Leeham News and Analysis
There's more to real news than a news release.
Leeham News and Analysis
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Embraer sees need for 10,550 airplanes in 50-150 sectors
May 29, 2019, © Leeham News: Embraer, in what will be its last 20-year market forecast as an independent company, sees a demand for 10,550 jet and turboprop aircraft from 50 to 150 seats through 2038.
The company, founded 50 years ago, growing to become the world’s third largest supplier of airliners, sees its Commercial Aviation unit disappear by the end of this year, barring a hiccup of some kind.
That’s when The Boeing Co. and Embraer expect approval of a joint venture that will be called Boeing Brasil-Commercial (BB-C). Boeing will own 80% of the JV and control governance. Embraer will own 20%. The CEO of the Commercial Aviation unit, John Slattery, will be president of the joint venture, but Boeing will be in charge.
Until then, Embraer is trying to carry on business as usual. And this means it issued its 20-year forecast Monday during its pre-Paris Air Show international media briefing at its headquarters in Sao Jose dos Campos, Brazil.
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E175-E2 prototype in production, first flight by year end
May 28, 2019, © Leeham News: The first E175-E2 prototype is now in production at the Embraer plant here at Sao Jose dos Campos, Brazil, despite having no firm orders and only a single conditional order for 100 aircraft from a US airline that so far can’t use the airplane.
The pilot union contracts contain a clause that prevent the only customer for the aircraft in the world from using it because the take-off weight exceeds the 86,000 lbs specified in the contract.
Embraer designed the airplane with the hope the so-called Scope Clause would be relaxed in contract negotiations this year and next by pilots for American, Delta, United and Alaska airlines. It’s become clear that relief is unlikely.
No new turboprop from Embraer for now
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May 27, 2019, © Leeham News: Embraer is not going to launch a new 70-90 seat turboprop now or at the Paris Air Show next month, the CEO of its Commercial Aviation unit said today at the company’s pre-air show briefings in Brazil.
Speculation has been rising since word leaked last year that Embraer began showing a conceptual turboprop airliner to potential customers. But John Slattery, CEO of Embraer 
Commercial Aviation, said the business case has yet to be closed, information still needs to be gathered and analyzed, and studies of the engine technology—including hybrid electric—still must be done.
ATR and Bombardier are the leading global manufacturers of turboprop airliners today. ATR has an overwhelming majority of the backlog, between 80%-85%. Bombardier neglected sales of the Q400 during the development of the C Series. The company last year agreed to sell the program to Canada’s Viking Air. The transaction is expected to close this summer.
Embraer delivers 90 EJets, finishes 2018 with 368 backlog
Feb. 11, 2019, © Leeham News: Embraer delivered 90 EJets last year, comprised of 67 E175 E1s, 13 E190-E1s, five E195-E1s, one E170 and four E190-E2s.
It finished the year with a book:bill of 2.3:1 and a backlog of 368 airliners.
Pontificatons: From the sidelines at the AFJ Dublin conference
By Scott Hamilton
Jan. 28, 2019, © Leeham News: Launch by Boeing of the New Midmarket Aircraft (NMA) is pretty much a given, despite a still undecided business case, say people on the sidelines of the Airfinance Journal’s Dublin 2019 conference.
Here is a potpourri of information picked up at the conference, which is attended by about 2,000 people.
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Airbus holds 56% share of backlogs vs Boeing
Jan. 11, 2019, © Leeham News: Airbus trailed Boeing in net orders in 2018 but it still holds a commanding lead in backlog market share.
With the companies reporting their year-end tallies, Airbus has a 56% share of the backlog to Boeing’s 44%.
Airbus carries the day with narrowbody backlog. Its share is 58% to Boeing’s 42%.
Boeing wins the widebody backlog, 53% to 47%, driven by a broader product line, including strong 777F and KC-46A/767-300ERF backlogs.
When the emerging narrowbody airplane programs of China and Russia, and Embraer’s sole entry into the 100-150 seat sector (based on two-class seating), Boeing’s narrowbody share of the backlog drops from 42% to 40%.
Charts are below. Data is based on firm orders only.
2018 deliveries: Airbus leads Single Aisle, Boeing Widebody and Freighters
By Bjorn Fehrm
Jan. 10, 2019, © Leeham News: Boeing and Airbus came within six aircraft in their 2018 deliveries, 806 versus 800. For orders, Boeing was the leader, with 893 net orders versus Airbus 747.
Looking at Orders and Deliveries for the different segments there are some interesting trends.
Airbus new Hamburg FAL (Final Assembly Line) for the A320. Source: Airbus.
Airbus poised to out-deliver Boeing in 2019
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- LNC’s Corporate and Enterprise subscribers received this Jan. 3.
Jan. 8, 2019, © Leeham News: Airbus is positioned to out-deliver Boeing this year, boosted by the addition of the Bombardier CSeries acquisition last year.
LNC projects that Airbus will deliver nearly 950 airliners this compared, compared with Boeing’s projected deliveries of about 890 jets.
These are LNC forecasts, not those of the manufacturers. Guidance for the year should come on their respective year-end earnings calls: February for Airbus and Jan. 30 for Boeing.
2019 Outlook: ATR begins year in commanding position
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Introduction
Jan. 7, 2019, © Leeham News: ATR, the turboprop airliner OEM, enters 2019 in a commanding position.
Year-end 2018 order numbers for ATR and rival Bombardier aren’t in yet.
Through October, ATR held 74% of the backlog. Bombardier, buoyed by a large order for 25 Q400s from India’s SpiceJet (the 2027 deliveries in the Chart below), had 26% of the backlog.
Bombardier contracted to sell its Q400 program to Longview Capital Partners, parent of Viking Air. The Canadian company previously purchased all legacy de Havilland programs, including the Beaver, Twin Otter and aerial firefighting aircraft.
Viking restarted production of the Twin Otter and is gearing up to restart the Beaver.
Its plans for the Q400, Q300 and previous Dash 8 programs hasn’t been announced.
Summary
- Bombardier neglected the Q400.
- Small market over 20 years.
- ATR would like new program.
Boeing deal, “crucial to Embraer survival,” in doubt
Update, Dec. 7: Embraer to appeal injunction.
According to the Google translation of a Brazilian newspaper, the injunction appears to be intended to halt any completion of the deal during the interim between the November presidential election and the assumption of office by the president-elect. The Google translation does not appear to indicate the injunction is based on any specific objection to the proposed JV.
ANALYSIS
Dec. 6, 2018, © Leeham News: In a stunning piece of news, a Brazilian court blocked the proposed joint venture between Boeing and Embraer.
If the action holds, this is a major blow to Boeing’s future plans.
The new joint venture, which LNC dubs NewCo for the lack of a name, was to be responsible for all future Boeing aircraft of 150 seats and below, according to a Memorandum of Understanding revealed by Embraer’s labor unions.
This is critical to Boeing’s long-term future for the 2030 decade. Read more