It was just hours after Airbus officially renamed the CS300 to A220-300 when the first order under Airbus control came in yesterday. Jetblue ordered 60 A220-300 and took options for another 60 (per a MoU).
Also, Jetblue converted their order for A320neo to the larger A321neo, now having 85 A321neo on order but no A320neo anymore.
The 60 firm A220-300 will be delivered by H1 2025, the options would be delivered from 2025 onwards.
by that time the oldest A320ceo in Jetblue's fleet are 25 years old - time to say goodbye maybe? But then what? Jetblue could have ordered A320neo again, of course. But what if there would be a A220--500 (formerly known as CS500) by then? Maybe we have already seen a (tentative) launch order for the A220-500...
Showing posts with label CS300. Show all posts
Showing posts with label CS300. Show all posts
7/11/2018
11/08/2013
Boeing B737NG order drain
7/05/2013
Paris Air Show 2013 Recap
The Paris Air Show 2013 is history – and it wrote (at least
a little bit) of aviation history:
Embraer
On the opening day it was Embraer to launch it’s highly
anticipated EJet E2 family. Not surprisingly, the E195-E2 will be a stretch of
the current E195. Also no surprise that the E170 will not be continued and that
the E190-E2 will stay where it is, sizewise. The E175-E2 will be a little bit
larger in capacity, stretching it’s fuselage by 0.62m or 24.4inches. The effect
is that two more seats can be fitted and in a 1-class 31” layout there are now
88 seats compared to 86 seats in the current E175. This is exactly the figure
that Mitsubishi gives for the MRJ90 – any questions? With the same engine as
the MRJ will get, the same cabin capacity and a new wing (even larger now than
the MRJ wing) the fuel efficiency of the two aircraft should be very close to
each other. The MTOW of the E175-E2 is a little bit higher (44.33 t vs. 42.8t),
but the Embraer has more range, too (1920nm vs. 1780nm).
10/07/2012
Pegasus Order
The turkish carrier Pegasus is about to announce their choice for the next 100 narrowbodies, ATWonline reports. The airline has already decided on which aircraft to take, ATW says and wants to announce it shortly. Obviously A320neo and the B737MAX are in the competition. As Pegasus has a fleet of 40 B737-800NG and two B737-400 right now I would rule out the CS300 as it would be a smaller aircraft than the ones currently in use.
One sentence in the article might give us a hint who will be the winner:
"The carrier expects to start receiving the new aircraft in around three years."
1. In 2015 only the A320neo is available, the B737MAX is coming to the market two years later. So one might think that the A320neo might be the aircraft of choice.
2. But as I laid out earlier, Boeing has about 1,000 B737NG positions to sell until the B737MAX will be the only B737 version produce by Boeing, which could happen in late 2019, about two years after EIS of the B737MAX.
So my guess is that Boeing made an irresistible offer to Pegasus. As Boeing is the provider of the current fleet, they have to loose more than Airbus anyway here.
But let's don't underestimate John Leahy - maybe he surprises us (well, at least me) one more time. But my bet is on Boeing here!
One sentence in the article might give us a hint who will be the winner:
"The carrier expects to start receiving the new aircraft in around three years."
1. In 2015 only the A320neo is available, the B737MAX is coming to the market two years later. So one might think that the A320neo might be the aircraft of choice.
2. But as I laid out earlier, Boeing has about 1,000 B737NG positions to sell until the B737MAX will be the only B737 version produce by Boeing, which could happen in late 2019, about two years after EIS of the B737MAX.
So my guess is that Boeing made an irresistible offer to Pegasus. As Boeing is the provider of the current fleet, they have to loose more than Airbus anyway here.
But let's don't underestimate John Leahy - maybe he surprises us (well, at least me) one more time. But my bet is on Boeing here!
10/04/2012
Boeing B737MAX orders gaining steam
This week Boeing firmed two orders for the B737MAX. On October 1st GOL signed for 75 B737MAX-8 and two days later GECAS for another 75 copies of the -8. Another unidentified customer signed for 22 B737MAX. Boeing has now 821 firm orders for the MAX.
What is maybe more important is that Boeing still has no order for the -7. Also the A319neo has only very few orders so far. There are two possible explanations for this:
1. Airlines are shifting to larger aircraft.
2. Other aircraft, especially the Bombardier CS300 is the better aircraft.
I discussed this also in an earlier post. Against the first assumption speaks that there are markets that do not support a 180 seater and a 150 or 130 seater is more economical.
But there are not really too much orders for the CSeries - yet. My guess is that once first flight happened (and went well) we will see some more orders, maybe also on a larger scale.
Another sidenote of the GECAS order is that there are "only" 10 orders for the B737-800NG included with 15 more options instead of the 25 firm orders originally announced. I also discussed this earlier: Boeing has to sell something like 500 more NG's to close the gap until the MAX enters service. And as a ramp up to full production will probably take another two years, Boeing needs to sell another 500 or so if they do not want to have an overall slowdown in B737 deliveries.
What is maybe more important is that Boeing still has no order for the -7. Also the A319neo has only very few orders so far. There are two possible explanations for this:
1. Airlines are shifting to larger aircraft.
2. Other aircraft, especially the Bombardier CS300 is the better aircraft.
I discussed this also in an earlier post. Against the first assumption speaks that there are markets that do not support a 180 seater and a 150 or 130 seater is more economical.
But there are not really too much orders for the CSeries - yet. My guess is that once first flight happened (and went well) we will see some more orders, maybe also on a larger scale.
Another sidenote of the GECAS order is that there are "only" 10 orders for the B737-800NG included with 15 more options instead of the 25 firm orders originally announced. I also discussed this earlier: Boeing has to sell something like 500 more NG's to close the gap until the MAX enters service. And as a ramp up to full production will probably take another two years, Boeing needs to sell another 500 or so if they do not want to have an overall slowdown in B737 deliveries.
8/14/2012
Narrowbody Market Shift
AirInsight last week published a report about the narrowbody market, especially about the 100-149 seat segment. What they found is that - in their opinion - the failure of aircraft in this segment was due to either weak OEM's (and I guess that this means that the OEM was undercapitalized) or due to the fact that the aircraft were no clean sheet designs optimized for that market segments but rather derivatives of (mostly) larger planes. As such a "shrink", an airplane carries a lot of weight that is not needed for it's role. For example the wings are too large and heavy, as they were designed for the original and larger aircraft.
The only aircraft that is currently in production and is a point design is the EMB190/195 family - where the EMB195 seems to be a bit underpowered in terms of takeoff length at MTOW, but the thrust is OK for typically flown routes below 1000nm.
The only aircraft that is currently in production and is a point design is the EMB190/195 family - where the EMB195 seems to be a bit underpowered in terms of takeoff length at MTOW, but the thrust is OK for typically flown routes below 1000nm.
8/03/2012
Boeing wins a MAX customer from Airbus
SilkAir announced they signed a LoI with Boeing for 23 B737-800 and 31 B737MAX-8 with another 14 options. The orders can be converted to other versions.
This is significant as Silkair is the first customer Boeing catched from Airbus. Silkair currently operates a fleet of 21 A320 with 3 more on order.
Until now it was Airbus who draw customers away from Boeing, the first one being American Airlines - prompting Boeing to announce the (then yet unnamed) B737MAX.
This is significant as Silkair is the first customer Boeing catched from Airbus. Silkair currently operates a fleet of 21 A320 with 3 more on order.
Until now it was Airbus who draw customers away from Boeing, the first one being American Airlines - prompting Boeing to announce the (then yet unnamed) B737MAX.
11/11/2011
Embraer decides in favor of EJet's
Embraer decided to abandon plans for a new 5 abreast aircraft for now and instead opted to reengine to EJet's in the latter half of the decade - EIS could be in 2018. Given that Embraer could not do both at the same time - financially, but also due to manpower restrictions, as the KC-390 is in development also, this seems to be a wise decision.
Let us look at the timeline: in 2018 all new engines currently under development for the MRJ, CSeries, the A320neo, the B737MAX, the C919 and the MS-21 will be in service. Of course one could ask at least in case of the latter two if the EIS dates for these will stay where they are now. But Embraer will have a good idea how the engines - two versions of the LEAP (the C919 LEAP-1C will have the same turbo machinery as the A320neo LEAP-1A) and three types of the GTF (MRJ, CSeries and A320neo/MS-21) - are doing during development. An EIS in 2018 would probably mean an engine selection about 5 years earlier, around 2013, maybe 2014. By that time the PW1200G and PW1500G are flying at least on the respective aircraft prototypes and the first PW1100G engine should run on ground (the LEAP-1A seems to be a bit behind).
8/05/2011
The 130 seater market
The launch of the CSeries in July 2008 initiated many discussions about the market those two aircraft are placed: the 110-130 seater market.
Let's have a quick look in the 130 seater market,
Let's have a quick look in the 130 seater market,
6/03/2011
CSeries order from Sweden
On June 1st Bombardier announced a new order for the CSeries. Five CS100 and five CS300 will be operated by Malmö Aviation, a small but highly regarded airline. The airline was rated "best national airline" in Sweden for several times. The roots go back to 1981. In 1998 Malmö Aviation was bought by the norwegian Braathens family and cooperated with Braathens Sverige. Braathens was bought by S.A.S. in 2002 and named S.A.S. Norge, but Malmö Aviation was dissociated before and remained under control of the Braathens family.
This order alone is not significant. But I am pretty sure that we will see some more orders - likely at the Paris Ais Show, maybe later in the year.
This order alone is not significant. But I am pretty sure that we will see some more orders - likely at the Paris Ais Show, maybe later in the year.
4/27/2011
COC and DOC Part II
Airbus offers a "A320neo Fact Sheet on it's website for download here.
Apart from one obvious typo - the A321 is mentioned as the 2nd variant to become available, but that has changed to the A319 as the 2nd family member recently, there are a few "facts" - or claims- on that sheet that compare cash operating costs compared to today's A320 and the fuel burn of the A320neo with the B737-800W and the CS300. These can be compared to my assumptions made in a recent blog entry called "COC and DOC".
First claim: A320neo has 8% better cash operating costs than today's A320.
Fact check: In the recent blog entry I assumed 9.5% better cash operating costs for a fuel price of $3.00/gallon - 7.5% from lower fuel burn and about 2% from lower maintenance costs. With oil prices in the range of $3.20 as of today, cash operating costs are more like 10% better - so Airbus is not overly optimistic with the 8% assumption.
Second claim: A320neo has 16% less fuel burn per seat than the 737-800W.
Fact check: Assuming 15% reduced fuel burn per trip through the sharklets and the new engines and three more seats, the overall improvement in fuel burn per seat is (153/150)*15%= 15.3%.
If Airbus says that the A320neo is 16% better in fuel burn per seat than the B737-800W it implies that the A320 today would be 0.7% better than the B737-800W. I assmued they are on par, but I guess a difference of 0.7% does not really count.
Third claim: A320neo has the same fuel burn (per seat is obviously meant, though not stated) as the CS300.
Fact check: Let's assume 153 seats on the A320neo and 130 seats for the CS300 in a comparable cabin layout and the same seat pitch. This is a difference of 17.7%, so the fuel burn per trip can be 17.7% higher for the A320neo in order to have the same fuel burn per pax.
A report from AirInsight (The Business case for the CSeries) from last year has some fuel burn numbers. Without knowing exactly how accurate these are and also keeping in mind that AirInsight assumed 158 seats from the A320neo, let's have a look at them:
For a 500nm mission, AirInsight gets a fuel burn of
But a larger aircraft should burn less per pax anyway -so although the claim is OK as a fact, it only shows that the smaller CS300 is a step ahead - and the A319neo cannot compete on a per seat basis as it is comparable in seat capacity but a lot heavier.
Bottom line: Airbus is not making any false statements here - but the facts presented are no new and eye-watering arguments...
Apart from one obvious typo - the A321 is mentioned as the 2nd variant to become available, but that has changed to the A319 as the 2nd family member recently, there are a few "facts" - or claims- on that sheet that compare cash operating costs compared to today's A320 and the fuel burn of the A320neo with the B737-800W and the CS300. These can be compared to my assumptions made in a recent blog entry called "COC and DOC".
First claim: A320neo has 8% better cash operating costs than today's A320.
Fact check: In the recent blog entry I assumed 9.5% better cash operating costs for a fuel price of $3.00/gallon - 7.5% from lower fuel burn and about 2% from lower maintenance costs. With oil prices in the range of $3.20 as of today, cash operating costs are more like 10% better - so Airbus is not overly optimistic with the 8% assumption.
Second claim: A320neo has 16% less fuel burn per seat than the 737-800W.
Fact check: Assuming 15% reduced fuel burn per trip through the sharklets and the new engines and three more seats, the overall improvement in fuel burn per seat is (153/150)*15%= 15.3%.
If Airbus says that the A320neo is 16% better in fuel burn per seat than the B737-800W it implies that the A320 today would be 0.7% better than the B737-800W. I assmued they are on par, but I guess a difference of 0.7% does not really count.
Third claim: A320neo has the same fuel burn (per seat is obviously meant, though not stated) as the CS300.
Fact check: Let's assume 153 seats on the A320neo and 130 seats for the CS300 in a comparable cabin layout and the same seat pitch. This is a difference of 17.7%, so the fuel burn per trip can be 17.7% higher for the A320neo in order to have the same fuel burn per pax.
A report from AirInsight (The Business case for the CSeries) from last year has some fuel burn numbers. Without knowing exactly how accurate these are and also keeping in mind that AirInsight assumed 158 seats from the A320neo, let's have a look at them:
For a 500nm mission, AirInsight gets a fuel burn of
- 805 gallons for the CS300
- 910 gallons for the A320neo
But a larger aircraft should burn less per pax anyway -so although the claim is OK as a fact, it only shows that the smaller CS300 is a step ahead - and the A319neo cannot compete on a per seat basis as it is comparable in seat capacity but a lot heavier.
Bottom line: Airbus is not making any false statements here - but the facts presented are no new and eye-watering arguments...
3/17/2011
Lufthansa next in line for A320/A321NEO
Lufthansa yesterday revealed that their supervisory board approved the purchase of 25 A320NEO and 5 A321NEO (along with 5 B777F, which is also significant, but another topic).
Why is Lufthansa significant? Firstly, because they have one of the best technical departments of all airlines. If they order an aircraft, often this is a sign for other airlines with less capable aircraft evaluation departments. Secondly, Lufthansa is the first european full service carrier (or "legacy airline" or "flag carrier", what ever one might call it) to commit to the NEO. Before we had two low cost airlines (Indigo, Virgin America), a south american airline (TAM) and ILFC as the first lessor. So the customer base not only gets larger, it gets more diversed, showing the attractiveness of the NEO for different kinds of business models. Well, not really surprisingly, as money savings (through fuel savings) works in every business model. But Nico Buchholz, fleet manager of the Lufthansa Group was to be convinced that the fuel savings are not eaten up by higher maintenance costs for the engines. The engine manufacturers always claimed lower (PW) or same (CFM)maintenance costs for their new engines when compared to their current offerings. But as the engines are running considerably hotter, I can understand why many are a little bit skeptical. We don't know yet which engine LH will have on their NEO's - but at least one of the two engine makers must have convinced them - or both: remember that LH is currently using CFM56 on their A319/A320 fleet and the V2500 on their A321's.
A few weeks ago Buchholz gave a interview to AirInsight where he talked about the CSeries, the NEO, the GTF and LEAP-X. He sounded very optimistic about the GTF and saw no risk in the gear anymore. Well, he (LH) is already a customer for the GTF via the CSeries...
The NEO order does not include any A319NEO. This might be a sign of more orders for the CSeries from Lufthansa, especially for the CS300, in the future - they still have 30 options along the 30 firm ordered aircraft.
This morning I read an article about the ISTAT meeting early this week which was very interesting: apparently the lessors reversed their opinion about the NEO from what they thought prior to the launch last October. They now think that residual values for the "Classic A320" would not immediately fall. I argued in October 2010 after the ISTAT meeting why I think that would not happen.
Even Steve Udvar-Hazy, who had no good word for the NEO last year, said that it was the "most sensible thing" for Airbus to do.
Why is Lufthansa significant? Firstly, because they have one of the best technical departments of all airlines. If they order an aircraft, often this is a sign for other airlines with less capable aircraft evaluation departments. Secondly, Lufthansa is the first european full service carrier (or "legacy airline" or "flag carrier", what ever one might call it) to commit to the NEO. Before we had two low cost airlines (Indigo, Virgin America), a south american airline (TAM) and ILFC as the first lessor. So the customer base not only gets larger, it gets more diversed, showing the attractiveness of the NEO for different kinds of business models. Well, not really surprisingly, as money savings (through fuel savings) works in every business model. But Nico Buchholz, fleet manager of the Lufthansa Group was to be convinced that the fuel savings are not eaten up by higher maintenance costs for the engines. The engine manufacturers always claimed lower (PW) or same (CFM)maintenance costs for their new engines when compared to their current offerings. But as the engines are running considerably hotter, I can understand why many are a little bit skeptical. We don't know yet which engine LH will have on their NEO's - but at least one of the two engine makers must have convinced them - or both: remember that LH is currently using CFM56 on their A319/A320 fleet and the V2500 on their A321's.
A few weeks ago Buchholz gave a interview to AirInsight where he talked about the CSeries, the NEO, the GTF and LEAP-X. He sounded very optimistic about the GTF and saw no risk in the gear anymore. Well, he (LH) is already a customer for the GTF via the CSeries...
The NEO order does not include any A319NEO. This might be a sign of more orders for the CSeries from Lufthansa, especially for the CS300, in the future - they still have 30 options along the 30 firm ordered aircraft.
This morning I read an article about the ISTAT meeting early this week which was very interesting: apparently the lessors reversed their opinion about the NEO from what they thought prior to the launch last October. They now think that residual values for the "Classic A320" would not immediately fall. I argued in October 2010 after the ISTAT meeting why I think that would not happen.
Even Steve Udvar-Hazy, who had no good word for the NEO last year, said that it was the "most sensible thing" for Airbus to do.
2/16/2011
AirAsia eyes A320NEO
News broke yesterday that AirAsia's CEO Tony Fernandes held talks with Airbus COO John Leahy and CEO Tom Enders about a mass purchase of the A320NEO. According to Fernandes the order would be similar in size to the existing order for 175 A320, so expect something like a firm order for 100 and a further 50 options or so to be announced soon. Maybe together with the also "pre-announced" order for more A330's, maybe firmed during the Paris Air Show in June.
If you look at AirAsia and the other two carriers which came forward to order or to sign an LoI for the NEO, it becomes clear who are the prime targets for Airbus when the A320NEO was launched: the fast-growing LCC's in Asia (IndiGo, AirAsia, Tiger) and elsewhere (Virgin America in this case). A few years back the prime targets would have been on different continents - this is a clear sign of how the world has changed in the last decade.
Why are these large LCC's attractive (potential) customers)? They already have (or will have in 2016) large fleets - adding another subtype (in case of the NEO it's "just" another engine) in an equal large scale does not produce a lot of headaches. And by being one of the launch customers for one of the NEO engines, they can bet on getting good deals not only regarding the purchase price of the engines but also for aftermarket packages. Remember IndiGo was the launch customer for the V2500Select.
Even Ryanair, at least in public, talks about adding another type to their B737-800 fleet, altough that might be just chatter get better pricing from Boeing. Southwest though, already having different types of the B737 in their fleet and adding the B717 with the purchase (merger) of airtran can be expected to have a closer look to diversifying the fleet more, but this would, if at all, point more in the direction of the CS300 (or a CS500) to replace the B737-300 and later -700.
So expect to see more big orders for the A320NEO from LCC's - but not only from LCC's...
If you look at AirAsia and the other two carriers which came forward to order or to sign an LoI for the NEO, it becomes clear who are the prime targets for Airbus when the A320NEO was launched: the fast-growing LCC's in Asia (IndiGo, AirAsia, Tiger) and elsewhere (Virgin America in this case). A few years back the prime targets would have been on different continents - this is a clear sign of how the world has changed in the last decade.
Why are these large LCC's attractive (potential) customers)? They already have (or will have in 2016) large fleets - adding another subtype (in case of the NEO it's "just" another engine) in an equal large scale does not produce a lot of headaches. And by being one of the launch customers for one of the NEO engines, they can bet on getting good deals not only regarding the purchase price of the engines but also for aftermarket packages. Remember IndiGo was the launch customer for the V2500Select.
Even Ryanair, at least in public, talks about adding another type to their B737-800 fleet, altough that might be just chatter get better pricing from Boeing. Southwest though, already having different types of the B737 in their fleet and adding the B717 with the purchase (merger) of airtran can be expected to have a closer look to diversifying the fleet more, but this would, if at all, point more in the direction of the CS300 (or a CS500) to replace the B737-300 and later -700.
So expect to see more big orders for the A320NEO from LCC's - but not only from LCC's...
1/21/2011
CSeries impact
Last year I wrote an entry about what the Bombardier CSeries meant for aircraft development. Meanwhile Airbus announced the A320NEO programme on Dec 1st, 2010 and announced first customers. I expect more to come forward in the next weeks and months - by the time the Paris Air Show ends, Airbus could have 500+ orders (or at least MoU-like commitments) for the A320NEO in the books.
If you read how Southwest is now pushing Boeing to clarify it's plans for the B737, you can clearly see how the decision by Bombardier to lauch the CSeries affected the whole development cycle:
Virgin America, the launch customer of the A320NEO, looked very seriously to buy the CS300 - it was only when Airbus came forward with the NEO that Virgin decided to stay with Airbus. So, very clearly: without the CSeries there would not be a NEO to buy!
Boeing has to and will react - until lately I was not convinced that they would do a 737 successor. My thoughts were, like John Leahy, that they would announce a reengining of the 737 soon after a launch of the NEO. In the meantime I am a little bit more convinced that they could announce a new narrowbody. Scott Hamilton recently argued why. If Boeing is right to think that the A350-1000 will enter airline service not before 2019 is on another piece of paper - but if they are convinced, it would make sense to do the narrowbody first - well, if it is a narrowbody! It could also be the long-discussed small widebody, starting at around the capacity of todays 737-800 and going up to the capacity of the 757-300. They would leave the 150 seater market to Airbus and possibly Bombardier (CS500?) and maybe Embraer, but they would have another big market for themselves.
At the EADS press conference CEO Louis Gallois thought loudly about a tie-up between OEM's, as the market place gets increasingly crowded during the next decade. There were speculations then that Airbus could partner with Embraer and Boeing with Bombardier - I could also see some cooperations with the japanese Heavies, as I wrote earlier. All this will not happen this year, but the possibility - and good reasons - are there for it that it will happen sometime.
If you read how Southwest is now pushing Boeing to clarify it's plans for the B737, you can clearly see how the decision by Bombardier to lauch the CSeries affected the whole development cycle:
Virgin America, the launch customer of the A320NEO, looked very seriously to buy the CS300 - it was only when Airbus came forward with the NEO that Virgin decided to stay with Airbus. So, very clearly: without the CSeries there would not be a NEO to buy!
Boeing has to and will react - until lately I was not convinced that they would do a 737 successor. My thoughts were, like John Leahy, that they would announce a reengining of the 737 soon after a launch of the NEO. In the meantime I am a little bit more convinced that they could announce a new narrowbody. Scott Hamilton recently argued why. If Boeing is right to think that the A350-1000 will enter airline service not before 2019 is on another piece of paper - but if they are convinced, it would make sense to do the narrowbody first - well, if it is a narrowbody! It could also be the long-discussed small widebody, starting at around the capacity of todays 737-800 and going up to the capacity of the 757-300. They would leave the 150 seater market to Airbus and possibly Bombardier (CS500?) and maybe Embraer, but they would have another big market for themselves.
At the EADS press conference CEO Louis Gallois thought loudly about a tie-up between OEM's, as the market place gets increasingly crowded during the next decade. There were speculations then that Airbus could partner with Embraer and Boeing with Bombardier - I could also see some cooperations with the japanese Heavies, as I wrote earlier. All this will not happen this year, but the possibility - and good reasons - are there for it that it will happen sometime.
12/08/2010
Is the NEO a threat for the CSeries?
AirInsight published a very detailed report about the CSeries this week. The main question to be answered was, if, after Airbus announced the A320NEO, there would be still a business case for the Bombardier CSeries. Not to my surprise (because of own studies), the answer was: Yes!
The only really big threat for the CSeries, according to the report, would be pricing-power from Airbus and Boeing, which could choose to give away A319NEO and 737-700W (or maybe also a 737-700NEO???) with losses just to protect their market.
There is an additional short piece at AirInsight detailing that threat here.
So how deep has a discount to be to be attractive?
Let's start with the price of the aircraft: let's start with the 41% that Airbus has to give according to the AirInsight article to match a 25% discount by Bombardier.
The AirInsight report comes to the conclusion that for a 500nm mission the CS300 will be $716 lower in costs and $444 lower than a A319NEO. I do not fully agree with the number of seats the report puts down for the various aircraft, so I will not discuss the differences in seat-costs here. Just assume a given flight with a given number of passengers (at or below the maximum of the smallest of the three aircraft), no matter what aircraft you fly.
For an airline, to get a better deal over the full life of the aircraft one should not only take into account the purchase price of the aircraft but the overall costs including operation and maintenance of the aircraft.
Assume there a seven flights per day on 320 days per year (allowing for maintenance) for 10 years - that makes 22,400 flights.
So the difference in operating costs between a CS300 and a 737-700W for these 10 years would be about $16 million, about $9.5 million against the A319NEO.
A big portion of the difference in operating costs is fuel burn - and if the price of fuel goes up ($2.25/gallon was assumed in the study), the operating cost difference goes up as well.
So there would be another big discount needed to make up for those difference in operating costs. If Airbus and Boeing are willing to make these discounts remains to be seen, but I doubt it - although Airbus once made such discounts for the A340-600 to sell it against the B777-300ER.
The only really big threat for the CSeries, according to the report, would be pricing-power from Airbus and Boeing, which could choose to give away A319NEO and 737-700W (or maybe also a 737-700NEO???) with losses just to protect their market.
There is an additional short piece at AirInsight detailing that threat here.
So how deep has a discount to be to be attractive?
Let's start with the price of the aircraft: let's start with the 41% that Airbus has to give according to the AirInsight article to match a 25% discount by Bombardier.
The AirInsight report comes to the conclusion that for a 500nm mission the CS300 will be $716 lower in costs and $444 lower than a A319NEO. I do not fully agree with the number of seats the report puts down for the various aircraft, so I will not discuss the differences in seat-costs here. Just assume a given flight with a given number of passengers (at or below the maximum of the smallest of the three aircraft), no matter what aircraft you fly.
For an airline, to get a better deal over the full life of the aircraft one should not only take into account the purchase price of the aircraft but the overall costs including operation and maintenance of the aircraft.
Assume there a seven flights per day on 320 days per year (allowing for maintenance) for 10 years - that makes 22,400 flights.
So the difference in operating costs between a CS300 and a 737-700W for these 10 years would be about $16 million, about $9.5 million against the A319NEO.
A big portion of the difference in operating costs is fuel burn - and if the price of fuel goes up ($2.25/gallon was assumed in the study), the operating cost difference goes up as well.
So there would be another big discount needed to make up for those difference in operating costs. If Airbus and Boeing are willing to make these discounts remains to be seen, but I doubt it - although Airbus once made such discounts for the A340-600 to sell it against the B777-300ER.
10/01/2010
CSeries expansion
AirInsight today has this piece about the possibility that Bombardier may expand the CSeries family beyond the CS100 and CS300 with CS500 and CS900 called 150- and 190-seaters. While at least the 150 seater would look like a good top end of the product line, the question is how to position it in the marketplace. If the 150 seater should have the same range as the CS100/300 (close to 3000nm), the aircraft would need a larger engine with higher thrust. Therefore Bombardier would have to raise the landing gear - the problem with that is...well, ask Boeing!
But there is another possibility: keep the MTOW at the CS300ER level - how many airlines are out there flying more than 2000nm with today's narrowbody. According to RR just about 3%.
So the CS500 might be a possibility. But I doubt there will be a 5 abreast 190 seater. This would be a too tube - just my two cents.
A driver for the 150 seater could be that Embraer thinks about a new aircraft. If they choose to place their aircraft sizewise above the CS100/300, Bombardier might be forced to react.
Interesting times ahead - Embraer should be ready to announce their plans in the next six months.
But how could Embraer pay for all this? To come up with a good CSeries competitor, they would have to be able to produce a carbon wing, for example. - Maybe they let Brasil, Argentina, Chile, South Africa and some other countries pay for it - via the KC-390 tanker development.
UPDATE: There was a suspension letter filed on October 4th, 2010 for the CS900. A 5 abreast 190-seater would have been a little bit of a too-far stretch, anyway. Or was is meant to be the name for a CRJ900 replacement? Very speculative of course...
But there is another possibility: keep the MTOW at the CS300ER level - how many airlines are out there flying more than 2000nm with today's narrowbody. According to RR just about 3%.
So the CS500 might be a possibility. But I doubt there will be a 5 abreast 190 seater. This would be a too tube - just my two cents.
A driver for the 150 seater could be that Embraer thinks about a new aircraft. If they choose to place their aircraft sizewise above the CS100/300, Bombardier might be forced to react.
Interesting times ahead - Embraer should be ready to announce their plans in the next six months.
But how could Embraer pay for all this? To come up with a good CSeries competitor, they would have to be able to produce a carbon wing, for example. - Maybe they let Brasil, Argentina, Chile, South Africa and some other countries pay for it - via the KC-390 tanker development.
UPDATE: There was a suspension letter filed on October 4th, 2010 for the CS900. A 5 abreast 190-seater would have been a little bit of a too-far stretch, anyway. Or was is meant to be the name for a CRJ900 replacement? Very speculative of course...
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