Thursday, March 29, 2018

Supersonic Bizjet Launch Inches Closer, Says Analyst

Aviation analyst Brian Foley is optimistic that a formal launch of a supersonic business jet is coming closer. Aerion Corp. has been developing key technologies for its AS2 design for more than a decade.
(Photo: Aerion Corp.)

“We’re much closer to a supersonic business jet (SSBJ) being formally launched” as costs and persistent risks related to regulatory, engines and sonic boom noise are “progressively mitigated,” according to aviation analyst Brian Foley. “The final impetus will be from the realization that to command this relatively small but high-value market requires being early to capture finite sales.”

One primary regulatory risk has been defining what constitutes an acceptable sonic boom noise over land, “which can be quite subjective,” he said. The FAA is currently re-examining the supersonic flight over land ban, which Foley hopes will result in “much needed guidance and design latitude” in the coming months.

Another challenge he cited is a powerplant able to operate in the supersonic regime while still offering reasonable times between maintenance overhauls. It also comes down to an issue of money: “Who pays for the development of a new or derivative engine that meets these unique performance and durability requirements?” he asked.

An SSBJ platform needs both a civil and government market component to be successful, Foley noted. “Once the race is on with teams formed and proper funding, the concept could leap forward. While I now view a formal SSBJ launch as being more conceivable than ever, it’s still moving at the very subsonic speed of technology, regulation and money.”

(Chad Trautvetter - AIN Online News)

LaudaMotion, Ryanair outline joint operations

LaudaMotion owner Niki Lauda and Ryanair CEO Michael O’Leary.

New Austrian carrier LaudaMotion and Irish LCC Ryanair have outlined details about their new partnership, which was announced March 20. LaudaMotion officially launched operations March 25.

Starting June 1, LaudaMotion will have 21 aircraft in operation from nine bases in Austria, Switzerland and Germany, serving 44 airports on 65 routes.

Lufthansa confirmed to ATW that eight Airbus A320s, currently operating wet-lease flights for Eurowings through the end of May, will be transferred to LaudaMotion bases.

LaudaMotion is also partnering with German leisure carrier Condor.

Ryanair has a 24.9% stake in Niki Lauda’s LaudaMotion, with a plan to grow ownership to 75%.

LaudaMotion currently operates 10 A320 family aircraft, which is planned to increase to 15 by June 1. Ryanair is wet leasing six Boeing 737-800s to LaudaMotion during the summer to make up 21 aircraft.

Lauda said he needs 21 aircraft to protect all its slots. The new carrier took 40,000 out of 60,000 slots at European airports, which became available following the takeover of bankrupt NIKI in January.

From June 1, four aircraft will be based in Vienna (Austria), four at Berlin Tegel, six in Dusseldorf and each one at Cologne, Frankfurt, Munich, Nurnberg and Stuttgart (Germany) and two aircraft in Zurich (Switzerland).

For the winter 2018/19 schedules, Laudamotion plans to launch so-called city-shuttle flights to European destinations (e.g., to Rome or Barcelona) and expand the Vienna-based fleet with three additional aircraft for a total of seven.

Ryanair CEO Michael O’Leary said the LCC is “happy to support LaudaMotion in its first summer schedule,” but added that LaudaMotion is not a Ryanair Austria.

LaudaMotion’s fleet should rise to 30 aircraft, but the number could rise to 40 in two to three years, according to Lauda.

(Kurt Hofmann - ATWOnline News)

Finnair to accelerate A350 deliveries

Finnair is speeding up the arrival of two of its remaining Airbus A350s to support its continued growth push toward Asia.

Speaking following a recent general meeting, Finnair CEO Pekka Vauramo said the airline’s Asian strategy—which has been accelerated over recent years—“has been the right choice.”

“We have now made decisions to receive two A350s ahead of the original delivery schedule,” he said.

Finnair already has 11 A350s in service, plus another eight on order.

The airline will now take one of its A350s—originally scheduled for delivery in 2023—in 2019. Finnair has also brought forward another delivery, planned for 2022, to 2020.

“The schedule for the remaining eight A350 deliveries is now the following: One in the last quarter of 2018, two in 2019, two in 2020, two in 2021 and one in 2022,” Finnair said.

(Victoria Moores - ATWOnline News)

India to sell 76 percent stake in state-run carrier Air India

India said on Wednesday it plans to sell a controlling stake in Air India along with roughly $5.1 billion of the state-run carrier's debt, one of the biggest divestments undertaken by Prime Minister Narendra Modi's government.

The government plans to sell a 76 percent stake in the carrier that operates both domestic and international routes, according to official bid documents released by the ministry of civil aviation.

The proposed sale will also include a 100 percent stake in Air India's low-cost arm - Air India Express, and a 50 percent stake in its ground-handling arm - SATS Airport Services.

Bids for the assets are expected to be submitted by May 14.

Modi's cabinet gave the go-ahead last year to sell the loss-making flagship airline after successive governments spent billions of dollars to keep it solvent.

But its debt burden of about $8 billion and a bloated cost structure have been a concern.

Previous attempts to offload the airline have been unsuccessful. If Modi can pull this off, it will buttress his credentials as a reformer brave enough to wade into some of the country's most intractable problems.

Air India has six subsidiaries – three of which are loss-making – with assets worth about $4.6 billion. It has an estimated $1.24 billion worth of real estate, including two hotels, where ownership is split among various government entities.

Companies including low-cost Indian carrier IndiGo, owned by InterGlobe Aviation, Tata Group and Turkey's Celebi Aviation Holdings, have expressed an interest in buying some of Air India's operations. Singapore Airlines has also said the company has an open mind about making an initial bid.

The successful bidder would need to retain its stake in Air India and management control of the airline for at least three years, according to the government document. The winning bidder would also need to ensure that substantial ownership and effective control of Air India and Air India Express would continue to be vested in Indian nationals.

Air India was founded in the 1930s and is known to generations of Indians for its Maharajah mascot. The government has injected $3.6 billion since 2012 to bail out the airline.

(Aditi Shah - Reuters)

F-35s in Japan are still losing dogfights to F-15s sometimes — here's why

The most expensive weapons system in history, the US's F-35 Lightning II, is still sometimes losing to the 1970s F-15 in dogfights during training scenarios in Japan.

US Air Force F-15 pilot Capt. Brock McGehee, when asked by Defense News if the F-35s at Kadena Air Force base in Japan still sometimes lost to the Cold War-era fighters, said "I mean, sometimes."

The F-35 has long been plagued by reports of that it can't dogfight as well as older, much cheaper jets, despite being in development for nearly two decades and claiming to revolutionize air combat.

In 2015, War is Boring published a report from a test pilot that said the F-35 couldn't turn or climb fast enough to keep up with older jets, and F-16s lugging heavy fuel tanks under wing still routinely trounced it.

But a lot has changed since 2015. The F-35 has had its software upgraded and the tactics refined.

Why the Cold War jets can still pull a win out — for now

Retired US Marine Corps Lt. Col. David Berke previously told Business Insider that the older jets benefited from decades of development and training, whereby new pilots today have established best practices. As the F-35 is still in its early days, Berke said the best is yet to come.

In 2017, the F-35 dominated older jets with a ratio of 15 kills to one death.

"The biggest limitation for the F-35 is that pilots are not familiar with how to fly it. They try to fly the F-35 like their old airplane," Berke said.

But the pilots at Kadena dogfighting against F-15s may be a cut above, according to Berke, who said that because they have never flown a legacy jet before, they won't bring the bad habits with them, and will instead learn how to fly the F-35 like the unique plane it is. "They're going to be your best, most effective tacticians," Berke said.

F-35s at a major disadvantage to any legacy jet in a dogfight

"The F-35 cannot out dogfight a Typhoon (or a Su-35), never in a million years," Justin Bronk, a combat aircraft expert at the Royal United Services Institute, previously told Business Insider.

The reason why, according to Bronk and other experts on the F-35, is that the F-35 just isn't a dogfighter. The F-35's stealth design put heavy demands on the shape of the aircraft, which restricted it in some dimensions. As a result, it's not the most dynamic jet the US could have possibly built, but it doesn't have to be.

Instead, the F-35 relies on stealth. F-35s, employed correctly in battle, would score most of their kills with long range missiles fired from beyond visual range.

"If you get into a dogfight with the F-35, somebody made a mistake. It's like having a knife fight in a telephone booth," civilian F-16 pilot Adam Alpert of the Vermont Air National Guard wrote in 2016 after training on F-35 simulators.

A Top Gun pilot says dogfighting is dead anyway

Berke, an alumnus of the US Navy's famous Top Gun school, echoed Alpert's assessment, but warned that the common perception of dogfighting was "way off," and something US jets haven't done in 40 years. Berke disagreed with Bronk's "never in a million years" assertion, but maintained that the dogfighting issue was basically irrelevant.

The bottom line is that in training, all jets lose "sometimes." That the F-35 can hold its own and beat a jet refined over four decades to excel exclusively at air-to-air combat — when the F-35 has been designed to fight, bomb, spy, and sneak — shows its tremendous range and potential.

(Alex Lockie - Business Insider)

Emirates 380 flight to Lebanon brings hope of tourism revival

The world’s largest passenger jet landed at Beirut’s international airport on Thursday, bringing with it hope for a revival of Lebanon’s vital tourism sector.

The one-off Emirates Airbus A380 flight from Dubai was an acknowledgement of the substantial passenger traffic between Lebanon and Gulf nations, where many Lebanese nationals work and more pass through to destinations farther afield.

Emirates said it scheduled the flight, the first of its kind to carry paying passengers, to see if Beirut’s Rafik Hariri International Airport was ready to handle regular A380 service.

Lebanese officials hope the results are positive, as tourist arrivals climb to levels last seen in 2010, before the uprising in neighboring Syria the following year raised fears of violent spillover.

Lebanon welcomed 1.85 million tourists in 2017, according to the Tourism Ministry, the most since 2.16 million came in 2010.

There are nine flights daily from Dubai to Beirut, on three different carriers.

Tourism is one of the key pillars of Lebanon’s economy, accounting for 19 percent of the country’s GDP, according to the U.K.-based World Travel and Tourism Council.

However, Beirut’s Rafik Hariri International Airport, Lebanon’s only commercial airfield, is sorely out-of-date and lines at security can stretch for hours in the summer months, when throngs of expatriates visit the country.

The airport, renovated after the 1975-1990 civil war, was designed to handle 6 million passengers annually. In 2017, it saw over 8 million, according to the airport’s research department. Its gate areas are grimy and gloomy — a poor reflection of politicians’ outsized ambitions for the national tourism industry.

Lebanon’s Cabinet and the country’s flagship airline, Middle East Airlines, are considering two plans to expand and improve the airport’s facilities, one costing $88 million and the other $200 million. Their aim is to expand capacity to 10 million passengers annually by 2020 and then support continued growth beyond that.

(Philip Issa - Associated Press / The Washington Post)  

BOC Aviation to buy six Boeing aircraft worth $1.7 billion

BOC Aviation Ltd said on Thursday it would buy six new Boeing 787-9 aircraft from Boeing worth a combined $1.7 billion at list prices.

Asia's second-biggest aircraft lessor, which had 491 aircraft as of the end of last year, said it expected to take delivery of the aircraft in 2018 and 2019. The deal will be funded through cash on hand, loans and borrowings.

The Singapore-based company, which is majority-owned by Bank of China, this month posted a better-than-expected 40 percent rise in full-year net profit on higher revenue and U.S. tax cuts.

(Donny Kwok - Reuters)

Wednesday, March 28, 2018

LOT’s long-haul service gets 787-9 boost

LOT Polish Airline’s first Boeing 787-9 will be used both to service the carrier’s flagship transatlantic routes and to open new sectors, the airline’s CEO Rafał Milczarski said as the first 787-9 arrived in Warsaw March 23.

The aircraft will go into service by the end of the month on the Warsaw-Chicago sector, one of the airline’s most heavily trafficked routes. The second and third -9s, scheduled to arrive later this year, will be used to supplement the existing fleet of eight smaller 787-8s on the New York and Toronto runs, as well as to the South Korean capital, Seoul.

The fourth and final 787-9 will arrive in 2019. All four aircraft are being leased to LOT by Aviation Capital Group.

The new aircraft will have a three-class, 294-seat layout, providing 42 more seats than the 787-8s. The 787-9s will have 24 full flatbed seats in business class (compared to 18 in. for the 787-8), 21 in premium economy with more legroom for passengers (42 in. compared to 38 in.) and 249 in economy class (36 additional seats). The 787-9s will have an additional toilet for the premium economy cabin.

“LOT is the first airline in Europe with a long-haul fleet consisting only of Dreamliners,” Milczarski said. “The Dreamliner is the driver of even faster growth of LOT…with the 787-9 significantly increasing the number of seats on the existing, most popular routes. The 787-9 will be perfect for our flagship flights to Chicago, New York City or selected Asian destinations and will enable us to launch completely new routes as well.”

Each seat on the 787-9 is equipped with its own power outlet, a USB port and IFE screen.

The maximum range of the 787-9s provided to LOT is more than 13,350 km (8,295 miles), approximately 700 km more than the 787-8. The engine is Rolls-Royce’s new Trent TEN.

LOT’s existing 787-8s are used on services to New York JFK, New York Newark, Chicago, Los Angeles, Toronto, Seoul, Tokyo and Beijing. The growing fleet means that from the end of April LOT will also use them to operate its flights from Polish regional airport Rzeszów to Newark. From the end of May, the carrier will also use them to operate Warsaw-Singapore and Budapest-New York JFK and Chicago.

LOT carried more than 6.8 million passengers in 2017, a nearly 25% increase over the previous year. The airline forecasts this figure will grow to more than 10 million passengers by 2020.

Eleven aircraft will be added to the fleet in 2018: the two additional 787-9s, three 737 MAX 8s and six Embraer E195s.

(Alan Dron - ATWOnline News)

Fiji Airways to begin replacing 737s with MAXs, widebodies

Fiji Airways plans to begin replacing its Boeing 737s with newer versions later this year, and is also evaluating wide-body replacements.

The airline said its first 737-8 is scheduled to arrive in November, with a second expected in December. The remainder of its five orders will come in 2019. These aircraft are slated to replace Fiji Airways’ current fleet of four 737-800s and one -700.

The -8s will serve short-haul markets in Australia, New Zealand and elsewhere in the South Pacific, the carrier said. The new aircraft are subject to a sale-leaseback agreement with GE Capital Aviation Services.

In its earnings report for 2017, Fiji Airways also said it has started “an evaluation campaign to select a wide-body jet aircraft type to augment and/or replace existing Airbus A330 fleet.” The airline operates three A330-200s and one A330-300.

Fiji Airways Group reported a pre-tax profit of F$95.8 million ($47 million) in 2017, up from F$84.5 million in the previous year. This was a record for the carrier, and its fourth successive annual pre-tax profit.

The airline is majority owned by the Fijian government. It increased annual revenues by 12.5% to F$929 million, with passenger numbers increasing by 14.3% year-on-year.

(Adrian Schofield - ATWOnline News)

Congress appropriates a 28% increase in funding for new aircraft

President Donald Trump signed into law on 23 March a spending bill that adds 143 aircraft, worth $9.5 billion, to what was already requested by the Department of Defence, including 20 additional F-35 Lightning II fighters, 10 F/A-18 Super Hornets, and three KC-46A tanker aircraft.

The defence spending was part of a $1.3 trillion budget that was six months overdue and only funds the government until 30 September. The Pentagon’s budget was boosted by $61 billion over last year to $700 billion. Congress appropriated $44 billion to aircraft procurement, 27.5 percent above what was requested by the Department of Defence.

The largest pile of money will be set aside to buy 90 Lockheed Martin F-35 Lightning II fighters, worth $10.2 billion in total. Some $2.9 billion of that total was not requested by the Department of Defence, but will fund 10 additional conventional take-off, six carrier variant and four vertical take-off F-35 Lightning II fighters, as well as additional tooling and spare engines, for the Air Force, Navy, and Marine Corps.

Congress also topped off the military’s wish list with 10 more Boeing F/A-18 Super Hornets for the Navy, worth $739 million. In all, the Navy is buying 24 Super Hornets for a sum of $1.8 billion in fiscal 2018.

And despite Secretary of the Air Force Heather Wilson heavily criticizing Boeing for what she believes will be further delivery delays of KC-46A Pegasus aerial refueling tankers during a House Armed Services Committee hearing on 20 March, Congress rewarded the company with three more unrequested orders, worth $510 million. In total, the Department of Defence has been appropriated $2.9 billion to order 18 KC-46A tankers this fiscal year.

The Department of Defence was also appropriated 16 additional Lockheed C-130 Hercules aircraft of differing variants – more than double the number of aircraft requested. Five MC-130J variants will go to Special Operations Command; six C-130J aircraft will go to Air National Guard; four KC-130J tanker aircraft will go to the Marine Corps; and one HC-130J aircraft will go to the Air Force. In total, Congress appropriated $2.4 billion for buying 25 C-130 Hercules aircraft.

(Garrett Reim - FlightGlobal News)

Great Lakes Airlines ceases flights after pilot shortage warnings

Great Lakes Airlines, a turboprop operator with a network that connected cities in the western USA, suspended all scheduled flights on 26 March.

The move, which follows several years during which the Cheyenne, Wyoming-based carrier trimmed scheduled flying, makes Great Lakes the latest small US regional airline to shut its doors.

Though Great Lakes has not specified why it ended operations, the company has long said a 2013 pilot hiring rule created a shortage of pilots that particularly impacted small regional airlines.

Part of Great Lakes Aviation, the carrier marketed and sold its own flights and operated under a codeshare agreement with United Airlines. It had partnerships with several other US airlines, including American Airlines and Delta Air Lines, according to securities filings.

Great Lakes did not respond to multiple telephone calls requesting comment. The once publicly-traded company delisted its stock in March 2016.

“At midnight tonight… Great Lakes will suspend scheduled flight operations as an air carrier,” the company says in a 26 March statement. “It is important to note that the company has not entered bankruptcy and will continue to operate certain segments of the business.”

Segments that will remain in operation include a deal under which Great Lakes provides ticketing and customer service for flights between Denver and the South Dakota cities of Pierre and Watertown, says the statement.

A company called Aerodynamics operates those flights, according to Aerodynamics’ website.

Great Lakes’ fleet includes six 30-seat Embraer EMB 120 Brasilias and 28 19-seat Beech 1900Ds, according to Flight Fleets Analyzer.

The company’s network connected about 10 cities from Watertown in the east to Los Angeles in the west, with most routes originating from Denver, FlightMaps Analytics shows.

In February, Great Lakes logged 1.7 million available seat miles (ASMs), according to FlightGlobal schedules data.

But several years ago the company’s network was much more substantial. In February 2015, Great Lakes served nearly 30 cities and logged 7.5 million ASMs, Diio shows.

Great Lakes was among US carriers to raise concern about the Federal Aviation Administration’s 2013 rule requiring airline pilots to have at least 1,500h of flight time, up from a previous minimum of 250h.

Critics insist the rule stymied the new-pilot pipeline. They say the cost of reaching the 1,500h threshold dissuades pilots from choosing an airline career, and they say the smallest regional carriers have been hardest hit. But proponents of the rule, including pilot unions, say it ensures more-qualified pilots are at the controls.

“It is difficult for a turboprop operator such as Great Lakes to compete for qualified pilots with other airlines operating larger jet equipment. These jet operators have greater revenue-generating capability due to the greater number of aircraft seats, and therefore can afford to offer higher compensation,” says a Great Lakes’ 2015 securities filing. “All of these factors put Great Lakes at a disadvantage, and the result is that small community air service is being lost as we reduce our level of operations to match pilot supply.”

In 2013, year Great Lakes requested that the FAA grant it an exemption from the 1,500h rule on the condition that it limit 19-seat Beach 1900Ds to just nine passengers. Nine-passenger aircraft fall outside the 1,500h rule requirement.

“Great Lakes had been confronting a sharp reduction in its eligible pilot hiring pool availability that was a byproduct” of the rule, the company said in a 2013 statement to the Senate Committee on Commerce, Science and Transportation.

The FAA granted that request.

Other small regional airlines have likewise shuttered operations or struggled financially in recent years.

Earlier this year, San Juan-based Seaborne Airlines filed for bankruptcy court protection, though it attributed the filing to hurricane-related disruptions.

In September 2016 independent operator SeaPort Airlines ceased operations.

(Jon Hemmerdinger - FlightGlobal News)

Greek airline making new Airbus order worth up to $5 billion

In a deal worth up to $5 billion, Greek airline Aegean said Wednesday it will buy 30 new Airbus aircraft, with the option of an additional 12, to upgrade its fleet as the country expects to break tourism records.

Aegean said it was signing a memorandum of understanding with Airbus for 30 of the A320neo and A321neo aircraft. Along with the option for the additional dozen, the agreement is worth $5 billion at list prices, making it the largest private investment in Greece, the airline said. Airlines often negotiate prices that are lower than the list price.

The signing of the final purchase agreement is expected in June.

"It's a big moment for Aegean ... and it's happening despite the (Greek) financial crisis and despite the challenges of international competition. Those are the conditions we grew in," said Eftichios Vassilakis, the airline's vice chairman.

Greece is expecting another record tourism year in 2018, after the country received 27 million visitors in 2017, according to Bank of Greece data.

The new aircraft have a choice of two engines, either from CFM International or Pratt and Whitney. The airline said it was in talks with both manufacturers and will make a decision on the engines by July.

The 19-year-old Star Alliance carrier currently has a fleet of 58 planes and will fly to around 80 destinations this year, combined with its subsidiary, Olympic Air.

(Miami Herald / The Associated Press)

JetBlue Swaps Trays for Carts to Speed Snack, Drink Service

JetBlue flight attendants are turning in their trays and will begin using onboard carts as passengers call for faster snack and beverage service and more options.

The shift on all JetBlue aircraft should cut service time by more than half, said Doug McGraw, a spokesman for the airline. Moving to carts will also enable the New York-based carrier to offer all snack and drink options on 95 percent of its flights, he said Tuesday.

Crew members preferred working with the carts in testing last year, McGraw said. The transition is occurring amid a switch to smaller “Space Flex” galleys made by Safran Zodiac Aerospace, as JetBlue outfits its Airbus A320 planes with more seats. Flight attendants currently take orders in the aisle and prepare drinks in the galley.

Switching to carts in late April will “mitigate some of the pain points with the Flex,” JetBlue Chief Executive Officer Robin Hayes said in a videotaped talk with employees last week.

“Do I love the fact that we had to go to Space Flex?” Hayes said. “No, I’ll be honest -- of course not. It creates a much bigger challenge for our crew members to provide that service.”

The airline’s change to carts will leave Southwest Airlines Co. as the last major U.S. carrier where drinks are carried to customers on trays. Southwest serves snacks from baskets. Flight attendants at the Dallas-based airline tested carts in 2012 but found that using trays let them provide better service and gave customers more freedom to move in the aisle, said Brad Hawkins, a spokesman.

JetBlue has always had carts in the galleys because they are used to load and unload beverages and supplies. The carrier will now use smaller half-carts that were designed by JetBlue employees, McGraw said.

(Mary Schlangenstein and Justin Bachman- Bloomberg News)

Boeing faces slowdown in 737 fuselage deliveries from Spirit AeroSystems

Boeing has been hit by a slowdown in deliveries of 737 fuselages from Spirit AeroSystems in Wichita, Kansas.

Although Boeing says it’s a short-term problem, the supply-chain glitch is threatening to stem, at least temporarily, the flow of cash it derives from the normally super-productive 737 program.

According to one Boeing worker who makes parts for the 737 in the Puget Sound region, “We’ve got 10 airplanes’ worth of product we can’t ship to Renton because of the fuselage shortages from Spirit.”

Boeing spokesman Doug Alder conceded that fuselage deliveries have been slowed but he said, so far, customer deliveries have not been affected.

“Boeing is working closely with Spirit as they track toward a full recovery in the next couple of weeks,” Alder said in a brief statement. “We have a plan in place to mitigate the issue in our factory so that airplane deliveries to our customers remain on schedule.”

The slowdown affects the complete fuselages that are delivered on rail cars daily from Wichita to Renton, where Boeing attaches the wings and installs all the airplane systems as well as the cabin interiors.

At the current production rate of 47 airplane deliveries per month, more than two jets roll out every working day from the Renton assembly plant, requiring a steady supply of those fuselages from Spirit.

Two weeks ago, the plant rolled out the 10,000th 737. And last year, about 42 percent of Boeing’s commercial-airplane-sales revenue came from the 737 program.

Spirit spokesman Fred Malley said the company has had problems in getting some parts from sub-tier suppliers.

“Spirit is focused on meeting increasing customer demand and higher production rates for the 737 program,” Malley said via email. “While we have had some challenges with some components, we are working closely with our customers and partners to meet commitments.”

More direct remarks by Spirit Chief Executive Tom Gentile almost two weeks ago at a JP Morgan industrial conference suggest the fuselage-delivery slowdown stems from problems in the company’s sub-tier supply chain.

In a question-and-answer session then, Gentile said supply-chain issues had caused disruption and higher costs in the fourth quarter of last year as more new-model 737 MAX fuselages came through the system at the same time as production was ramped up from 42 jets per month to 47 per month.

For that quarter, Spirit recorded a $21.7 million hit to pretax earnings attributed to higher costs on the 737 program.

Gentile said the supply-chain problems continued into the first months of this year.

“There’s tens of thousands of different parts that we put together for the 737. And we have 600 major suppliers, and it’s fair to say that the suppliers experience some difficulty going up in rate,” he told investors at the conference. “We’ll still see some stress in the first quarter, as we work our way through that.”

Now as the end of the first quarter approaches, that stress is appearing at the Boeing terminus of the supply chain.

Gentile said Spirit has identified the problematic suppliers, though he didn’t name them, and has sent out teams headed by executives to help fix their issues.

“We’ve put SWAT teams out at more than a dozen of the suppliers,” Gentile said. “In the case of all the suppliers that have been behind, we have action plans. We will review those on a daily basis. I see them at least weekly. I talk regularly with the CEOs of those companies.”

“We feel we’re getting on top of it,” Gentile summarized.

(Dominic Gates - The Seattle Times)

Hawaiian Airlines CEO explains why Airbus lost a major order to Boeing

Hawaiian Airlines announced an order for 10 Boeing 787-9 Dreamliners while canceling an existing order for six Airbus A330-800neos.
The Dreamliner was selected after an intense sales competition between Airbus and Boeing.

In an interview with Business Insider, Hawaiian Airlines CEO Peter Ingram explained why his company decided to abandon its long-standing Airbus order and go with Boeing.

On March 6, Hawaiian Airlines announced its decision to order 10 Boeing 787-9 Dreamliners with a list price of $2.82 billion. It was also the first major move the airline had made since Peter Ingram took over as president and CEO less than a week earlier.

Hawaiian Airlines CEO Peter Ingram.
(Photo by Hawaiian Airlines)

Ingram previously served as Hawaiian's chief commercial officer under former CEO Mark Dunkerley, who retired this month.

For Boeing, the announcement proved to be a double shot of good news.

At the same time as the Dreamliner announcement, Hawaiian also confirmed that it had canceled an order for six Airbus A330-800neos. It was the only six orders Airbus had for the aircraft type.

Hawaiian's decision to go with Boeing is the culmination of an intense and protracted sales competition between the 787-9 and the Airbus A330-900neo. As a result, Hawaiian is believed to have received a very substantial discount off the list price.

"Both airplanes are terrific and both had pros and cons," Ingram told Business Insider in a recent interview. "Ultimately, we came to a conclusion after a disciplined and detailed process that the 787-9 is the right airplane for us."

Hawaiian's decision to go with Boeing surprised some people. Over the past few years, Airbus had been on a roll with the Honolulu-based carrier. Hawaiian is replacing its Boeing 767-300s with smaller and much more efficient Airbus A321neos. More significantly, the airline's current flagship is its fleet of two dozen Airbus A330-200s.

Since the A330neo is simply an updated version of the A330 Hawaiian already has in service, it would make perfect sense to simply upgrade to the newer model of the plane it already has.

In fact, Ingram called the A330neo order "a natural extension" for the airline.

So how did Boeing manage to pull off the win?

The story goes all the way back to 2008, when Hawaiian placed an order with Airbus that included six next-generation A350-800 jets.

With room for about 280 people, the Dash 800 is the smallest member of the A350XWB family of carbon-composite wide-body jets. Even though the European airplane maker was able to find plenty of buyers for the plane, the company decided to effectively give up on it in favor of developing the A330neo. (Neo stands for new engine option.) The neo would also be available in two sizes: the smaller A330-800 and the larger A330-900.

As a result, in 2014, Hawaiian switched its order from the A350-800 to the A330-800.

However, Hawaiian proved to be the only airline to go with the A330-800, and that made Ingram and his team uncomfortable with the situation.

"Unfortunately, the A330-800 has not proved to be as popular in the marketplace," Ingram said. "But for us, it doesn't make sense to remain committed to an airplane that had the risk of not being sufficiently accepted in the marketplace in the future."

He continued: "So the lack of orders for the A330-800 opened us up to having a competition to look at the wide-body platform for us going into the decade."

The lack of industry acceptance creates all kinds of complications for airlines in terms of maintenance, service, and resale value.

Ingram went on to further explain his rationale. Even though Hawaiian purchases aircraft with plans to fly it for its entire service lift, the airline CEO also goes into it with the understanding that his company needs to remain nimble if the industry changes.

"From a risk management perspective, it's always prudent for us to consider what happens in the future if something affects the economics (of the business) and we need to make a change," he said. "The fact that there are no other customers for that particular variant at this time put us in the position where, if we continued with the order, we would have very few options if we need to make a change."

In short, Hawaiian didn't want to be stuck with a plane no one else wanted.

(Benjamin Zhang - Business Insider)

Monday, March 26, 2018

New Chinese Gulfstream G650

This new G650 B-3350 is captured undertow at Long Beach Airport (LGB/KLGB) on March 26, 2018. Destined for a Chinese customer, I have yet to identify airframe (fuselage) number but hope to soon.

(Photo by Michael Carter)

China Airlines transfers a LAX service to Ontario, California

Taiwan’s China Airlines has moved one of its two daily Los Angeles International Airport (LAX/KLAX) services to Ontario, California, in the eastern part of the metropolitan area, to get closer to ethnically Chinese people living there.

The service from Taipei is the first direct Asian connection for Ontario International(ONT/KONT), the carrier said, adding that it “has now set its sights on the market for travel between Greater Los Angeles and Southeast Asia.”

“Ontario Airport’s superb location means it’s close to local Chinese communities and can attract travelers from the east side of Greater Los Angeles,” China Airlines said.

The San Gabriel Valley in eastern Los Angeles is a popular residential location for immigrants from Taiwan and China and their descendants. ONT is about 80 km (50 mi.) east of LAX.

Boeing 777-300ERs are flying the Taipei-Ontario route, which opened March 25.

The unusual move means that China Airlines has reduced its frequency at LAX to one flight a day.

The carrier said it undertook extensive studies and assessments before shifting one daily service to ONT. Average bookings are already 70% full, “despite March through to April being the off-peak season.” 

(Bradley Perrett - Aviationweek / ATWOnline News)

Saturday, March 24, 2018

ANA to boost air cargo fleet, orders two 777Fs

Seeking to build on its fleet of Boeing 767-300 freighters, All Nippon Airways (ANA) has finalized an order for two 777Fs, which the carrier plans to fly on international routes, focusing on Asia, China and North America.

The order, valued at $678 million at list prices, continues a resurgent interest in Boeing’s 777F over the past year, with orders for seven of the model in 2017 (four from Ethiopian Airlines, three from Turkish Airlines and one from FedEx Express) and now five so far in 2018 (an unidentified customer ordered three 777Fs in February).

ANA will become the first Japanese carrier to fly the 777F, which—with a payload of 102,010 kg—nearly doubles the volume capability of the 767F. It is also capable of flying 4,970 nautical miles, expanding the 767F’s range by 1,715 nautical miles. ANA’s cargo fleet at present comprises four 767-300Fs and eight 767-300BCF converted freighters.

“Air cargo is an essential part of global trade growth,” ANA Cargo VP-corporate planning & administration Hiroshi Sugiguchi said. “We are committed to playing a critical role in further advancing Japan’s economic growth through trade and these new freighter airplanes will help us accomplish our goal.”

In its 2017 year-end analysis, IATA reported global air cargo traffic grew 9% year-over-year (YOY), more than doubling the 4.2% projected long-term growth rate for the market. In January 2018, traffic grew by 8% YOY, driven by increased global trade related to the ongoing rise in e-commerce. 

(Mark Nensel ATWOnline News)

American vs. Southwest: DFW's airlines disagree on new government regulation

Southwest Airlines and American Airlines have opposing viewpoints in regard to a new way the U.S. Department of Transportation plans on calculating a metric.

Set to take effect Jan. 1, 2019, the DOT will change the way mishandled bags are counted. Every month, the DOT publishes the Air Travel Consumer Report, which details how often an airline was on time to its destination. Another metric it publishes is the Mishandled Baggage Reports, which details how many times passengers' bags were lost, damaged, delayed in getting to the final destination, etc.

Starting next year, the DOT will change the way mishandled bags are counted.

Here's the current way MBR is calculated: Total baggage reports divided by enplaned passengers

And here's what the new formula will look like: Total baggage reports divided by enplaned bags

Southwest likes this change. American does not.

"We don’t oppose monthly operational metrics on Mishandled Baggage Reports," an American spokesperson said in a prepared statement to the Dallas Business Journal. "... We support a consistent industry standard that puts all carriers on a level playing field and give consumers the ability to make a true comparison."

Southwest did not respond to a request for comment.

Each airline wrote letters to the DOT stating their arguments for why the new measure should be enacted or scrapped. Here's what each airline had to say.

Southwest's Case

The Dallas-based airline said the current way of calculating the metric is "outdated," and the new way would be "a far more logical and accurate measure," because it uses the total number of bags to calculate the metric, not passengers.

This new rule change is sure to benefit Southwest, as its Bags Fly Free policy means passengers bring more bags on their flights than their competitors.

"Not every enplaned passenger checks a bag and many passengers check two or more," Robert Kneisley, associate general counsel for the airline, said in a letter to the DOT. "Moreover, as the department knows, the average rate of bags checked per passenger varies significantly by carrier."

And responding to claims by American and United that the measure would cost $10 million to install the necessary technology to better track bags, Southwest said that estimate is six years old and not true. Southwest says it could do the job for less than $3 million at its 600 gates with no material ongoing costs.

American's case

The Fort Worth-based airline penned a letter with United Continental responding to Southwest's claims. American and United do not want to change the way the metric is calculated.

One of the major reasons why American and United oppose the new rule is costs far outweigh the benefits, and nobody proving the rule will in fact be beneficial.

In its joint letter, American extrapolated Southwest's market share to show that the industry as a whole would end up paying $16 million to comply with the new rule.

"In the almost seven years since the department proposed the rule neither government, public interest groups nor any private party has been able to show any quantifiable, or even unquantifiable, public benefits of this rule," the letter to the government said.

"In fact," it continued, "no party has convincingly demonstrated that the government has a legitimate role in a deregulated industry of requiring airlines to report this service metric."

American and United do support one element of the new rule. Each airline favors a breakout of damage done to wheelchairs and scooters used by passengers with disabilities during travel into its own separate statistic.

(Evan Hoopfer - Dallas Business Journal)

Thursday, March 22, 2018

Boeing optimistic about 777F as air cargo demand increases

An extended period of sustained demand for global air cargo lift has Boeing optimistic about its freighter product line, including its slow-selling 777F.

“Over the last 18 to 24 months, we have seen industrial production come back. We’ve seen trade come back. We’ve seen a very strong and resilient cargo market,” Boeing Commercial Airplanes VP-marketing Randy Tinseth said. “We see strong demand potential for our freighter product line as we move forward.”

The upswing, which included a 9% year-over-year increase in global freight-ton kilometers in 2017, IATA data show, has breathed life into Boeing’s 747-8F and 767-300ERF programs.

Boeing has increased 767 production rates twice in the past two years, primarily to meet FedEx Express’s demands. The cargo carrier’s 46-aircraft order in July 2015 is the largest in 767 program history, and one of 11 it has placed. FedEx has taken delivery of 51 767-300ERFs and is scheduled to receive 54 of the 99 767s in Boeing’s backlog. UPS Airlines last month ordered four 767Fs to join the 59 it has in service.

UPS’s recent order included 14 747-8Fs, more than doubling Boeing’s 2017 747-8 order book of six aircraft and boosting the backlog to 25. The carrier, which had a 14-aircraft 747-8F order on the books from October 2016, has taken delivery of four.

Tinseth suggested that a comparable boost to the 777F order book may not be far off. “As we look at the 777 product line, we have a number of things in the pipeline around 777 freighters,” he told attendees at the recent Bank of America Merrill Lynch Global Industrials Conference.

Boeing said it has booked just 13 777F orders since July 2015, including a single, three-aircraft commitment this year from an undisclosed customer. It has sold a total of 171 777Fs and started March with a backlog of 33.

Interest in Boeing’s factory freighters could grow if demand persists and the pool of viable used aircraft grows more shallow. Atlas Air Worldwide recently added six 747-400Fs to its fleet, and said it would not rule out an order for more 747-8Fs if the freight market continues to show strength and the timing of deliveries makes sense. Atlas operates 10 747-8Fs.

(Sean Broderick - ATWOnline News)

Wednesday, March 21, 2018

China Southern places $3.6 billion Boeing 737 MAX order for Xiamen Airlines subsidiary

China Southern Airlines said on Wednesday it had placed an order for 30 Boeing 737 MAX narrow-bodies for its Xiamen Airlines subsidiary in a deal the plane maker said was worth more than $3.6 billion at list prices.

The order, including 20 737 MAX 8s and 10 737 MAX 10s for delivery between 2019 and 2022 will be used to increase efficiency and capacity, China Southern said in a filing to the Hong Kong Stock Exchange.

Xiamen Airlines in July had signed a provisional deal during the 2017 Paris Airshow to join the group of launch customers for the 737 MAX 10, the largest version of the Boeing narrow-body family.

Boeing said the firm order for 30 jets for Xiamen Airlines had been booked in 2017 and attributed to an unidentified customer at the time. The U.S. plane maker last year received 912 net orders after cancellations, while rival Airbus SE received 1,109.

Xiamen Airlines operates an all-Boeing fleet of more than 160 jets and the new airplanes will be used with subsidiaries including Hebei Airlines and Jiangxi Airlines, Boeing said in a statement.

(Jamie Freed - Reuters)

Tuesday, March 20, 2018

Spurred by Amazon, Airbus reportedly weighs building A330 cargo model

Airbus is considering building a freighter version of its slow-selling A330neo wide-body, spurred by requests from potential customers Amazon and United Parcel Service, according to people familiar with the matter.

The interest from Amazon and UPS could rekindle a competition between Airbus and Boeing as the global air-cargo market rebounds from a decade long slump. Production of the popular Boeing 767 freighter has been restricted as the U.S. manufacturer focuses on a military tanker variant that is more than a year behind schedule, the people said.

If Airbus moves ahead, the cargo model could help lift sales of the A330neo, a re-engined version of the European planemaker’s smallest wide-body, which has struggled in the marketplace. The aircraft has garnered 214 orders and lost a sale this month after Hawaiian Airlines switched to Boeing’s Dreamliner.

Airbus and Amazon declined to comment. “UPS studies possibilities for acquiring new and used aircraft as a matter of routine business. However, anything you may be hearing is speculation,’’ Glenn Zaccara, a spokesman for the Atlanta-based courier, said by email.

Airbus has already been exploring ways to boost sales of the A330, including a pitch to increase the jet’s maximum takeoff weight and range. Both Amazon and UPS are asking Airbus to consider stretching the A330-900’s fuselage to enable it to carry more cargo while flying a shorter range, the people said.

A freight variant would be a natural advancement of an aircraft that uses the same fuselage as its predecessor, the A330ceo. There is already a freighter version of the earlier model. It garnered just 42 orders over more than a decade, all but four of which have been delivered. One issue was that the A330 freighter’s front landing gear has to be extended to overcome a tilt forward on the passenger version that complicates cargo loading.

Amazon plans an initial fleet of 40 used 767 freighters for its Prime Air fleet, and has discussed ordering airplanes with Boeing in the past. The $1.5 billion air hub the company is plotting to build near Cincinnati suggests it will eventually have a far larger operation.

Still, it’s uncertain whether adding new engines to the A330ceo freighter would allow Toulouse, France-based Airbus to make significant inroads in a market dominated by Boeing. The Chicago-based company has logged 196 orders for its 767-300 freighter, almost five times more than the Airbus A330-200F, and has 61 undelivered planes.

Cargo carriers typically value cost and capacity over performance, said Richard Aboulafia, an aerospace consultant at Teal Group.

While Boeing’s freighter, at a list price of $212.2 million, is cheaper, brand-new cargo planes from both companies also face competition from inexpensive conversions from used passenger models. A wave of retired 767s and A330s provide “a lot of feedstock,’’ Aboulafia said by telephone.

(Julie Johnsson and Benjamin Katz - Bloomberg News / The Seattle Times)

Saturday, March 17, 2018

Hong Kong Airlines Airbus A350-941 (c/n 187) B-LGD

The carriers newest A350 which was delivered on February 28, 2018 is captured arriving at Los Angeles International Airport (LAX/KLAX) on a glorious St. Patrick's Day morning here in SoCal.
(Photo by Michael Carter)

Boeing moves to keep 777X on track after engine snag

Boeing Co has scrambled to reorganize testing of its new 777X to avoid being delayed by engine snags, while robots and mechanics are starting work on the fuselage, the executive who heads efforts to build the world's largest twin-engined jet said in an interview.

Engine supplier General Electric began flight trials of its new GE9X jet engine on Tuesday after a three-month delay caused mainly by a problem in its compressor. But to put the engine development back on track it must build a new component.

During that time, Boeing will place two temporary engines on the first flight-test aircraft that is gradually beginning to take shape, starting with its lightweight carbon wings and now the fuselage, which Boeing says is on schedule.

The engines, identical in every other respect to the ones that will go into service, will be swapped for fresh ones with the new part before the first 777X carries out its maiden flight next year. The temporary engines will not be fired up, but having them in place will allow other tests to go ahead.

"Honestly, when this happened I thought 'this is going to be bad' and we just kept grinding and grinding at it, and we came up with some pretty creative things to test where we could, build where we could," 777X Vice President and General Manager Eric Lindblad told Reuters.

"To put engines on and then take them off - that is all to protect the schedule," Lindblad said.

The hurried rejig reflects the fact that after years of planning, production has begun in earnest - something evident from activity inside Boeing's new high-tech wing center.

"We are at the point where it is time to start scaling up the speed that we build things here," Lindblad said inside the 1.3 million-square-foot (120,800-square-meter) fabrication plant where machines weave and bake major parts of the carbon wings.

The engine swap is also an example of how Boeing is trying to avoid eating into the 'buffer' traditionally built into development schedules. That's because it faces a challenging two years before the latest version of its 777 enters service.

"We are now in the thick of it ... There is no more waiting until later to solve problems," Lindblad said. "There are still two years left. You cannot give away your buffer."

The 777X aims to maintain Boeing's grip on the 'mini-jumbo' market by leapfrogging Airbus SE's 365-seat A350-1000. Boeing has sold over 300 jets, though activity has slowed.


So far, Boeing says it is on track to meet a 2020 target for delivering the first 406-seat 777-9 model to Emirates Airline.

But although the engine snag marks the first significant public slippage, Boeing has already faced a number of teething problems in building carbon wings and other components.

"Everything is hard at this point where you start building an airplane. When you ask me how wing assembly has been going, it's been hard," Lindblad said.

One of the problems involves fitting the carbon panels to the skeleton of spars and ribs, with the light but strong carbon-fiber material less forgiving than traditional aluminum.

"Assuming we continue to march our way through the plan that we have laid out, I feel pretty optimistic about (the engine) and I think that wing assembly is a matter of incorporating the learnings," Lindblad said.

Six months ago, Lindblad says something else was making him feel "queasy". Integration of aircraft systems in a special demonstration lab was not happening as quickly as planned.

"I am more optimistic today," he said. He added that he would be "cautiously guarded" until the first flight, due in the first quarter of 2019.

Another headache has been producing enough wing stringers: reinforcing strips that go outwards from the fuselage.

"I feel confident we have got a plan for that so we are tracking basically back to schedule."

Now Boeing must marry together the various wing parts and produce the long metallic fuselage.

Fuselage panels arriving from Japan have been loaded into a "Fuselage Automated Upright Build" (FAUB) machine used to fasten them. Boeing had delays when the machine was tried out on existing versions of the 777, but Boeing says the system is now running at full speed of five planes a month.

Drawing on experience of the smaller 737 MAX, which has absorbed production increases on a larger scale, Lindblad said the 777X production system had been set up to handle a targeted speed but would not disclose capacity.

"We are planning for world demand," he said.

The first task is to get flight trials under way so that ambitious fuel-saving goals can be tested.

"Will we get four airplanes in the flight test on schedule? We'll see. I think we have a pretty good shot at it."

(Tim Hepher - Reuters Yahoo Business News)

Boeing completes 737 MAX 7 first flight


Boeing test pilots completed a 3-hour, 10 min. first flight of the 737-7, the third and smallest member of the 737 MAX family, when the aircraft landed at Boeing Field, Seattle, on March 16.

Boeing is scheduled to spend the bulk of this year completing the flight test and certification program before delivering the initial 737-7 in 2019.

However, the company is banking on positive performance results from the test campaign to help stimulate further orders for the variant. While overall sales of the MAX now exceed 4,300, the diminutive 737-7 is believed to have attracted less than 100 orders, lagging behind its siblings as operators continue to “up-gauge” to larger aircraft.

Despite a redesign of the -7 in 2016 at the request of launch customer Southwest Airlines and Canada’s WestJet, which added range and an extra 12 passenger seats, Boeing until now has acknowledged only around 60 firm orders for the variant, which seats 138 in a typical two-class configuration. However, Boeing believes the aircraft’s range capability of 3,850 nm, the greatest of any MAX version, could make it attractive for airlines looking to open new point-to-point routes in much the same way as the 787.

The second 737-7, which is scheduled to join the program in coming weeks, is set to conduct “hot and high” temperature and altitude takeoff tests in China where Boeing anticipates additional demand for the aircraft will emerge.

Piloted for its maiden flight by Boeing test and evaluation captains Jim Webb and Keith Otsuka, the aircraft departed Renton, site of Boeing’s 737 production line, at 10.17 am and climbed to 25,000 ft. and 250 kt. while heading west to pass over the Olympic Peninsula before flying back over Seattle on its way to eastern Washington. The crew continued to conduct handling tests while descending to 15,000 ft. before flying a missed approach to Boeing’s Moses Lake test site. The aircraft was then flown to the Mount Rainier area where Boeing took the opportunity to capture some air-to-air photographs before landing at Boeing Field, Seattle.

Boeing says aerodynamic and propulsion improvements developed for the MAX 7 enable it to fly 1,000 nm farther and carry more passengers than its predecessor, the 737-700, while having 18% lower fuel costs per seat. As a result, the company said the MAX 7 has the advantage over its nearest rival, the Airbus A319neo. The aircraft, it said, carries 12 more passengers 400 nm farther than the smaller Airbus and with “7% lower operating costs per seat.”

Other close rivals in the tightly contested 130-seat sector include Bombardier’s stretched CS300 and the Embraer E195-E2.

(Guy Norris - Aviation Week / ATWOnline News)

Saturday, March 10, 2018

Turkish Airlines to buy at least 50 Airbus, Boeing jets

Turkish Airlines has confirmed plans to buy at least 50 wide-body aircraft from Airbus and Boeing as the flag carrier ramps up its ambitions ahead of a move to a new Istanbul airport.

The company said in a statement late Friday that it had agreed to buy 25 Boeing B787-9 aircraft, known as the Dreamliner, and 25 Airbus A350-900 aircraft.

In addition, it has the option to buy five more of each aircraft from both suppliers, meaning the eventual purchase could total 60 planes.

It said six would be delivered in 2019, 14 in 2020, 10 in 2021, 12 in 2022, 11 in 2023 and 7 in the year 2024.

A statement by Airbus indicated that the catalogue price of the 25 A350s alone would amount to $9.5 billion.

Turkish Airlines chief executive Ilker Ayci said that the announcement came after agreements signed during recent visits to France and the United States -- the homes of Airbus and Boeing -- by President Recep Tayyip Erdogan.

He hailed the deals as a "very important initiative to meet the need for wide-body aircraft at the new airport" and strengthen the fleet ahead of the 100th anniversary of the founding of modern Turkey in 2023.

"We believe this will not just accelerate the steady rise of Turkish Airlines, but also contribute to Turkish civil aviation as a whole," Ayci said, quoted by the Anadolu news agency.

The government plans to open the new airport by Istanbul's Black Sea coast on October 29, hoping to make it a global hub that can compete with Dubai for transfer traffic.

Turkish Airlines, which is 49-percent owned by the government through a wealth fund, has grown exponentially in recent years in a rise strongly supported by Erdogan to create a national champion.

Passenger numbers have swelled from just 14 million in 2005 to 69 million in 2017.

And the airline is targeting a total 74 million passengers in 2018 and wants to expand its fleet from 329 at present to 424 planes by 2023.

(AFP / Yahoo Business News)

Thursday, March 8, 2018

American to Retire 45 Boeing 737s in Next Two Years

American Airlines Boeing 737-823 (30084/629) N942AN delivered to the carrier on August 14, 2000 is captured on short final to Rwy 30 at Long Beach Airport (LGB/KLGB).
(Photo by Michael Carter)

American Airlines Group Inc. plans to retire 45 of its oldest Boeing 737 jets over the next two years as part of an overhaul that will reduce the age of its workhorse narrow-body fleet.

The Fort Worth, Texas, carrier plans to withdraw 12 of the aircraft next year and 33 in 2020, or about three a month. American’s oldest 737-800s are almost 19 years old, although recent deliveries have reduced the group’s average age to 8.1 years, according to the airline’s annual report. American had 304 of the Boeing model at the end of last year, making up nearly one-third of its main jet fleet.

“It’s strictly an age-based retirement at this point,” American spokesman Josh Freed said Thursday. “We have some that we took back in 1999.” Older planes tend to require more maintenance than newer models.

Between the end of this year and the end of 2020, American plans to add 50 Airbus A321neo jets and 40 Boeing 737 Max aircraft, according to a regulatory filing.

The changes are part of American’s broader effort to offset deliveries of new planes with retirements to hold its mainline fleet at around 950, although the figure is set to drop to 935 in 2020. The carrier has received 469 new planes since it merged with US Airways at the end of 2013. It has retired the same number, lowering its average fleet age to 10 from 13.

By the end of next year, American will shed the last of its aging MD-80s, which have an average age of 21.3 years. The carrier previously had as many as 375 of the planes, which once made up the majority of its fleet.

(Mary Schlangenstein - Bloomberg Business News)

Sims succeeds Saretsky as chief of WestJet

WestJet executive vice-president of commercial Ed Sims has succeeded Gregg Saretsky as president and chief executive of the Calgary-based airline, effective immediately.

Saretsky, who has headed WestJet since 2010, will retire.

"Gregg Saretsky, president and CEO, has advised the time has come for him to retire from the company. Having found his successor, he has agreed with the company that his retirement will be effective immediately," the airline says.

"With plans well underway for the launch of Swoop and the introduction of the 787-9 Dreamliners on the horizon… I'm confident WestJet will continue to grow to the next chapter and beyond," says Saretsky.

Saretsky joined WestJet in June 2009 as vice-president of WestJet vacations. He became the company's executive vice-president of operations in October 2009, then became chief executive in March 2010.

A newcomer to WestJet, Sims joined the airline as executive vice-president of commercial in May 2017, taking a position previously held by Bob Cummings, who transitioned to head WestJet's new ultra-low-cost subsidiary Swoop.

Sims previously had been chief executive of Airways New Zealand, that country's air service provider. He also worked at Tui, Thomas Cook, Virgin Group and Air New Zealand, leading the latter's international widebody business, WestJet notes.

"I am honoured by the opportunity to assume the role of president and CEO, and believe strongly in WestJet's next global chapter and the growth potential ahead," says Sims. "WestJet has a strong challenger's spirit."

The change comes at a pivotal moment for WestJet, which is executing a business transformation executives say will help it compete at all spectrums of the air travel market.

That transformation includes the launch of Swoop, aimed at attracting price-sensitive travellers. Swoop is scheduled to operate its first flight on 20 June.

Meanwhile, the company is going upscale and international. WestJet is preparing to take delivery of 10 Boeing 787-9s, an aircraft that will help the largely-provincial carrier expand overseas. WestJet is also building business class lounges and has discussed adding business class to its 737s.

(Jon Hemmerdinger - FlightGlobal News) 

Virgin cancels long-dormant A380 order

Virgin Atlantic has finally cancelled its order for six Airbus A380s, the airframer's latest backlog data shows.

Airbus has listed a cancellation of six of the double-deck type in its figures covering the first two months of this year.

Virgin Atlantic had six A380s on order, but Airbus no longer lists these aircraft against the UK airline.

The carrier had been among the first A380 customers, originally signing for the Rolls-Royce Trent 900-powered jets in 2001.

But it has repeatedly postponed deliveries – the jets were supposed to have been handed to the airline in 2006 – and Virgin Atlantic has since amended its fleet plans to include long-haul twinjets such as the Boeing 787 and Airbus A350-1000.

Virgin Atlantic has confirmed the A380 cancellation.

"Following a thorough review of our fleet we have taken the decision not to pursue our order for six Airbus A380," says the carrier.

It says it is "in discussions" to acquire additional A350-1000s, as it prepares to introduce the first of its current batch of 12 from spring next year.

"We believe the A350-1000 will best serve our customers and network, and will enable us continue reducing the carbon emissions from our fleet, through our ongoing investment in quieter, more fuel efficient aircraft," it adds.

Airbus has lifted the A380 backlog, however, with the inclusion of 20 firm aircraft for Emirates.

These take total A380 orders to 331 of which 222 have been delivered, leaving 109 still to be produced.

Airbus is aiming to deliver 12 A380s this year but is intending to cut production of the A380 to just six aircraft per year from 2020.

(David Kaminski-Morrow - FlightGlobal News) 

Rolls-Royce spending millions of dollars to repair 787 engines

The deterioration of turbine blades inside Rolls-Royce jet engines that power more than 200 in-service 787 Dreamliners has required constant monitoring of the engines and urgent maintenance in some cases. The problems have caused serious disruption to airlines — and they’re proving costly to the British engine-maker.

Rolls on Wednesday reported an accounting charge of $315 million to cover ongoing repairs to two models of its jet engines, mostly the Trent 1000 in the Boeing 787 fleet, as well as compensation to airlines for planes taken out of service for the engine retrofits.

The affected Trent 1000 engines now flying will be monitored and gradually taken out of service and repaired through 2022.

“These issues have required urgent short-term support including both on-wing and shop visit intervention which has resulted in increased disruption for some of our customers,” Rolls said in a news release. It said it is “making solid progress with longer-term solutions, largely through re-designing affected parts.”

The problems with the engines first appeared in 2016, when All Nippon Airways (ANA) of Japan discovered that turbine blades inside the engine were corroding faster than expected and said it would have to cancel up to 300 flights as it took aircraft out of service for repairs.

Similar problems later were discovered by British Airways, Air New Zealand, Norwegian Air and Virgin Atlantic.

The European Aviation Safety Agency (EASA) in 2016 issued an airworthiness directive after an investigation of high engine vibration during climb revealed damage to some Trent 1000 high pressure turbine blades attributed to cracks in the metal.

The U.S. Federal Aviation Administration (FAA) followed up a year ago with its own directive requiring repetitive inspections of Trent 1000 high-pressure turbine blades.

In December, Air New Zealand took two of its 787s out of service after each encountered in-flight abnormalities in one engine. The airline canceled some flights and delayed others as engines were taken out of service for repair with no replacement engines available.

“The remainder of the (Air new Zealand 787) fleet is subject to a Rolls-Royce approved monitoring and scheduled maintenance program,” said airline spokeswoman Hannah Searle, in an email.

Norwegian Air is swapping out 42 Trent 1000 engines in its fleet.

Boeing spokesman Paul Bergman said the jetmaker is working with Rolls-Royce and its airline customers to ensure the engine issues are “addressed in a timely manner.”

ANA spokewoman Nao Gunji said the airline has “been able to operationally manage the situation to avoid a major impact to our scheduled service.”

The second Rolls engine affected by the early corrosion problem is the Trent 900, which powers some models of the Airbus A380 super-jumbo jet.

Rolls has also redesigned an extended-life turbine blade for this engine and further redesigns will be available in 2020.

The engine-maker said Wednesday that the cash impact to cover the problems with both the Trent 1000 and Trent 900 was $236 million last year, will rise to a peak of about $472 million next year and is expected to decline to $333 million in 2019.

(Dominic Gates - The Seattle Times)

VietJet will make widebody decision by year-end

Vietnam low-cost carrier VietJet Air will make a decision on whether to obtain wide-body aircraft by the end of 2018.

The carrier, which operates narrow-body aircraft mainly on domestic routes, is considering three options, says carrier vice president Nguyen Thi Thuy Binh. These are the Boeing 787, Airbus A330neo, and the A350.

"We are near a conclusion," says Nguyen. "This year we will decide yes or no. We've taken a long time to study this model, and we're being very careful about the cost efficiencies of wide-bodies. This year we will make a conclusion."

For several years, VietJet executives have flirted with the idea of using wide-bodies to serve the Vietnamese diaspora in the United States, Europe, and Australia.

"Our advantage is that we understand Vietnamese [people], and we know what they expect," she says. "Countries where you have huge Vietnamese communities will be our future markets."

Vietnam Airlines is also considering the launch of services to Los Angeles, possibly as soon as 2019. The country has no FAA category rating, precluding Vietnamese airlines from launching US services, but category 1 is expected to be granted in May.

Nguyen declined to discuss how a VietJet wide-body would be configured, but stressed that there are vast differences between narrow and wide-body operations.

"We try to think about how we can provide a reasonable experience for the customer," she says. "How do we make them the most comfortable?"

In an August 2016 interview with Flight Airline Business, VietJet's chief executive held open the eventual possibility of long-haul, wide-body operations, but said that the carrier was content to focus on narrow-bodies.

Nguyen adds that the carrier has also looked at the A321LR as a way tapping markets farther afield.

"We are studying the range of this aircraft and it's very interesting," she says. The company is studying the cost effectiveness of the type.

Nguyen adds that the mainline VietJet Air carrier will take 15 new A320 family aircraft this year after taking 17 in 2017. Flight Fleets Analyzer shows that the carrier has 55 A320 family aircraft in service, with orders for 77. In addition, it has orders for 100 Boeing 737 Max 200s.

A major focus will continue to be international growth. In 2017, international traffic grew to 20% of total traffic, compared with 18% a year earlier. By 2020, VietJet aims for 35% of its traffic to be international.

Key markets for development include India and Japan, where VietJet presently has no services. It also aims to increase frequencies to existing North Asian destinations in South Korea, China, and Taiwan.

Apart from demand locally and abroad for LCC services to Vietnam, growth to North Asia is partially driven by the slot situation at Ho Chi Minh City's Tan Son Nhat International Airport. Nguyen says the carrier has added flights in the evening to North Asian destinations, and passengers generally do not mind late departures because they can get a full day in their destination upon arrival.

In addition, the carrier plans to have a new e-commerce platform implemented by the third quarter. This will be integrated with its passenger service system.

"Whatever passengers need, they can select: fares, tickets, seats, baggage, meals, hotels, insurance... even consumer goods," she says. "2018 is a year of innovation and connectivity."

(Greg Waldron - FlightGlobal News)

Wednesday, March 7, 2018

Boeing promotes government operations leader Tim Keating ahead of 797 decision


Boeing has promoted Tim Keating to executive vice president of government operations.

Keating, 56, has served as senior vice president of government operations since joining Boeing in May 2008. He leads the unit's office in Arlington, Virginia, heading up the company's public policy efforts, including all U.S. federal, state and local government liaison operations.

Boeing's government operations unit will play a key role as the jet maker comes closer to making a decision about whether to launch a new mid-sized airplane and where to build it.

Tax incentive packages offered by lawmakers and bureaucrats in Washington state and competitors for the new jet, dubbed the 797, will be among the top factors that influence the company's decision.

Boeing Chairman, President and CEO Dennis Muilenburg said Keating will also serve on Boeing's Executive Council, a select group of top leaders and executives, and continue to lead the Boeing Global Engagement organization, the company's philanthropic unit.

"This well-earned promotion recognizes Tim's many contributions to our company over the past decade and reflects the critical role he and his talented team play every day in the long-term success of our business," Muilenburg said in a news release. "Tim has worked tirelessly to develop and strengthen relationships at all levels of government and in our communities to help ensure our collective voices are heard on issues important to Boeing, our people and our customers."

Before joining Boeing, Keating was senior vice president of global government relations at Honeywell International. He was also chairman of the board and managing partner at Washington lobbying firm Timmons and Co.

Earlier in his career, Keating served the Clinton Administration as special assistant to the president and staff director for White House Legislative Affairs, Boeing said.

(Andrew McIntosh - Puget Sound Business Journal)

Tuesday, March 6, 2018

Hawaiian Airlines to purchase 10 Boeing Dreamliners in lieu of Airbus planes

Hawaiian Airlines announced Tuesday that it will purchase 10 Boeing Dreamliner aircraft in lieu of its original plan to purchase planes from Airbus Industries.

The Honolulu airline has executed a non-binding letter of intent for the purchase of the Boeing 787-9 aircraft, with the first plane scheduled to arrive in the first quarter of 2021.

General Electric’s GEnx engine will power the 10 aircraft, which will be used for Hawaiian’s long-haul Asia/Pacific and North America routes.

“The Dreamliner combines excellent comfort for our guests with fantastic operational performance and will allow us to continue modernizing our fleet into the next decade,” said Hawaiian Airlines President and CEO Peter Ingram in a statement. “It has more seating capacity than Hawaiian’s current wide-body fleet, which will allow us to further build upon our successful growth in Asia."

In 2014, Hawaiian ordered and finalized six A330-800neo planes from Airbus. The company chose to instead go with Boeing as the result of a competitive bid process, the airline said.

“We were in the enviable position of choosing between two outstanding models for our flagship aircraft of the future and I couldn’t be more excited about the prospect of adding the Dreamliner to Hawaiian’s fleet,” Ingram said.

The wide-body aircraft is fuel-efficient, lightweight and passenger friendly because it allows the airline to pressurize cabins at a lower altitude, according to Hawaiian said. Additional features include a quiet cabin, dimmable LED window shades, and larger overhead luggage bins.

Hawaiian expects to finalize binding purchase agreements with Boeing and GE in the second quarter of this year. The company also said it plans to begin negotiating inclusion of the new Boeing aircraft in its contracts with the Air Line Pilots Association and the Association of Flight Attendants, which is required prior to final approval of the purchase by the company’s board of directors.

Hawaiian currently operates a mainline fleet of 54 aircraft: 24 Airbus A330-200, eight Boeing 767 wide-body aircraft, two Airbus A321neo planes and 20 Boeing 717 narrow-body aircraft.

(Katie Murar - Pacific Business News)

IAG's Walsh Calls for Cheaper A380s as It Considers Fleet Plan for Level

IAG could consider buying more A380s from Airbus if the superjumbo was cheaper, CEO Willie Walsh said, adding that he was also looking at planes for the airline group's new carrier Level.

IAG operates the British Airways, Iberia, Vueling and Aer Lingus airlines, as well as Level, a low cost unit launched last year which flies between Europe and the United States.

IAG already operates 12 A380s, and could be interested in buying more if Airbus improved the pricing, Walsh said, although the airline was not currently negotiating with Airbus.

"The pricing that Airbus has offered in the past is unacceptable to us," Walsh said on the sidelines of a conference hosted by industry body Airlines for Europe.

"We've said very clearly to Airbus if they want to sell A380s they need to be aggressive on pricing and when they work out how to sell the aircraft, knock on our door and we'll talk to them."

Airbus secured the future of the superjumbo when it agreed a deal with airline Emirates in January for up to 36 A380s worth as much as $16 billion at list prices.

For Barcelona-based Level, Walsh said he would need to buy planes to meet a plan to grow the fleet to 30 aircraft by 2022, and would consider a number of different aircraft.

"I think in five years' time, I think there might be opportunities for a different aircraft type," he said, suggesting that Level would not just stick to the A330s it currently operates.

"There are Airbus options with the A330-neo or the A350 and as I said more and more we'll see Boeing 787s becoming available at that stage," Walsh said, noting that 787s may become an option in the coming years, if their price comes down or second-hand planes become available.

Those decisions may fall to Level's new chief executive. Walsh said IAG was in the final stages of interviews to appoint a CEO for Level.

Among Walsh's other concerns is the building of a new runway at Heathrow Airport in London, where IAG's biggest airline British Airways is based.

IAG would be interested in running terminals at Heathrow, Walsh said.

The company already runs a terminal at JFK airport in New York and Walsh cited the example of Munich's terminal 2, run as a joint venture between airline Lufthansa and the airport, as a "good example" of how this can be done.

"Would I like to run Terminal 5? Absolutely," Walsh said when asked about his interest in running parts of Heathrow.

Walsh has long-complained about the cost of a proposed new runway at Heathrow, and a lack of competition at the airport, and has recently called for Britain to allow other operators to build facilities and run terminals at Heathrow.

"We know how to do it (run terminals) and we know the benefit that that can bring so we're open to doing it," he said.

(Sarah Young - Reuters)

Ryanair to use "pretty much all" of Boeing 737 buying options

Ryanair expects to exercise "pretty much all" of the options it has to buy Boeing's 737 MAX 200 jets, chief executive Michael O'Leary said on Tuesday.

Ryanair has options to buy 100 of the planes, which it expects will lower its fuel consumption and offers a greater number of seats. The Ireland-based company was the launch customer for the 196-passenger jet in 2014.

"I expect we will exercise pretty much all of these options as they come due to exercise two years prior to delivery," O'Leary told a news conference in Brussels. 

(Robert-Jan Bartunek and Samantha Koester - Reuters / Yahoo Business)

Boeing unlikely to resume passenger 767 production

Boeing is unlikely to resume production of the passenger version of the 767-300ER, even as airlines look to meet fleet needs until the possible New Mid-market Aircraft (NMA) comes on the market in the next decade.

"Bringing back the 767 passenger airplane – I just don't see it," says Randy Tinseth, vice-president of marketing at Boeing Commercial Airplanes, during a media briefing from an industry conference in San Diego.

The airframer continues to build military and freighter versions of the 767, and executives have said as recently as November 2017 that resuming production of the passenger variant was an option.

Reports last fall suggested that Boeing could resume production of the passenger 767-300ER to act as a bridge until the NMA debuts in the 2024 to 2025 timeframe. United Airlines was understood to have expressed interest.

Boeing chief executive Dennis Muilenburg said last November that the airframer had "broad customer interest" in the 767 beyond military and freighter uses.

However, resuming production would only act as a bridge until the NMA and not provide airlines with an aircraft with next generation engines and economics that they are looking for.

Tinseth says today that potential customers for the NMA, which is aimed at replacing ageing 757 and 767 fleets, tell Boeing that they are happy waiting for an entry-into-service as late as 2025.

The NMA would seat 220-270 passengers and have a range of around 5,000nm, he says.

American Airlines, Delta Air Lines and United Airlines have all expressed interest in the NMA, with Delta chief executive Ed Bastian reportedly telling pilots in February that the airline would like to launch the new aircraft.

The three US carrier operated a combined 238 757s and 153 767s with an average age of 20.1 years and 20.4 years, respectively, Flight Fleets Analzyer shows.

Boeing faces competition from Airbus for some of the 757 and 767 replacement market. The European airframer will deliver its first A321LR this year targeting some transatlantic 757s and airlines, including American and United, are considering the A330-800neo to replace their 767 fleets.

The A330-800neo is scheduled to enter service in 2019. However, the future of the variant is in question as the only customer – Hawaiian Airlines – is publicly exploring options to drop the order, with reports suggesting a possible Boeing 787-9 deal.

(Edward Russell - FlightGlobal News)

Israel claims Saudi Arabia is allowing use of its airspace for the first time in 70 years

Israeli Prime Minister Benjamin Netanyahu told reporters on Monday that Saudi Arabia has given permission to an airline flying through to Tel Aviv to use its airspace.

"Air India signed an agreement today to fly to Israel over Saudi Arabia," he said during a briefing in Washington, DC on Monday, according to Times of Israel.

Currently, Saudi Arabia does not recognize Israel and has banned any flights to the country from using its airspace for more than 70 years. If Netanyahu's claims are correct, it would mark the first time Saudi Arabia has allowed commercial flights to Israel to use its airspace, and would signal a significant shift in strategic policy in the region.

But an Air India spokesman denied the Prime Minister's comments several hours later, stressing they had not received any confirmation and had only submitted a request for a flight along that route.

"We have yet to receive anything from authorities," Air India spokesman Praveen Bhatnagar told The Times of Israel.

Saudi Arabia's aviation authority did not respond to requests for comment from Business Insider.

Last month, Air India confirmed it had begun plans for three faster weekly flights between Israel and India, although Saudi Arabia's aviation authority was quick to deny reports that its airspace would be used.

At the time, Israel's Airports Authority told Reuters the service was set to begin in early March.

Currently, Israel's national airline El Al is the only airline offering direct flights from Israel to India. The route avoids flying into neighboring Saudi Arabia's airspace by diverting to the Red Sea and around the Arabian peninsula, adding two hours to the overall trip.

If Saudi Arabia were to ease its airspace regulations it could be seen as concrete evidence of warming relations with Israel and a broader re-configuring of regional alliances.

(Rosie Perper - Business Insider)

Monday, March 5, 2018

Boeing expects more 777 Freighter orders as air cargo market surges

Boeing expects to secure new orders for 777 Freighters later this year thanks to a surging air cargo market, a senior executive said Monday.

"You're going to see more 777 Freighters (orders) this year as that market continues to improve," Boeing Commercial Airplanes Vice President of Marketing Randy Tinseth said during a conference call with journalists during the annual International Society of Transport Aircraft Trading conference in San Diego, California.

Asked if he meant new 777 cargo jet orders in the single or double digits, Tinseth declined to answer but added: "There's a lot of freighters in the pipeline and I'm confident that a lot of them will come home,"

Boeing makes the 777 Freighter in Everett. The wide-body aircraft has a list price of $339.2 million, and a surge of orders would be good news for the jet maker and its Puget Sound-area supply chain.

Boeing has not yet reported an order for a 777 Freighter in 2018, but has so far only disclosed deals for the month of January. Boeing has 30 undelivered orders for 777 Freighters, all of them powered by GE engines, according to Boeing's website.

The International Air Transport Association said in late January that global air freight markets grew nine percent in 2017, more than double the increase in 2016.

Last month, shipping giant UPS ordered 14 Boeing 747-8F cargo jets and four Boeing 767 freighters, saying it needs the 18 new aircraft to boost its air cargo capacity amid surging global demand.

In January, Boeing disclosed an order for three 777 freighters from Turkish Airlines. Worth $977.1 million at list prices, that order came weeks after the carrier took delivery of two 777 cargo jets.

Tim Myers, president of Boeing Capital Corp., said at the ISTAT conference that aircraft sales have been spurred by alternative financing solutions that emerged because of the inability of the Export–Import Bank of the U.S. to approve new aircraft loans.

More than $1 billion of new airplane deliveries in 2017 were supported by a new Marsh McLennan affiliate called the Aircraft Finance Insurance Consortium.

(Andrew McIntosh - Puget Sound Business Journal)