The Boston Connection

Boston is the new Black for airline profitability. Hainan, Jal, and others are rerouting to Bean Town. No I didn't use the Tea Party metphor for this blog (already used in poltics). The Boston Connection is more entertaining than the French version. Where else can you go on the East coast for Lobster, American engineering and computer code. Nowhere like Boston. People, Chinese, need want and aspire for these commodities. China, a place far away, is addicted to this connection. Hainan Airline had a devious scheme many years ago is some back room in China, that Boston is the untapped American Connection that does not have a wait in line opportunity on its top billing. It is an "Emerging American Hub" for the Orient, who knew? The Boston Connection has been noticed and many people are considering this discovery like a gold strike. The slow motion rush is on. Paper work, applications and agreements rush is on. JAL started with a bang (fire) several years back with the enabling 787.

The "Enabler" (Dreamliner) is the most effective mechanism today for opening new routes such as Boston to all of China. It was reported that Boston area has over 400,000 people who will travel to and from (Boston- China) annnually. Hainan, when no one knew what a Hainan was, ordered some 787. Today everybody else is talking about flying to Boston to go to China. Making others second tier from the crowded traditional super ports like New York, Chicago and DC. Take an express flight to Boston and then go directly to China, or basically on a 787 anywhere flight from Boston that traverses the North Pole. You could say the 787 is remaking Boston and its economy as a world trade center. Its the new gold, "The Boston Connection". Other Airlines are secrectly deciding epuipment purchases along with route acquistions in symphony. United Airlines is attacking the Orient from the West. The route grabbing rush is on, only its not happening in Oklahoma like it did in the 19th century during the great land grab. Its happening in under utilized markets with an abundance of people needed for travel, bringing its intellectual capital into a economic destination such as China. The 787 is the perfect freighter for world intellect going to and from China. Boston is to be the center for world intellectual capital. The connection is that pipe line for transporting this valued commodity, people and its talent.

The Enigma Of Unidentified Customers Drives Boeing's Order Book

Boeing received a boost to its 737 order book this month and has several other orders swirling about in order limbo. Recently it received an order for 80 737 in the form of maybe 60 Max and 20 NG from one customer. Also...

Jiuyuan Airlines is to take delivery of its 50 Boeing 737s by 2020

"Jiuyuan Airlines is a planned Chinese LCC start-up, expecting to launch services in Aug-2014. The carrier will be a JV between Juneyao Airlines and CTI, with Juneyao Airlines to hold at least a 70% stake. The start-up will focus on secondary and third-tier cities from its hub at Guangzhou Baiyun Airport. The carrier also has plans to expand to serve destinations in South Asia, East Asia and Northeast Asia once it has consolidated its domestic network. Jiuyuan Airlines plans to initially operate three leased Boeing 737-800 aircraft in a 189-seat, all-economy class configuration. The start-up has future orders for 50 Boeing 737NG and MAX variants. Jiuyuan Airlines was was officially established and registered in Baiyun District on 02-Apr-2014 and is now in the process of applying for its air operator’s licence with CAAC".

The Orient is beginning to become Boeing's go to market for single aisle 737's. The 737 standard is rapidly becoming the choice of airline operations as a complete package, while customers may add operational gap filling services from Boeing, such as its "Edge" program. The edge offers support programs that would keep all new equipment flying when an upstart airline may lack the technical upgrading of its staff, as it keeps up with an infusion of new aircraft.

I've never even heard of Juiyuan Airlines, as of today. It’s part of the Enigma of Boeing's unidentified 737 customers, which will have a reveal sometime in the future. The Boeing marketing team always falls back on, "it’s up to the customer to announce fleet aquisitions". China, a burgeoning market, has many mystery players, Shangdong Airlines and now Juiyaun. Fifty and Fifty and now 80 float about aviation's competitive realm. The key here, is that China, Asia, and the likes are guarding its order books, which grows Boeing's Unidentified Order Book in significant number. The order battle field has shifted to China. No longer are sales campaigns ensconced in Europe or North America. 

For the next ten years, it will be China, as Boeing has predicted in its prognostications for the market. Billions of people, new economic growth have placed China as the place to do business. It is important for the aviation duopoly to sink its heels into that market as it had predicted it needed to do last year, or from prior years of reports.

Now the many Chinese airlines would prefer to keep its order book unknown for a while, so its own Chinese competitors cannot read the "Tea Leaves" very well on its purchases. 

Since, there are only a few producers, Boeing, Airbus, and Comac in the running currently, it would be important for those customer airlines not to tip its hand. Boeing wants no part in displaying a Chinese Airlines intent on equipment at this crucial stage of fleet expansion.

Every time a Shangdong announces for fifty it causes a Chinese ripple across aviation's market place because of China's former locked potential is beginning to unravel, and any unwanted Boeing announcement causes like minded competitors in this huge market to adjust its game plan. 

Boeing's recent string of 737 orders "unidentified", and "announced", have been at a relatively fast pace. This Boeing order pacing may continue towards the end of 2014. 

Not knowing all the airlines in China, whether a start-up or established, it will be exciting time to follow the region's ordering during the next six months. 

Ordering season has officially started in China, and Boeing is playing a huge role in this endeavor. Therefore, a caution is issued, "learn all the names of Chinese based airlines whether in start-up phase or legacy airline for China". 

The stepping stones for growth are being placed in China at this time. Go for regional services, order 737's stones. Go international, order 787, and 777 stones. The path to international travel is through a strong regional (China region) operation first for a few years, then expand upon opportunity of available international routes. 

Picking the right airplane maker first, is the pathway to future orders later on, when routes expand. Fifty 737's ordered now, indicates that a customer would order 787/777's later, as the airline customer expands its fleet.  

Boeing has a nurturing plan for growing airlines around the world, and the Chinese market is ripe for this kind of nurture on airline's business models.

The Max Bubble Keeps Growing

Boeing has just updated its order book with 15 and 80 orders to Turkish Airlines and unidentified respectively. That is a total of 480 NG/Max orders this year where orders for all types  is 489 in total. 98% are the 737 variety. What does this mean is the context of the blog today.

Remember that last year was a extremely robust year for 737's including a preponderance of Max 737 orders. Boeing had a long journey to go catching-up Airbus Neo since it started 15 months after the NEO. The NEO jump started with all its existing customers in great quantity. Boeing threw the Hail Mary Max pass and caught it with the MAX.

737 Order Book Balloons in 2012 and 2013

2010    475 (NG only)
2011    580 (150 Max) December *
2012  1171*
2013  1208*
2014    480**

*   Max order years added to the books
** Partial year including June orders to date

The Max years has made its case that Boeing is on to something very special. Customers are given the inside scoop on the Max. They really like what they see. Boeing accommodates customers with transitioning orders taking NG's to Max split order bookings. Not all orders in the asterisk years are MAX but the significant part of 2012-2014 YTD belong to the Max. There have been a total of    3,439*  737 added to the books since the Max was announced. Close to two thirds are the Max when considering 2011 had the initial Max order of 150 in December and most of 2011 737 bookings were NG orders.

The Max balloon is not about to burst, as unannounced and commitments are not factored in on theses numbers at this time. Airbus may pride themselves on the NEO, orders, since it is  its job to do so. However, the steady pace of Boeing Max would be disturbing for the Neophytes. If Boeing book reaches a thousand 737 in 2014 , it would be a remarkable testament to its Max concept and the customer's understanding of that same concept. Reputation has a lot to consider for the customer. As Boeing originally announced for the 787 project that it would gain 15% fuel advantage but ends up with a 21% fuel advantage in some cases, then the Boeing reputation carries forward with the Max where they have announced a 13% advantage over its competitors current models and then a 6% advantage over its NEO offering. Airlines for Airbus may rationalize its too expensive to reequip, retrain and re market a NEO fleet over to a 737 fleet. However, they may find that bleeding slowly is the way to go. The 737 Max got the message out to its potential customers and is loading up in China in numbers (Hint unidentified list). China has not signed an oath of allegiance yet on single aisle types. They have older equipment or mixed fleets so they are more free than European counterparts when selecting the Boeing 737 Max. China may take on some 737 NG's for instant gratification when updating the China based fleets while waiting for Max delivery.

When will the Max sweep past the NEO in Numbers? That should occur in late 2015, Airbus will be perplexed with stagnant orders for both the A350 and A380 in 2015. The Neo will have maximized its customer base as those in the undecided arena choose more Max for a third consecutive year. Toulouse announces a new production facility near Waterloo.

The 747-8I Metaphor Or Metamorphic.

The 747-8i is a Metaphor in its current stage of life. Its a beach mansion hanging on a sea side cliff. The waves of larger aircraft are finally catching up to its lofty perch and eroding under its cliff facade, dropping it into aviation's ocean where it will sun in some desert some day. The 777 wave came then the Mega Ball A380 washed another piece of its foundation away. Finally, A350's arrive along with 787 during the last three years. Boeing countered with a "can't we all get along" commonality pitch to its customers. Stay with the 747-8i because it will seem like a 787 on steroids, even though the 787 is another tool for customers to try, as they stay away from four engines in numbers, since two engines is the "New Black" . The 747-8i cliff keeps eroding, even from its own family of aircraft coming in waves. The abode of the Queen of The Skies, is in peril.


Boeing moved this house back a hundred feet, in an epic effort of metamorphic proportions on the 747-8i. Making it a compliant Jumbo that flies like a 787. Will anyone notice those four engines in the make-over? Rhetorically speaking, four engines is still four engines no matter how you fit out technology, but at least its a step back from the edge in an eroding Jumbo market.  How about that A380 from Europe. It failed as a freighter and then sales are as soft now as the 747-8i. At least the 747-8i is has appeal as as the worlds best over-all freight hauler. The passenger service thinks it looks 45 years old even with a new wardrobe. Its a shinning mansion on an eroding cliff. Every airline takes a shot at its under pinning when ordering another set of two aisles with two engines no matter the maker. Boeing deviously remade the 747-8i not regarding the eroding cliff. It changed its position in the aviation scheme. Took some sales from the A380 in an attempt of spoiling the A380's break even point. Mission accomplished, as Super Jumbo sales are drifting towards irrelevancy.

A dying 747 concept has sacrificed itself for the greater good of Boeing. Time was gained for completing the final nail in the 747 program, by extending its usefulness. The 777X program will have time to develop as the 747-8i holds the A380 off the profit line. Once the 777X launches, the cliff will tumble Boeing's 747-8i into the sunny sea. The 777X is the true twin aisle twin engine Jumbo. The A380 will remain an Airbus profit bleeder. The 747-8i will remain a workhorse for freight hauling. The 747-8i is a metamorphic rock that has  50 years behind it changing into a hardened beautiful Diamond.

Big Blog Of The Day 787-9 Cleared For Take-off

The 787-9, as expected have cleared both the FAA and EASA  certification for delivery into the public domain. Seemless testing and frquent flying regimine have set its wings, free of encumbered review by both aviation authorities. Evidently Boeing must have made its case regarding a recent insufficiency discovery by the FAA, concerning flight control issues withing the Cabin. One, a knob needing more attention, and two a capaciter for the RAT, needing upgrading, as it failed in some flying tests. It wasn't sufficient enough issues for grounding the new 787-9, and it could be addressed within the current model, so as it wii not pose a critical problem. Therefore, the FAA, relinguished upon the Boeing's plan of fixing both problems during the next six months as a conditional acceptance of the 787-9. Where Boeing would upgrade components in issue and it would not affect new deliveries.

787-9, Its Good To Go

Open for Business sign goes up for the 787-9. New Zealand Air can possibly recieve a 787-9 by the end of the month with a few more following on by Audgust. ANA is chomping at the bit as it has a nearily ready for prime time 787-9 waiting for the signal to come and pick-it-up phone call. 

Those built 787-9; Flown, Tested, but not ready for delicery at this time:

Under 60 day delivery path:

Air New Zealand (4)
JAL (1)
ANA (1)
United Airline (1)

Airbus Discusses Fixing Its Swagger, As Boeing Just Tied Airbus Shoe Laces Together

Airbus is in Conference this week sorting out what happened these last five years. Of course everything Airbus did was right and on the mark when considering what Boeing did. Not only are its rose colored glasses picking up additional enlightenment's, they are bold to speak half-truths as it were a literary license to do so list.

Half Truth List from the past to the future from Airbus, my insights added:

• In 2003 Airbus remarked, the newly announce 787 project would fail and shouldn't be tried.
• Two years later it announced it would build a better XWB A350 greater than the 787.
• Incremental technology is better than all new technology slide, meeting starts.
• NEO code naming is synonymous with incremental advancement.
• Baghdad Bob Announces, Airbus is slaughtering the the MAX with A320 Neo orders at a 6:4 ratio over the Max.
• John Leahy sitting next to Baghdad Bob announces, "(The Airbus Chief Operating Officer Customers, John Leahy, calls it) A period of panic for Boeing, as Airbus moves its largest single aisle model, the A321, into the territory occupied by aged 757s which Boeing no longer makes by exploiting the things new tech engines make possible in a 240 passenger single aisle jet."
• Someone remarked, "isn't that what the 787-8 does", they were escorted out
• Airbus CEO Fabrice Brégier made it clear: Incremental, Incremental, quiet please.
• A Hand went up as a calculator turned off. How many Max have sold verses A320 Neo since the time the Max was announced? Then the meeting speaker got annoyed, "more space is now available for those still standing." (Door in the back slams).
• CEO Bregier continues, Brégier’s strategic direction means that the next big step, or NBS when it comes to the lucrative single aisle airliner market will be sometime around 2030, rather than now, in 2014, as just about everyone in Airbus and Boeing was predicting in 2004.
• Its John Leahy's turn, he has a slide show of how panicked Boeing is, in Everett,WA
• Fabregier talks about the Next Big Step (NBS), The A330-NEO-NBS-XWB.
• "What About Bob (AKA Bill Murray)" Comes up to the Microphone. Incremental is all about "Baby Steps". Applause and then ovation. Dr. Leo Marvin (AKA Richard Dryfuss) screams.
• Symposium Brain storming next; let’s all write down ideas on the NEO with everything we've got.
• Does that include the A380? Yes it does!
• Can we go Neo on the A350-800? No you can't!
• Do Airbus Gliders qualify? Yes they do, even though no New Engine Option is available.
• Has everybody Brain Stormed their Baby Steps Incremental Dream Plane? (oops)
• Announcer, "We now have one more chair up front for those still standing."

From Game Changer To Difference Maker

Even though Boeing did a quantum leap in technology verses the Airbus mantra of Baby Steps, Boeing will have perfected its family of aircraft feeding off that quantum leap over the next 25 years. The 777X, 747-8i and The Max all benefit from Boeing's technological leap with the 787. The 787 is the root cause of Boeing's future success in anything it does until 2030 or there about. Airbus does not have a 787 playbook to feed from. They have a menagerie of NEO's, XWB, and giant aircraft, which adds to its well spring of advancements for the future. Baby steps will put Airbus further behind in this case.

Announcement: The A330 Neo is doing a competitive airplane build on the cheap in baby steps (no applause). 

Airbus cannot draw from a 787 technology parts bin. The A350 did not break significant ground in technology other than a plastic frame and wings. Many unique and one-off new technologies are found in the 787 development, and is showing up in Boeing's new airplane portfolio, or already is flying, and also is making a differences through its family of aircraft.

The 787 is a difference maker for the complete Boeing family. Developing the A350 by Airbus does not make a significant difference for all follow-on NEO planes. Airbus laid up short with its technology on the A350. They didn't match or catch Boeing's 787 technological inspiration. A customer and journalist recently rode on the A350-900 test plane during a promotional flight for the press.

This journalist remarked in his article, how noisy the A350 was compared to the 787-8 he had flown in on. The interior was not that remarkable, but had the latest in seat innovation just like any other airline. Missing were the engineering touches that Boeing has, those wings sweeping back, Window innovations, and a quieter ride. These types of observations were interrupted by 150 other seated press from Europe and the Airbus embedded journalist. He thought this was kind of cheesy when all clapped after the A350 took off, and then cheered when it landed. No objectivity was given by anyone that this journalist could see. He just felt he had a better ride and quieter experience on the 787 when considering all its systems in play. 

Boeing has the game changer and the difference maker for its family of aircraft, where Boeing is also taking incremental steps forward in all sizes. It has positioned itself for the customer and airline operations. The 10 years of new technology R&D was not just for the 787, it was for all of its commercial aviation divisions of aircraft. Every aircraft from the smallest to the largest contains 787 engineering DNA under its skin, whether it is metal or plastic. The 777X program will validate this statement.

On the other hand, Airbus went on the hurry up route, and dumbed down the A350, which is not a good comparison for Airbus against 787 technology. The A350 is also, a well to draw from, when taking additional steps in Building NEO's for all types. These NEO's will have to depend on engine makers outside the company for making old technology fly better. Airbus does not have an inside game with its own technology like Boeing. They will try and win with Engine builders, the same ones Boeing also uses.  When you look at the Airbus situation, it looks disjointed, unorganized and hap-hazard. Airbus lacks a Game Changer and Difference Maker.

Airbus “Snickies” List:

• Considering a remake of a 20 year old plane, A330 NEO as the primary 787-8 fighter (haphazard)
• Failing with A350-800 and abandoning its development. (unorganized) 
• Discussing a NEO program for the A380 since sales have hit bottom. (knee jerk)
• Considering the A321 NEO as a competitor of the discontinued 757.  (disjointed)
• Tasking the A350-900 and A350-1000 to compete with the following (are you kidding me): Airbus must be delusional?

Boeing Bottom Line:

• 787-8
• 787-9
• 787-10
• 777-8X
• 777-9X

Does Airbus Have Nerves Of CFRP

Judging by the mood of Airbus, after today's striking announcement that Emirates will not need the service of 70 A350's, it has thrown many unanswered questions to the fore-front. Many an executive may eye the window from ten stories up at a Toulouse office. Its not that Airbus just erased 16 Billion off the books in one fell swoop, but it highlights the exigency of the A330 NEO program over the dead or dying A350-800. Now Airbus is wondering if it has the nerve of metal or laminated plastic.  The choices are few with the back drop of advanced Boeing Technology on both the 787 and 777X coming forth in numbers.

Two Questions are on the table with a third thought floating the room.

Why doesn't the A350-800 take off where customers have abandon this ship or not boarded on it in the first place?

How Come An A330 NEO isn't a good stop gap airplane that will buy time for Airbus until they get it right?

"Thought"
That technological mountain that Boeing built is awfully tall, and look at those beautiful Boeing wings and associated technology.

Airbus has stayed the course as long as they can, by dressing its pigs in advance technology trimmings for its family aircraft. It has has put on plastic panels, made an approachable attempt against Boeing windows. Even provided a Boeing like light show on the interior. But it just just doesn't have that "It Factor", the 787 has, and the Boeing is showing up everyday with its 150 or so flying examples. Airbus didn't even bother with core technology like Boeing did, and even bought barrels of hydraulic fluid for the entire A350 family. How come people didn't like the A350-800?  A perplexing question, the A330 NEO team asked. Now they are thinking of a do-over for its customers with the A330 NEO proposition. (Simile alert) Its like going to the grand ball in a 1990's suit when every body is wearing the newest 787 Tux at the ball (flowers not included).

Airbus has indeed had an Epic week. It was found out, by Emirates no less, who is now dating Boeing with wide body orders and issued an  Airbus break-up with them on XWB types. The ripple effect will be felt by other airline suitors who now question its own portfolios with Airbus. If Boeing keeps cranking out 10-12 a month 787's, and they will, along with pushing the 777X sooner rather than later. Maybe the A350 isn't all that, as Airbus has dressed its pig to the nines while wearing old school styles in a modern setting.

An Epic week indeed. Nothing better than a slug of new Airbus orders for John Leahy as mentioned in his reaction. "We now have production slots open on the A350 assembly and we can serve customers faster." The problem now is its order book when there is a lull aviation orders this month as Airlines are examining and consolidating purchase strategy. Emirates is not the only company doing this type of evaluations. All Aviation companies continuously do this analysis 24/7. Emirates is the first to break in dramatic fashion in 2014. Back in the heady days of the initial 787 order book, Boeing had customers retract orders, as they went back and analyzed financial strength supporting a 787 order. Qantas had to retract on its 787 order and a few other airlines had to regroup, thus stacking up a number of cancellations for Boeing for its 787. Since then, that has not been a problem for Boeing. It has kept growing its order book for the 787. When Leahy stated Boeing had more cancellations than the 70 he just experienced with Airbus, he was correct in-a-way. Boeing has achieved over 1050 787's orders since the beginning of the 787 program and order book adjustments occured when financial minds said, "we need to pull back and reconsider what a big 787 order will do to our finances in a down market" during 2008-2010 period. Airbus is about 30 % behind Boeing with A350 orders comparing Boeing's 787 order book. Looking at the financial quality of airlines who cancelled for either Airbus or Boeing is important. Emirates prints money and Qantas has its cup out asking for money most months. Leahy fails to footnote publically the situation properly, as he usually does when making bold statements. The airlines know and they smile when it happens. Its part of Leahy's salesmanship. The Emirate deal dismissal is a crusher for Airbus! A Qantas/Boeing cancellation was felt, but Boeing recovered with many more 787 orders from others, even in a recession.

This Emirates cancellation will have a large ripple effect on the world of aviation. It will effect decisions Airbus is about to make towards its A330 NEO idea. Old technology will be harder for Airbus to sell its customers, as the A350 lost to the 777X project and the 787 tag alongs. You could say Airbus has finally been exposed. Others will certainly reexamine that exposure from its own order book. You are not the biggest passenger airline company in the world, because of carelessness, Emirates knows this and others have taken note, Boeing is better at these WB aircraft models it has and Boeing doesn't build a super giant airplane, so be it it for the Airbus' A380.

The late time tells me Airbus won't go for a CRFP hail Mary Pass in a A350-800 renovation, but will go all in for full metal jacket in a losing war with the A330 NEO.

The Airbus Stopped At Emirates and Boeing Gets ON

Orders from Boeing website for Emirates since 2010.

Orders for January 2010 through May 2014
Customer Name	Country	Region	Model	Engine	Order Date	Total
Emirates	United Arab Emirates	Middle East	777-300ER	GE	30-Apr-2010	18
Emirates	United Arab Emirates	Middle East	777-300ER	GE	16-Jul-2010	12
Emirates	United Arab Emirates	Middle East	777-300ER	GE	16-Nov-2011	50
Total						80
Customer Name	Country	Region	Model	Engine	Order Date	Total

The current order book does not reveal potential  777X9 commitments as reported below by Guy Norris, @Aviation Week, during last years air show at Dubai.

Emirates and Clark were probably thinking when they committed to the 777X, that they would drop the A350 line during that time. They stopped short of the elimination then, and waited for the soft part of aviation's yearly news cycle before having any mid-year financial impact for the industry. It appears to be a calculated information announcement, timed for not offending Airbus sensibility towards Emirates. It also heightens the anticipation of turning its Boeing commitments towards the 777 program forward a notch with a placed order, from last falls Dubai Airshow MOU's with Boeing.  There is always a chance Emirates will tweak its commitments already established, either upwards or downwards considering many factors contained in Emirates' future plans. However it appears, United Arab Emirates is all-in for both the A380 and the 777X programs as exampled by Boeing's chart above in the last four years of booking Emirates 777-300ER orders, which tally eighty.

Aviation Week: Guy Norris: Date-Line November 17, 2013

Back ground information:

"Boeing officially launched the 777X derivative at the Dubai air show on the back of259 orders from four airlines worth almost $100 billion, making it the largest single commercial launch by value in the history of the industry.

Dubai-based Emirates Airlines grabbed the lion’s share of the contracts with firm orders for 150 777X, plus purchase rights on a further 50, while neighboring Qatar Airways and Etihad Airways shared the limelight by ordering an additional 50 and 25 respectively. Together with Lufthansa’s earlier order for 34 777-9X, Boeing says the combined value of the 777X agreements is more than $95 billion. The Emirates order is made up of 115 of the larger capacity -9X versions and 35 -8X, while Etihad will take 17 777-9X versions and eight -8Xs. Etihad’s order also includes options and purchase rights for 12 additional 777X.

Beyond the 777X, Boeing’s 787 orderbook also received a significant boost with Etihad ordering 30 787-10s. Together with the carrier’s previous order for 41 787-9s, the -10 purchase means Etihad will become the largest operator of the 787 with a total of 71 787s on order. The deal includes options and purchase rights for an additional 12 787-10s and marks the 1,000th order for the 787 family since All Nippon Airways launched the program in April 2004. The Etihad selection also means the 787 has reached the 1,000 firm order milestone in just over nine years, faster than any other twin-aisle aircraft. Etihad’s order also includes one additional 777 freighter plus two options.

The 777-9X will be configured to carry more than 400 passengers, and will have a range of more than 8,200 naut. mi. The 777-8X, which with capacity for 350 passengers is sized close to the current 777-300ER, will have a range of more than 9,300 naut. mi. The aircraft will be powered by General Electric’s GE9X which will be rated at around 105,000 lb. thrust, confirms David Joyce, the engine maker’s president and CEO.

“The -9X will have a 16% to 17% delta in fuel burn (compared to the current 777-300ER), and is an aircraft that is redesigned inside and has a new wing,” says Emirates Airlines president Tim Clark. “It is all composite and has great lift over drag. The -8X is about the same size as the 777-300ER but will be able to fly 17 hours to 18 hours non-stop and with the same fuel efficiency as the -9X. It’s a step change in aircraft design and a step change in propulsion but we have to wait seven or eight years for this to come.”

Design of the 777X is under way and Boeing confirms suppliers will be named “in the coming months.” Production will begin in 2017, with first delivery of the 777-9X targeted for 2020, with initial deliveries of the -8X following around 18 months later.

Almost eclipsed by the twin-aisle order avalanche was the news that flydubai has ordered 100 737 MAX, all of them -8s, as well as 11 737-800s. The deal is valued at $11.4 billion at list prices, including purchase rights. It is the largest ever Boeing single-aisle airplane purchase in the Middle East, says the manufacturer. First flight is scheduled in 2016 with deliveries starting in 2017. Flydubai currently operates the 737-800 and so far has taken 33 of the 50 aircraft it ordered in 2008."

Breaking Airbus News (Updated from Gulf News)

Emirates cancels a total of 70 A350's, 50 Airbus A350-900, and 20 A350-1000, knocking the Airbus order book for the A350 further back of Boeing's 787 Program.     Airbus book drops down to 742 A350 orders after subtracting 70 from the books. Tim Clark announces the change as a fleet adjustment. Currently Emirates has the 787 family of Aircraft and Boeing's 777-9X on the books. Clark has not been favorable towards the A350-1000. This is a significant blow for Airbus to absorb, as Emirates has been a key customer for the Airbus A380 with Emirates.  In the next five months Airbus hopes to deliver its first customer an A350-900. More information emerging on the cancelation tomorrow.

The Western Australian Link                                                                      


John Leahy Gives "The Baghad Bob Report: Gulf News  Reference Link

Dubai: Emirates said on Wednesday it has cancelled its entire order for Airbus A350 XWBs (extra wide bodies) that it signed with the European plane maker back in 2007, then valued at around $16 billion (Dh58.48 billion) in list prices.

Without divulging exact reasons for the move, an Emirates spokesperson said in a statement that the contract which the airline signed in 2007 for 70 A350 aircraft has “lapsed”. “We are reviewing our fleet requirements,” the spokesperson added.

Confirming the same, Airbus, which suffered its biggest-ever order cancellation, said in a statement that Emirates’ decision “follows ongoing discussions with the airline in light of their fleet requirement review, as demonstrated by their order of 50 additional A380s at the last Dubai Airshow and their continuous interest in the programme”.

The order of 50 A350-900s and 20 A350-1000s was originally placed by Emirates in 2007 with first delivery slots scheduled from 2019.

A disappointed Airbus sales chief, John Leahy, reportedly told reporters in Toulouse, France, that it’s “not good news commercially but not bad news financially”, adding Boeing has had more cancellations for its 787 Dreamliner.

Airbus stated that it was confident of filling the spare production slots and saw no financial impact from the order cancellation. It added that half-a-year before entry into service, the A350 XWB order book stands at 742 firm orders.

The first A350 is scheduled for delivery to Qatar Airways in the fourth quarter of this year.

Analysts, meanwhile, see Emirates’ move as one prompted by Boeing’s 777x planes.

Terming Emirates’ decision as “strange”, Addison Schonland, Partner at US-based AirInsight, told Gulf News in a statement that a reduction in the order would seem plausible in light of the [Boeing] 777x. “But a total cancellation seems like an overkill.” Bear in mind the A350 programme is on time with an excellently executed flight test programme, he said. “What could possibly be ‘wrong’ with the A350 now? Can the 777x — which is ‘not’ even in flight test — offer so much more?”

Emirates in November last year placed a $76 billion order with Boeing for 150 of its new 777X planes at the Dubai Airshow.

Another analyst, Andrew Charlton of Geneva-based Aviation Advocacy, is of the view that by moving away from its A350 order Emirates is saying that there is no great need for them, “or perhaps that the need for A380s is greater”.

He added that the cancellation has two implications, the first being Emirates’ long-haul hub model can be sustained and maintained by its fleet of Boeing 777s. “And secondly, the A380s are the way of the future,” Charlton pointed out.

The cancellation comes shortly after Emirates President, Tim Clark, recently said that if Airbus could deliver by 2019-2020 he would be interested in up to a 100 new A380neos (new engine options) over the 10 years to meet fleet replacement and expansion needs.

Rolls-Royce, the sole engine maker for the A350, will also suffer a blow owing to Emirates’ move as it would reportedly end up losing $4.4 billion.

Airbus’ shares were reportedly down 3.3 per cent to 52.08 euros in afternoon trading in Paris.

       

The A330 Gamesmen$hip And Game Board Tatics

Airbus is playing Boeing just like Boeing has played Airbus. Wait for the other to make its move then make the counter move on the opponent. A very good article outlining this tactic:

Airbus A330 Upgrade May Pressure Jet Prices 

Reference: Air Wise June 10,2014
"Critics say Airbus has flip-flopped over strategy after initially rejecting an A330 redesign in favor of its new A350.

But some in the industry say Boeing also erred by over-engineering the 787, leaving the door open to more sales of a wide-body aircraft suited to shorter trips such as fast-growing routes within Asia.

Airbus has already begun promoting the "A330neo" as the most affordable wide-body jet catering to this new regional niche.

Comparing the A330neo to the Boeing 787-9, the most popular version of the Dreamliner, Airbus sales chief John Leahy said it would have the same "cash operating costs" and significantly lower capital costs, making it "an unbeatable plane in that category".

Boeing disputes these claims as well as Airbus's forecasts of more than 1,000 potential sales for the A330neo. But that has not prevented its sales chief stepping up the market battle."

The point was made through Ryan Air, that you can buy a boat load of 737 NG's like its recent #176, 737's on one order, and fly it competitively against the NEO or Max. Because operational margins are close enough comparing the Max and NEO against the NG, where it can risk buying a lower cost airplane and leverage acquisition savings through its operations making extra cash available for buying additional fuel and service of its higher overhead operation. The lower capitalization also achieves lower interests amount, and effective depreciation benefits for the tax calculation of the company. The bottom line improves when Ryan Air can buy the cheaper older design, and beat the bottom line of its competitor's "bottom line", during head to head operations of competing airlines that have ordered the A320 NEO. 

That is what Airbus is saying that it can do with an A330 Neo against the 787 capitalization margins.  Airbus claims they will  sell you an A330 NEO with lower purchase price, lower interest payments on acquisitions, that will supersede the 787 higher purchase cost and better fuel performance beating the 787. The A330 NEO would compete on the bottom line in head to head profitability with airlines that have the 787. The A330 doesn't have to use less fuel to beat the 787 because cash savings just mentioned will catch-up the A-330 NEO on its operational cash flows against the higher purchase price 787. Thus, affording more fuel for years to come. That is the argument in short hand. They can buy an tremendous amount of fuel from purchase savings and lower interest cost as part of the head to head Airbus analysis.

This short sighted Airbus scheme fails on its assumptions, where all things Boeing will be a constant factor and never adjust. As the article link suggests, Boeing has several options available to knock the Airbus scheme off the table. The fuel price is the wild card. If fuel price raises significantly in an operational year, then Boeing would have orders tip to its favor.

"Comparing the A330neo to the Boeing 787-9, the most popular version of the Dreamliner, Airbus sales chief John Leahy said it would have the same "cash operating costs" and significantly lower capital costs, making it "an unbeatable plane in that category".

Boeing disputes these claims as well as Airbus's forecasts of more than 1,000 potential sales for the A330neo. But that has not prevented its sales chief stepping up the market battle.

"Clearly our competitor is pursuing this product and thinks it is a great way to compete against the 787-8 and 787-9, which is an interesting change in their strategy because we thought they were building the A350-800 and A350-900 to compete against those airplanes," said Boeing senior vice president John Wojick.

"Airbus is saying 'my airplane isn’t as efficient as Boeing's, so maybe Boeing won't react'. Well, we are going to react," he told Reuters in Doha. Boeing declined to elaborate.

Analysts say Boeing has three main options: do nothing, fine-tune the 787's design or retaliate with lower prices".

• Assigning a lower thrust engines on a 787-8 for regional airport hoping as China is leaning towards. 
• Add special performance tweaking on a 787-8 regional for under 5,000 mile routes.
• Passenger configuration standards on a regional market maximizing efficiency.
• Weight reductions from eliminating long range system currently installed on all 787.
• Boeing has the ability to sell a 787-8R (Regional) configuration that would kill the A330 NEO.    

Boeing blinked and didn't build the regional 787-3. The A330 NEO concept is trying to grab China's attention and sell 1000 units in the next ten years over the 787-8, 787-9

and 787-10 models. China could purchase a block of A330 NEO's as a place holder for its airplane growth until later when the 787 order book shrinks and production cost improves making the Boeing sales team aggressive at that time, out selling the A330 bargain beater. 

Whether the A330 Neo is launched, is the roll of the dice at this time. The A350-800 is a lost leader. The A350-900 can't hold up to all competing models. The A350-1000 is just a dream not a liner, Since Boeing has four brand new models each filling slots that brackets the Airbus line into a take down.