking hand in hand with Boeing during early validation tests on the 787-10. One question must of have been answered during the Emirates participation observing 787-10 testing. This model can stand the desert heat and deliver flying efficiency beyond what its competitor can do.

A second clue from the above quote indicates the 787-10's remarkable flexibility for long haul flights not formerly indicated by Boeing's own publications. The 787-10 has outperformed Boeing's own estimations documented before air frame testing was conducted. It is capable of longer distances than first reported. The 787-10 doesn't have to go beyond 7,000 miles, it just has to go where its potential customers travel. The Emirates business philosophy is right sizing capability within a family of aircraft which Airbus lacks. 

There is no A-350-800 it’s a paper airplane. The A-350-900 is a one trick pony and has more capability than needed, so it hauls that unused capability everywhere while only meeting maximum efficiency 10% of the time. The A-350-1000 steadily loses ground or has a stagnate order book since many airlines cannot find a slot within its business footprint. The 777X is a common ally to all of Boeing's other aircraft. The A-350-1000 only has one friend, that in the A-350-900, making it a family of aircraft I guess.

Airbus is losing the WB end of the airplane spectrum rapidly because it cannot connect the dots from single aisle to the A-380. Boeing has completed several important goals where Airbus has failed to do so in response. A short list below describes the Airbus shortfalls causing customers coming back to Boeing in numbers.

·      Incomplete A-350 Family from Top to Bottom.

·      Inability to counter the 777X program

·      Cannot counter Boeing's mid-range high density 787-10 slot with any of its aircraft.

·      Boeing buried its 747 Jumbo, Airbus can't give up the A-380 before its Break-even point. 

The "Dubai forty" 787-10 is a serious red flag for Airbus. Even if Emirates does place an order for another 30 A-380’s it will have a hard time staying with the A-380 as competitors continue with the Boeing family of aircraft. It will become a one-off super Jumbo carrier. The other airlines will nip its heals around the jumbo fleet. 

However, Emirates realize its ill-fated tacking move with the A-380 and it made a new tack in 2013 by ordering 150 of Boeing’s 777-X’s. Coincidentally, 150 units is a similar to its 142 A-350 orders it has on the Airbus order book. The 787-10 fills an important slot along with the 777X that will in time replace all it’s a-380’s. The total wide body book for Boeing’s "new wide body" stands at 190 not counting the 777-300-ER backlog.

Emirates has to replace its older 777’s in the next ten years. A problem posed with Boeing’s marketing team. Some of the long range Boeing commitment to its customers has been made with this Dubai 40 order. Emirates will need more aircraft in its fleet to replace both the A-380 and its older 777’s. Another airshow another day is the answer for this dilemma. Emirates will need another 100 wide body order in five years. Probably a 50-50 split with the 777X and the 787 family. It just has to wait to see if the 787-10 and 777X works as advertised during testing. It appears the 787-10 has accomplished its goals.

Emirates: "How Suite It Is"

The United Arab Emirates is installing first class suites towards the pointy end of its 777's. For those who work from 6:00 AM to 7:00 PM, here is a Dubai airshow promo of the the "Suite". No ticket price range for the seat was mentioned but when flying that high it is rude to ask how much it cost because by asking you can't afford it.

The Emirates New 777-300-ER  Suite

After studying this photo for some time the following complaints were listed.

• No Lou
• No Micro Wave
• No stocked refrigerator
• and finally no in-cabin personal attendant

The pitch is 40 square feet and boredom becomes a passenger's problem. It is much different in economy when passenger heights can vary from 19" to 80". Square foot comparisons could be made and  its a squeezing attempt from economy's  3.6 sq ft per seat compared with the suite's 40 sq ft. Suite coffee is free in fact after purchasing a suite's ticket everything is free. Using the price per sq. ft. scientific calculation for the ticket may indicate how much it would cost to buy a suite ticket? 

If an economy ticket cost $500 going 6,000 miles it works out to 2.3 cents per sq.ft-per seat-per mile.

The economy of scale takes $.023 times 40 sq ft times 6,000 coming up with $5,550 dollars. Add cruise ship gratuity rates and "incidental costs" it quickly becomes $6,500 dollars for a suite from here to there.

Airlines spend more time ciphering up a ticket price using a big spinning wheel similar to the ones found in Las Vegas, than what the Winging It team's clock indicated when fumble fingering a calculator. There should be a standard, not unlike an airlines efficiency metric called seat/ mile, when analyzing ticket prices. 

In this case it could be called sq.ft/seat/mile or Economy sq.ft./seat/mile and so forth. However it may be sliced-up, suites represent a ludicrous profit dollar where economy covers the trip's operational costs and Business class represents a mix between profit percentages and its operational costs. 

Emirates has a business plan and its involves copious amounts of cash. 

Winging It Said 50, Emirates Orders 40

Earlier, Winging It predicted about 50 787's would be ordered by Emirates in various models. However, (sometimes) a prediction can become wrong and it was missed by ten 787's and all 40 came-in as an Emirates order for 787-10's for $15.1 billion.

Winging It Quote: November 7, 2017

"So there should not have any additional 777X orders at this year's show. The only outlying is the 787-9 or  787-10. It could fill an Emirates fleet completeness having fifty ordered in a combination of the 787's. Its only speculation at this point, and no rumor is floating on that matter." 

Winging It Article Link 

Dubai and The Tip Of The Wing November 7,2017

The show is just starting, it ain't over yet!

Every Good Airplane Story Has a Beginning, Middle and End

Boeing has reported its on an exploratory mission for a new aircraft called MoM, NMA or 797 to name a few tags for this mission. The story begins with its chief competitor Airbus, with its A-321. Then there was the subplot with a thing called a 757 suffering a production retirement without a replacement in sight because of other ambitious projects; the 787, then Max and finally the 777X programs. Airbus was allowed to run the range of opportunity within an important segment chewing away at the single aisle big end of this market.

Chapter two begins with a simple title called "The Gap." It is an abandon place where airplane framers feared to tread, but had to go if it were to become the hero of this story. This gap is wedged between the 737 or A-320 single aisle airplanes and the dual aisle 787 wide body aircraft. The mathematicians were asked what a MoM would look like?

They tallied the inches in width of the 787, then added the inches in width of the 737 and  divided its total by two to come up with a gap airplane width. The calculation was (216" + 132") / 2 = MoM or 174 inches, or for people liking feet in instead of inches its about 14.5 feet. The maker said we need an XWB MoM so it added another 5 inches to 14.5 and came up with a 15 foot wide cabin. The "bean counters stepped in with two aisles and seven across seating. The "knights" working late poke and prod its engineering way through big windows.

Studies where made with all its customers and more studies were conducted by its accountants and a summary report indicated a 797 "might" be a good idea. The maker then asked for more studies taking the story to the middle of it all. Its evil competitor was not impressed since they could do the same only 5" wider than the hero of this story even after it made its MoM 5" wider than 14.5 feet. 

The story becomes complicated in the middle chapters. The serf's of this kingdom demanded less costs and the maker had to build its NMA selling for about $70 million as it would replace its old type selling for $200 million at list prices. The costs would be huge when considering an all new manufacturing and product concepts coming forward. Questions arose, could orders from the serfs be enough to pay for the development and then make a profit for the King?

The bookmark is on chapter 10 at this time and all the questions do not have answers so another study was ordered by its "wise" King from its northern county from the Northwest kingdom. 

Out of nowhere comes news that the $200 million beast was not dead since the study and surveys suggested a launch customer for the 797 needs more time replacing its older fleet of beasts. A certain serf has about 40 aging beasts grazing the airspace and it would like those replaced by a like beast until the NMA is ready. Other serfs once again questioned this idea with a big What?, as they also place some beast orders?

This story is nowhere near an ending it only has moved to the part where it has established a villain, a MoM and some studies so far. 

The King (of the) County issues another proclamation, "a study must be conducted this time "we" really mean it, and hear Ye, hear ye, call in the bean counters!" 

The serfs of the world were gathering at a ball near Castle Dubai, awaiting to hear about the new study conducted by Prime Minister, Prince Everett. 

A proclamation was issued from Castle Dubai from Prince Everett, "Long live MoM".

Chapter eleven-eleventy starts with a rumble of jet engines and the serfs cry out, "what happened to Seventy-seven (million dollars)?" 

Some said, "we won't live long enough to see the MoM" and others just cried out, "NMA, NMA, NMA".

The King replied, "subtract two from eleven and add two sevens and you will have your 797, there is no seventy with your seven. 

At this point math becomes too hard for the serfs. 

The King chants, "one more study, one more study, one more study!" So all the polling data flooded in from all corners of the earth. 

The evil empire says, "the market is too small and we can still do better", after offering no further explanation. 

The King was distraught but unfazed by the evil empire's slighted quip. 

He proclaims, "we have studies but I won't tell you what they say!"

The serfs become doubly anxious over having no NMA and feel orphaned from a non-existent MoM. They start wearing black Tee Shirts with a printed slogan, "Long Live The 797".

Not Mom

Photo credit from The Telegraph

Chapter 15 starts the beginning of the end part of this story long after the Castle Dubai Ball had ended. Skipping to the last chapter, it starts with MoM going to the Farnborough England Ball and it slays the dragon. The maker proclaims, "The end will come after the last study is completed."

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More 777-300ER Orders = More 777X Orders

One critical point Boeing had to face was a diminishing  777 300-ER order book in front of the initial production of its new 777X models made in the same assembly space. Boeing needed more 777-300-ER's ordered before it could build its first 777X. The by-product of this sentiment is the unintended consequence of selling more 777-X's than anticipated because of the strength of sales of the 777-300-ER. 
The Dubai airshow next week will feature at its front and center the Emirates newest 777-300-ER delivered. This 777 will have a fantastic customer environment with its expansive seating arrangement, it wants to impress the world with this static display. Hardly a death knell for the 777-300-ER. 

Emirates may be up to something once again (2013 777X orders) and it will become known next week what it is.  It is also important to note that Emirates massive show display in the main pavilion is only a few feet away from Boeing's somewhat smaller display at the main entrance going into the show. The 777-300-ER should get an order nod at the show with some more orders. The pride of the middle east sits just outside with Emirates complete fleet by type on static display. The 777-300-ER it just received is a star at the show.

Boeing had a plan that it needed more 777's classics until the 777X made its first delivery in 2020 or possibly sooner. Boeing has about 111 classic 777's including its freight version to build and deliver until the 777X is ready as of October 31, 2017. It also has 326 of its 777X's on order as well. In total Boeing has an October ending backlog of 437  777 units it will build over the next half dozen years.

Seeking Alpha just reported; "China Southern Airlines airlines committed to the purchase of 30 Boeing 737 MAX 8 aircraft and 8 Boeing 777-300-ER's..."

Boeing, whom is counting the days and weeks it needs to keep its 777 assembly line full, prices the 777 classic so low its an offer a customer can't refuse. Boeing is looking beyond the 777X entry into service as demonstrated at next weeks Dubai Airshow with Emirates' 777 static display. The eight 777-300-ER just signed for by China Southern demonstrates that a full conversion from the 777-ER to the 777X production schedule will allow for more 777-ER sales until full rate 777X production is achieved.

Dubai Airshow could be a 777 completeness show where Boeing will end up with enough classic 777's ordered and more 787's to boot. After-all Boeing is rubbing shoulders with Emirates at the main pavilion's front door. A second point is for every 777-300-ER ordered it will represent a fleet renewal opportunity for Boeing's 777-X's over the next 10 years. If airline growth continues as predicted, the 777X will dominate the LR Wide body growth. Instead of 326 units currently on order it could conceivably exceed 500 total 777X sales by 2021. Boeing will have made the production assembly conversion from 777-300-ER to the 777X and it will have been a success.