Fuel burn and operating costs

Obviously, the comments from Boeing’s  Randy Tinseth about reengining and what it means to the operating costs of an aircraft caused some confusion about the relation between fuel burn and operating costs.

Randy Tinseth said that the reengining, widely believed to result in a fuel burn advantage of  13-14% would mean that operating cost would be 3-4% lower than today.

Some people were surprised by this low number (at least compared to the 15% better SFC the engines shall deliver), but it becomes clear, if you put it in perspective:

With a fuel price around $2/gallon, fuel accounts for roughly 40% of the cash operating costs. 14% from 40%....- that’s 5.6% cash operating improvement. Mow all depends on the airlines capital costs to determine the effect on direct operating costs.

But it’s not a too long way to come from 5.6% to 3-4%, so Tinseth’s numbers seem to be in the right range.

The question is, if he is right when he says that these 3-4% would just close the gap between today’s narrowbody families, bringing the A320NEO essentially on par with the B737NG.

I guess that’s there many airlines (and Airbus of course) would disagree. As both aircraft manufacturers as of today own about 50% of the market, I would say that the aircraft are more or less on par - in the end it depends on the exact mission an airline has for the aircraft (stage length, cargo revenue potential, etc.) to decide which one is better for it.

Now: 3-4% does not sound like a lot – does that justify the reengining effort?

Yes! It becomes clear if you take a look at the results of airlines like American or Continental. Taking the numbers from their quarterly filings one can obtain their operating profit and operating margin. As fuel costs are listed separately, you can see what would happen if the whole fleet would be 15% more fuel efficient.

Of course, this is a simplification, but still impressive, I think - it makes Continental in 2009 going from a $147m. loss to a +$350m. operating profit - American would have made an operating loss of (just) $171m. instead of $1004m.

A320NEO vs. B737NG+

Signs are getting clearer that Airbus will proceed with the A320NEO to go ahead and announce that in the coming weeks. Meanwhile flightblogger comes with the news that Boeing has a 3rd way to react (with the 1st being also doing a reengining, the 2nd going with an all new design).


Boeing claims that that the A320NEO would only have a 3-4% operating cost improvement over the existing version. Hard to believe, if one believes the likes of CFM and P&W: 15% fuel burn reduction minus 1-2% through integration of the larger and heavier engines, plus the 3-4% improvement via the sharklets would result in 16-18% reduction in fuel burn. Considering that fuel costs are at 40% of the total COC this would lead to a COC reduction of 6.4-7.2%. If you then believe that maintenance costs are 20% below today’s engines and consider lower environmental costs, Boeing and their B737NG+ will significantly fall behind the A32XNEO, especially the A321NEO will burn the B737-900ER, which even today is a slow seller.
Then consider lower environmental costs, especially for European operators:
a) The inclusion of aviation in the ETS (Emissions Trading System) will add about 12% to the fuel costs.
b) Lower noise fees could save up to 4% COC of a 500nm flight. For example, at Paris CDG Airport an A319 today pays $177 (at $1.30/€) more than the CSeries CS300 will pay for noise. The difference of the A320NEO vs. the B737NG+ would be in the same range.
c) NOx fees at many European airports will also be lower, but this contributes just a few € to the equation.
All in all, Boeing could only sell their B737NG+ for a steep discount, profit margins will fall. At the same time they have to invest (more or less, but probably more) heavily in their most profitable program, the B777, as the A350XWB threatens to eat these margins, with the B787 and the B747-8 being far away from being profitable.

Not a good time to be a Boeing shareholder…

The CSeries and what it already did to aviation

We don't know today if the Bombardier CSeries will ever become a success. But one thing is for sure: it has initiated a maybe never seen activity in aircraft development, if you count re-engining activities as aircraft development.
Airbus and Boeing would never have lost a thought about that matter - and they just started when it became clear that the CSeries would have the potential to eat into their market.
This has a lot to do with the Geared Turbo Fan: Airbus started their re-engining studies only after they tested the GTF-Demo on their A340-600 testbed.
But it does not end with A. and B. - also Embraer today thinks about a re-engine programme for their successful EJet-Series. They feel the pressure that comes with the MRJ70/90 on the low end and the CS100 on the high end of their product line.
A re-engining with the same engines could be a straightforward and low-risk solution. Why:
a) The GTF works as advertised. Then the E170/175RE with the "MRJ GTF" would regain it's leading position, as the MRJ70 is (somewhat surpringsingly) heavier than the EJets, so that with the same engine and (probably) a new wing, as Embraer would have to redesign the center wing box to accomodate a longer gear anyway would provide less fuelburn. The same would be true for the E190/195RE against the CS100. For routes typically flown by the EJets (<1000nm), they would be unmatched in fuel burn. Embraer would have the market for themselves.
b) The GTF does not work (which is, from my perspective unlikely, but let's just play the game...): then there is no competion to the EJets anyway and they can flip back to the CF34  - the MRJ is dead, the CSeries is dead, BBD can't do anything to keep the CRJ family competitive as they are financially burdened with the CSeries, the Lear85, a Global successor and maybe the Q400X, the SSJ100 will not have a big impact in the western markets.
c) Embraer decides to take another engine, either a CFM/GE LEAP-X/TECH-X or a RB282 from RR: then there is the risk that the GTF works but the alternative fails - and Embraer is out of the market altogether.

But there is also the possibility that Embraer decides to develop a whole new aircraft. Probably to compete with the CSeries. Then there is the danger that it will be a "me-too" aircraft. They will probably go a little bit higher in capacity than the CS300 (see B787 vs. A350XWB), as aircraft tend to get biger anyway. But they would then also compete heavily against A. and B., so they would have to bet on new narrowbody aircraft families by A. and B. coming earlier than it is expected today. These aircraft families then would probably start at the size of todays A320 and 737-800, so that there would not be any direct competition to the new potential Embraer Jet.

Enough food for thought for today - whatever Airbus as the catalyst for all what is coming after that decides  - and annouces - in the coming weeks: it will lead to a series of decisions to make by all others involved.

Meantime - good luck to Bombardier: they are the ones we have to thank for all the debates we can do today ;-)

Have a nice sunday!

Don’t consider Pratt being dumb…

Again the “usual suspect”, writing on the GLG website, tries to tell us that P&W would be dumb enough to develop separate engines for the MS-21 and the A320NEO. He believes to know that the MS-21 (still – more or less – in the definition phase) needs 32klbf of thrust - and the fact that the A321 has a max. thrust of 33klbf drives him to the conclusion that P&W would have to start the design of a fourth engine to cover the A32XNEO thrust range.


Now – if you would be an engine maker: would you do that? Or would you design one engine that covers the full range up to 33klbf – especially as Airbus seems to be the far more important customer than the Russians?
Interestingly he does not see the need for CFM to come up with two different engines for the C919 and a potential B737 re-engining – just because a CFM official told him that the LEAP-X1C would fit under the wing of the B737. The C919 needs around 30klbf of thrust – the stretch version to be introduced later even more, far more than the B737 needs, so that the LEAP-X1C would be far being the optimal solution for the B737 – it seems that it would be better matched for the A32XNEO needs.
This might be an explanation why Boeing seems so skeptical about the re-engining.

But let’s wait what we hear out of Chicago after Airbus announced what they will do – I expect this to happen in late September or October…

aeroturbopower

The „war of words“ on the GLG website

The GLG website is a big fairground for those who wish to tell the audience what they think about the two engines currently in development for the new or re-engined narrowbodies. I found the most of the claims that are being made in the recent “expert contributions” as just plain wrong or as misunderstandings.


Take the contribution “CFM International LEAP-X Engine Anything But A Derivative” as an example. This article is nothing as plain anti-rhetoric against P&W’s GTF and pure PR for the LEAP-X, but has nothing to do with an objective analysis.

Both engines feature (or will feature) a complete new core, both will have a 2 stage HPT.

One can guess that the HPC of the LEAP-X is a scaled-down and advanced version of the GEnx HPC and the same is true for the HPT. New materials further improve the performance of the core, as less cooling is needed as with conventional materials. What we don’t know is if the HPT would basically need more cooling air than the GEnx HPT as it probably runs even a little hotter. This is unusually for a narrowbody engine, as maintenance costs play a significant role here in the equation.
The core of the GTF is all new and was already tested successfully (if you want to believe the PR from P&W).
Now take a look at the comparison the author makes:

He states that the baseline thrust of the GTF starts at 21,000lbs – wrong as the MRJ engine starts at about 15,000lbs for the MRJ70. The engine for the CSeries starts at 21,000lbs and the proposed engine for the A320NEO covers the full range of the thrust needed for the Airbus narrowbody family up to 33,000lbs. This engine would have an up-scaled core from the CSeries engine, as the NG34 (or TECH-X) from GE would get a scaled-down core from LEAP-X.

If the author would be right when he writes that the baseline thrust for LEAP-X would be 30,000lbs (for the C919), CFM would have a hard time to sell that engine to Boeing, as the B737 does not need more than 27,300lbs today and a downrated engine would be sub-optimal for the B737. So CFM might have to come up with a separate engine (maybe with a smaller core) to cover Boeing’s thrust needs.

If one claims that the GTF architecture is forty years old as the author does, he has to call the architecture of the LEAP-X at least forty years either, as it is nothing less but nothing more than a 2 spool turbofan.

SFC reduction for both is in the same range. CFM gives a certain number, P&W gives something like a range, but in the end they will end in the same area – it’s coming down to physics.

Please, bloggers, experts and who-else-writes-about engines: let’s do not just play CFM vs. P&W, just as others always play A. vs. B. on the aircraft side. It might be fun when you start but soon turns boring.