NO ROOM FOR ER­ROR

SP's Airbuz - - Table of Contents -

CHINA, RUS­SIA JOIN THE FRAY. Mean­while, oth­ers also have jumped into the fray to give the duopoly a run for their money and they in­clude Rus­sia’s Irkut MC-21 and China’s Comac C919. The Irkut MC-21 is de­signed to com­pete with the most pop­u­lar air­lin­ers in the world, the sin­gle-aisle Boe­ing 737 and Air­bus A320. Irkut MC-21 seats 163 pas­sen­gers in two classes and has a range of about 3,500 nau­ti­cal miles (6,400 kilo­me­tres). Irkut, which is an arm of the Rus­sian state-owned aero­space con­glom­er­ate United Air­craft Cor­po­ra­tion, has said that the MC-21 will be 12 per cent to 15 per cent less ex­pen­sive to op­er­ate than its Western coun­ter­parts. Irkut has got 175 or­ders till date.

Irkut MC-21 made its maiden flight on May 28, thus be­com­ing Rus­sia’s first large air­liner since the fall of the Soviet Union. Rus­sian air­line Aeroflot will be the first to fly the new jet­liner. Till date, Aeroflot, the state-run car­rier has re­lied heav­ily on Air­bus and Boe­ing jets as part of its mod­erni­sa­tion, but now with MC-21 com­ing this is likely to change, par­tic­u­larly in view of the Rus­sian pol­icy which has en­cour­aged the in­tro­duc­tion of home-grown mod­els, like the MC-21.

Sim­i­larly, there is chal­lenge com­ing up from China, the Comac C919 which had its first flight on May 5 this year. Un­like Rus­sia which is look­ing at mar­ket­ing to the world MC-21 to in­crease its non-mil­i­tary aero­space ex­ports, Comac is keen on ex­pand­ing its do­mes­tic mar­ket sales. The C919 is in com­pe­ti­tion with the A320­neo and the 737 MAX with a seat ca­pac­ity of 168. As of now, Comac has 517 or­ders, but all from Chi­nese op­er­a­tors. The Shang­hai-built air­liner is ex­pected to make its first flight next year and en­ter ser­vice some­time after 2020, again dent­ing the mar­ket of the duopoly. RE­GIONAL JETS BLUR­RING CLAS­SI­FI­CA­TION. The Brazilian aero­space ma­jor Em­braer, a re­gional avi­a­tion player, is knock­ing on the doors of the two gi­ants. The quick progress of the sec­ond-gen­er­a­tion of fam­ily of E-Jets E2 is go­ing to make other play­ers sit up and no­tice. Em­braer is pitch­ing the E2 as a not so big al­ter­na­tive to the A319 and the Boe­ing MAX7. The E2 lineup con­sists of 88-seater E175-E2; the 106-seat E190-E2 and the 132seat E195-E2.

So also there is an­other re­gional player, Mit­subishi from Ja­pan which has come out with the Mit­subishi Re­gional Jet (MRJ), the first na­tive com­mer­cial air­liner in 50 years. While the MRJ will ad­dress the re­gional mar­ket with its of­fer­ing of the 80-seat MRJ70 and the 92-seat MRJ90, it is pro­vid­ing a do­mes­tic al­ter­na­tive for Ja­pan which mostly has gone the Boe­ing way. The com­pe­ti­tion is in­deed heat­ing up and the duopoly can­not eas­ily shrug it off say­ing that they are in a dif­fer­ent class al­to­gether.

Even while the oth­ers are at the gates, the gi­ants con­tinue their long-es­tab­lished ri­valry which one gets to see at the iconic Paris Air Show where bat­tle of words just fly about. The Moody re­port states that the bat­tle is get­ting in­tense as the Euro­pean air framer wins more nar­row-body or­ders, tak­ing ad­van­tage of its ear­lier start of pro­duc­tion of its re-en­gined nar­row-body, the

AC­CORD­ING TO AIR­BUS’ LAT­EST GLOBAL MAR­KET FORE­CAST 201736, THE WORLD’S PAS­SEN­GER AIR­CRAFT FLEET ABOVE 100 SEATS IS SET TO MORE THAN DOU­BLE IN THE NEXT 20 YEARS TO OVER 40,000 PLANES AS TRAF­FIC IS SET TO GROW AT 4.4 PER CENT PER YEAR

A320­neo. Air­bus is also close on the heels of the US gi­ant in the wide-body mar­ket as it ramps up its pro­duc­tion rate for the A350 pro­gramme against Boe­ing’s 787 pro­gramme. How­ever, it is the sin­gle-aisle mar­ket which is hotly con­tested.

OR­DERS AND DE­LIV­ER­IES. As of May 31, 2017, Air­bus in its ‘or­ders and de­liv­er­ies’ has claimed 17,155 units of which the A320 nar­row-body air­craft ac­count for a huge chunk of 13,111; fol­lowed by A330, A340 and the A350 XWB at 2,911; A300 and A310 at 816 and the A380 at 317. De­liv­er­ies dur­ing May in­volved 46 A320 fam­ily air­craft (in­clud­ing 12 A320/A321­neo ver­sions), along with six A330-200/A330-300s, five A350-900s and three A380s.

Boe­ing’s de­liv­er­ies in 2017 up to May has been put at 277 with 737 ac­count­ing for 187 units; fol­lowed by 787 at 53; 777 at 30; 747 at 4 and 767 at 3. In May the net or­ders were 56, down by two units com­pared to the pre­vi­ous year. So it has been a ding-dong bat­tle be­tween the two play­ers.

PAS­SEN­GER, FREIGHT GROWTH ON THE RISE. How­ever, con­sid­er­ing the ex­po­nen­tial growth of pas­sen­ger and freight traf­fic in the world, there are go­ing to be many op­por­tu­ni­ties and chal­lenges to the sec­tor per se. The In­ter­na­tional Air Trans­port As­so­ci­a­tion (IATA) an­nounced full-year global pas­sen­ger traf­fic re­sults for 2016 show­ing de­mand (rev­enue pas­sen­ger kilo­me­tres or RPKs) rose 6.3 per cent com­pared to 2015 (or 6.0 per cent if ad­justed for the leap year). This strong per­for­mance was well ahead of the 10-year av­er­age an­nual growth rate of 5.5 per cent. Ca­pac­ity rose 6.2 per cent (un­ad­justed) com­pared to 2015, push­ing the load fac­tor up 0.1 per­cent­age points to a record full-year av­er­age high of 80.5 per cent.

Ac­cord­ing to Air­bus’ lat­est Global Mar­ket Fore­cast 2017-36, the world’s pas­sen­ger air­craft fleet above 100 seats is set to more than dou­ble in the next 20 years to over 40,000 planes as traf­fic is set to grow at 4.4 per cent per year. Over this pe­riod, in­creas­ing num­bers of first time fly­ers, ris­ing dis­pos­able in­come spent on air travel, ex­pand­ing tourism, in­dus­try lib­er­al­i­sa­tion, new routes and evolv­ing air­line busi­ness mod­els are driv­ing a need for 34,170 pas­sen­ger and 730 freighter air­craft worth a com­bined to­tal of $5.3 tril­lion. Over 70 per cent of new units are sin­gle aisle with 60 per cent for growth and 40 per cent for re­place­ment of less fuel ef­fi­cient air­craft.

With such op­por­tu­ni­ties and com­pe­ti­tion, the two have to think of in­no­va­tion and out-of-the box think­ing to meet its eco­ef­fi­ciency goals and that air travel con­tin­ues to be one of the safest, and most eco-ef­fi­cient means of trans­porta­tion. After cel­e­brat­ing its own four decades of in­no­va­tion, Air­bus now is look­ing to the next 40-plus years — ac­tively work­ing with other in­dus­try stake­hold­ers and ex­perts to an­tic­i­pate the global needs of a bet­ter con­nected and more sus­tain­able world.

AIR­BUS UNVEILS ITS 2050 VI­SION FOR ‘SMARTER SKIES’. Air­bus has ini­ti­ated the ‘Smarter Skies’ as more flights, fewer emis­sions and quicker pas­sen­ger jour­ney times be­comes the norm. The Fu­ture by Air­bus looks be­yond air­craft de­sign to how the air­craft is op­er­ated both on the ground and in the air in order to meet the ex­pected growth in air travel in a sus­tain­able way. Since launch­ing this re­port in 2010, Air­bus has embarked on a two-year global con­sul­ta­tion with more than 1.75 mil­lion peo­ple through air­shows, events and on­line, as part of the Fu­ture by Air­bus pro­gramme — its vi­sion of sus­tain­able avi­a­tion in 2050.

BOE­ING IS MOM. Mean­while, Boe­ing plans to in­tro­duce a slightly larger sin­gle-aisle model (tentatively called the 737 MAX 10X), in an at­tempt to com­pete more ef­fec­tively with the A321­neo. It is also mulling a new plane the ‘797’ MoM (mid­dle of the mar­ket) air­craft. The 797 would be a twin-aisle plane but would have a smaller cargo hold than a typ­i­cal wide-body, thus re­duc­ing weight and boost­ing fuel ef­fi­ciency. Two dif­fer­ent ver­sions would seat 220-260 pas­sen­gers in a stan­dard multi-class con­fig­u­ra­tion and have a stated range of up to 5,000 nau­ti­cal miles. It is re­ported in the me­dia that it may cost Boe­ing nearly $15 bil­lion to de­velop the 797 fam­ily. This propo­si­tion may not sound good to op­er­a­tors who are look­ing at lower ac­qui­si­tion costs.

By con­trast, Air­bus’ most likely plan for the MoM seg­ment is to stretch the A321LR to boost its pas­sen­ger ca­pac­ity and equip it with a new wing to give it more range. This A322 would be rel­a­tively cheap to de­sign and build, al­low­ing Air­bus to un­der­cut Boe­ing on price by a wide mar­gin. It would prob­a­bly be al­most as large as the smaller 797 vari­ant, but might be lim­ited to 4,500 nau­ti­cal miles of stated range.

Air­bus and Boe­ing not only have to fight it out but also have to keep the oth­ers at bay. Be­sides, geopo­lit­i­cal con­sid­er­a­tions are go­ing to come in play, more so after Don­ald Trump has be­come the US Pres­i­dent. They are go­ing to be in­ter­est­ing times for the avi­a­tion in­dus­try.

IT IS RE­PORTED IN THE ME­DIA THAT IT MAY COST BOE­ING NEARLY $15 BIL­LION TO DE­VELOP THE 797 FAM­ILY. THIS PROPO­SI­TION MAY NOT SOUND GOOD TO OP­ER­A­TORS WHO ARE LOOK­ING AT LOWER AC­QUI­SI­TION COSTS.

Bom­bardier CS100: Bet­ter per­for­mance, fuel ef­fi­ciency and de­sign

China’s Comac C919

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