Pressure mounts on Airbus A330 in widebody order battle tells us:

PARIS (Reuters) - Imminent airline decisions on $10 billion of wide-body plane orders could influence the fate of Airbus’ A330neo even before the recently upgraded jet completes flight trials, industry sources said.

I don't agree with the dark tone (the "fate" of A330 is fine) but the article summarizes the situation pretty well.

Some things it mentions:
• (Of course) HA dropping order for six A338s
• AA reviewing 789 vs A339
• LEVEL considering 8 frames in this segment
• AirAsia upheld its decision to take 68 A339s but "analysts say that could change if it feels too exposed as the dominant buyer"
• IR deal for 28 potentially held up due to US concerns on nuclear treaty
• QF and/or NZ could be the next battle ground

One interesting point:

But keeping A330neo output to a minimum would leave Airbus increasingly dependent on one model, the much newer A350-900, for its position in the wide-body market - mirroring Boeing’s predicament in the Airbus-led narrowbody market.

Is that fair to both parties?

Is Airbus becoming solely dependent on A359 in the wide body market?

Is Boeing becoming solely dependent on 738 in the narrow body market?

If so, is that a big problem, or is it in fact a positive sign that your decisions have created the most popular platform for the market segment?

Given that Airbus still have some unfulfilled small 332 orders with some relatively large airlines, could they be like for example talk with them to convert them to 338 in order to launch it first?

c933103 wrote:

Given that Airbus still have some unfulfilled small 332 orders with some relatively large airlines, could they be like for example talk with them to convert them to 338 in order to launch it first?

Seems dubious to me.

The A332 actually is more efficient on short sectors and the buyers might be counting on that efficiency. They also may be wanting commonality for spare parts (especially engines) that A330neo can't provide.

The NEO will cost more. Perhaps Airbus would eat the cost difference just to get some A338s into service, perhaps not.

The thing is, its always better to have a bad market than a bad product. Markets can change, but products can't. Even the 777 and 787 had weak periods as the A330 does now, but both rebounded and I have no reason to believe the A330 is any different. While there might be some temporary skepticism as the NEO proves itself, the A330NEO is a solid airplane and fills a niche that Boeing has a hard time competing with and I would not worry about the future of the plane as long as this is the case. The 787 has too much range and not enough capacity for a lot of airlines out there which is why the current model has been so popular. For airlines where the 787 is too much plane, the A330 is perfect, and has a very significant advantage of commonality for airlines that already have the A330 and a cheaper list price due to it not being a prohibitively expensive clean sheet program.

neomax wrote:

The thing is, its always better to have a bad market than a bad product. Markets can change, but products can't. Even the 777 and 787 had weak periods as the A330 does now, but both rebounded and I have no reason to believe the A330 is any different. While there might be some temporary skepticism as the NEO proves itself, the A330NEO is a solid airplane and fills a niche that Boeing has a hard time competing with and I would not worry about the future of the plane as long as this is the case. The 787 has too much range and not enough capacity for a lot of airlines out there which is why the current model has been so popular. For airlines where the 787 is too much plane, the A330 is perfect, and has a very significant advantage of commonality for airlines that already have the A330 and a cheaper list price due to it not being a prohibitively expensive clean sheet program.

The 787 has too much range....only true if you are comparing 339 vs 789. The 338 has even more range and is a larger aircraft than the 788. While the 788 is not as popular as the 789, it still gets trickles of orders from time to time.

Question.These days can a warmed over aircraft compete with an all new aircraft?
Boeing did not try and respond directly with the 359/351 which are directly aimed at the 772er/773er - models which have now effectively ended.
The 779 is in its own marketplace really.(744?)
Certainly the 748i could not compete with the A388.
The 330 effectively finished the 767
It may well be that the 787 has in turn finished the 330.
Neither side are replacing their narrow bodies right now.But when the time comes both will have to respond.

Perhaps the days of 'derivatives are us' may be over.

If the 787 range can 'knock out' the 330neo family the Boeing board may not feel a need to launch a 797? Or does the A321LR pose too much of a risk?
If they do launch the 797 they will have one hell of a product lineup imho.

The article posits…

“As the two marketing armies chase around the globe to the next 787-A330 dog fight, Australia’s Qantas and Air New Zealand could be next to step into the battle, sources said.”

Which is inaccurate as with both airlines it’s a duel between the A350 and 77X. NZ is looking at what will replace their 77E and 77W fleets as well as offer range growth for destinations like NYC and GRU from AKL. QF is looking for non-stop SYD-LHR/NYC capability.

Both airlines already have 787’s.

Motorhussy wrote:

The article posits…

“As the two marketing armies chase around the globe to the next 787-A330 dog fight, Australia’s Qantas and Air New Zealand could be next to step into the battle, sources said.”

Which is inaccurate as with both airlines it’s a duel between the A350 and 77X. NZ is looking at what will replace their 77E and 77W fleets as well as offer range growth for destinations like NYC and GRU from AKL. QF is looking for non-stop SYD-LHR/NYC capability.

Both airlines already have 787’s.

Thanks for the clarification/correction. I also found that statement odd when I read it, but didn't know enough about their needs in this segment to refute it.

As Boeing has the production capacity and the ability to lower the price of the 787, the A330 is practically dead. It had the advantage of lower investment costs and faster delivery, but this is no longer the case. If you figure the probably low resale value of the A330NEO, the 787 already is cheaper. What that means for Boeing´s books remains to be seen, as the aggressive deal with HA won´t go unnoticed by other interested airlines.

I would not pay too much attention to editorial comments. It's just an opinion and they change tone when a large order is announced.

Revelation wrote:

Is Airbus becoming solely dependent on A359 in the wide body market?

The jury is still out. The entire A330 backlog is healthy (> 300 orders / 4-5 years production) and I wouldn't be surprised if more will follow when the A330 replacement cycle kicks in.

Currently 2 new aircraft models are positioned at the current A330 market: 787-10, and A330neo. The former sold some 200 copies in 5 years, the latter some 200 copies in 4 years. So people argue these aircraft are not selling in large numbers, but airlines are not yet focussend on A330 retirements. As such, we need to look at the long term prospects.

The resale value of the A330NEO vs 787 might actually be a strong point. P2F is a real (flying) option.

parapente wrote:

Question.These days can a warmed over aircraft compete with an all new aircraft?
Boeing did not try and respond directly with the 359/351 which are directly aimed at the 772er/773er - models which have now effectively ended.
The 779 is in its own marketplace really.(744?)
Certainly the 748i could not compete with the A388.
The 330 effectively finished the 767
It may well be that the 787 has in turn finished the 330.
Neither side are replacing their narrow bodies right now.But when the time comes both will have to respond.

Perhaps the days of 'derivatives are us' may be over.

If the 787 range can 'knock out' the 330neo family the Boeing board may not feel a need to launch a 797? Or does the A321LR pose too much of a risk?
If they do launch the 797 they will have one hell of a product lineup imho.

That is an excellent point actually, I think you're right on the money. These days, it feels like having different variants in a family is more about growing an existing a/c family vs competing with the competing variant. Nowadays, you have to get the original plane right because its all or nothing. Airlines don't order in the same way they used to. In previous times, if one variant was bad, the other compensated for it, but now, airlines go all in on a given family and ignore the other completely so you either have a home run or nothing at all. EK has banked on both the 777-8X and 777-9X and QR has banked on the A350-900 and A350-1000, so that definitely seems to be the trend.

neomax wrote:

The thing is, its always better to have a bad market than a bad product. Markets can change, but products can't. Even the 777 and 787 had weak periods as the A330 does now, but both rebounded and I have no reason to believe the A330 is any different. While there might be some temporary skepticism as the NEO proves itself, the A330NEO is a solid airplane and fills a niche that Boeing has a hard time competing with and I would not worry about the future of the plane as long as this is the case. The 787 has too much range and not enough capacity for a lot of airlines out there which is why the current model has been so popular. For airlines where the 787 is too much plane, the A330 is perfect, and has a very significant advantage of commonality for airlines that already have the A330 and a cheaper list price due to it not being a prohibitively expensive clean sheet program.

Not sure I follow.

Many companies have been very successful selling bad products into good markets. Microsoft comes to mind pretty quickly. Also some very good products never find markets.

Vendors can't wait forever for markets to form. There's a window that one has to hit. There still is an open window for A330neo. It just hasn't had the acceptance to date that I thought it would have. Airbus suggests the replacement cycle will peak in the early 2020s. There's enough backlog to see if that statement becomes true or not. However if cancellations become the norm and the backlog doesn't grow, there are problems.

I'm not sure A330neo is a perfect product for customers that find 787 has too much range. I'm thinking eventually NMA/MOM will be that product.

I do think A330neo is an excellent product, and has a large installed base to sell into. It just needs to win a few sales campaigns to get back on track.

keesje wrote:

The resale value of the A330NEO vs 787 might actually be a strong point. P2F is a real (flying) option.

Which only happens when the passenger airlines get rid of the plane. Which either means that the aircraft quickly gets rejected by operators en masse (which also means airlines are not ordering new pax neos, or else there would be interest in the 2nd hand planes) which is not necessarily a good look for Airbus/the A330neo, or a NEO P2F is only viable ~20+ years from now.

It is also not a real option for the Neo because an A338/A339P2F still needs to be converted (although they can leverage a lot of the engineering from the ceo) and certified. Which means there needs to be a sufficient amount of feedstock available to make those costs worthwhile. If not you end up like A345/A346s- sitting unwanted rotting away.

KarelXWB wrote:

I would not pay too much attention to editorial comments. It's just an opinion and they change tone when a large order is announced.

Revelation wrote:

Is Airbus becoming solely dependent on A359 in the wide body market?

The jury is still out. The entire A330 backlog is healthy (> 300 orders / 4-5 years production) and I wouldn't be surprised if more will follow when the A330 replacement cycle kicks in.

Currently 2 new aircraft models are positioned at the current A330 market: 787-10, and A330neo. The former sold some 200 copies in 5 years, the latter some 200 copies in 4 years. So people argue these aircraft are not selling in large numbers, but airlines are not yet focussend on A330 retirements. As such, we need to look at the long term prospects.

Fully agree

The A330-900 is a low cost / low risk project, and I wouldn't be surprised if it is already way past recouping its development cost. My personal opinion however, is that the A330neo can only win sales campaigns if the airline hasn't yet ordered 787s. But that's okay, it won't sell as many as 787s, but Airbus will have a lot more profit with the A330neo than without it.

neomax wrote:

The 787 has too much range and not enough capacity for a lot of airlines out there which is why the current model has been so popular. For airlines where the 787 is too much plane, the A330 is perfect, and has a very significant advantage of commonality for airlines that already have the A330 and a cheaper list price due to it not being a prohibitively expensive clean sheet program.

I don't agree with the assumption the 787-9 has too much range. If an aircraft is efficient enough, additional range is a bonus. The A339 is not more efficient than the 787-9 (it will be close though), but can be acquired more cheaply.

If too much range was that much of an issue, the 787-10 would have outsold the A359 many times. Hasn't happened.

frigatebird wrote:

KarelXWB wrote:

I would not pay too much attention to editorial comments. It's just an opinion and they change tone when a large order is announced.

Revelation wrote:

Is Airbus becoming solely dependent on A359 in the wide body market?

The jury is still out. The entire A330 backlog is healthy (> 300 orders / 4-5 years production) and I wouldn't be surprised if more will follow when the A330 replacement cycle kicks in.

Currently 2 new aircraft models are positioned at the current A330 market: 787-10, and A330neo. The former sold some 200 copies in 5 years, the latter some 200 copies in 4 years. So people argue these aircraft are not selling in large numbers, but airlines are not yet focussend on A330 retirements. As such, we need to look at the long term prospects.

Fully agree

The A330-900 is a low cost / low risk project, and I wouldn't be surprised if it is already way past recouping its development cost. My personal opinion however, is that the A330neo can only win sales campaigns if the airline hasn't yet ordered 787s. But that's okay, it won't sell as many as 787s, but Airbus will have a lot more profit with the A330neo than without it.

neomax wrote:

The 787 has too much range and not enough capacity for a lot of airlines out there which is why the current model has been so popular. For airlines where the 787 is too much plane, the A330 is perfect, and has a very significant advantage of commonality for airlines that already have the A330 and a cheaper list price due to it not being a prohibitively expensive clean sheet program.

I don't agree with the assumption the 787-9 has too much range. If an aircraft is efficient enough, additional range is a bonus. The A339 is not more efficient than the 787-9 (it will be close though), but can be acquired more cheaply.

If too much range was that much of an issue, the 787-10 would have outsold the A359 many times. Hasn't happened.

There is a huge assumption here and underlying the whole A330neo business case that I am not sure is valid anymore. I think the acquisition cost of a 787 and an A330 are not nearly as far apart as the original business case believed.

neomax wrote:

The thing is, its always better to have a bad market than a bad product. Markets can change, but products can't. Even the 777 and 787 had weak periods as the A330 does now, but both rebounded and I have no reason to believe the A330 is any different. While there might be some temporary skepticism as the NEO proves itself, the A330NEO is a solid airplane and fills a niche that Boeing has a hard time competing with and I would not worry about the future of the plane as long as this is the case. The 787 has too much range and not enough capacity for a lot of airlines out there which is why the current model has been so popular. For airlines where the 787 is too much plane, the A330 is perfect, and has a very significant advantage of commonality for airlines that already have the A330 and a cheaper list price due to it not being a prohibitively expensive clean sheet program.

I struggle to understand why you say the A330neo fills a niche that Boeing has a hard time competing with. At an operating cost level, the 787 matches or is better than the A330neo from what I have heard. It has three versions for multiple capacity options. It has more range, which is a positive as long as it doesn’t hurt efficiency. As far as I know, the 787 competes well against the A330neo.

The one advantage for the A330neo is price. However, with 787 rates going up, significant cost cutting efforts, and A330 rates going down, the production cost difference is likely shrinking.

KarelXWB wrote:

I would not pay too much attention to editorial comments. It's just an opinion and they change tone when a large order is announced.

Revelation wrote:

Is Airbus becoming solely dependent on A359 in the wide body market?

The jury is still out. The entire A330 backlog is healthy (> 300 orders / 4-5 years production) and I wouldn't be surprised if more will follow when the A330 replacement cycle kicks in.

.

4-5 year production at 5 per month - the 787 is being produced at twice that rate with a stronger backlog.

There is no pressure unless AirAsia changes its mind, then "Houston, we have a problem". Do not forsee that happening so alot of nothing.

Airbus needs more A330 orders, why they stated publicly I have no idea.
https://www.reuters.com/article/us-sing ... SKBN1FR144

https://www.reuters.com/article/us-sing ... SKBN1FS0JC

Its a buyer's market now, good deals to be had.

Revelation wrote:

c933103 wrote:

Given that Airbus still have some unfulfilled small 332 orders with some relatively large airlines, could they be like for example talk with them to convert them to 338 in order to launch it first?

Seems dubious to me.

The A332 actually is more efficient on short sectors and the buyers might be counting on that efficiency. They also may be wanting commonality for spare parts (especially engines) that A330neo can't provide.

The NEO will cost more. Perhaps Airbus would eat the cost difference just to get some A338s into service, perhaps not.

The advantage of the A330ceo over the A330neo on short sectors, was based on estimates done 2014. Some things have changed since than. The weight increase is less than first estimated, most likely the difference of the engines only, not more than 4t. Airbus offers a 6t higher MZFW on both neo versions. The A330-800 grows to 176t and the A330-900 grows to 181t. That means slightly higher max payload on the A330neo than the ceo instead the other way round. The fuel burn of at least on the A330-900 beats planed specs. So the advantage attributed to the A330ceo on short routes should be rather limited to far shorter trips than anticipated in 2014, or perhaps no advantage at all.

Revelation wrote:

Pressure mounts on Airbus A330 in widebody order battle tells us:

PARIS (Reuters) - Imminent airline decisions on $10 billion of wide-body plane orders could influence the fate of Airbus’ A330neo even before the recently upgraded jet completes flight trials, industry sources said.

I don't agree with the dark tone (the "fate" of A330 is fine) but the article summarizes the situation pretty well.

Some things it mentions:
• (Of course) HA dropping order for six A338s
• AA reviewing 789 vs A339
• LEVEL considering 8 frames in this segment
• AirAsia upheld its decision to take 68 A339s but "analysts say that could change if it feels too exposed as the dominant buyer"
• IR deal for 28 potentially held up due to US concerns on nuclear treaty
• QF and/or NZ could be the next battle ground

One interesting point:

But keeping A330neo output to a minimum would leave Airbus increasingly dependent on one model, the much newer A350-900, for its position in the wide-body market - mirroring Boeing’s predicament in the Airbus-led narrowbody market.

Is that fair to both parties?

Is Airbus becoming solely dependent on A359 in the wide body market?

Is Boeing becoming solely dependent on 738 in the narrow body market?

If so, is that a big problem, or is it in fact a positive sign that your decisions have created the most popular platform for the market segment?

IR has already received 2 out of the 8 A330 CEO's. The 28 frames are for the NEO's and only reason why Airbus hasn't delivered one yet to date is due to Iran refusing to pay down payments.This is a done deal and there's nothing the US can do about it, without protest from Airbus or Europe.

The A330 is going to be competing in a few sales campaigns in China...

Given the large number of current operators there and the worsening trade climate between the US and China, along with the new Chinese a330 completion center, Beijing might well replace many of China's ageing domestic 330's with more of the same.

That market alone would buoy a330 sales for quite a while.

persiangulf93 wrote:

Revelation wrote:

Pressure mounts on Airbus A330 in widebody order battle tells us:

PARIS (Reuters) - Imminent airline decisions on $10 billion of wide-body plane orders could influence the fate of Airbus’ A330neo even before the recently upgraded jet completes flight trials, industry sources said.

I don't agree with the dark tone (the "fate" of A330 is fine) but the article summarizes the situation pretty well.

Some things it mentions:
• (Of course) HA dropping order for six A338s
• AA reviewing 789 vs A339
• LEVEL considering 8 frames in this segment
• AirAsia upheld its decision to take 68 A339s but "analysts say that could change if it feels too exposed as the dominant buyer"
• IR deal for 28 potentially held up due to US concerns on nuclear treaty
• QF and/or NZ could be the next battle ground

One interesting point:

But keeping A330neo output to a minimum would leave Airbus increasingly dependent on one model, the much newer A350-900, for its position in the wide-body market - mirroring Boeing’s predicament in the Airbus-led narrowbody market.

Is that fair to both parties?

Is Airbus becoming solely dependent on A359 in the wide body market?

Is Boeing becoming solely dependent on 738 in the narrow body market?

If so, is that a big problem, or is it in fact a positive sign that your decisions have created the most popular platform for the market segment?

IR has already received 2 out of the 8 A330 CEO's. The 28 frames are for the NEO's and only reason why Airbus hasn't delivered one yet to date is due to Iran refusing to pay down payments.This is a done deal and there's nothing the US can do about it, without protest from Airbus or Europe.

The 2 delivered A330s were already built NTUs not new builds for IR. Airbus has not yet assigned MSNs for any new A330s for IR. I can only speculate on why this might be.

Geoff

Revelation wrote:

The A332 actually is more efficient on short sectors and the buyers might be counting on that efficiency.

Doesn't that also include acquisition cost differences?

parapente wrote:

Perhaps the days of 'derivatives are us' may be over.

A320neo and 737MAX current order books do not support that thought (just ask Bombardier . . . ).

What I find particular interesting, and perhaps pretty worry some to Airbus at this point, is that apparently Boeing is able/willing to undercut A330 pricing. Pricing would be the territory where the "cheap" derivative should shine . . . Is this perhaps a sign of the 787 increased production rate investments starting to pay off?

PW100 wrote:

parapente wrote:

Perhaps the days of 'derivatives are us' may be over.

A320neo and 737MAX current order books do not support that thought (just ask Bombardier . . . ).

What I find particular interesting, and perhaps pretty worry some to Airbus at this point, is that apparently Boeing is able/willing to undercut A330 pricing. Pricing would be the territory where the "cheap" derivative should shine . . . Is this perhaps a sign of the 787 increased production rate investments starting to pay off?

I think the do as little as possible and hang new engines approach actually has been oversold. It works for the 737max and A320neo for two primary reasons.

1. It doesn’t shift capability up that much in pure range and payload terms.

2. The industrial investment needed to challenge them on a scaled basis is huge.

I don’t think that works as well for widebodies. I think the a330neo moves out of the sweet spot it occupied in terms of payload and range and is now bigger than a plane needs to be for the jobs it wants to do. The extra fuel savings of a 787 or A350 mean that this plane needs to make its money on relatively shorter routes. Adding more range isn’t exactly where things need to go. If you just strap more efficient engines on a plane that is pretty much what is going to happen. You get more range/payload. As engines get more efficient the amount of fuel you need to carry for a given distance goes down and weight on any new competitor drops as well.

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

bigjku wrote:

PW100 wrote:

parapente wrote:

Perhaps the days of 'derivatives are us' may be over.

A320neo and 737MAX current order books do not support that thought (just ask Bombardier . . . ).

What I find particular interesting, and perhaps pretty worry some to Airbus at this point, is that apparently Boeing is able/willing to undercut A330 pricing. Pricing would be the territory where the "cheap" derivative should shine . . . Is this perhaps a sign of the 787 increased production rate investments starting to pay off?

I think the do as little as possible and hang new engines approach actually has been oversold. It works for the 737max and A320neo for two primary reasons.

1. It doesn’t shift capability up that much in pure range and payload terms.

2. The industrial investment needed to challenge them on a scaled basis is huge.

I don’t think that works as well for widebodies. I think the a330neo moves out of the sweet spot it occupied in terms of payload and range and is now bigger than a plane needs to be for the jobs it wants to do. The extra fuel savings of a 787 or A350 mean that this plane needs to make its money on relatively shorter routes. Adding more range isn’t exactly where things need to go. If you just strap more efficient engines on a plane that is pretty much what is going to happen. You get more range/payload. As engines get more efficient the amount of fuel you need to carry for a given distance goes down and weight on any new competitor drops as well.

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

Another reason it works for the narrow bodies is Airbus/Boeing are both doing it, and can overwhelm any new entrant due to their sheer production volumes (good luck quickly getting a brand new plane from a new manufacturer to 50-60 planes a month with no issues). Keeping that production volume, and commonality with the thousands of existing A320/737s, is why both Airbus and Boeing are hesitant to pull the trigger on a brand new narrowbody unless that is the only way they can get fanatasic improvement.

That doesn’t apply in the wide body realm. Boeing is currently producing 787s faster than Airbus is with the A330 despite one plane being brand new and the other not. Widebody production is much less predictable over the long term than narrowbody, as as specific widebody product demand is less predictable.

AA has NO A339s on order, they have A350s have have deferred that order twice so far and is contemplating ordering more A350s or canceling them.

So as we recall Airbus was being opportunistic by taking advantage of the 787 production issues and early in-service issues back in the early 2010s to sell more A330ceos. Turns out that they may have overdone that campaign. Firstly, it delayed the development of the A330neo, which with hindsight should had been done much earlier to garner a bigger customer base (ie critical mass) for the neo. Secondly, they reduced the amount of potential customers for the A330neo as a lot of them have gotten brand new A330ceos and are unlikely to buy any neo in the short or medium term.

Airbus has underestimated how fast Boeing was able to rebound after the quite lengthy period of 787 issues and how Boeing was able to pursue the subsequent production ramp up. The main selling point of the ceo was availability and Boeing seems to be able to match this now, doesn't help that the A330neo is facing delays of its own.

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

That is a bit far fetched to go from price dumping and a never before seen WB production rate
to "original manufacturing savings promise of the 787 methods are finally being realized"

... and bookkeeping gyrations won't expose this either way in the near to middle future.

Airbus sold more then 1000 330s copies after it was supposed to be dead.

I think this tells everything. 330neo shall sell deasent until a new engine is available 2025 when replacement will come.

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

It's interesting how much of a.net rejected much of the Leeham HA report, and is now willing to admit he had the inside track on HA dropping A338 and picking up 789, but still not really taking in his rationale ( 787 can price aggressively due to earlier investments at reducing production cost, squeezing of subcontractors to reduce their prices, increasing production rate allowing fixed cost to be amortized across more production etc).

WIederling wrote:

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

That is a bit far fetched to go from price dumping and a never before seen WB production rate
to "original manufacturing savings promise of the 787 methods are finally being realized"

... and bookkeeping gyrations won't expose this either way in the near to middle future.

Right on cue...

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

Let us now see, 600 787 produced and sold, at an average loss of over 40 million USD so far, yes the manufacturing savings must now be fully realised.

mjoelnir wrote:

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

Let us now see, 600 787 produced and sold, at an average loss of over 40 million USD so far, yes the manufacturing savings must now be fully realised.

You can't drive the car staring in the rear view mirror.

What matters now is the cost to produce the next aircraft available to be sold, not what it cost to produce the previous ones.

olle wrote:

Airbus sold more then 1000 330s copies after it was supposed to be dead.

I think this tells everything. 330neo shall sell deasent until a new engine is available 2025 when replacement will come.

When the A330 first came out, Airbus was aggressively pushing for the A340, and limited the A330's capabilities. It was more of a case of infanticide if it were to happen. But then again, the A330/340 share the same line and have a lot of common parts, so there was always a backlog for that production line to work on, especially when there was ton of 747 classics flying around that the A340 was meant to replace. Now it is a different story with the backlog for the same production line dwindling as there is a glut of new widebodies being flown around the world, and Airbus had to adjust its production rates to better suit the new norm of lesser A330 orders.

Revelation wrote:

mjoelnir wrote:

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

Let us now see, 600 787 produced and sold, at an average loss of over 40 million USD so far, yes the manufacturing savings must now be fully realised.

You can't drive the car staring in the rear view mirror. What matters now is the cost to produce the next aircraft available to be sold, not what it cost to produce the previous ones.

.......correct; but you could then complain to the DoJ or WTO about competitors selling product 'below cost of production'; particularly if those costs have been endlessly 'deferred'; and even more particularly if an organisation had made that exact same complaint a few months earlier against one of its 'competitors'.......

The A330-800 may be under pressure, but I don't see the A330-900 having any real issues.

Six frames a month on a fully mature and amortized production line can still comfortably make money so as long as Airbus can maintain a neutral or positive Book to Build ratio things should be fine.

Stitch wrote:

Six frames a month on a fully mature and amortized production line can still comfortably make money so as long as Airbus can maintain a neutral or positive Book to Build ratio things should be fine.

And within the industry, rate 6 is still considered to be "high" for a widebody aircraft.

KarelXWB wrote:

And within the industry, rate 6 is still considered to be "high" for a widebody aircraft.

Indeed. I believe only the A350, 777 and 787 have gone to sustained double-digit monthly-rates and the 777 has since reverted back to half it's peak rate and likely will not see double-digits again with the 777X.

Stitch wrote:

Indeed. I believe only the A350, 777 and 787 have gone to sustained double-digit monthly-rates and the 777 has since reverted back to half it's peak rate and likely will not see double-digits again with the 777X.

777 never went beyond 8.something. ( 98,99 / 12 ~= 8.25 )

A330 came up to 9 afair. ( 108 / 12 ~= 9 ) airbus speak : target rate 10/month announced in 2012.

currently only the 787 and later the A350 reach rate 10 and beyond.

Stitch wrote:

KarelXWB wrote:

And within the industry, rate 6 is still considered to be "high" for a widebody aircraft.

Indeed. I believe only the A350, 777 and 787 have gone to sustained double-digit monthly-rates and the 777 has since reverted back to half it's peak rate and likely will not see double-digits again with the 777X.

If I'm reading this correctly, A330 held rate 10 from 2013 to 2015 which seems "sustained" to me, so rate 6 is a 40% drop from peak.

http://www.airbus.com/newsroom/press-re ... month.html

Edit: EuroMonth translation factors need to be applied.

The biggest order wave for A330neo has yet to come. China is at the top of my head in terms of future A330neo customers. A330ceo has historically been working SO well in China-Europe markets. It has just about the right range from Beijing and Shanghai to western Europe. After the MTOW increase on the NEO, it will serve China Southern even better out of CAN.

Plus the A330 completion Center is not only built for the couple dozens of A330ceo orders. It will be used for a LONG time. Just calm down. The best has yet to come.

WIederling wrote:

777 never went beyond 8.something. ( 98,99 / 12 ~= 8.25 )

Yeah it was 100 a year, which worked out to 8.3 a month.

parapente wrote:

Question.These days can a warmed over aircraft compete with an all new aircraft?

*cough* A320neo *cough* best selling plane of all time *cough*

parapente wrote:

Question.These days can a warmed over aircraft compete with an all new aircraft?

JamesCousins wrote:

*cough* A320neo *cough* best selling plane of all time *cough*

I don't think anyone on this forum would define the 737MAX as an "all new aircraft".

Revelation wrote:

mjoelnir wrote:

bigjku wrote:

I also think we have to acknowledge the possibility that the original manufacturing savings promise of the 787 methods are finally being realized. If that is the case it’s far worse for Airbus than any short term issue.

Let us now see, 600 787 produced and sold, at an average loss of over 40 million USD so far, yes the manufacturing savings must now be fully realised.

You can't drive the car staring in the rear view mirror.

What matters now is the cost to produce the next aircraft available to be sold, not what it cost to produce the previous ones.

Shhh....if we keep harping on that subject we can ignore the potential going forward problem that we don’t want to address because we don’t like the answer it might bring us to.

Stitch wrote:

parapente wrote:

Question.These days can a warmed over aircraft compete with an all new aircraft?

JamesCousins wrote:

*cough* A320neo *cough* best selling plane of all time *cough*

I don't think anyone on this forum would define the 737MAX as an "all new aircraft".

Good point, the competitor isn't that great, although if the A320neo family didn't work really well for airlines Airbus would have been heavily pressured to peruse a new design. There's good reason it's sold very well...

JamesCousins wrote:

Good point, the competitor isn't that great, although if the A320neo family didn't work really well for airlines Airbus would have been heavily pressured to peruse a new design. There's good reason it's sold very well...

MAX has sold 61% as many frames as the NG in 35% of the time so it may not be "great", but it certainly isn't "bad".

It's pretty clear all of the latest-generation narrowbody and widebody frames are benefitting strongly from airline fears of a return to high fuel prices, just as they benefitted strongly when fuel prices were high.

seahawk wrote:

As Boeing has the production capacity and the ability to lower the price of the 787, the A330 is practically dead. It had the advantage of lower investment costs and faster delivery, but this is no longer the case. If you figure the probably low resale value of the A330NEO, the 787 already is cheaper. What that means for Boeing´s books remains to be seen, as the aggressive deal with HA won´t go unnoticed by other interested airlines.

They have the ability to lower the price of the 787, thats true, if its a sound business decision? We will know later in the game.

Resale value of the 330No is unknown, so there is no point going there.

BUT, they really went for HA order, and that wont go unnoticed by all other customers, that will demand a good price now that Boeing has shown its poker hand, specially big orders... I think Boeing went too far to get that HA order and has kicked the hornet nest and this article is proof enough. Boeing can subsidize its 787 program with the gazzilion of Maxes they are selling, but they should be focusing on new products with that money instead of reducing its margins and assuring production at very low prices.

Time will tell but I honestly think that HA jumped the (330) boat , because Boeing give them a helluva great deal on a great aircraft, so why not? but in the end if they waited for the final performance specs on the 338, they could even get a mixed fleet with more taylor to mission specs (more so because they were only 6 aircraft ordered)

Now everyone and its dog know that the 789 can be had at 100 million plus minus 10....

TRB

TheRedBaron wrote:

BUT, they really went for HA order, and that wont go unnoticed by all other customers, that will demand a good price now that Boeing has shown its poker hand, specially big orders... I think Boeing went too far to get that HA order and has kicked the hornet nest and this article is proof enough. Boeing can subsidize its 787 program with the gazzilion of Maxes they are selling, but they should be focusing on new products with that money instead of reducing its margins and assuring production at very low prices.

Again, they can ask, but that doesn't necessarily mean they're going to get it.

And we don't know how GE played into this deal - a significant portion of that "deep discount" could be from GE considering HA had a contract with RR for the Trent 7000 and cancelling the A330-800 might have triggered a breach of that contract.