Paris Air Show Commande /Intention de commande : 2011

Outlook for Paris Air Show



As we head into the Paris Air Show, here is AirInsight’s outlook:
The big news at air shows are orders for new aircraft.
Forget the drivel that Airbus “saves” up orders for the show and
Boeing doesn’t. Customers drive when the announcements are made, and
many like the limelight of air shows, and some don’t. Boeing has
announced many orders at air shows that were “Unidentified” on the order
books. Airbus typically has fewer Unidentified orders on its
spreadsheet and we know that Airbus works mightily to conclude orders at
the air show—as well as converting MOUs to firm orders during the show
and re-announcing them—but this is all part of the game.
So here is a company-by-company run-down of what we expect:
Airbus
This going to be Airbus’ show.
A320neo
We expect hundreds of A320neo orders to be firmed up and new ones to
be announced, from perhaps as many as about a dozen customers. We expect
the long-talked about AirAsia to place an order to as many as 175
A320neos; we also think GECAS may be ready to place its first neo order.
We know any neo order by GECAS will be with family-member CFM LEAP-X
engines; GECAS has a corporate policy that it will not place orders with
rival engine companies. We also believe AirAsia will select CFM
engines.
Other neo orders likely:

• Republic Holdings, which placed a deposit to hold neo positions, is
  expected to announce an order (which also keeps its Bombardier CSeries
  orders, despite speculation to the contrary), although news last week
  that Republic is under financial pressure and wanting to cut $100m in
  spending raises a question in our mind about this deal;
  
• In addition to GECAS, another lessor to join ILFC’s previously announced and firmed-up order for 100;
  
• a long-rumored order from Qatar, and several existing A320 customers adding neo to their fleets.
  

The anticipated neo order from Delta Air Lines is not likely to be
ready until later this year. There is an outside chance it could happen
at Paris, but we believe it will be later this year.
A330 and A350
We think there will be only a smattering of A330 orders. There should
be some big news for the A350 program, not only on the order front but
also about the program itself. We anticipate some more A350s from China
and we believe there could be an order coming from the Air France-KLM
group–but this might not be ready, so this one could go either way. A
few other carriers may have some orders, but given that there are no
significant delivery slots until 2018, there’s little reason for
customers to rush an order in time for the air show.
Lufthansa is comfortably down the road.
A380
Airbus should have some new A380 customers to announce at Paris. The
one from Hong Kong Airlines, thought to be a Zhuhai Air Show order that
did not materialize, may be back on track and ready for Paris, for five
aircraft. A few additional orders are likely. Emirates however, while
likely to place another order for 30 A380s, may hold off until the
Dubai Air Show.
Boeing
The big question facing Boeing is what will they do to compete with
the neo – will it stick with the existing model with incremental
improvements, re-engine the airplane, or focus on an entirely new
aircraft for the 2019-2020 time frame. Boeing has been purposely
ambiguous on this issue to the point that it has caused Embraer to
indicate that they will “wait for Boeing” before deciding on their new
aircraft. Right now, Boeing has little incentive to announce its
intentions, but has been hinting at an all-new aircraft to potential neo
buyers. So far, that strategy isn’t working very well.
While we expect new 737 orders, they won’t be near the volume of neo orders for Airbus.
737
We expect modest 737 orders to be announced (some undoubtedly coming
from “Unidentified”), including the 737-900ER, which has been finally
catching on. Boeing plans a briefing about the 737 and the new
airplane, but there won’t be any announcements or decisions about
intentions. Inevitably there will some questions from reporters about
the prospect of re-engining the 737.
The shift from the -700 to the -800 and -900 are strong indications
that Boeing will focus on the 160-180-200 seat size for its 737
replacement.
747-8
Boeing’s sales force has been working mightily to gets orders (mostly
from Asia) for the slow-selling 747-8 Intercontinental. Despite
Boeing’s protests that it doesn’t save up orders for the air show, we
know that sales has been working hard to get these orders for an air
show splash. We believe there will be some success.
787
As for the 787? There might be some, but this airplane is largely in
the same predicament as the A350: no significant near-in delivery
slots. We largely expect more stagnation in 787 orders until Boeing
starts delivering the airplane and ramping up production. Air France-KLM
is also a prospect to announce a 787 order, sharing its medium
twin-aisle order with the A350, but we don’t know the split.
Furthermore, as noted above, this order might not be quite ready for
Paris.
Bombardier
Bombardier disappointed at Farnborough because expectations elsewhere
for CSeries orders weren’t met. AirInsight predicted 10 days or so
before Farnborough that there would be no orders announced and we were
right. This year we predict the drought is over (a position we came to
before the pre-Air Show order for 10+10 from Braathens Leasing for
Malmo).
CSeries
Given the smaller market segment of the CSeries, the number of orders
won’t be anything like those to be announced by Airbus and Boeing, and
we’re not predicting as many as 100, but we do expect multiple customers
in groups of five to 10 to 20. Braathens started the process, and we
expect the long-rumored order from Qatar to finally get back on track.
On the other hand, Akbar Al-Baker is so unpredictable that this might
not happen, either. You can never tell with him–he’s alternative
embarrassed Boeing, Airbus and Bombardier. We just don’t know how to
predict Qatar.
Q400
Turboprops always do well in high fuel cost environments, and with
high fuel prices, we expect additional orders for the efficient Q400.
The real question, with PW and GE each working on new turboprop engines
that are more efficient, is when the 90+ seat “Q500” will arrive with
even better seat-mile economics. We don’t expect an announcement this
year, but perhaps by Farnborough next year, there will be a new model
added to the line-up. Bombardier has indicated 2015 might be a
reasonable time frame for a new airplane.
CRJ-1000
The CRJ-1000, the latest version of the CRJ line, shows that
Bombardier is a master at stretching designs for better seat-mile
economics. For existing CRJ operators, this is a strong candidate to
replace CRJ-200s that are becoming economically obsolete. But with the
CSeries offering a better cabin in the 110 seat size, we see only a
handful of orders at the show, but enough to keep the line moving until
CSeries production begins.
Embraer
Embraer is waiting to see what Boeing does before deciding to enter
the market with a competing aircraft in the 120 to 155-seat range,
slightly larger than the CSeries. If Boeing continues to compete in the
market below 150 seats (unlikely with a new airplane, but continued
offering of the 737-700), Embraer may not move forward, and simply
re-engine its E170-190 series to more effectively compete with the
CSeries and MRJ, each of which will have a fuel efficiency advantage
from the PW GTF engine. (We consider this scenario unlikely.) Of
course, having announced that they will wait for a decision from Boeing,
this provides Boeing an incentive to delay their decision as long as
possible to keep Embraer from launching an aircraft that could
potentially compete at the low end with their airplane.
Embraer appears to be afraid to go head-to-head against Boeing or
Airbus, unlike Bombardier, which has caused quite a stir as well as
concern in Toulouse and Seattle.
E170-190
We forecast limited success for the E170-190 series in the
short-term, with a few additional orders. With the CSeries and MRJ
looming three years out with superior economics, the competitions will
begin to heat up significantly for what has been a very good airplane.
Additions to existing fleets and those needing immediate lift will
purchase, but several potential large orders will be decided in
competition with the MRJ and CSeries, both of which will have a fuel
savings advantage with the PW GTF.
Embraer is considering a re-engining for the E-series, which is still
quite young in its product life cycle. A design implemented just
before a step change in engine economics from the GTF and LEAP-X will
simply not have the operating economics to compete once new models enter
the market. A re-engining with the GTF or LEAP-X would re-invigorate
the E-Series, already the market leader in its size class.
Business Jets
Embraer has quite rapidly become a major player in business jets, and
its Phenom 100 and Phenom 300 models are rapidly becoming the
replacement for the venerable Cessna Citation series. We expect
continued success from Embraer as it expands its product line in this
market using derivative models of passenger airliners, including the
Legacy that derived from the EMB-145 series. Bombardier proved the
synergy of business and airline markets with the Challenger and CRJ, and
Embraer entered with its Legacy derivative with modest success. The
Phenom, their first pure business jet designs, has done quite well and
has quickly made Embraer as a key player in the business aviation
market.
Mitsubishi Regional Jet
We understand that a major order from ANI in Indonesia is near
completion, which would provide additional momentum to the MRJ program.
With the Trans States deal finalized, the MRJ, like the CSeries, needs
to build backlog. With the GTF now selected by Airbus, customers that
were initially skeptical of the GTF are now seriously considering the
product as initial entry into service is within 2 years.
We expect at least one and perhaps several orders for the MRJ over the next few month
CFM International
CFM will have its first A320neo orders at the show, including as
noted above an order from family member GECAS. In addition, we expect
AirAsia (historically financed by GE) and Virgin America (an existing
CFM customer) to go with LEAP-X. ILFC will also likely split the
remainder of their 100 aircraft order with 40 LEAP-X orders (60 GTF
were already announced). Word on ILFC and Virgin America leaked out in a
news report this week, but none of the parties confirmed it. Our
sources tell us CFM has these deals.
Engine Alliance
The GE-PW Engine Alliance has the market share advantage on the A380,
and will continue that with new orders from Emirates. While the recent
engine difficulties were costly to RR on the A380, with the problem
fixed we would expect them to continue to do well in attracting
customers.
GE Engines
GE Aircraft Engines will chug along on the 787 and 777, as well as
gain some orders for the 747-8. While we are not expecting a major
volume of wide-body orders, GE will maintain its market share. GE and
Rolls-Royce will likely split any A330 orders.
Pratt & Whitney
PW will continue to dominate A320neo orders, and we expect about at 2/3^rd – 1/3^rd
split over the longer term between the GTF and LEAP-X. In the
short-term, LEAP-X may appear to gain some momentum with large orders at
the show, but we expect several additional PW orders on neo by the end
of the year, if not by the end of the show, that will cement its market
leadership.
In the wide body sector, we don’t expect much for PW in the
short-term, but note that the GTF technology is applicable in the
100,000 thrust range as well, which could make life interesting given
its superior economics. The 777 replacement aircraft could be an
interesting first application—but this isn’t likely until the next
decade.
Rolls-Royce
Despite the negative headlines in the last year, Rolls is well
positioned on 787 and A380 programs and it remains the dominate supplier
on the A330 and it is, of course, the sole-source engine provider on
the A350 XWB.
We expect a major announcement from Rolls at the Air Show, however;
we believe Rolls is going to announce a larger version of the Trent XWB
for the A350-1000, with an incremental thrust increase of perhaps 5,000
lbs.
The disconcerting element for Rolls is the loss of the narrow-body
market, which they participated in through IAE and the V2500, replaced
by the GTF for neo. The good news for IAE is that it appears to be the
engine of choice for the Brazilian KC-390 tanker developed by Embraer.
ATR
The ATR42-600 and ATR-72-600 series models are now certified (or
close for the -72) and will make major inroads at Paris. We expect a
major order for ATR to be announced from an unlikely customer.
With a strong market in Asia, we expect some additional orders for
both growth and replacement of earlier ATR models. In high fuel cost
environments, turboprops thrive, and we expect new orders and continued
momentum for ATR.
Others
The Sukhoi Superjet has been gaining momentum, but still has
a majority of its customer base in Eastern Europe, which needs to
change. With the help of Alenia in marketing and strong western
content, this aircraft is much more appealing than older Russian models,
but still faces a skeptical audience among western airlines.
Irkut, building the MS-21 trunkliner, has selected the PW
GTF and numerous western vendors to create an aircraft that should be
quite competitive with the 737 and A320 families. While it is still
too early to expect orders, Irkut could build some interest at Paris
with its design.
COMAC will bring the fuselage mockup of its C919 to Paris
and tout the C919 aircraft, which is primarily aimed at the Chinese
market. While we expect the aircraft to sell well in China, we don’t
yet see a level of confidence in the market that China can itself build a
competitive aircraft. There may, however, be some orders from Chinese
allies in Africa, effectively trading natural resources for aircraft.
Overall
There probably won’t be any blockbuster announcements this year at
Paris. Boeing will remain quiet about its decisions, and it will be
Airbus show to tout the neo and their 500 commitments goal that will
easily be surpassed. It may also be a coming out party for the GTF,
which with four applications, and two other potential applications
waiting in the wings, has taken the mantle of leadership on new programs
from CFM.
But there are always a few interesting surprises, so stay tuned.

Hazy in talks with Airbus about Air Lease A320neo deal
By Max Kingsley-Jones

Air Lease Corporation (ALC)
chief executive Steve Udvar-Hazy has indicated that the leasing company
could place an order for the Airbus A320neo at this month's Paris air
show. He is also hopeful that Boeing will soon declare its intentions
over a competitive response.

"We're in delicate negotiations. There's still two weeks to go [until
Paris]," said Udvar-Hazy, regarding talks with Airbus about the
re-engined A320.
Speaking to Flightglobal at the IATA AGM in Singapore, Udvar-Hazy
said ALC's existing deal with Airbus for A320 family aircraft comprises
orders for 21 A320s and 30 A321s, with deliveries due to conclude in
2013 and June 2015, respectively. "Virtually all the A320s are placed,"
he added.
That deal, announced at last year's Farnborough air show, does not
include any additional options or purchase rights but does have the
flexibility to convert unassigned aircraft to the A320neo variant.
However deliveries would have to be recycled as the A320neo is not
available before October 2015.
Udvar-Hazy added that ALC would evaluate both engines offered on the
A320neo, which include the Pratt & Whitney PW1100G and CFM
International Leap-X.
Meanwhile the leasing chief is awaiting news from Boeing on its next
move in the single-aisle sector, as the airframer evaluates launching
either a 737 re-engining or an all-new aircraft. "We're encouraging
Boeing to decide its strategy soon. We want to see what's on the menu. I
think they're leaning towards an all-new aircraft at the moment."
Udvar-Hazy said he was keen to establish the likely competitive
landscape in the single-aisle sector as he evaluates whether to order
the A320neo. If Boeing goes for an all-new design it could force Airbus
to respond with its own clean-sheet aircraft, which could hamper the
longer-term prospects for the re-engined variant. "The issue is, are we
looking at an aircraft with a 20-30 year life? If Boeing launches an
all-new airplane and Airbus has to respond with an all-new aircraft in
the early 2020s, what happens to the Neo?" he said.
The arrival of the A320neo family is affecting efforts by Bombardier
to increase the order book for its PW1000G-powered CSeries family, said
Udvar-Hazy: "The A319neo impacts the larger CS300 variant - no
question."
Regarding air show announcements, Udvar-Hazy indicated that ALC would
be making some news about orders at Le Bourget this month, saying:
"We've been ordering widebodies, we just haven't announced them yet."http://www.flightglobal.com/articles/2011/06/07/357649/iata-hazy-in-talks-with-airbus-about-air-lease-a320neo.html