Boeing chair holds steady on 737 Max monthly build rate
June 06, 2022
Boeing is wary of setting timetables for aircraft certification, new jet design, and especially for rate increases of its jet production amid the uncertainty of supply chains. Airlines and lessors despite the rise of new Covid-19 infections continue to retire older aircraft and replace them with more fuel-efficient jets, including Boeing’s 737 Max. Even though “the market is hot right now”, the Chicago-based airframer seeks to continue its monthly production rate of 31 Max jets for the near future because of supply chain limits, Boeing chairman David Calhoun said on 3 June during the Bernstein Strategic Decisions Conference. “Right now demand is significantly better than supply,” Calhoun says. “Our company has to be patient.” The chairman reiterated his past concerns about overestimating Boeing’s ability to increase production of its jets, adding “I am not going to run a public campaign on production rates” because rapid increases could endanger the stability of supply chains. Maintaining a steady monthly production rate of 31 Max jets for 18 months or two years, he says, would be “fairly significant”. Based on Boeing’s performance during the first half of 2022, Calhoun says the airframer is on track to “reach cash flow positive” by the end of the year. Russia’s invasion of Ukraine has added uncertainty to the supply of metals including titanium, yet both Boeing and aerostructures manufacturer Spirit AeroSystems remain confident in the near-term accessibility and stockpiles of those metals. The rise of Covid-19 infections, however, raises the risk of workers calling in sick across supply chains.
Addressing the ongoing pressure to certificate aircraft, Calhoun also says “we’re playing the long game” by not overcommitting to timetables. Boeing has halted deliveries of its 787 widebodies while it continues to co-ordinate with the US Federal Aviation Administration on rework and certification of those aircraft. The airframer is producing 787s at a very low rate until deliveries resume, with an expected gradual return to five per month over time. Without commenting about ongoing certification processes, Calhoun promised transparency with both the public and the FAA. Boeing in April outlined some initial estimates for certification goals. The airframer expects regulatory approval for 777X aircraft in 2024, as new FAA requirements for aircraft certification have led Boeing to delay its timetable for 777X deliveries until 2025, postponing from its previous delivery goal of 2023. Boeing in April also targeted separate FAA certification processes in time to begin deliveries of Max 7 jets in 2022 and Max 10s in 2023. Patience is also a virtue, Calhoun says, as Boeing considers its strategy to design a new mid-market commercial aircraft. Echoing his past concerns, he says the airframer will have to add value to make the next-generation aircraft competitive as a whole rather than mainly seeking improvements from engine makers. “There are a lot of good ideas that are being tossed around on the subject of sustainability and new ways to power airplanes,” he says. “That timeline is well out there, well out there, at least a decade from now, [in] my view.” Propulsion advances at this point will not dominate new designs, he says, while digital technology enables opportunities to test and produce aircraft more efficiently. Virtual testing is among the growth technologies that can help minimise risks and expenses at early stages even before flight tests, he says, while it could be “at least a couple of years before I’m confident that those tools are tested and mature enough to implement on the next airplane”.
US carriers 'in denial' about capacity constraints: United chief
June 03, 2022
Aviation executives and observers who expect US carriers will be able to expand their capacity to meet rising demand for travel are in denial about the near- and long-term effects of the country's pilot shortage, United Airlines' chief executive argues. "Anybody that thinks that the airlines are all going to be able to grow at the rate they've said is wrong, including those airlines," United's Scott Kirby said on 1 June during the Bernstein Strategic Decisions Conference in New York. "The reality is there's not enough pilots for everyone to staff." The Chicago-based carrier went through "the seven stages of grief" when the pilot shortage first hit US regional airlines during the Covid-19 pandemic, before its impact was felt by larger carriers. "I think I'm uniquely good at getting to acceptance quicker than most people," Kirby says. "We accepted [the pilot shortage] and figured out what to do about it. A lot of other people are still in the denial phase, but it's here." United and its pilots' union Air Line Pilots Association on 13 May signed an agreement in principle encompassing terms for a new contract. Kirby wrote in a LinkedIn post that day that United was the only US carrier to "work with its pilots' union to reach an agreement during Covid". United, which intends to hire an additional 10,000 pilots by 2030, disclosed on 1 June that it will add on a new four-story building to its 23-acre flight training centre in Denver. The expansion will make room for 12 additional advanced flight simulators, training classrooms, conference rooms and offices. Kirby contends that United has an edge on other US majors and, especially, on regional and low-cost carriers in its ability to recruit and retain pilots. "We're at the top of the food chain. If you're a pilot, United is always at the top tier for pay. [We have] the most widebodies of any airline in the country. You get paid more to fly a widebody, plus you get to fly to cool places." He says that low-cost carriers had previously been able to attract pilots by offering to upgrade them to captain faster than US majors could. United can now match low-cost carriers' speed in which pilots get upgraded to captain because it was the only US carrier that did not retire widebodies during the pandemic, creating relatively more room for career growth, he adds. US airlines' pilot staffing holes are only going to get deeper as time goes on, Kirby says. "There were several thousand pilots that retired early during the pandemic. You had two years of no airlines hiring new pilots, so you dug the hole even deeper. Additionally, you need more pilots to operate the same amount of flights today because sick calls are higher. I think that's permanent. You need 4-6% more pilots to operate an airline than you needed before just because Covid leads to a higher level of sick calls." Kirby notes that during the decade preceding the pandemic, US airlines typically added 5,000 to 7,000 new pilots per year. "At the start of this year, airlines said they were going to try to hire 13,000 pilots… it's going to take a long time to address and fix this."
USA lifts limits on Cuba flights
June 03, 2022
The US Department of Transportation on 1 June lifted restrictions on charter and commercial flights to Cuba imposed by former president Donald Trump, enabling US airlines to plan new flights to the island nation amid the recovery of leisure travel. The move is part of a broader strategy by current president Joseph Biden to support freedom of movement for citizens of Communist-run Cuba and to encourage the growth of a free market economy there. The DOT in October 2019 restricted US airlines from operating routes to any destination in Cuba other than Havana’s Jose Marti International airport, and in 2020 restricted charter flights to all Cuban cities except Havana. The DOT lifted the ban at the request of secretary of state Anthony Blinken, who sent a letter to the department on 31 May. “We aim to support Cubans’ aspirations for freedom and for greater economic opportunities so that they can lead successful lives at home,” the US State department says. “We continue to call on the Cuban government to immediately release political prisoners, to respect the Cuban people’s fundamental freedoms and to allow the Cuban people to determine their own futures.” Lifting Trump’s ban enables US carriers to reopen routes operated during the second quarter of 2019 to the Cuban cities of Holguin, Camaguey, Santiago de Cuba, Santa Clara, and Varadero. American Airlines scheduled 902 flights to Cuba during that quarter in 2019, Cirium schedules data shows, making it the biggest US operator of flights to that nation. JetBlue Airways scheduled 715 flights to Cuba during that period, followed by Southwest Airlines with 377, Delta Air Lines with 273 and United Airlines with 182 flights. Delta and United had no flights scheduled to Cuba during the second quarter of 2022. Limited to only Havana flights, capacity on American’s network to Cuba during the second quarter is 39% lower compared with that period in 2019, while JetBlue’s capacity is 72% lower and Southwest’s is 18% lower. The USA resumed diplomatic relations with Cuba in 2015 when Biden was vice-president alongside then-president Barack Obama. US carriers resumed commercial flights to Cuba in 2016 for the first time since 1961.