Airbus cuts A380 production
Europe’s Airbus announced it is drastically cutting back on production of its A380 superjumbo jet and warned the programme could sink into the red if new orders are not lined up. The company said it would build only 20 of the doubledecker jet in 2017 and cut that number further to just 12 planes in 2018. Those figures compared to the 27 it delivered in 2015.
The company maintains it has no plans to cancel the A380 programme, which currently has 193 planes flying currently with 126 on order, far below initial estimates of 1,200 flying by this time, according to Airbus’ estimates in 2005, when the plane was first introduced.
The programme has been difficult from the start for Airbus, which hoped to use the plane to dislodge rival Boeing from its lead in the superjumbo category with its stalwart 747. The A380 programme ran years late and billions of dollars over budget and caused a crisis at Airbus because of wiring problems, delayed deliveries and other problems.
Airbus officials said they expect to earn money on the programme for the rest of this year and next, but it said it would also work to cut costs to lower its break-even point on the planes even further. The planes cost US$433 million, but airlines do not pay list prices.
The company said at the beginning of the jet’s development that airlines would embrace the large plane because of the leap in air travel that crimped capacity at airports around the world. The problem is airlines worried about filling seats on such a large aircraft on single routes. The plane is also troubled by the lack of a secondary market that would keep it flying for much longer like the 747.
Boeing signs deals for 20 737 MAX 8s, 6 Dreamliners
Boeing and Air Europa announced an order for 20 737 MAX 8s at the 2016 Farnborough International Airshow. The order was previously attributed to an unidentified customer on Boeing's Orders & Deliveries web site. The order would be worth US$2.2 billion at list prices.
Boeing also said it had signed a deal to finalise an order with Ruili Airlines for six 787-9 Dreamliners valued at US$1.59 billion at current list prices. The order represents the first widebody order for the Yunnan-based carrier.
Ruili Airlines first announced an intent to order the six 787-9 Dreamliners in May at the ceremony for the airline's two-year anniversary. Established in February 2014, Ruili operates a fleet of nine 737 airplanes on 16 domestic routes with 46 daily departures. The start-up carrier plans to expand its fleet to 70 airplanes by the end of 2025.
Boeing and EGYPTAIR also announced an order for nine Next-Generation 737-800s in a deal valued at US$864 million at current list prices. Eight of the airplanes will be financed by Dubai Aerospace Enterprise, headquartered in Dubai. EGYPTAIR currently operates 20 737-800NGs and when the nine airplanes on order have been delivered will comprise the largest single-aisle aircraft type in its fleet. The airline also has six 777-300ERs and two 777-200ERs. EGYPTAIR forecast significant growth of their total fleet by 2026.
Boeing also announced that it has signed data analytics agreements with six airlines to help cut operational costs for more than 500 airplanes. The deals were signed with: All Nippon Airways, British Airways, Delta Air Lines, GOL, Pobeda Airlines and Yangtze River Express.
Finally, Boeing announced that three customers had ordered 10 converted freighters. Cargo Air, based in Sofia, Bulgaria, and Lineas Aereas Suramericanas (LAS) Cargo, based in Bogota, Colombia, will each receive two 737-800BCFs. Air Algerie, based in Algiers, Algeria, signed a commitment for two 737-800BCFs. An unidentified customer ordered four 767BCFs.
Bombardier may cut business aircraft
Canadian manufacturer Bombardier said it could cancel plans to make a new extended range business aircraft because of softness in the market globally in general and in emerging markets in particular like China, the Middle East and Russia. CEO Alain Bellemare said in media reports from Farnborough that the company is looking to cut costs because the market has slowed considerably – to levels not seen since at least 2009 according to a UBS survey.
Qatar takes a piece of LATAM Airlines Group
One World alliance members LATAM Airlines Group and Qatar Airways announced that they have entered into a subscription agreement providing for Qatar Airways to acquire up to 10 percent of LATAM’s total shares, which will be acquired in connection with a capital increase. LATAM will hold an extraordinary shareholders meeting no later than 2 September 2016 to propose a capital increase in the amount of US$613 million through the issuance of new shares at a price of US$10 per share. The companies expect the transaction to be completed within the fourth quarter of 2016.
Comac sells ARJ21
Chinese manufacturer Commercial Aircraft Corporation of China (Comac) said it won sales in two separate orders for up to 90 of its ARJ21 regional jet that just started revenue flights recently. The first deal is for 60 planes and worth US$2.3 billion at list prices. Comac received a second order for 30 of the planes with an option for 30 more from Hong Kong-based China Aircraft Leasing Group. The planes will be leased to an unnamed Indonesia airline.
Sichuan show gets backers
Farnborough International has signed a memorandum of understanding with Chengdu Hi-Tech Zone and EU Project Innovation Centre (EUPIC) to develop the Sichuan International Airshow. The MoU will see Farnborough International’s Airshows business providing consultancy services to create an aerospace trade exhibition and public airshow located in Chengdu in western China. With a specific focus on civil and commercial aerospace infrastructure, manufacturing, MRO and support services, the event will showcase COMAC, AVIC and Sichuan Airlines, Haite group, Sigma Components other state representatives’ supply chains. Originally planned to take place in 2017, the show will now take place in September 2019.
Dowty signs LOI for XAC's MA700
Dowty Propellers signed a letter of intent to develop and supply the propeller electronic controller on twin-engine MA700 regional aircraft from Xi'An Aircraft Company (XAC), a subsidiary of China's AVIC. The deal follows the earlier selection of Dowty Propellers to provide a six-blade propeller system for the MA700's two Pratt & Whitney Canada PW150C turboprop powerplants.
Cathay signs up A350s for Satair services.
Satair Group’s “Integrated Material Services” (IMS) has won their first A350XWB customer, Cathay Pacific Airways, and has started their new service offering for the airline’s fleet of 48 Airbus A350XWB aircraft. Working in conjunction with the recently announced long-term agreement with Airbus to provide Flight Hour Services (FHS), Satair Group will operate the IMS, which was signed through the Airbus Flight Hour Services Limited, to provide an expendable material management solution.
Qatar Executive orders G650ERs
Qatar Airways president Akbar Al Baker announced that the airline’s Qatar Executive division has placed an order for three more ultra-long-range Gulfstream G650ERs. They will join the three already in service, starting with the first delivery early next year. These three aircraft are part of a 15 May agreement from Qatar Executive for up to 30 Gulfstreams, including examples of the in-development G500 and G600, for which Qatar is one of the launch customers.
AirAsia, CALC opt for CFM engines
Hong Kong-based China Aircraft Leasing Company (CALC) announced it has selected CFM International CFM56-5B engines to power 20 firm and up to five options of new Airbus A320ceos with the firm ordered valued at US$430 million at list prices. Deliveries are scheduled between 2017 and 2018. The engines are for part of an aircraft order was announced in 2014. CALC became a CFM customer in 2013 with an order for CFM56-5B engines to power 25 Airbus A320ceo aircraft.
CFM also announced that Air Europe ordered CFM International’s LEAP-1B engine to power 20 Boeing 737 MAX aircraft with the engine ordered valued at US $800 million at list prices, including a maintenance agreement.
AirAsia also announced that it has ordered 200 additional CFM International LEAP-1A engines to power the 100 new Airbus A321neos it ordered while at Farnborough. The engine order, which expands its LEAP engine fleet to nearly 730 engines, is valued at US$2.7 billion at list prices.
BOC Aviation orders shipsets for A320s
BOC Aviation announced firm orders for 18 shipsets of V2500 engines to power new Airbus A320ceo family aircraft already in the company’s order book. The aircraft have all been placed on lease with customers. The V2500 engine is offered through IAE International Aero Engines AG, a multinational aero engine consortium whose shareholders comprise Pratt & Whitney, a division of United Technologies; Pratt & Whitney Aero Engines International; Japanese Aero Engines; and MTU Aero Engines. Financial details were not disclosed.
Thomas Cook signs TrueChoice deal
Thomas Cook Group Airlines signed a five-year TrueChoice Transitions agreement with GE Aviation for the time and material to repair and overhaul its fleet of CF6-80C2 engines that power its eight Boeing 767 aircraft. Financial details were not disclosed. Thomas Cook Group Airlines consist of four sun and beach focused leisure airlines: Thomas Cook Airlines UK, Thomas Cook Airlines Belgium, Thomas Cook Airlines Scandinavia and Condor.
Icelandair also signed a TrueChoice Transitions agreement with GE Aviation for three overhauls of its CF6-80C2 engines powering its Boeing 767 aircraft, as well as an engine lease. Financial details were not disclosed. Headquartered at Reykjavik Airport, Icelandair offers one-stop transatlantic service from 16 cities in North America to more than 20 destinations in Europe.