Embraers choice is the GTF

Embraer yesterday revealed that it has selected Pratt's GTF family for the yet to be officially launched EJet revamp, due to enter service in 2018.
The E175G2 will get the PW1700G, which is a derivative of the PW1200G, powering the Mitsubishi MRJ70 and MRJ90 (and eventually the MRJ100 now under consideration).
The E190G2 and E195G2 will be powered by the PW1900G, essentially a PW1500G, which powers
the Bombardier CSeries CS100/CS300, but customized for the Embraer EJets.
On the same day, just hours before, Embraer was downgraded by JP Morgan, citing less deliveries for commercial aircraft in the coming years than forecasted previously. In fact the backlog of the EJets decreased dramatically since it's highest level in 2008, prior to the Lehman debacle, when 466 firm unfilled orders were in the books. Since then the backlog declined to just 178 in the 3rd quarter of 2012 and likely declined further until the end of the year.
Embraer lost the last large campaign against Bombardier when Delta ordered 40 CRJ900 with further options. and Skywest opted for the MRJ90 and ordered 100 of them with an option for up to 100 more (they will be delivered starting in 2017, so it would not have helped to up production short term).
More campaigns are looming at American and United, so there are some opportunities for Embraer to bridge the (time) gap. Especially as in 2014 there is a midlife upgrade named Plus coming to market. This should better fuel burn by some 5% on the E175 and 3% on the E190 and E195. New winglets and some aerodynamic cleanup will do the trick here. Also maintenance  intervals for A- and C-Checks will be increased to lower maintenance costs. A new cabin will also increase passenger comfort.
But as Teal Group Vice President Richard Aboulafia points out, an EIS in 2018 seems a litte late: the Bombardier CSeries will now enter service in mid 2014, the MRJ in late 2015, the A320neo in 2015, the B737MAX in late 2017.
So with only just a little bit of production overlap between the first and the second generation of EJets (say one year), Embraer would need orders worth six years of production  - at the current (2012) level of production around 600 orders. But Paulo Cesar de Souza e Silva, Head of Commercial Aviation at Embraer says there would be a three to four year overlap. Personally I highly doubt that we will see a CF34 powered EJet delivered in 2022.
Embraer claims to have a further 468 options for the EJets, but I guess not too many of them will be turned into form orders as these stem from pre 2008 times, where there was a boom (if not a bubble) in orders.
So why did Pratt win the engine competition: Embraer VP Silva said that this was due to "commercial and technical considerations".
The technical superiority of the GTF concept is not really a surprise. There are some doubts about the LEAP concept of GE, as the larger bypass ratio means more LPT stages and the smaller core higher temperatures. And RR seems to be too far behind in the development of a new two spool engine, as they concentrated on the big three spool engines lately.
The question is why GE was not able to beat PW financially, especially as GECAS is an important customer for the EJets today.
Maybe it was a matter of "risk management": the GTF development and testing is now in full swing, with the PW1500G for the CSeries close to certification. The PW1200G is "waiting" for the airframe, but also tested on ground and in flight. And the first PW1100G for the A320neo is also in the test phase. So the two competitors to the EJets, the MRJ on the lower side and the CSeries on the upper end, will at least not fail because of the engines. But what if Embraer would have chosen an engine that has not yet shown that it works and potentially fails (even if it would be better than the PurePower family engines on paper)?  The EJets would be dead immediately. So taking the same engines as the competitor is the safe way to go - and it worked previously when Embraer chose the CF34-8 for the E170/E175, competing with the CRJ700/CRJ900 with the same engine.
Illustration of 2nd gerneration EJet (Credit: Embraer)

1 comment:

  1. Good direction IMO. Best engine, adjust ( wing) and stay out of 135-165 seat bloody battle field. A small stretch of the E jet is build in, apparently. rgds keesje