White House says Trump has worked out a $3.9B Air Force One deal with Boeing

President Donald Trump has reached a deal with Boeing to have the company supply a pair of 747s for Air Force One planes, the White House announced Tuesday according to Reuters.

The deal is worth $3.9 billion, according to the report.

“President Trump has reached an informal deal with Boeing on a fixed price contract for the new Air Force One Program,” Deputy Press Secretary Hogan Gidley told Reuters.

Reuters said Gidley said the contract would save taxpayers more than $1.4 billion. But Reuters said it could not independently confirm that figure.

The announcement comes a five days after a defense industry publication reported that Boeing is in final negotiations for a multibillion-dollar deal to modify two Boeing 747 jets into Air Force One aircraft.

Last year, Boeing won a $600 million contract to do early design work on the next generation of Air Force One aircraft. The Air Force bought two 747-8 jumbo jets that were being stored in the Mojave Desert after their original buyer, a Russian airline, went bankrupt and never took delivery.

(Greg Lamm - Puget Sound Business Journal)

JetBlue talks pick up with planemakers over replacing jets

Jet Blue Airways met with Canadian planemaker Bombardier and also had plans to meet with Brazil's Embraer this month, according to an internal email reviewed by Reuters, in a signal that talks are picking up for the U.S. airline's closely watched sales campaign.

Low-cost carrier JetBlue has previously said it is weighing whether to replace its fleet of about 60, 100-seater E-190 jets, in a campaign pitting Bombardier's CSeries against its Brazilian rival's latest model, the E190-E2.

JetBlue officials also met Bombardier Chief Executive Alain Bellemare at the company's Montreal-area plant on Monday, said an industry source, confirming earlier media reports. The source said JetBlue had not finalised a deal with either planemaker.

A spokeswoman for Bombardier declined to comment on a sales campaign.

JetBlue said in a statement it is "exploring a full range of options from maintaining the current fleet to a full replacement with an alternative aircraft type."

Embraer is determined to keep JetBlue as a key customer, while Bombardier wants to grow sales in the United States after a trade agency ruled the Canadian plane-and-train-maker could sell its 110-to-130 seat CSeries to American carriers duty-free following a dispute with Boeing.

The Feb. 17 email says "the Bombardier team was in to discuss product support and maintenance for its C Series. And later this month, we’ll have a chance to take a close-up look at the Embraer E2."

It was not clear whether JetBlue already saw the E2 and a spokesman for Embraer could not immediately answer Monday night.

In January, JetBlue said it would prolong an internal review over the future of its fleet at a time of an evolving landscape for commercial aviation. Embraer is now holding tie-up talks with Boeing and Bombardier is working to complete a deal giving a majority stake in the CSeries to Airbus.

(Allison Lampert & Alana Wise - Reuters)

SaudiGulf considers 787 model in Boeing talks - CCO

Talks between SaudiGulf Airlines and Boeing could include deals for the 787 Dreamliner, the Saudi carrier's chief commercial officer said on Monday.

The privately owned airline signed a preliminary agreement for 16 Boeing jets last May during a visit to Saudi Arabia by U.S. President Donald Trump.

SaudiGulf's Chief Commercial Officer Karim Makhlouf said that the agreement covers talks for the 787-9 and 787-10 or the 777-200 and 777-300 jets. The airline previously said the deal could include Boeing 777s.

SaudiGulf operates a fleet of four 136-seat Airbus A320s on six domestic routes and will launch its first international flight to Dubai, United Arab Emirates, on March 1.

Two Airbus A320 or larger A321 jets will be added to its fleet this year to launch flights to Pakistani cities Islamabad, Lahore, Peshawar and Sialkot.

"We are in good talks with Boeing," Makhlouf told Reuters in an interview in Dubai.

The wide-body aircraft could be delivered within the next three to four years, he said.

SaudiGulf has not indicated exactly which aircraft it intends to take and the talks have not yet produced an order.The airline aims to fill at least 70 percent of its seats this year, up from 65 percent in 2017, and plans to increase usage of its planes to at least 12 hours a day in 2018, up from about 11 hours last year.

The airline is also in talks with Airbus and Boeing to buy A320s or Boeing 737s to build a narrow-body fleet of about 30 jets, Makhlouf said.

It is still considering whether to take delivery of 16 Bombardier CS300s ordered prior to SaudiGulf's launch in 2016, he said.

SaudiGulf, owned by the Abdel Hadi Al-Qahtani & Sons Group, is Saudi Arabia's youngest airline, having started domestic operations in October 2016. It competes against state-owned Saudi Arabian Airlines and discount operator Flynas, as well as smaller carriers, in a domestic market of 32 million people.

(Alexander Cornwell - Reuters)

Tyrolean Technik to end turboprop MRO business after 38 years

(Bombardier)

Tyrolean Technik, a fully owned subsidiary of Austrian Airlines, will downsize its Innsbruck maintenance and repair operations (MRO) by the first half of this year by terminating MRO work on the Bombardier Dash 8 Q400 as business declines and cost rises for the type.

A spokesperson told ATW the company is considering transferring its Q400 MRO business to either Lufthansa Technik (Malta or Sofia) or Austrian Technik Bratislava.

Aircraft line maintenance will continue to be carried out locally.

Tyrolean Airways’ maintenance arm Tyrolean Technik began turboprop operations in 1980 and became an Austrian Airlines subsidiary in 2014.

“Due to increasing passenger volumes, the deployment of this very special and small aircraft type has been on the decline for years. This situation is intensified by the decreasing number of maintenance orders and uncertainties in the field of heavy maintenance, most recently triggered by the [2017] Airberlin bankruptcy,” Tyrolean Technik co-managing director Wolfgang Henle said in a statement.

Airberlin operated Dash 8s and was one of the biggest customers at the Innsbruck site.

The move affects 80 out of 110 Innsbruck workers.

“We have been assessing the situation for a long time. The bottom line is that we cannot bear the millions in additional costs for heavy maintenance, so we have decided to downsize operations in Innsbruck,” CEO Kay Kratky said. “We have offered a job in Vienna to all affected employees.” 

(Kurt Hofmann - ATWOnline News)

Hawaiian Airlines adjusts summer schedule on A321neo delivery delays

Hawaiian Airlines is experiencing a further operational and planning disruption because of Airbus A321neo delivery delays related to issues with the Pratt & Whitney PW1100G geared turbofan (GTF) engine.

The carrier has had to remove two seasonal flights from its summer schedule and defer the start of a new route because of the A321neo delays. Hawaiian currently operates two A321neos, but was relying on further deliveries to start the affected flights.

Hawaiian is not yet able to provide an estimate for when its remaining A321neos will be received. “While we anticipate some delays with upcoming deliveries, it is too early to know how they will be affected throughout the year as Airbus is currently adjusting its schedule to account for Pratt & Whitney’s engine retrofitting and production,” an airline spokesperson said.

The Honolulu-based carrier is scheduled to receive a total of 18 A321neos fitted with the PW11000G engine.

GTF-powered A320neo family aircraft on order are also experiencing delivery delays. Airbus stopped delivering GTF-powered neos after an issue arose in early February with the engine’s high pressure compressor (HPC) aft hub knife-edge seal that prompted an emergency airworthiness directive (EAD) from the European Aviation Safety Agency (EASA). Pratt has developed a fix that is expected to enable GTF-powered A320neo family deliveries to resume in April.

A321neo delivery delays also caused operational headaches for Hawaiian late last year. The airline had wanted to introduce its first A321neos into service before its winter peak season, but was not able to do so. The airline intends to use the new type on its network between Hawaii and the US mainland, replacing wide-bodies on some flights and also opening new routes.

The flights removed from the summer schedule are an extra flight between San Francisco and Honolulu and a flight between Oakland and Kona. Service between Oakland and Lihu’e was slated to start April 11, but has been deferred until July 15. 

(Adrian Schofield - ATWOnline News)

US flights form part of Gulf Air’s long-term strategy

Bahrain-based Gulf Air has detailed its corporate strategy for the five years to 2023, which will see it take delivery of 39 new aircraft and ultimately expand its network to the US.

The plan, which follows a 360-degree strategic review, has seven pillars: safety, network growth, innovation, HR, customer focus, revenue versus cost and the airline’s role as a national economic asset.

In 2018, Gulf Air will receive five Boeing 787-9s and two Airbus A320neos, as the 39 aircraft that it has on order start to arrive. A new business class cabin will be rolled out, aimed at competing with rival airlines’ first-class products, along with new branding.

This year, eight destinations will join Gulf Air’s network, Bangalore and Calicut in India, Abha and Tubuk in Saudi Arabia, Alexandria and Sharm El Sheikh in Egypt, Baku in Azerbaijan and Casablanca in Morocco. Frequencies will also be added on key routes.

New Gulf Air CEO Krešimir Kučko said the airline plans to strengthen its “regional base,” before adding flights to Asia Pacific, Europe, Africa, the Indian subcontinent and—ultimately—North America.

By 2023, Gulf Air’s network will span over 60 destinations, up from the current 42.

Gulf Air operates a fleet of 28 narrow and wide-body aircraft.

(Victoria Moores - ATWOnline News)

Westjet Boeing 737-6CT (34288/1931) C-GBWS

This somewhat rare aircraft (Only 69 built of this NG variant), arrives at Los Angeles International Airport (LAX/KLAX) on February 24, 2018. The aircraft was delivered to the carrier on April 28, 2006, ex-Boeing N1786B.

I flew on this aircraft between Edmonton International Airport (YEG/CYEG) and Vancouver International Airport (YVR/CYVR) on August 18, 2009.

(Photo by Michael Carter)

Emirates Airline boss reveals that the nastiest feud in the airline industry could kill his $76 billion Boeing order

Emirates Airline president Sir Tim Clark believes the US aviation industry could become a victim of the trade dispute centered around the Open Skies agreements that govern air travel between the US and the United Arab Emirates where his airline is based.

The US Airlines led by American, Delta, and United have accused Emirates, Etihad, and Qatar Airways of receiving more than $50 billion in state aid over the past decade. Something the Middle Eastern carriers have vehemently denied.

According to the US carriers, this is a violation of Open Skies and would like to see the agreements re-evaluated.

This, Clark believes, threatens to weaken the network of Open Skies agreements that have served the aviation industry so well over the past couple of decades.

"There are those in the United States who would like to see a shut down of the Open Skies," Sir Tim said in a recent interview with Business Insider.

However, if the Open Skies agreements are scrapped or made more strict, it may take a toll on the US economy and the US aviation industry, specifically.

"When the US went Open Skies I thought it was the best thing because if the US had done it then everybody would follow suit," Clark told us.

Indeed that's what has happened. Since 1992, the state department has signed more than 120 Open Skies agreements that have opened up air travel into and out of the US.

"I know that as a result of what they did, the number of planes Boeing sold went nuclear," Clark declared. "Because the number of aircraft sold was a direct function of the Open Skies versus closed skies relationship."

In the 26 years since the first Open Skies agreements were signed, Boeing has sold an average of 10% more planes a year than it did in the five years prior to the treaties.

Emirates is one of Boeing's most lucrative customers. Not only does the airline buy in bulk, it buys Boeing's most expensive products in bulk. Emirates operates nearly 170 Boeing 777 airliners, the largest fleet of its kind in the world by a large margin.

In 2013, Emirates agreed to an order for 150 of Boeing's next-generation 777X jets worth a record $76 billion. Although it is believed Emirates received a healthy discount from Boeing as the plane's launch customer. In addition, Emirates signed a $16 billion deal with GE Aviation to service and maintain the 300 GE9X engines that will power the 150 777Xs.

According to Clark, the whole Open Skies system is put in jeopardy if the US decides to go after the agreement with the United Arab Emirates and Dubai.

So what happens if the Open Skies agreements are rolled back and restricted?

"For one thing, I certainly won't need those 150 planes," Clark said in regards to his record-breaking order.

(Benjamin Zhang - Business Insider)

Mysterious abandoned Boeing 737 is turning into a tourist destination

(Google Maps)

An abandoned plane is sitting in the middle of a field in Bali, and the mystery on everyone’s minds is how it got there.

The Boeing 737, which sits off the Raya Nusa Dua Selatan highway, five minutes from the beach, is something of a tourist attraction these days, News.com.au reported.

The plane itself has no branding, so it is unclear whether or not it belonged to an airline. Some people speculate that the surrounding shipping containers concealed it from view for a while, according to The Sun. Others have theorized that the plane was meant to be converted into a restaurant, but the owner ran out of money and abandoned it.

Now, it sits behind private gates and is protected by a security guard. Tourists who want to see it must buy tickets and very few actually get to see what’s on board. Some visitors and travel bloggers have tried to get up close to the plane, to no avail.

With no leads on its origin or the fates of the crew members and passengers, the plane remains just another mysterious attraction by the side of the road.

(Andrea Romano - Fox News / Travel + Leisure)

_____________________________________________________________

The aircraft is not unknown as the story indicates, but has a rather long and interesting history. The Fox News story is another in a long line of inaccurate reports by the mainstream media and why we should not to let reporters who know nothing about aviation write about it as if they do.

Michael Carter
Editor
Aero Pacific Flightlines

I have compiled the aircraft's history below:

4X-BAC	Boeing 737-2E7(A)	Arkia - Israeli Airlines	15. Mar 1983		2x PW JT8D-17A
G-BLDE	Boeing 737-2E7(A)	Dan-Air London	22. Dec 1983		2x PW JT8D-17A
4X-BAC	Boeing 737-2E7(A)	Arkia - Israeli Airlines	26. Mar 1984		2x PW JT8D-17A	leased from Dan-Air London
G-BLDE	Boeing 737-2E7(A)	Dan-Air London	22. Apr 1984		2x PW JT8D-17A	ret
PK-RII	Boeing 737-2E7(A)	Mandala Airlines	15. Mar 1993		2x PW JT8D-17A	Preserved Nusa Dua, Bali, Indonesia

Hawaiian Airlines Will Buy Boeing's 787-9 Dreamliner, and It Makes No Sense

Boeing just pulled off a huge coup in its home market. It has convinced Hawaiian Holdings to cancel a firm order for six Airbus A330-800neos and order Boeing's 787-9 instead, according to Scott Hamilton of Leeham News and Comment.

This is an important win for Boeing. While Hawaiian Airlines had an all-Boeing fleet just a decade ago, it has become a repeat customer for Airbus in recent years. However, from Hawaiian's perspective, adding further complexity to the fleet is a bizarre choice. 

Hawaiian Airlines had a clear fleet strategy

Hawaiian Airlines is currently nearing the end of a fleet transition that has lasted for much of the past decade. The carrier will retire the last of its Boeing 767s by the end of 2018. For the most part, they have been replaced by Airbus' A330-200 -- a plane that's roughly 10%-15% larger, has somewhat more range, and can carry significantly more cargo.

More recently, Hawaiian Airlines has added the Airbus A321neo to its fleet. The A321neo is much smaller than the 767, is vastly more fuel efficient, and will be an ideal fit for some of the carrier's lower-demand routes between the West Coast and Hawaii.

In the past year, Hawaiian's management has touted that the carrier finally has the right planes for the right markets. The Boeing 717 is a perfect fit for its short-haul routes within Hawaii, the A321neo is ideally suited to the West Coast-Hawaii market, and the A330 will cover the rest of Hawaiian's route network -- particularly flights to Asia and the South Pacific.

One potential weak point of Hawaiian's fleet strategy is that the A330 is a 25-year-old aircraft platform. However, Airbus addressed this concern in 2014 when it decided to develop a re-engined A330neo that will virtually eliminate the fuel-efficiency advantage of Boeing's 787 Dreamliner. A330neo deliveries are set to begin later this year. 

Hawaiian waffles on the A330neo

Hawaiian Airlines ordered six A330-800neos soon after Airbus started selling the re-engined models. However, while the larger A330-900neo variant has been moderately successful -- albeit far from a blockbuster, with 214 firm orders as of last month -- Hawaiian is currently the only customer for the A330-800neo.

This made Hawaiian's management nervous, as "orphan" aircraft are more difficult to maintain, finance, and resell. As a result, the company began rethinking its decision last fall.

Hawaiian Airlines considered both the Boeing 787 and Airbus' A350-900 as alternatives to its A330-800neo order. While the company claims that it hasn't committed to any aircraft deal, multiple sources have indicated that it's buying the 787-9 Dreamliner from Boeing.

Why not the A330-900neo?

Hawaiian's preference for the 787-9 over the A350-900 and the A330-800neo makes sense. The lack of interest for the A330-800neo from other airlines is a big mark against that airplane, while the A350-900 is simply too large for Hawaiian Airlines.

However, the A330-900neo would be roughly equivalent in size to the 787-9, while maintaining commonality with the existing A330-200 fleet. This would offer significant cost advantages in terms of pilot training. While Boeing reportedly offered extremely aggressive pricing on the 787-9 to secure the order from Hawaiian Airlines, Airbus could have beaten that price due to the low production cost of the A330neo. It doesn't seem that Hawaiian seriously considered this option, though.

The 787-9's one real advantage over the A330-900neo is additional range. Hawaiian Airlines' management has talked about the possibility of flying nonstop to London, which is more than 7,000 miles from Honolulu. Yet flying to London hardly seems like an urgent priority. At its 2016 investor day, Hawaiian Airlines identified 18 potential new destinations that are all within the range of the A330-200 or the A330-900neo.

What it means for investors

Ordering the 787-9 isn't necessarily a bad move for Hawaiian Airlines. The 787-9 should reduce unit costs significantly on Hawaiian's longer routes, such as Honolulu-New York and Honolulu-Sydney. It's just perplexing that a company with less than $3 billion of annual revenue would want to take on the complexity of adding yet another aircraft type to the fleet when there was no clear need to do so.

On the bright side, this move should push back some capital spending. Hawaiian's A330-800neo deliveries were scheduled to begin next year, whereas the 787-9 probably isn't available until at least 2020. This will free up some cash for Hawaiian Holdings' share-buyback program.

From Boeing's perspective, getting a Dreamliner order from Hawaiian Airlines is a solid win, even though the initial order is only for six aircraft and the price was low. First, the 787-9 is set to be Hawaiian's growth platform for long-haul routes, which could lead to further orders down the road. Second, if Boeing eventually upgrades the Dreamliner with new engines, it will be in good position to win a replacement order for Hawaiian's fleet of 24 A330s in the 2030s.

Meanwhile, Airbus is the clear loser here. Hawaiian's decision to abandon its A330neo order puts further pressure on an aircraft program that hasn't gotten much support from airlines. Lining up more A330neo customers should be the top priority for Airbus' sales team in 2018.

(Adam Levine-Weinberg - The Motley Fool)

Qatar Airways' new plane battles jet lag with ambient light, hospital-grade air filters

A sleek new plane designed with customer comfort in mind hit the skies this weekend.

Qatar Airways unleashed its new A350-1000 with premium airplane upgrades on Saturday between London and Doha, Qatar.

The new aircraft boasts millions of ambient anti-jet lag LED lights, hospital-grade air filters, and the lowest cabin altitude in an airplane on the market, the Daily Mail reports. Cabin altitude is what scientists identify as attributing to jet lag symptoms – feeling of fatigue and shortness of breath – at 6,500 feet. The A35-1000 maintains an altitude of only 6,000 feet.

The plane also claims the quietest twin-aisle cabin, larger overhead bins, higher ceilings and window seats where every seat has a window.

And these perks are just in economy – business class is treated to even swankier digs with the Qsuite seats, which offer the first-ever in-flight double beds for those on long-haul flights who want to recline and take a snooze.

“Qatar Airways always demands the very best for its customers, so it is right that we are the first airline in the world to fly the Airbus A350-1000,” said Qatar Airways Group Chief Executive, Mr. Akbar Al Baker to the Daily Mail.

“This remarkable state-of-the-art aircraft will become a firm part of Qatar Airways fleet and will keep us ahead of the curve, allowing us to continue to offer our passengers outstanding levels of comfort and service,” he added.

Though the passenger-focused flight isn’t just about customer comfort. Fabrice Brégier of Airbus said the new carrier is fiscally practical, as well.

(Alexandra Deabler - Fox News)

Ethiopian Airlines adds Airbus A350 XWB flight simulator

Ethiopian Airlines has finalized the installation of an Airbus A350 XWB full flight simulator (FFS), becoming the first FFS operator of the type in Africa. The device is fitted with a full electrical motion system.

Ethiopian operates seven A350-900s with 17 on order.

Ethiopian Airlines Group CEO Tewolde Gebremariam said the introduction of the A350 XWB FFS is “a continuation of our pioneering role in African aviation technology” and is “part of our Vision 2025 strategic roadmap to be fully self-sufficient in the provision of pilot training in all the aircraft type we operate.”

The A350 XWB simulator, which is in the flight operations building at Addis Ababa Bole International Airport, complements five other FFSs, including Boeing 787, 777, 737NG, 757/767 and Bombardier Dash 8 Q400. The company also plans to add a Boeing 737 MAX FFS.

Ethiopian have invested over $125 million in the last seven years to expand and upgrade its training capabilities.

(Kurt Hofmann - ATWOnline News)

Eviation Aviation picks battery supplier for all-electric regional

Alice concept
(Eviation Aviation)

Israeli startup Eviation Aviation has selected South Korea’s Kokam to supply lithium-polymer batteries for its initial Alice all-electric regional aircraft, and hopes to fly a full-scale prototype by early 2019.

Eviation CEO Omer Bar-Yohay said Kokam supplies a “stable, safe, high energy-density” cell in a pouch form factor that allows Eviation to pack a large battery into the airframe of the nine-passenger Alice. Kokam supplied the batteries for the Solar Impulse 2, which flew around the world on solar power in 2015-16.

Using the Kokam cells, which have an energy density of 260 Wh/kg, Eviation will build up a battery system with a capacity of 900 kWh. This will give the Alice a range of 650 nm at a cruise speed of 240 kt. and 10,000 ft., Bar-Yohay said.

“We are claiming 1,000 km [540 nm] range so as not to over-promise, and the Alice will have that range from the get-go,” he said. Range will improve with battery technology but, “The first few aircraft will use Kokam batteries,” he said. To achieve that range, the battery will be tightly integrated into the structure and will make up about half of the aircraft’s weight. “[The pouch format] allows us to fit the dimensions of the cell to what we need to better optimize capacity,” Bar-Yohay said. “We are building a big battery so as not to over-stress it.”

“We are building the full-scale aircraft as fast as we can,” Bar-Yohay said. “We expect to test the drive-train by the end of the summer and the integrated system—batteries, motors and controllers with the fly-by-wire flight controls—within 2018. Flight test will be in late in 2018 or early 2019.” 

(Graham Warwick - Aviation Week / ATWOnline News)

Emirates to restore A380 service to Houston

Emirates Airline will resume its flagship Airbus A380 service between Houston, Texas, and Dubai from June 1, after the rise in oil prices improved the route’s viability.

The move is one part of a raft of recent adjustments by the Dubai-based carrier to its US services.

The airline is launching a nonstop Dubai-New York Newark service from June 1 and plans to resume daily services to Fort Lauderdale and Orlando, Florida, from March 25.

Houston has been part of Emirates’ route network since December 2007, but the A380 that was brought onto the service in December 2014 was replaced with a Boeing 777-300ER in July 2016, when the global oil price was slumping.

International services to Houston, one of the world’s centers for the oil industry, are susceptible to lower oil prices, which tend to produce lower activity in the hydrocarbon sector. This is reflected in less international travel between the Texan city and oil-producing areas such as the Middle East and nations surrounding the North Sea.

With the energy sector recovering, Emirates has decided to reinstate the A380, in line with commercial demand.

The Emirates A380 on the Houston route will offer 516 seats: 14 private suites in first class, 76 flatbed seats in business class and 426 in economy. This gives more than 160 extra seats compared to the Boeing 777-300ER.

Emirates currently serves 12 points in the US. Given the long-running discontent among some US majors over unfair competition by Emirates, Etihad Airways and Qatar Airways—which all three carriers deny—Emirates stressed as it announced the return of the A380 that of the 80-plus destinations on its Middle East, Africa, and Asia Pacific network, 67 are not directly served by any US carrier.

(Alan Dron - ATWOnline News)

Boeing's 737 MAX 9 Wins FAA Certification, but It's Already Dead in the Water

Boeing's 737 MAX 9 was certified by the FAA last week.
(Boeing)

Boeing's 737 MAX 9 -- the second variant of its upgraded 737 MAX family of single-aisle planes -- is finally ready for action. Last Friday, the aerospace giant announced that the FAA had issued an amended type certificate for the MAX 9. This will allow Boeing to begin deliveries to customers, including rapidly rising Southeast Asian carrier Lion Air and United Continental.

However, the 737 MAX 9 hasn't sold very well. Further, Boeing launched a slightly larger model last year (the 737 MAX 10) to better compete with the Airbus A321neo. The 737 MAX 9 now fills a tiny niche between the 737 MAX 8 and 737 MAX 10, which will make it very difficult to gain additional orders.

Boeing's 737 mistake

Boeing's outgoing generation of 737 jets came in four basic sizes: the 737-600, 737-700, 737-800, and 737-900. The smallest model (the -600) sold very poorly, with fewer than 100 orders. By contrast, the 737-800 and its variants accounted for more than 5,000 orders -- roughly three-quarters of the total. The 737-700 and 737-900 size classes both sold in respectable numbers as well, with more than 1,200 orders for the former (including business jets) and nearly 600 orders for the latter.

Not surprisingly, when Boeing designed an upgrade program for the 737, it dropped the smallest model. However, it left the other three model sizes unchanged, which proved to be a mistake.

The 737 MAX 7 attracted little interest from airlines, as its relatively small size means unit costs are higher. Boeing eventually changed the MAX 7's specifications to add 12 more seats, while increasing its commonalities with the 737 MAX 8 to reduce development costs.

Demand for the 737 MAX 9 was a little better, but still underwhelming. Boeing doesn't provide an official breakdown of its 737 MAX orders by variant, but one third-party analysis pegged the number of MAX 9 orders at approximately 410 as of a year ago. For comparison, Airbus currently has 1,920 orders for its competing (but somewhat larger) A321neo.

Stuck in the middle

At last year's Paris Air Show, Boeing launched the 737 MAX 10, a model that can fit 12 more seats than the MAX 9. The MAX 10 has roughly the same capacity as Airbus' A321neo, and will likely have similar unit costs.

The 737 MAX 10 has superseded the MAX 9 in Boeing's product lineup. 

(Boeing)

Not surprisingly, airlines and aircraft leasing companies responded much more positively to the 737 MAX 10 than to the MAX 9. Boeing garnered 361 orders and commitments for the 737 MAX 10 in the span of a week during the air show.

In theory, it might have made sense for Boeing to scrap the 737 MAX 9 in favor of the MAX 10, just as it had abandoned the original 737 MAX 7 concept. Unfortunately, by the time it made the decision to go ahead with the 737 MAX 10, the MAX 9 was less than a year away from entering service. In other words, it was too late to completely change course.

This has left the MAX 9 in a no-man's land where it isn't likely to get more orders. (In fact, the size gap between the 737 MAX 8 and 737 MAX 10 is less than the gap between the A320neo and A321neo.) Most airlines prefer the 737 MAX 8, which hits a sweet spot in terms of the trade-offs between size, unit costs, and performance. Meanwhile, airlines that want to minimize unit costs will move all the way up to the 737 MAX 10, bypassing the MAX 9.

Orders melting away

The tough outlook for the 737 MAX 9 can be seen from the evolution of United Continental's fleet plan. Back in 2012, the carrier ordered 100 737 MAX 9s, making it one of the two primary customers for that variant (along with Indonesia's Lion Air).

However, United converted 39 of those orders to the 737 MAX 10 last June, along with another 61 737 MAX orders that didn't previously have a variant specified. United Airlines will still add the 737 MAX 9 to its fleet starting this year, but that's probably just because the 737 MAX 10 won't be available until 2020. Going forward, the MAX 8 and MAX 10 look like better fits for the carrier's needs.

Lion Air has also ordered some 737 MAX 10s. While it did so as a new order rather than a conversion, this suggests that it won't have as much need for the 737 MAX 9 in its long-term fleet plan as previously expected.

Many other Boeing customers converted smaller numbers of existing 737 orders to the MAX 10 last year, hollowing out the 737 MAX 9 backlog even further. Once 737 MAX 10 production ramps up in the next few years, the 737 MAX 9 will have lost most of its (limited) appeal. As a result, its production run could come to a premature end within the next five years or so.

(Adam Levine-Weinberg - The Motley Fool)

ATSG-Precision A321 Freighter on track for 2019 deliveries

US air cargo company Air Transport Services Group (ATSG) still aims to receive type certification for its Airbus A321 converted freighter by 2019, says chief executive Joe Hete.

The Ohio-based company also anticipates substantial demand for the aircraft specifically because it has significantly more cargo volume capacity than Boeing 737 freighters.

Produced by ATSG in partnership with Oregon-based conversion company Precision Aircraft Solutions, the A321-200PCF should be available to customers in "the latter half of 2019", Hete says during an investor conference hosted by Stifel on 13 February.
Ads by ZINC

Though Boeing freighters currently compose the bulk of the world's narrow-body freighter fleet, the A321 converted freighter will have 25% more cubic cargo capacity than the 737-800F, says Hete.

It will have capacity to carry 14 cargo containers, compared to the 737-800F's 11-container capability, he notes.

Carriers specifically need more cargo volume, rather than payload, due to heavy demand for shipments of relatively light e-commerce products, says Hete.

"The cubic capacity is the thing that you max the aircraft out at long before you ever get up against the weight carrying capabilities," he says. "[The A321 freighter] makes a lot of sense in the burgeoning e-commerce sector because density is an issue, not the weight-carrying capability of the aircraft."

"We see it as a very high growth potential in the coming years," Hete adds.

(Jon Hemmerdinger - FlightGlobal News)

Qantas Airways sees record half year profits

Australia's national flag carrier, Qantas Airways, has posted record profits for the six months to December.

The firm, which has been through a major restructuring in recent years, booked underlying profits of 976m Australian dollars (£547.m; $761.48m).

Three years ago, the flying kangaroo, as the airline is affectionately known, posted record losses .

Its turnaround to profit is seen as one of the biggest in Australia's corporate history.

"Today's result comes from investing in areas that provide margin growth and a network strategy that makes sure we have the right aircraft on the right route," chief executive Alan Joyce said.

The half-yearly result marks a 14.6% jump in underlying profit from the same period a year earlier and comes amid higher fuel costs and stiffer competition on the domestic front.

The airline's underlying profit is the measure most closely watched by analysts and investors. The firm's Sydney-listed shares closed higher, up by nearly 6%.

The firm said overall revenue and other income rose 6% to $8.66m over the same period. It also announced a share buy-back worth $378m.

On the international front, however, Mr Joyce said the firm had faced more seats in the market together with rising fuel costs.

But Qantas International "had largely held its own, with a 6% decline in profit and a slight rise in unit revenue," he said.

Qantas is Australia's biggest airline and controls nearly two-thirds of the country's domestic market.

(BBC News)

Boeing Steals an Order From Airbus

Late Tuesday afternoon airline industry analysts at Leeham News reported that Hawaiian Airlines parent Hawaiian Holdings Inc. canceled an existing order for six Airbus A330-800s and will place an order next week with Boeing for an unspecified number of Boeing’s 787-9 Dreamliners.

The cancellation is no particular surprise. Back in October, CNN reported that Hawaiian Airlines was considering an aircraft change for its planned expansion into Indian, western Australian, London and even Moscow markets. With its 7,500-nautical mile (nm) range, the A330-800 was believed to be a good solution for these so-called long-thin routes (lots of miles, not so many passengers) that have been serviced primarily by Boeing 757s and 767s.

Boeing also has been considering a new airplane to fill the gap left by the discontinued 757 and the virtually discontinued 767. This is the “New Midrange Aircraft” and Boeing would really like to drive a spike through the heart of the A330-800 before it announces what some have dubbed the Boeing 797. The six Airbus planes reportedly canceled Tuesday were the only six A330-800s on the Airbus order book, another reason Hawaiian wanted out of the deal.

Airbus’s A330neo family also poses a threat to the 787, which has not been a really hot order driver for Boeing since 2013. That’s one more reason why Boeing needs to announce the 797. Airbus is pitching the A330neo to both United and American Airlines while Boeing has essentially vaporware. Even if the 797 is approved and announced, it won’t be available until the middle of the next decade.

Is that soon enough? Boeing must think so because the company has been in no particular rush to counter Airbus with a new aircraft. Leeham News notes, however, that if Boeing can convince both United and American Airlines to be launch customers for the 797, the Airbus A330neo will be seriously wounded.

That’s what makes the reported deal with Hawaiian Airlines so interesting. It’s an early shot fired in what will be a much more intense battle.

(Paul Ausick - 24/7 Wall St.)

Southwest to launch first international cargo services in May

Southwest Airlines plans to start rolling out international cargo shipments in May, with Mexico City, Cancun, Cabo San Lucas/Los Cabos and Puerto Vallarta at the top of the list, the carrier announced.

The new service, subject to government approvals and the successful deployment of its new Southwest Cargo Suite (SCS) point-of-sale and back-office system, would expand to more destinations in 2018, Southwest said. SCS is expected to be in place by April 1 and will enable advanced cargo bookings and electronic air waybills.

Southwest saw cargo revenue rise 1.2% year-over-year (YOY) in 2017 to $173 million, “primarily due to increased demand,” the carrier said in its most recent 10-K filing with the U.S. Securities and Exchange Commission. Its 2018 first-quarter outlook was for a YOY rise compared to 2017's first three months. “Sluggish demand” contributed to a 4.5% drop in full-year 2016 revenue to $172 million from $178 million in 2017.

North America, like much of the rest of the globe, enjoyed a strong air freight year in 2017. IATA figures show North American FTKs rose 7.9% YOY in 2017, while global FTK growth was 9%—the strongest YOY surge since 2010.

(Sean Broderick - ATWOnline News)

Wijet places record order for 16 HondaJets

(Wijet)

European air taxi operator Wijet has placed a record order with Honda Aircraft for 16 HA-420 HondaJets, as part of a fleet upgrade and expansion program.

Deliveries are scheduled to begin in March and all the light business jets should be in service within 18 months, says Wijet chief executive Patrick Hersent. "The HondaJets will replace some of our 15 [Cessna] Citation Mustangs, which have an average age of around seven years," he says.

Established in 2009, Wijet is one of the world’s oldest and largest operators of the out-of-production Mustang. Cessna halted manufacture of the entry-level aircraft in May 2017, following feeble demand for the all-metal type.

While 470 Mustangs were built over the type's 12-year production run, Flight Fleets Analyzer shows a steady slide in deliveries, from a peak of 128 units in 2009 to only eight in 2015. Cessna recorded seven Mustang shipments in the first half of 2017.

Hersent says the four-passenger business jet still has an important role to play in Wijet's plans. A clutch of aircraft will be used to supplement the HondaJet fleet, to help meet the burgeoning demand across Europe for ad hoc charter.

"The Mustang can operate from shorter runways than the HondaJet, including from our headquarters at Blackbushe airport in the south of England, which the HondaJet cannot," he says. "We will therefore base our new aircraft at London Biggin Hill, where Honda is planning to establish a maintenance center to support the fleet."

The HondaJet has a larger cabin than the Mustang, with seating for five passengers, Hersent notes. It also boasts a range of over 2,000nm (3,700km) – 300nm longer than the Cessna– "putting several Nordic and North African destinations within reach", he adds.

Honda Aircraft secured European certification for the HondaJet in 2016. Fleets Analyzer records seven examples as operating in the region, out of a global fleet of just under 70.

The Greensboro, North Carolina-based airframer is progressively ramping up production of the GE Honda Aero Engines HF120-powered type to meet market demand. Deliveries climbed from 23 units in 2016 to more than 43 last year, and the company expects a "steady" increase in output in 2018.

(Kate Sarsfield - Flight International / FlightGlobal News)

Alaska Air Group's January Load Factor Declines, Stock Falls

Alaska Airlines Boeing 737-890(WL) (35189/2393) N586AS on short final to Rwy 25L at Los Angeles International Airport (LAX/KLAX) on December 5, 2017.
(Photo by Michael Carter)

Shares of Alaska Air Group, Inc. have declined more than 2% ever since it released its traffic results for January 2018, last week. In the first month of 2018, the company’s consolidated traffic (measured in revenue passenger miles or RPMS) increased 3.5% to approximately 4 billion.

Consolidated capacity (measured in average seat miles or ASMs) also increased 6.6% to 5.2 billion. As capacity expansion outweighed traffic growth in January, load factor (percentage of seats filled by passengers) declined 230 basis points to 75.8%. The decline in this key metric was due to capacity over expansion which disappointed investors, thus leading to the stock price depreciation.

In first-quarter 2018, the carrier aims to expand capacity by around 8%. For the full year, the metric is likely to climb 7.5%. Consequently, load factor will be pressurized throughout 2018 at this Seattle, WA-based carrier in the event of traffic growth lagging capacity expansion.

Alaska Air Group, Inc. Price / Alaska Air Group, Inc. Quote

In fact, Alaska Air Group is not the only carrier which is facing capacity relate issues. We remind investors that shares of United Continental Holdings, Inc. UAL also declined significantly in the last month, even after reporting better-than-expected results in the fourth quarter on issues related to capacity.

On the fourth-quarter conference call, the company stated that it will continue to expand capacity in a bid to maintain market share at major airport hubs to deal with competition from discount carriers like Spirit Airlines, Inc. SAVE. For 2018, United Continental’s capacity growth is projected between 4% and 6% year over year. The metric is anticipated to grow for 2019 as well as 2020.

(Zacks Equity Research - Zacks) 

Iranian airline covertly bought parts from U.S. suppliers

The U.S. has suspended the export privileges of a Turkish national and three related companies it says obtained American-made aircraft parts for Iranian airlines, violating U.S. sanctions.

The move was announced earlier this month but has passed largely unnoticed. Mira Ricardel, Under Secretary of Commerce for Export Administration, said in a February 5 news release from the Commerce Department's Bureau of Industry and Security (BIS) that the sanction shows that trade with Iran that defies U.S. export laws and regulations will not be tolerated.

BIS oversees exports of high-technology and other products related to national security.

According to the Commerce Department, Turkish national Gulnihal Yegane set up shell companies to purchase equipment from U.S. suppliers on behalf of Iran's Mahan Air. The carrier is under sanctions by the U.S. for allegedly carrying arms and fighters in Syria. The jet parts were obtained through the Turkish fronts in the past several years, most recently in December.

According to the Wall Street Journal, the trade action could support the views of some in the Trump administration who oppose granting permission to Boeing to sell aircraft to another Iranian carrier.

Boeing inked a $16.6 billion deal with with Iran Air in 2016. The agreement was seen as evidence of normalizing U.S. relations with Iran following a 2015 pact in which Tehran agreed to freeze development of its nuclear program in exchange for international sanctions being lifted.

Ending the Boeing deal could impact the nuclear agreement as well as an estimated $40 billion in contracts for Boeing and Europe's Airbus, which relies on U.S. licensing for its own agreement with Iran due to the many U.S.-made parts on its planes, according to the WSJ.

The U.S. has loosened sanctions again Iran Air, but they remain in place against Mahan for more than a decade due to its alleged collaboration with Iran's Islamic Revolutionary Guard Corps, the newspaper said.

(Kate Gibson - CBS MoneyWatch)

Air Italy expands as UAE-backed Alitalia goes bankrupt

Qatar Airways has expanded airline investment with Italy's Meridiana 

(Photo: Meridiana / AirItaly)

Italian airline Meridiana changed its name to Air Italy on Monday with the backing of Qatar Airways, its new shareholder, aiming to become Italy's flagship carrier as UAE-backed Alitalia undergoes bankruptcy proceedings.

Air Italy was put under new ownership last year after Qatar Airways bought a 49 percent stake in AQA Holding, with the previous owner Alisarda retaining 51 percent.

It is now the country's second-largest airline behind Alitalia, which was mainly backed by Abu Dhabi-based Etihad Airways.

However, the carrier started bankruptcy proceedings last year for the second time in a decade, after saying it will no longer invest in the faltering airline.

Air Italy's new restructuring plan aims to make it Italy's "airline of reference", said Qatar Airways' CEO Akbar al-Baker.

"We will show that we are the star," said al-Baker, presenting the airline's development plans in Italy.

Over the next three years, 20 Boeing 737 MAX aircraft will be added to Air Italy's fleet, the first of which arrives in April.

Qatar Airways will lease five of its Airbus A330-200 aircraft to Air Italy "at market prices", al-Baker said.

(Al Jazeera News)

Fight over man's flatulence forces flight to make emergency landing

A pilot made an emergency landing after a fight broke out over a passenger who allegedly refused to stop passing gas.

Two Dutchmen sitting next to the flatulent passenger reportedly asked the man to stop, but he refused and continued to break wind aboard the Transavia Airlines flight from Dubai to Amsterdam Schiphol.

The budget airline crew allegedly did not help the passengers after their complaints, Metro reports, leading to a fight between the men. Despite a warning from the pilot, the altercation continued and forced the airplane to be diverted to Vienna Airport, where it made an emergency landing.

Police boarded the plane once it landed and removed two women and two men that the pilot reported as “passengers on the rampage,” Metro reports.

The women, who are sisters, that were removed from the flight are now taking the airline to court claiming they were not involved in the alternation. Nora Lacchab, a 25-year-old law student, called the removal “humiliating.”

“We had no idea who these boys were, we just had the bad luck to be in the same row and we didn’t do anything. All I will say is that the crew were really provocative and stirred things up,” Lacchab said to De Telegraph.

All four passengers were released from police custody without being charged. However, all have been banned from flying Transavia Airlines in the future.

“Our crew must ensure a safe flight. When passengers pose risks, they immediately intervene. Our people are trained for that. They know very well where the boundaries are. Transavia is therefore square behind the cabin crew and the pilots,” the airliner said in a statement.

(Alexandra Deabler - Fox News)

Delta Air Lines Wants the Boeing "797" ASAP: Here's Why

Last year, Boeing strained its relationship with U.S. airline giant Delta Air Lines by attempting to have big tariffs imposed on Delta's purchase of CSeries jets from Bombardier. Many pundits saw Boeing's trade complaint as a risky move that could alienate a key customer -- especially after Delta ordered the Airbus A321neo last December instead of Boeing's 737 MAX 10.

However, these fears weren't justified. Delta isn't going to make bad business decisions just to punish Boeing. In fact, Delta Air Lines CEO Ed Bastian wants the carrier to be a launch customer for Boeing's proposed "middle-of-the-market" jet, according to Bloomberg.

Indeed, this proposed jet -- which would likely be called the 797 in Boeing's numbering scheme -- would fill a crucial gap in Delta's future fleet. Thus, it's not surprising that management wants to get this plane into the fleet as quickly as possible.

What the 797 will be

Boeing has confirmed that it's studying a possible middle-of-the-market jet, but it's still in the process of talking to customers and building the business case. As a result, nothing about the future 797 program is set in stone.

That said, the broad outlines of Boeing's plan have come to light. It's envisioning a twin-aisle aircraft with an elliptical fuselage to improve fuel efficiency. The 797 would have two variants: One could hold 225 seats in a typical international configuration, with 5,000 nautical miles of range, while the other could seat 275 and fly up to 4,500 nautical miles. Boeing is targeting a 30% unit-cost improvement over its aging 757 and 767 models.

Based on these parameters, the 797 would be an ideal aircraft for routes from the East Coast and Midwest to Europe. It would also work well for the busiest transcontinental routes and for some routes to Latin America.

Why Delta needs the 797

Boeing intends the 797 to be a much-needed replacement for its 757 and 767 jets. It would be somewhat larger than the 757, with more range, while being similar in size to the 767, albeit with somewhat less range. Delta Air Lines is the largest operator of both of those older models, which explains its enthusiasm for the 797.

To be fair, the A321neos that Delta recently ordered can replace the 757s that it uses on domestic routes. If Delta upgrades some of those orders to Airbus' new A321LR, it would also be able to replace 757s used for longer routes -- primarily to Europe. That said, one big disadvantage of the A321LR is that its auxiliary fuel tanks take up a lot of space that could otherwise be used for cargo.

On the other hand, the alternatives for replacing Delta's roughly 80 767s are far from ideal. In late 2014, the carrier ordered 25 A330-900neos from Airbus to replace some of its older 767s. However, while the A330-900neo will have much lower unit costs than the planes it will replace, it will probably have about 40% more seats than Delta's 767-300ERs.

Some of Delta's 767 routes may be able to handle the additional capacity. For others, 300 seats would be way too much capacity and would undermine unit revenue. The 797 would be far better than any other option for international routes that can't handle a 300-seat aircraft.

There could be a big rush to be first

If Boeing decides to go ahead with the 797 project, the jet would probably be ready to enter service around 2025. That's perfect timing for Delta, which will need to replace most of its 757 and 767 fleets during the late 2020s, based on a typical 25-30 year aircraft-replacement cycle.

However, Delta Air Lines won't be the only airline vying for early delivery slots. The majority of the Boeing 757s and 767s that are still flying were built during the 1990s. Production dropped off dramatically after 2001. Thus, by 2025, most of the remaining 757s and 767s will be due for replacement -- if they haven't already been retired.

This urgent replacement demand means that if Boeing starts selling the 797 this year, it could get a huge number of launch orders. Many airlines simply won't have the luxury of waiting for the new aircraft to prove itself before placing an order.

(Adam Levine-Weinberg - The Motley Fool)

Will Southwest Airlines' Hawaii Plans Be Disrupted by Labor Discord?

Southwest Airlines' mechanics are trying to block the carrier's plans for maintaining the planes it will use for Hawaii flights.

Last October, Southwest Airlines announced that it would start selling tickets for flights to Hawaii during 2018. This came after years of rumors that the U.S. airline giant would expand to this popular tourist market, potentially bringing lower fares.

However, the Aircraft Mechanics Fraternal Association -- the union representing Southwest's mechanics -- has threatened legal action to halt the carrier's plans to fly to Hawaii. Southwest Airlines wants to use outside contractors to do necessary maintenance work in Hawaii. The union claims that this would violate its contract, although the company disagrees.

The main barrier to Southwest's Hawaii flights

Flying from the West Coast to Hawaii involves traveling more than 2,000 miles over the Pacific Ocean, with no diversion airports in between. The FAA has strict "ETOPS" rules for operating routes that involve flying more than an hour from the nearest diversion airport. These include special certifications for the airline as a whole and the specific airplanes operating those routes.

Maintenance procedures are particularly important for airlines operating ETOPS routes. Given the importance of avoiding aircraft problems in the middle of the ocean, the FAA has special rules beyond what is normally required for commercial airlines.

The ETOPS certification process is currently the primary sticking point preventing Southwest Airlines from beginning flights to Hawaii. Depending on how quickly it can complete the approval process, Southwest may be able to launch its first flights to Hawaii in late 2018 or it may have to wait until 2019.

Why maintenance is a challenge for Hawaii flights

For Southwest Airlines, flying to Hawaii introduces some complications from a maintenance perspective. Most flights from the West Coast to Hawaii leave in the morning and arrive in the early afternoon, in time for hotel check-in. Return flights typically leave in the afternoon and arrive back on the West Coast in the late evening.

Southwest hasn't released any flight schedules for Hawaii, but it isn't likely to deviate from this general pattern. One of the main alternatives would be an evening departure from the West Coast and a red-eye return flight. However, Southwest has never operated red-eyes -- although it could change that policy.

As a result, it's entirely possible that there would never be Southwest Airlines planes on the ground in Hawaii outside of the hours of noon to 4 p.m. HST (roughly speaking). That would make it extremely inefficient to hire local staff to carry out ETOPS maintenance inspections in Hawaii, as there would only be a few hours of work each day.

The solution gets caught up in bargaining

Rather than hiring local maintenance staff in Hawaii, Southwest Airlines wants to use outside contractors to perform ETOPS checks on its aircraft there. On the West Coast, it would use its own staff.

This plan doesn't sound unreasonable on its face. However, Southwest's mechanics are still working under a contract that became amendable more than five years ago. (Airline labor contracts never formally expire.) The mechanics are seeking raises and job protections, and they aren't inclined to do any favors for management until a new contract is implemented.

Ideally, Southwest Airlines and the mechanics would sign a new contract during 2018 that would directly address the issue of outsourcing maintenance in Hawaii. However, if they don't reach an agreement, the courts may have to decide whether Southwest's plan violates the existing contract. That would raise a risk of the carrier having to postpone its Hawaii service.

Not much reason to worry -- yet

Despite all of the tough talk from the mechanics union, management and the union aren't very far from one another on most contract issues. The differences in the two sides' pay proposals are extremely small in comparison to Southwest Airlines' annual earnings. Instead, the main issue of contention appears to be the "scope" section that determines what work must be performed by Southwest's in-house maintenance staff.

Reaching an agreement on this issue won't be easy, but there's still time to make a deal. It should be possible for Southwest Airlines to trade some combination of job protections and pay raises for the flexibility to outsource maintenance at far-flung airports where it would be prohibitively expensive to rely on full-time staff.

Given Southwest's history of relatively peaceful labor relations, investors shouldn't worry too much about this contract dispute derailing the carrier's Hawaii plans.

(Adam Levine-Weinberg - The Motley Fool)

Airbus A321LR completes nonstop Paris - New York test flight

Airbus announced that on February 13, 2018 its long-range aircraft A321LR successfully completed nonstop flight between Paris (France) and New York (U.S.) for the first time. According to the manufacturer, the A321LR “has the longest range of any single-aisle commercial aircraft today” as it is able to fly 7,400 kilometers nonstop.

The aircraft, powered by two CFM International LEAP-1A engines, flew from Le Bourget Airport near Paris to the New York region’s John F. Kennedy International Airport.

According to Airbus, A321LR is “well suited” for intra-regional airline segments in Asia, the United States and other markets and the Paris-New York flight demonstrates this jetliner version’s ability to “serve new markets and operate on heavily-traveled North Atlantic routes”.

The A321LR is the next step of Airbus’ twin-engine A321neo that has captured more than an 80 percent share in its middle-of-the-market category. Airbus expects the A321LR to continue this trend. The manufacturer also notes having already received over 100 orders for the aircraft with the first customer delivery expected in late 2018.

The A321LR performed its maiden flight on January 3, 2018.The transcontinental flight on February 13, 2018, is part of nearly 100 hours of flight tests in advance of the jetliner’s airworthiness certification, expected in the second quarter of 2018.

(Airbus / AeroTime News)

Spirit delivers 10,000th Wichita-built 737 fuselage to Boeing

Spirit AeroSystems Inc. this week delivered the 10,000th Wichita-built 737 aircraft fuselage to Boeing.

The milestone number, which was confirmed by the company, stretches back decades to when the Spirit facility was still part of Boeing Commercial Airplanes and where production on the 737 dates back to the mid-1960s.

A company spokesperson says Spirit will hold an event to celebrate the achievement in the coming weeks.

Spirit, which has work on all Boeing commercial programs, builds about 70 percent of every 737 that the company delivers. Those deliveries now are comprised of the company’s Next-Generation 737 models and the growing 737 MAX family.

The 737 fuselages are transported by rail from Wichita to Boeing's assembly line in Renton, Washington.

Local work on the aircraft also involves numerous other smaller companies in the local supply base, making the high-volume 737 the most important aircraft program to the local economy.

And new delivery milestones are only going to continue to be hit in the coming years as Boeing will again increase the build rate on 737 this year to 52 aircraft per month, on its way to 57 per month in 2019.

Boeing had orders on its books at the end of January for 4,648 of the narrow-body 737s, representing years of continued work on the program for Spirit and the commercial aerospace cluster in Wichita.

(Daniel McCoy - Wichita Business Journal) 

Southwest Airlines' dispute with its mechanics could stall flights to Hawaii

Four months after Southwest Airlines announced plans to start flights to Hawaii, a smoldering dispute between the Dallas-based carrier's management and its aircraft mechanics threatens to delay the highly anticipated launch to the islands.

The discord also could affect passenger safety if changes aren't made, the Federal Aviation Administration has warned.

Southwest is in negotiations for a new contract with the Aircraft Mechanics Fraternal Association, or AMFA. The negotiations have dragged on for more than five years.

Southwest plans to outsource maintenance work related to its Hawaiian operations — a plan the union opposes. The issue has become a main sticking point in the negotiations, Bret Oestreich, national director of AMFA, told the Dallas Business Journal in an email interview.

“Southwest Airlines needs to stop playing games and negotiate in good faith with their aircraft maintenance technicians,” Oestreich said. “Southwest continues to want to increase the outsourcing of the aircraft maintenance footprint. We do not want to negatively impact expansion to Hawaii, but AMFA needs black and white job protection language.”

Southwest did not respond to interview requests for this story.

In order for Southwest’s Boeing 737 aircraft to fly long distances over the ocean, including service to Hawaii, the planes must get special “extended operations,” or ETOPS, certification and maintenance.

It’s AMFA’s position that Southwest is violating the current collective bargaining agreement by outsourcing ETOPS-related and other maintenance work to third-party vendors. The dispute is in arbitration

Southwest said in a previous statement that the planned flights to Hawaii do not violate the current collective bargaining agreement.

“At Southwest, our goal is to ensure reliable operation of our ETOPS-equipped aircraft through multiple maintenance and safety avenues, as there is no higher priority than the safe operation of our aircraft," said Russell McCrady, Southwest Airlines vice president of labor relations.

AMFA members say it’s not just their jobs they’re worried about, but passenger safety.

Southwest has been penalized for maintenance missteps involving companies to which the airline outsourced work in the past.

In 2014, the low-cost carrier was fined $12 million by the Federal Aviation Administration over improper replacement of fuselage skins on 44 aircraft for work it outsourced to Everett, Washington-based Aviation Technical Services from 2006 to 2009. The FAA said the incorrect skin installations could have resulted in gaps that would allow moisture to penetrate and lead to corrosion, according to court documents from the case.

The $12 million fine was, at the time, the second-largest in the FAA’s history and was in addition to a $7.5 million penalty that Southwest paid in 2011 over missed monitoring for fuselage cracking.

In the $7.5 million case, the lax oversight initially appeared to play a role when a five-foot hole tore open in the roof of one of Southwest’s older 737s in 2011, causing depressurization and necessitating an emergency landing. However, the National Transportation Safety Board two years later blamed the incident on poor workmanship during the aircraft’s manufacture by Boeing.

In addition to the ETOPS issue, major sticking points in the contract negotiation between Southwest and AMFA include pay raises, headcount protections and retroactive pay for the more than five years the company and the union have been in contract talks, Oestreich said.

Oestreich said Southwest has 3.3 aircraft mechanics per plane, the lowest ratio in the industry. To compare, Chicago-based United Airlines has 11.2 mechanics per aircraft, and Fort Worth-based American Airlines has 7.5 mechanics per plane, he said.

Pilots, flight attendants and other Southwest employee groups are projected to grow in proportion to the airline's purchase of new planes, Oestreich said. But the company wants to reduce the headcount of mechanics to 2.75 per aircraft, which it plans to accomplish through outsourcing and attrition, Oestreich said.

Southwest’s McCrady called it “illogical" to compare mechanic-to-aircraft ratios among carriers, because the number of mechanics needed to support a fleet is unique to each carrier.

"The ratio is driven by aircraft type, aircraft size, aircraft age, flight schedules and airline partnerships," McCrady said. "Making comparisons risks an apples to oranges mischaracterization."

Meanwhile, Southwest mechanics over the past year have filed over a dozen whistleblower complaints alleging a variety of grievances, including pressure to gloss over maintenance issues.

The complaints are filed by individual mechanics, not the union, and investigated independently by the FAA and the Occupational Safety and Health Administration. The government agencies then rule on whether the complaint is substantiated or not.

An Oct. 25, 2017 report following an investigation of several whistleblower complaints warned that a lack of collaboration between employees and management at Southwest Airlines is threatening the quality of aircraft maintenance.

“The environment at Southwest Airlines — specifically lack of communication, lack of training, perception that airworthiness findings will result in disciplinary actions for all involved to include mid-level managers — if not addressed will impact the value of quality having a direct effect on the status of aircraft airworthiness,” says the memo from James Gardner, deputy director of Air Carrier Safety Assurance for the FAA.

The union thinks that management wants mechanics to avoid documenting discrepancies, while management’s perspective is that the mechanics want to go beyond the scope of their tasks to find and document discrepancies that may or may not impact operations, Gardner’s memo says.

“This dichotomy has created an environment that if not corrected will have a detrimental impact on the airline and its fleet,” the memo says.

Gardner cites as an example a complaint involving a flight control rudder balance weight that had damage his report characterized as “substantial.” The aircraft maintenance technician was inspecting another part when he noticed visible corrosion on the rudder weight.

“After reporting what he found, the individual was questioned as to why and how he came to notice this when he was not conducting work on the rudder,” Gardner said, “rather than being praised for finding a serious airworthiness issue.”

Southwest management pointed out that the issue with the rudder was addressed, but “the impact to the employees and the overall maintenance organization arguably is impacted by the questioning,” Gardner noted.

“This event led to the discovery of a systemic issue with the fleet and now has involvement with the carrier’s engineering and the aircraft manufacturer,” Gardner’s memo adds.

In a separate and independent FAA field investigation of the carrier's Los Angeles maintenance operations conducted Sept. 20, 2017, the agency's investigators reported that all of the mechanics except two felt "pressured and under scrutiny" as to whether they were finding too many things wrong with the aircraft.

Mechanics in Los Angels were told “Dallas is watching us, don’t make us look bad with delays,” according to whistleblower documents.

The FAA investigators said a lack of trust and communication combined with fears of threats and reprisals resulted in "a degraded level of safety."

(Bill Hethcock - Dallas Business Journal) 

Airbus’s Most Important Aircraft Can’t Shake Its Teething Problems

Airbus's most important aircraft just can’t shake its teething problems.

The European manufacturer has been forced to suspend some deliveries of its A320neo jet following another issue with the engines supplied by Pratt & Whitney. IndiGo, the Indian low-cost airline that’s the plane’s biggest customer, on Sunday disclosed three in-flight shutdowns, and said pilots have had to turn back before taking off in three other instances -- an alarming new problem for a Pratt power plant that’s been hobbled by glitches from the start.

Replacing the engines is the “best possible precautionary measure” to avoid further mishaps, IndiGo spokesman Ajay Jasra said Sunday.

As many as 11 of the 113 Pratt-powered A320neos delivered by Airbus have been grounded, according to people familiar with the matter, with 43 in-service engines affected in total. All are from the most recent batches to come off the engine-maker’s production line. Further turbines at both Airbus and Pratt facilities are affected, they said. Three of the grounded planes are at IndiGo, the airline said. Airbus declined to identify the other airlines.

More Fuel-Efficient

It’s impossible to overestimate the importance of the A320 for Airbus. It put the European planemaker on the map three decades ago, allowing the company to go from a speck in Boeing’s rear-view mirror to powerful equal in what has become a de-facto duopoly in the global civil-aircraft market. Airbus churns out more than 50 of the aircraft each month, and the promise of the neo with its more fuel-efficient engines turned the model into the fastest seller in commercial aviation history, forcing Boeing to respond with a refreshed 737.

Airbus has traditionally offered two engine options on the A320, and the company maintained that approach on the neo. Customers can choose between the Pratt & Whitney model and a type built by the CFM joint venture between General Electric Co. and France’s Safran for Pratt, the introduction of the two-year-old neo was a chance to solidify its position in the lucrative market for single-aisle planes, which form the backbone of most global airline fleets.

Durability Issues

Pratt, a unit of United Technologies Corp., invested $10 billion to develop the geared turbofan, now its most important product. The latest issue undermines its efforts to move past earlier snags, including a cooling problem that marred its commercial introduction in early 2016, and subsequent durability issues and delivery delays. Pratt said Friday that the problem was isolated to “a limited subpopulation” of the engines, and had to do with a “knife edge” compressor seal.

Shares of parent United Technologies fell 1.9 percent on Friday, the biggest slide of any member of the Dow Jones Industrial Average, while Airbus dropped 2.3 percent the same day in Paris. Shares of InterGlobe Aviation Ltd., which operates IndiGo, declined as much as 1.7 percent in Mumbai on Monday.

Compensation Costs

If the latest problem leads to penalty payments to IndiGo and other customers, it wouldn’t be the first time Pratt was on the hook financially. Greg Hayes, chief executive officer of United Technologies, said last April that Pratt incurred costs to retrofit the engines to address durability issues, and related to “helping the airlines through some of this.” He didn’t specify the exact amount, but he said “it’s not material.”

The early glitches at Pratt led many customers to wait on the sidelines: The competing CFM engine outsold the GTF on the A320neo by a 10-to-1 margin in early 2017. Pratt won several key orders late in the year as the earlier issues subsided, and executives at Airbus and United Technologies said the manufacturer seemed to be moving on from a difficult chapter.

ANA Holdings Inc., Hong Kong Express Airways Ltd. and Go Airlines India Ltd. are some of the other carriers in the region that have A320neos with Pratt engines in their fleet.

While Pratt works on a fix, IndiGo said it will take delivery of older, less-efficient A320ceos to fuel its growth. Pratt is also working closely with IndiGo to provide replacement engines, having replaced 69 of them in the past 18 months.

IndiGo said Saturday that it canceled some flights after the European Aviation Safety Agency warned of a new issue with the engines and said it was investigating. The regulator said Friday that operators with planes using two affected engines must stop flying them within three flight cycles. Aircraft with one affected engine are restricted from certain extended-range flights.

“Airbus and Pratt are working in close cooperation and will be swiftly communicating on the way forward to regain normal operations and resume aircraft deliveries,” spokesman Jasra said.

(Anurag Kotoky, Benjamin D Katz, and Rick Clough - Bloomberg News)