Odds and Ends: Bombardier, Boeing and Mountain Dew
Bombardier: Jon Ostrower reports that Bombardier will deliver 10 CSeries per month from 2016 in this report. This is a pretty modest rampy up rate, in our view, on the way to a projected maximum of 20 per month. Ostrower also has this piece about the activation of BBD’s CIASTA “iron bird” designed to test systems on the ground, well before the first flight, in a bid to iron out any problems before getting too far into assembly.
Even at the maximum rate, this pales compared with the 42 per month announced by Boeing for the 737 and 44 per month announced by Airbus for the A320. Both companies are considering even higher rates, to as many as 60 per month.
This also is one reason why BBD isn’t striving for some mega-order that some observers and analysts want as indicative a vast market acceptance of the CSeries. BBD simply couldn’t fill such an order without one customer dominating its production line. BBD wants to establish a broad customer base by entry-into-service.
In a recent research note, Goldman Sachs said BBD indicated it wants a customer base of 20-30 by EIS. The company now has orders and commitments from 10 customers. Ostrower reports the total commitments now exceed 300 (we were aware of about 250), and BBD’s former president Gary Scott said at an ISTAT conference the plan was to have 300 orders by EIS. EIS is still planned for the end of 2013, though there is growing speculation this will slip anywhere from 3-6 months. First flight is targeted for the end of this year.
Chet Fuller, who heads sales at BBD, gave a 30 minute interview on Canada’s Business News Network. Ostrower has the video posted here.
Boeing: The company announced its 2011 deliveries on Jan. 5, and due to shortfalls in the 787 and 747-8, missed its target. We’d written several pieces about the likelihood the 787 and 747 deliveries would fall short, so we’ll link Flightblogger’s summary here. Flightblogger has a lengthy look at the 787 situation here.
Boeing Wichita: With it now official that Boeing will close its military-based Wichita (KS) facility, Kansas politicians are understandably crying foul over the support the gave Boeing in the KC-X tanker competition in exchange for the 7,500 jobs promised for the state.
As a Washington resident, welcome to the club (vis-a-vis the 787 Line 2 issue). But reality is reality, you there in Kansas. With declining military contracts, the tanker business alone could not sustain a profitable facility that (according to press reports) included more than 90 buildings.
We do note that all but 100 of the jobs that will be transferred from Wichita go to non-union states Oklahoma and Texas. The final 100, tied to the tanker, go to Washington State. The recent union contract with IAM 751 included a provision that if Wichita closed, the tanker jobs would come here.
Airbus: The long, long expected order from Hong Kong Airlines for 10 Airbus A380s finally has been announced. This is about a year overdue. This had been expected at the Zhuhai Air Show in November 2010.
Yuk: From our days as a garage employee in high school, we knew that you can clean corroded battery terminals with Coca Cola, which says a lot about what we all drink when it comes to soda. But this story is really weird.
The Pepsi company owns Mountain Dew and in a lawsuit where someone claimed to have found a dead mouse in is can of soda, Pepsi counters that this isn’t possible because Pepsi says Mountain Dew will dissolve a dead mouse.
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Leeham News and Comment
- Boeing’s McNerney: Interest in 787-10, 777X high; “our airplanes are better than theirs” May 22, 2013
- Odds and Ends: Boeing ponders 787 rate hike; A350 fly-by at PAS?; EMB wins order for E-Jet May 21, 2013
- United returns 787 to service today; WSJ points to other issues May 20, 2013
- Comparing the 787, 777-200/300ER and the 777-8/9X May 17, 2013
- Assessing the A350 program May 16, 2013
Re: Yuk
Coke is the vehicle restorators perfect solution to loosening coroded parts like
cylinder and piston combos. ( active incredient here is phosphoric acid. )
Bombardier is not Boeing. Bombardier is not Airbus. BBD should not be compared to A or B. Just remember when Airbus introduced the A300 in the early seventies. They were nowhere near the 40 + per month, in terms of production capabilities. Same thing for Boeing. They never produced 40 + 707 per month. Both majors have evolved over the years and they came to the present level gradually. There is no magic there. That is why we have a duopoly today. It is not easy to get to the position where A and B are today.
The same reasoning applies to the backlog. Most observers compare the number of orders for the CSeries to the A320neo or 737 MAX. This is ludicrous. A and B never had the amount of orders they can generate today when they started the 737 and A320 programs. You don’t become a Boeing or an Airbus overnight. And it has nothing to do with the technical capabilities of the airplane. I don’t think Boeing or Airbus would have done much better with their own “CSeries” than what Bombardier has achieved themselves. What BBD still lacks at this stage is the industrial base of A or B.
The BBD management should be praised for their cautious approach to the realities of aircraft manufacturing. The reason they have “so few” orders is very simple: they cannot fabricate more aircraft than what they had already planned for when they introduced the CSeries at Farnborough in 2008. They have just enough experience to know that they should not bite more than what they can chew. They have already sold the production for the next three years and they resist the temptation to heavily discount in order to come out with a spectacular order of 200 + units with a “prestigious” launch customer.
In the early nineties, when BBD introduced the CRJ (that’s less than twenty years ago) they sold each aircraft with a huge discount. It became quickly very successful. Before they terminate the program they will have sold more than 2000. But after 9/11 BBD almost went out of business. You know why? For the simple reason that they had no reserves at all, because they were selling each airplane almost at a lost. Yeah lots of sales, but little profits.
Do you remember what happened to Douglas in the sixties? They sold more DC-9 than they could produce. And each one was sold at a lost. The result is that they quickly went out of business. McDonnell had to rescue them. That is a fate that BBD wants to avoid because they have been near that cliff before.
When you compare A to B you compare apples to apples. BBD is not in the same league at all. What fools people is that the CSeries is such a competent airplane that they think it has been designed by a corporation that is as capable as A or B. That’s how good this airplane is. But Bombardier only started manufacturing Business aircraft twenty-five years ago and Commercial aircraft less then twenty years ago.
They just need more time. And what I like about them is just that: they take their time. They are audacious, but realistic. They are capable, but wise. All around it’s one of the best run aerospace company right now.
Bravo ! In 2045, BBD will have the same old experience than A and 2070, the same industrial, management and engineering experimentation than B. And because it’s a family business, they have time, and time to learn to perfect a Roll-Royce art (the Global Express) and Ferrari art (like the Learjet) !!! Imagine the future!
Agree much of the CSeries critism comes directly from J Leahy and Boeing. They have looked at the number a long time ago & the CS300 / GTF combo simply beats the shrink versions of the A320 and 737. Bombardier should follow a cautious route. I always thought there a place fo an optimized 120-155 seat aircraft. And everyone can see the wing-fuselage-engine combi can be stretched. BD denies, smart at this stage.
I don’t drink Mountain Dew.