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KarelXWB
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Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 12:28 pm

While analysts and lessors scratch their head about rate 60, Airbus considers pushing single aisle production to rate 70.

“If we look at the piled up demand and the backlog, we need to progress on rate 70, which is underway right now. We are in advanced discussions with our supply chain on feasibility and from when on it could be done,” CEO Tom Enders told analysts after the group reported 2017 results.


Article
https://www.reuters.com/article/us-airb ... SKCN1FZ0RS
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JetBuddy
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 12:37 pm

What's new to me is this part:

"A new issue was discovered with Pratt & Whitney engines for the A320neo this month and Airbus CEO Tom Enders also said engines for the same plane made by CFM - a joint venture of GE and Safran - were currently experiencing delays."

I didn't know CFM also were delayed? What's the problem?
 
mxaxai
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:25 pm

Last November, Airbus had a backlog of 5488 A320 family aircraft. At 70 per month that backlog is still worth 6 years and 6 months of production.

Boeing on the other hand had 4065 orders for its 737 family, worth 5 years and 11 months of production at their planned peak of 57 aircraft per month.

For comparisons sake, the CSeries stood at 341 orders, worth 2 years and 10 months at their projected maximum rate of production of 120 aircraft per year. The E-Jets were at 152 (E1) + 228 (E2), which translates to 3 years and 6 months of production at their 2016 rate of 108 jets per year.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:28 pm

How? Neither engine manufacture has shown the ability to hit current production goals. Can PW handle 70 engines for new airplanes per month? Can CFM handle184?! I am skeptical.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:31 pm

KarelXWB wrote:
While analysts and lessors scratch their head about rate 60, Airbus considers pushing single aisle production to rate 70.

“If we look at the piled up demand and the backlog, we need to progress on rate 70, which is underway right now. We are in advanced discussions with our supply chain on feasibility and from when on it could be done,” CEO Tom Enders told analysts after the group reported 2017 results.


Article
https://www.reuters.com/article/us-airb ... SKCN1FZ0RS

While I believe in making hay while the sun is shining, one can imagine the risk if the economy goes south for more than a short period of time.

If we need any more evidence of market fragmentation, consider a world where A320 is at rate 70, Boeing 737 is at rate 57 or more, and A380 is at rate 0.5.

JetBuddy wrote:
What's new to me is this part:

"A new issue was discovered with Pratt & Whitney engines for the A320neo this month and Airbus CEO Tom Enders also said engines for the same plane made by CFM - a joint venture of GE and Safran - were currently experiencing delays."

I didn't know CFM also were delayed? What's the problem?

Keeping up with orders. PW is more or less starting from scratch (although it and partners were/are part of IAE), whereas CFM is on half the A20s and all the 737s for both CEOs (CFM56) and NEOs (LEAP). Keep in mind the overall delays in A320neo meant priority was shifted back towards CFM56 deliveries for a while.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:34 pm

Now is not the time to talk about the NB aircraft bubble, right?
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KarelXWB
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:42 pm

Revelation wrote:
While I believe in making hay while the sun is shining, one can imagine the risk if the economy goes south for more than a short period of time.


Indeed. It's one of the main concerns of the lessors:

AerCap: planned narrowbody production rates are unrealistic
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:51 pm

Spacepope wrote:
Now is not the time to talk about the NB aircraft bubble, right?

There is a point at which the bubble will burst. The problem is you can't tell where that point is till you hit it. Till then, you make hay while the sun shines, and hope that when the bubble bursts it'll be your successor's problem to deal with.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 1:55 pm

Revelation wrote:
Spacepope wrote:
Now is not the time to talk about the NB aircraft bubble, right?

There is a point at which the bubble will burst. The problem is you can't tell where that point is till you hit it. Till then, you make hay while the sun shines, and hope that when the bubble bursts it'll be your successor's problem to deal with.


It’s more a question of how much fixed cost you add vs how much variable cost you add. If you can add capacity without adding fixed cost then it’s fine. If rate drops to 30-40 a month can you drop your cost in line with it relatively quickly? That is the real question.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 2:01 pm

bigjku wrote:
It’s more a question of how much fixed cost you add vs how much variable cost you add. If you can add capacity without adding fixed cost then it’s fine. If rate drops to 30-40 a month can you drop your cost in line with it relatively quickly? That is the real question.

Thank you for being more succinct than I was.

Meanwhile, SUH describes CFM's situation ( https://www.reuters.com/article/aviatio ... SL8N1PH3X2 ):

“Boeing is on time so far. But if the CFM problem continues to be more complex than we anticipated, then I think Boeing has its work cut out as far as getting on time sufficient numbers of engines from CFM for the LEAP-1B,” Steven Udvar-Hazy told the Airlines Economics conference in Dublin. “But we are optimistic that these are solvable problems . We don’t see any technology or major design flaws. It’s just what I call baby pains,” he added.
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KarelXWB
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 2:05 pm

Prior to the introduction of the LEAP-1B type, the LEAP did undergo a redesign in some areas to reblade the low-pressure compressor.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 2:36 pm

Perhaps a good time to launch a new aircraft when the opposition cannot respond for circa 7 years by which time your aircraft is nearing testing.Hmmm
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 2:47 pm

KarelXWB wrote:
Prior to the introduction of the LEAP-1B type, the LEAP did undergo a redesign in some areas to reblade the low-pressure compressor.

Yes, I think it's fair to call those changes a re-design, but they were done to meet performance goals, not to deal with the kinds of reliability issues we unfortunately see on the PW engines.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 4:11 pm

Hahaha whaaaat? What year do they expect to reach *that* goal exactly?
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mxaxai
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 4:50 pm

KarelXWB wrote:
Revelation wrote:
While I believe in making hay while the sun is shining, one can imagine the risk if the economy goes south for more than a short period of time.


Indeed. It's one of the main concerns of the lessors:

AerCap: planned narrowbody production rates are unrealistic

It should be clear though that the lessors are responsible for the backlogs themselves, to a large part at least. At the same time, maybe half of the earth's population is nowhere near wealthy enough to board a plane. The future will be interesting...
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 5:45 pm

Only possible if all these engine issues are resolved. Not this year or next year either, but in the way to distant future its possible that this might be archivable.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 6:33 pm

How in the world they're able to find enough pax (and airports) for that amount of new planes every month? Even with ultra-rapid growth of LCC in Asia and other places, I don't see enough pax to fill them up. The market will soak up eventually, and the growth will slow down. And let's not talk about airport congestion everywhere.

Now, we can talk about the real bubble here.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 6:44 pm

Commercial aircraft leasing used to be an easy money game, with predictable residuals, and even support from OEM's to find new homes.

It's 2018. The model for aircraft leasing companies, has, and is changing, and with it funding and pricing models need to evolve, tapping sources so far ignored.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 7:02 pm

KarelXWB wrote:
Revelation wrote:
While I believe in making hay while the sun is shining, one can imagine the risk if the economy goes south for more than a short period of time.


Indeed. It's one of the main concerns of the lessors:

AerCap: planned narrowbody production rates are unrealistic


What i see as a problem is how big some of the orders are from relatively small airlines. IndiGo, Air Asia, Lion Air, and Indigo Partners ordered for massive expansion that exceeds market growth rates. That means either those orders wont be fully taken up, may get deferred, or some other airline will be out out of business or shrink (like Monarch or Air Berlin). That could create a bubble of used planes
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 7:02 pm

If the market is going to burst due to oversupply, it's probably wise to make as much aircraft as they can now and pocket the profit first before it burst and airlines cancels their order. They can always scale the production line back if airlines start cancelling their orders

Also, in a hypothetical scenario when NB aircraft become oversupply after Boeing making them at a rate of 57/month and Airbus making them at a rate of 70/month, it mean there will be more Airbus NB on the market after the saturation. This will only help Airbus in the future.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 7:26 pm

c933103 wrote:
If the market is going to burst due to oversupply, it's probably wise to make as much aircraft as they can now and pocket the profit first before it burst and airlines cancels their order. They can always scale the production line back if airlines start cancelling their orders

Also, in a hypothetical scenario when NB aircraft become oversupply after Boeing making them at a rate of 57/month and Airbus making them at a rate of 70/month, it mean there will be more Airbus NB on the market after the saturation. This will only help Airbus in the future.

Who is going to fund lead time items, partly and fully built aircraft?

Also, if the bubble bursts, there will be shortage of funding for purchase and lease (lead financiers will stick around, but participants will dive for cover), margins increase, funding terms shorten, and conditions become more onerous. Even airlines with a sound business case may struggle to find competitive funding.

A lot of these orders are qualified, subject to funding on terms suitable to the purchaser. Airlines do not put in place funding for aircraft planned for delivery 2 years or further out.

The OEM's in increasing production rates are only responding to customers / orders. If airlines and leasing companies are being reckless in placing orders, that's a discussion that needs to take place between the OEM and customer.

As I pointed out last year, 2018-2020, OEM sales staff will spend as much time negotiating cancellations and deferrals, as writing new business.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 7:36 pm

mxaxai wrote:
Last November, Airbus had a backlog of 5488 A320 family aircraft. At 70 per month that backlog is still worth 6 years and 6 months of production.

Boeing on the other hand had 4065 orders for its 737 family, worth 5 years and 11 months of production at their planned peak of 57 aircraft per month.

For comparisons sake, the CSeries stood at 341 orders, worth 2 years and 10 months at their projected maximum rate of production of 120 aircraft per year. The E-Jets were at 152 (E1) + 228 (E2), which translates to 3 years and 6 months of production at their 2016 rate of 108 jets per year.



Boeing's 737 backlog as of 12/31/2017 was 4,668 planes

http://investors.boeing.com/investors/f ... fault.aspx
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 7:40 pm

https://www.cnbc.com/2018/02/15/boeing- ... rowth.html

Boeing thinks this is not cyclical as in times past but a sustained growth period. Airbus may share the same outlook with world wide pax numbers growing. Or Boeing and Airbus are trying quickly monetize their backlogs before they "shrink. Why wait 7 years to monetize your backlog when it can be done in 5.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 8:00 pm

benbeny wrote:
How in the world they're able to find enough pax (and airports) for that amount of new planes every month? Even with ultra-rapid growth of LCC in Asia and other places, I don't see enough pax to fill them up. The market will soak up eventually, and the growth will slow down. And let's not talk about airport congestion everywhere.

Now, we can talk about the real bubble here.


Its already happening, young 10-12 year old A320s are being scrapped so that newer A320s can take their place.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 8:06 pm

SC430 wrote:
mxaxai wrote:
Last November, Airbus had a backlog of 5488 A320 family aircraft. At 70 per month that backlog is still worth 6 years and 6 months of production.

Boeing on the other hand had 4065 orders for its 737 family, worth 5 years and 11 months of production at their planned peak of 57 aircraft per month.

For comparisons sake, the CSeries stood at 341 orders, worth 2 years and 10 months at their projected maximum rate of production of 120 aircraft per year. The E-Jets were at 152 (E1) + 228 (E2), which translates to 3 years and 6 months of production at their 2016 rate of 108 jets per year.



Boeing's 737 backlog as of 12/31/2017 was 4,668 planes

http://investors.boeing.com/investors/f ... fault.aspx


It was, although mxaxai quoted November's figures.
Both manufacturers had an impressive December for narrowbodys.
Airbus's A320 backlog on 31/12/2017 a total of 6 141 planes - a full 32% bigger than the 737 backlog. :)
Clearly well worthy of a higher production rate target than the 737.

Revelation wrote:
If we need any more evidence of market fragmentation, consider a world where A320 is at rate 70, Boeing 737 is at rate 57 or more, and A380 is at rate 0.5.


The talk of a bubble make me smile.
Airbus squeezed 560 A320's out last year, which I think was a record.
But that is still 11 years of production at that rate. A ridiculous number by any measure.
Even a rate of 800 per year is 7 3/4 years production, even with no further orders appearing - plenty of time to see any trend in orders/deferrals/cancellations appear.
I remember the same conversations during the GFC in lare 2000's, but all that really happened was a pause in production growth, rather than a cut-back.

As Revelation points out, these more capable narrowbodys are the planes that are REALLY driving the true fragmentation in the industry.

The evidence tends to support the Boeing comment - there really is a shift in the marketplace going on

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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 8:43 pm

jeffrey0032j wrote:
Its already happening, young 10-12 year old A320s are being scrapped so that newer A320s can take their place.


Show me! ( beyond some A318 being worth more in parts than as an intact airframe.)
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 8:45 pm

For the record Airbus has over 1,700 frames (28%) of total back log from eight airlines that currently only fly 728 planes. There are cancellations in this bunch for sure.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:05 pm

The clearest sell signal is when you hear "It's different this time."
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:26 pm

SC430 wrote:
For the record Airbus has over 1,700 frames (28%) of total back log from eight airlines that currently only fly 728 planes. There are cancellations in this bunch for sure.


That Indigo Partners order really has me scratching my head. To me it feels really speculative that all four of those airlines can have significant sustained growth like that. To me it seems like there is some orderbook inflation going on.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:27 pm

KarelXWB wrote:
While analysts and lessors scratch their head about rate 60, Airbus considers pushing single aisle production to rate 70.

“If we look at the piled up demand and the backlog, we need to progress on rate 70, which is underway right now. We are in advanced discussions with our supply chain on feasibility and from when on it could be done,” CEO Tom Enders told analysts after the group reported 2017 results.


Article
https://www.reuters.com/article/us-airb ... SKCN1FZ0RS


Unfortunately, Reuters are less accurate then I am. The above is misleading. I reported yesterday after listening to the recording of the Airbus Presentation of their 2017 Results. It is the case that neither Reuters nor other news agencies or newspapers can be relied upon to deliver the truth.

"I may have heard it wrong, but I think it was said that Airbus are in the middle of lifting the A32x production to Rate 60, and are discussing with suppliers on moving towards Rate 70 during the next decade, i.e. from 2020 onwards. No decision yet, but the demand is there and Airbus like to meet their commitments to customers."
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:42 pm

Newbiepilot wrote:
SC430 wrote:
For the record Airbus has over 1,700 frames (28%) of total back log from eight airlines that currently only fly 728 planes. There are cancellations in this bunch for sure.


That Indigo Partners order really has me scratching my head. To me it feels really speculative that all four of those airlines can have significant sustained growth like that. To me it seems like there is some orderbook inflation going on.

It's a landgrab. If everything goes according to plan, then great. Otherwise, someone's left holding the bag. Indigo's a pretty sharp bunch, so my bet is it ain't them.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:43 pm

Not surprising.

Boeing has been talking about this too, and I've been surprised Airbus hasn't (until now). Of the two, it's clearly Airbus who needs the production increase more
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:45 pm

Egerton wrote:
KarelXWB wrote:
While analysts and lessors scratch their head about rate 60, Airbus considers pushing single aisle production to rate 70.

“If we look at the piled up demand and the backlog, we need to progress on rate 70, which is underway right now. We are in advanced discussions with our supply chain on feasibility and from when on it could be done,” CEO Tom Enders told analysts after the group reported 2017 results.


Article
https://www.reuters.com/article/us-airb ... SKCN1FZ0RS


Unfortunately, Reuters are less accurate then I am. The above is misleading. I reported yesterday after listening to the recording of the Airbus Presentation of their 2017 Results. It is the case that neither Reuters nor other news agencies or newspapers can be relied upon to deliver the truth.

"I may have heard it wrong, but I think it was said that Airbus are in the middle of lifting the A32x production to Rate 60, and are discussing with suppliers on moving towards Rate 70 during the next decade, i.e. from 2020 onwards. No decision yet, but the demand is there and Airbus like to meet their commitments to customers."

Sadly, that's not atypical. I have had times in my life when I had first hand knowledge of a story or event, and to read about it in the media was, let's be kind and say disconcerting.
 
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KarelXWB
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:46 pm

Planesmart wrote:
As I pointed out last year, 2018-2020, OEM sales staff will spend as much time negotiating cancellations and deferrals, as writing new business.


And apparently, Boeing and Airbus are making good money out of deferrals and cancellations.

A Paris Air Show player offers some brutal home truths for airlines
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 9:49 pm

If Airbus thinks the A321 is making deep inroads into what used to be a market segment reserved for widebodies, that's a shift worthy of an increased production rate. And the more A321LRs are floating around the market before Boeing can get the 797 off of paper, the better position Airbus has in the duopoly.
 
SC430
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 10:26 pm

KarelXWB wrote:
Planesmart wrote:
As I pointed out last year, 2018-2020, OEM sales staff will spend as much time negotiating cancellations and deferrals, as writing new business.


And apparently, Boeing and Airbus are making good money out of deferrals and cancellations.

A Paris Air Show player offers some brutal home truths for airlines



A self-serving interview at best. To use his terminology deferral and cancellation income would be "chump change" to Airbus or Boeing.
 
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Fri Feb 16, 2018 11:18 pm

jeffrey0032j wrote:
benbeny wrote:
How in the world they're able to find enough pax (and airports) for that amount of new planes every month? Even with ultra-rapid growth of LCC in Asia and other places, I don't see enough pax to fill them up. The market will soak up eventually, and the growth will slow down. And let's not talk about airport congestion everywhere.

Now, we can talk about the real bubble here.


Its already happening, young 10-12 year old A320s are being scrapped so that newer A320s can take their place.

I predicted that when the NEO was launched. In particular the A319 and 73G. Now, I didn't predict that the FAA wouldn't all WN for 3 type certificate to buy up 73Gs. I didn't predict neither Pratt nor CFM would meet NEO deliveries. CFM realized early and pushed out NEO deliveries and the really discounted CFM-56s which made Airbus happier...

Sigh, it is tough being a Pratt fan...

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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 12:32 am

More efficient and more capable narrowbodies means new routes are possible, and with cheaper tickets. This could drive a growth in PAX numbers that seemed impossible not long ago.
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 2:47 am

jeffrey0032j wrote:
benbeny wrote:
How in the world they're able to find enough pax (and airports) for that amount of new planes every month? Even with ultra-rapid growth of LCC in Asia and other places, I don't see enough pax to fill them up. The market will soak up eventually, and the growth will slow down. And let's not talk about airport congestion everywhere.

Now, we can talk about the real bubble here.


Its already happening, young 10-12 year old A320s are being scrapped so that newer A320s can take their place.

How many used A320 frames are there available for P2F conversion?
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 3:12 am

cledaybuck wrote:
How? Neither engine manufacture has shown the ability to hit current production goals. Can PW handle 70 engines for new airplanes per month? Can CFM handle184?! I am skeptical.


OK, here's a radical thought, could Airbus ask RR to produce a 3rd engine choice? How advanced is the advance program. Unfortunately the Advance program seems set currently to produce engines in the wrong thrust classes, 20klb and 50klb; engines Ideally a 28-40Klb engine would be best for A320/1 class.

How long would it take RR to build and certify, 4 years?
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 3:53 am

Aesma wrote:
More efficient and more capable narrowbodies means new routes are possible, and with cheaper tickets. This could drive a growth in PAX numbers that seemed impossible not long ago.

We'll see growth.

quote="Planesmart"]
c933103 wrote:
If the market is going to burst due to oversupply, it's probably wise to make as much aircraft as they can now and pocket the profit first before it burst and airlines cancels their order. They can always scale the production line back if airlines start cancelling their orders

Also, in a hypothetical scenario when NB aircraft become oversupply after Boeing making them at a rate of 57/month and Airbus making them at a rate of 70/month, it mean there will be more Airbus NB on the market after the saturation. This will only help Airbus in the future.

Who is going to fund lead time items, partly and fully built aircraft?

Also, if the bubble bursts, there will be shortage of funding for purchase and lease (lead financiers will stick around, but participants will dive for cover), margins increase, funding terms shorten, and conditions become more onerous. Even airlines with a sound business case may struggle to find competitive funding.

A lot of these orders are qualified, subject to funding on terms suitable to the purchaser. Airlines do not put in place funding for aircraft planned for delivery 2 years or further out.

The OEM's in increasing production rates are only responding to customers / orders. If airlines and leasing companies are being reckless in placing orders, that's a discussion that needs to take place between the OEM and customer.

As I pointed out last year, 2018-2020, OEM sales staff will spend as much time negotiating cancellations and deferrals, as writing new business.[/quote]
There will be differals, But if Airbus is increasing production, it is because of new demand.

To others:
There won't be an equal sharing of the pain when there is a downturn. Look at the MD-80 vs. 737 vs. A320, the MD-80/717 line took the brunt of the downturn.

The reality is that to keep selling, Airbus must increase production. The detractors note that the top Airline in India, Top Airline in Indonesia, and an airline doing very well in Eastern Europe.

KarelXWB wrote:
Revelation wrote:
While I believe in making hay while the sun is shining, one can imagine the risk if the economy goes south for more than a short period of time.


Indeed. It's one of the main concerns of the lessors:

AerCap: planned narrowbody production rates are unrealistic

The leasing companies should be concerned. The rapid rise of NEO production is going to result in used A320CEO values dropping. AerCap was thinking about NEOs... but by trying to sell their CEOs coming off lease.

Lightsaber
Flu+Covid19 is bad. Consider a flu vaccine, if not for yourself, to protect someone you care about.
 
brindabella
Posts: 620
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 4:38 am

c933103 wrote:
If the market is going to burst due to oversupply, it's probably wise to make as much aircraft as they can now and pocket the profit first before it burst and airlines cancels their order. They can always scale the production line back if airlines start cancelling their orders

Also, in a hypothetical scenario when NB aircraft become oversupply after Boeing making them at a rate of 57/month and Airbus making them at a rate of 70/month, it mean there will be more Airbus NB on the market after the saturation. This will only help Airbus in the future.


FWIW, it may be useful to check the current Seattle Times:"Boeing & Aerospace" .

Talk of announcing 63/64 at Farnborough.

cheers
Billy
 
Planesmart
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 6:36 am

KarelXWB wrote:
Planesmart wrote:
As I pointed out last year, 2018-2020, OEM sales staff will spend as much time negotiating cancellations and deferrals, as writing new business.


And apparently, Boeing and Airbus are making good money out of deferrals and cancellations.

A Paris Air Show player offers some brutal home truths for airlines

After years of forgiveness and free passes, first A with A380, then B across the board, and now A all products, are taking a hard line. Rest assured, if A380 orders remain on the books, those customers have serious skin in the game, and swapping to A350's or anything else, will be nowhere close to a dollar for dollar exchange.
 
Planesmart
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 6:43 am

lightsaber wrote:
The leasing companies should be concerned. The rapid rise of NEO production is going to result in used A320CEO values dropping. AerCap was thinking about NEOs... but by trying to sell their CEOs coming off lease.

But the leasing companies which keep writing new business, with softer credit conditions, are the problem, along with other financiers. OEM's are merely responding to orders. If really concerned, raise the bar, rather than chasing market share.
 
RalXWB
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 9:19 am

Sad to see another Anet-myth is still alive. "Most A320 orders are from unstable airlines or won´t be fully taken up or will be deferred or will be cancelled or orderbook inflation or order bubble or whatever". If there is a bubble or something similar it affects all types and not just one type of one producer...smh. If Airbus increases the production rate, they do it for a reason.
 
mxaxai
Posts: 1900
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 9:49 am

RalXWB wrote:
Sad to see another Anet-myth is still alive. "Most A320 orders are from unstable airlines or won´t be fully taken up or will be deferred or will be cancelled or orderbook inflation or order bubble or whatever". If there is a bubble or something similar it affects all types and not just one type of one producer...smh. If Airbus increases the production rate, they do it for a reason.

I haven't seen that. Most posters pointed out that the amount of standard narrowbodies, both Airbus and Boeing, on order is higher than ever and likely unsustainable. Back in the 2000's Boeing had to severely discount the 737 to sell it to Ryanair. Similarly, JetBlue and US Airways got some great deals on the A320.
And while narrowbody backlogs are growing, widebodies cannot get out of their slump. 777, 747 & A380 are at their lowest rates ever, A330neo sales are poorer than expected and although their backlogs are just as large, few new orders have been coming in for the A350 & 787.
 
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unrave
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 11:30 am

Newbiepilot wrote:

What i see as a problem is how big some of the orders are from relatively small airlines. IndiGo, Air Asia, Lion Air, and Indigo Partners ordered for massive expansion that exceeds market growth rates. That means either those orders wont be fully taken up, may get deferred, or some other airline will be out out of business or shrink (like Monarch or Air Berlin). That could create a bubble of used planes


This reads awfully similar to the hordes of sceptic comments made by Anetters 13 years back when IndiGo placed its first 100 aircraft order. Not only did it take delivery of all of them, it now operates more than 150. Unless some dramatic economic downturn I don't see why an airline that controls 40% of the fastest growing aviation market that is projected to become grow 4x in 20 years wouldn't be able to operate a fleet of 300 aircraft (accounting for replacements). All the jumbo airlines of the world today - Southwest, Ryaniar, Easyjet - would have gone through a similar phase of hectic growth.
17April2019: RIP Jet Airways
 
SC430
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 12:56 pm

mxaxai wrote:
RalXWB wrote:
And while narrowbody backlogs are growing, widebodies cannot get out of their slump. 777, 747 & A380 are at their lowest rates ever, A330neo sales are poorer than expected and although their backlogs are just as large, few new orders have been coming in for the A350 & 787.


Nothing new about VLA sale being low, 777 sales are low pending introduction of the X series, 787 is doing fine with a ramp up to 14 planes per month in the works. Even the 767 is enjoying a second life.
 
StTim
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 1:08 pm

SC430 wrote:
mxaxai wrote:
RalXWB wrote:
And while narrowbody backlogs are growing, widebodies cannot get out of their slump. 777, 747 & A380 are at their lowest rates ever, A330neo sales are poorer than expected and although their backlogs are just as large, few new orders have been coming in for the A350 & 787.


Nothing new about VLA sale being low, 777 sales are low pending introduction of the X series, 787 is doing fine with a ramp up to 14 planes per month in the works. Even the 767 is enjoying a second life.


The ramp up to 14 isn’t confirmed last I heard. I think sales not quite strong enough to support it.
 
Olddog
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Re: Airbus might push A320 family production rate to 70 aircraft per month

Sat Feb 17, 2018 3:27 pm

Maybe that when your cancellation numbers are mostly conversion orders registered that way ?
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