A320ceo and B737NG backlogs

As I wrote briefly last week, it looks like Airbus is increasingly overbooking the A320ceo. But what does "overbooking" mean? Well, I always compare the remaining backlog to what I think was the ramp-down/ramp-up plan for the A320ceo and A320neo production.
As of now, Airbus produces 42 A320ceo per month. As there is a summer break in production we have to take 11.5 months per year into account to come to a yearly production of 483 A320 In fact 493 were delivered in 2013, but there is always a small difference between production and delivery. In 2014 there were 9 fewer deliveries until the end of November than in 2013, so that we can expect very close to 483 deliveries this year.The same amount we can expect in 2015.
Airbus already announced that in Q1 2016 a rate of 44 aircraft a month will be reached and in Q2 a rate of 46 will be reached. We can expect a full year rate of 517 aircraft then. From 2017 on we can then expect 529 aircraft per year.
Now we have to differentiate between the A320ceo and the A320neo.
I expect in

• 2015:   12 A320neo  / 471 A320ceo
• 2016: 100 A320neo /  417 A320ceo 
• 2017: 290 A320neo /  239 A320ceo
• 2018: 480 A320neo /    37 A320ceo

Airbus said before that the last A320ceo should be delivered in 2018. So there are 1164 A320ceo delivery positions to be filled between 2015 and 2018.

At the end of November there were 1470 open A320ceo orders in the Airbus O&D spreadsheet. Let's have a look at the "Quality" of these orders.

It is a given that the open orders for Kingfisher and Kingfisher Red will not be delivered. We can subtract these 67 orders.
Mexicana and Hamburg International are defunct. We can subtract 4 and 2 orders respectively. The same can be said for Alphastream, as these 15 aircraft were ordered for the defunct Blue Air. Nile Air already canceled a part of there A321ceo order and I am not very optimistic that the remaining orders for two aircraft will be delivered. I also would put the remaining deliveries for Croatia and Yemenia in doubt, that is another 12 aircraft.
Now we are at 1368, still more than 200 aircraft above what would be delivered with the A320neo ramp-up I assumed above.

The next question is who could swap orders from the A320ceo to the A320neo. But that would mean that these airlines (or lessors) would defer the deliveries as we can expect that all A320neo slots for at least 2015 and 2016 (and probably most for 2017 as well) are already filled.

So which are the customers with the largest backlog?
American 71
easyjet      69
BOCA      63
Wizz         59
Lion Air   55
Spirit        53
LATAM   47
Delta         45
LH            44

AA and easyjet are unlikely. AA wants to transform the fleet quickly, easyjet is on a growth path. BOCA has probably most if not all their remaining aircraft already assigned to customers. They "just" ordered more A320ceo's in summer at the Farnborough Airshow.
Wizz could be a candidate, but they already said they better want more A321ceo's than A320neo's as the cost per seat would be the same and they would get the A321ceo for a better price (per seat I suppose).
Lion Air wants to grow against AirAsia, which already deferred and switched A320ceo orders to the A320neo, so I do not think that conversions from Lion are likely.
Also Spirit is unlikely to defer some of their orders and convert them to (more) A320neo. LATAM though already switched some ceo orders to the neo this year and had some aircraft not taken up that then found other customers. So there could be some deferments here.
Delta is unlikely to switch to the A320neo for "fleet policy" reasons.
There could be some aircraft switched to the neo or canceled altogether from Lufthansa, pending their ongoing negotiations with the pilots.

On the other hand there are two more larger orders from China. One from CALC for 26 A320ceo (along with 74 A320neo). This order was firmed in early December. And another one from CASGC for 70 A320/A321ceo. This again increases the number of A320ceo overbookings.

So is this maybe a sign that the A320neo ramp-up will not work as anticipated? The flight test program of the first A320neo with the PW1100G-JM engines so far accumulated almost 140 flight hours, so there is no sign of a problem so far.
The LEAP-1A test program though seems to be behind schedule. There is no sign that the first flight test campaign on the GE Flying Testbed with the LEAP-1A started. The test program on the other GE Testbed started in early October and at that time it was said that the LEAP-1A should follow within a month.

Or is the reason for the continued A320ceo order bookings just real demand for this proven aircraft? Do some airlines follow the philosophy of Delta Air Lines to order the "old" aircraft when all the world is waiting for the new one?

Today and tomorrow are the "Airbus Investor Days": maybe we get a hint from John Leahy's presentation then...

The situation is a little bit different at Boeing. There are 1633 open orders for the B737NG at the end of November. But B737MAX deliveries start in Q3 2017, so let's say in August 2017, some 22 months after the first delivery of the A320neo. Boeing builds the B737NG at a rate of 42 aircraft per month (without any "break"), so for a first assumption let us consider that the ramp-up and ramp-down of the B737NG and B737MAX happen at the same rate as at Airbus. Then Boeing would need 22*42=924 more aircraft in the backlog than Airbus to fill all B737NG slots until the B737MAX takes over full production. That would be then 1164+924=2088. So Boeing would need about 450 more orders for the B737NG.
Now Boeing already announced to produce 47 aircraft per month (or more than 560 aircraft per year) when the B737MAX enters service and to go to a build rate of 52 or more than 620 B737 a year in 2018. I expect that these rate increases are only affecting the B737MAX, although this could stretch the supply chain. Otherwise it would make even more B737NG delivery slots available. Boeing also said that B737NG production would sustain at least until 2019. This is only two years after the introduction of the B737MAX, so, in other words, the transition could be faster than at Airbus, making the calculation of open production slots for the B737NG somewhat shaky.
Compressing the ramp-up/ramp-down cycle to two years would lead to about 200 open slots for the B737NG.
So if we would follow the theory that the demand for the "old" aircraft is there, Boeing should not have larger problems to fill 200 slots (450 would maybe a stretch). But if there are other reasons at Airbus to book all these A320ceo orders and especially if this is somewhat related to the LEAP-1A engine, then there should be some alarm bells ringing in Seattle and Chicago, as a problem with the LEAP-1A would probably also mean a problem with the LEAP-1B.

Only time will tell - as always, interesting times!