US Airways has a large fleet of aging Boeing 757s it needs to replace. The problem is, a carrier official says, neither the Airbus A321neo nor the Boeing 737-9 MAX can do what needs to be done: Phoenix-Hawaii non-stop in both directions with maximum payload under all conditions.
The distance is 2,910 miles, well within the advertised range of 4,200 miles for the A321neo and 4,137 for the 9 MAX. But Derek Kerr, executive vice president and chief financial officer says fleet planners have yet to be convinced either plane can replace the 757W, which is uniquely able to handle the hot, summer conditions at Phoenix, where temperatures often soar to 110F degrees or more.
US Airways is one of only two legacy airlines in the US that has yet to order the MAX or the NEO (Delta Air Lines is the other). A year ago, US Airways CEO Doug Parker told us that the value proposition of ordering the neo still was unconvincing given the price premium sought by Airbus. Kerr told us last week that the large, outstanding order for the current generation A320 family as replacements for the oldest jets–and the lack of a true replacement for the 757–meant the airline wasn’t in a hurry to place an order for re-engined aircraft.
MAX v NEO: Here is an excellent set of tables updating the orders between the 737 MAX and the A320 NEO. According to the analysis, Airbus right now has a 63% market share for the airframe. On the NEO, where two engines are offered, CFM has a 41% share vs PW’s 39% share with the remainder undecided.
The launch of the Airbus neo programme on 1 December with plans for a 2016 entry into service for the initial model has generated a lot of talk in the aviation finance community, particularly concerning the impact on residual values.
CAO spoke to lessors and bankers about the move and here’s what they had to say:
Airbus’ A320 NEO won’t kill the Bombardier CSeries, a new study concludes, issued today by AirInsight.
The study, “The Business Case for the Bombardier CSeries,” which we co-authored, is discussed on the AirInsight blog.
The study began as an update to AirInsight’s report in December 2009 on the prospect of re-engining the Airbus A320 and Boeing 737 families. As Airbus COO-Customers John Leahy repeatedly asserted that to re-engine the A320 would kill the business case for the CSeries, AirInsight broadened its update into a full, in-depth study. AirInsight concluded that the business case for the CSeries is sound.
Airbus offers new fuel saving engine options for A320 Family
1 December 2010
Airbus has decided to offer for its best-selling A320 Family new fuel saving engines as an option. Airlines have the choice between CFM International’s LEAP-X engine and Pratt & Whitney’s PurePower PW1100G engine. Known as the A320neo, this new engine option also incorporates fuel-saving large wing tip devices called Sharklets. Airbus will start deliveries of the A320neo Family in spring 2016.
Airbus Said to Plan New A320 Engine Option to Fend Off Rivals
2010-11-30 20:50:43.24 GMT
By Andrea Rothman
Nov. 30 (Bloomberg) — Airbus SAS plans to offer its A320 series of aircraft with an option of more fuel-efficient engines to help defend its position in the single-aisle jet market, said a person familiar with the decision.
The company received backing from parent European Aeronautic, Defense & Space Co. at a meeting today and may announce the decision as early as tomorrow, said the person, who spoke on condition of anonymity because the plan has not yet been made public. Airbus, based in Toulouse, France, would offer the A320 with two new engine options, the person said. Continue reading →
Richard Aboulafia, aerospace consultant with The Teal Group, published his monthly two-page newsletter in which he gives five reasons why Airbus should proceed with the A320 New Engine Option (NEO). The newsletter may be downloaded here.
We disagree with one of his conclusions, and that is Delta Air Lines continues to be predisposed toward Boeing. This was certainly true under the previous management (the pre-bankruptcy one) and stems from an exclusive supplier agreement between Delta and Boeing signed c. 1996 and good for 20 years. Boeing agreed not to enforce the contract as a concession to the European Union for approval the following year to merge with McDonnell Douglas, but Delta only ordered Boeing aircraft anyway.