PIA states requirement for 34 additional aircraft

Pakistan International Airlines has stated it needs 34 additional aircraft to adequately make up for an operational shortfall.

Chairman of the Pakistani Civil Aviation Authority (CAA) Muhammad Ali Gardezi stated that of the carrier’s 30-strong fleet of aircraft, only 19 were currently operational, and that plans to resume viable routes were being hampered by a lack of operational equipment.

Gardezi also stated that PIA’s process of acquiring ATR turboprops for use on domestic routes had encountered difficulties in finding lessors willing to supply both aircraft and pilots due to Pakistan’s current security situation.

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Boeing lists new order for 80 737s

Boeing has added orders for 60 737 Max and 20 737NGs to its order backlog and attributed them to at least one unidentified buyer

Though Boeing declines to confirm the customer’s identity, details about the transaction point to a recently announced order by China Eastern Airlines.

A 13 June filing on the Hong Kong stock exchange shows China Eastern has signed a purchase agreement with Boeing for a total of 80 737s, including both 737 Max and 737-800 aircraft.

China Eastern did not break down how many aircraft of each variant were included in the deal. However, the filing lists the overall value of the deal as $7.387 billion. It also lists the “basic” price of the 737-800 as $81.16 million and the 737 Max as $96.07 million. Combining the prices of 20 737-800s and 60 737 Max aircraft adds up to $7.387 billion.

Purchase agreements usually precede the signing of a firm order, but not always.

It is not clear why Boeing would not identify China Eastern as a customer, if China Eastern had already announced it was buying 737s.

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Boeing Faces Competition From China

Chinese airlines are expected to purchase about 5,000 new planes in the next 20 years, and the country wants to keep some of the estimated $560 billion at home. To that end, a new company was founded in 2008, Commercial Aircraft Corporation of China, better known as Comac. So far, the Chinese firm has had its own troubles.

Getting a new airplane off the ground is a complicated task. Just ask the folks at Boeing Co. (NYSE: BA), where the first 787 Dreamliners were finally delivered to customers three years late and at massive cost overruns. Comac’s first commercial aircraft is a regional jet, the 90-seat ARJ21, that was being built by a consortium of Chinese aircraft companies, was announced in 2002 and is expected to begin commercial operations next year. The consortium was subsumed by Comac in 2009. The ARJ21 will compete against the regional jets built by Canada’s Bombardier and Brazil’s Embraer S.A. (NYSE: ERJ).

The first plane that Comac has designed from the ground up is the C919, a 158-seat single aisle (narrow-body) plane that will compete with Boeing’s 737 and 737 MAX and the A320 and A320neo from Airbus. The C919 service date was scheduled for 2016, but delays have pushed that date out at least to 2017, and more likely into 2018. The plane’s first test flight was originally scheduled for this year but has been delayed until late next year.

It took Boeing almost nine years to get the 787 into commercial service, so a 10-year timetable for the first commercial plane a country has ever built is not a bad showing. Comac reportedly has orders for 252 ARJ21s and 400 orders for the C919. The airplane leasing arm of General Electric Co. (NYSE: GE), GE Capital Aviation Services, as well as Ryanair Holdings PLC (NASDAQ: RYAAY) and British Airways, are among the 16 customers for the C919.

Comac is also reported to be pairing up with a Russian aircraft maker UAC on development of a dual-aisle, wide-body jet, although no time frame has been announced for that project.

Slicing off 400 of 5,000 planes from the total Chinese demand over the next two decades is just the beginning. And Comac clearly has designs on the international market as well, as the C919′s order demonstrates.

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Air New Zealand orders 14 new Airbus aircraft, the first Boeing 787-9 completes its first flight

Air New Zealand (Auckland) has announced it has placed an order for 10 Airbus A320neo aircraft (above), one A320ceo and three A321neo aircraft (above, image via Airbus). The signing ceremony took place at the IATA annual meeting today in Doha, Qatar. In other news, on May 29 Air New Zealand’s first Boeing 787-9 (ZK-NZE) (above) took to the air for the first time, successfully completing its first production test flight in the skies above Seattle, Washington. The aircraft, which is in Air New Zealand’s signature black livery, is currently in the final phases of the delivery process before being formally handed over to the airline as the new owner.

Air New Zealand is the launch customer for the Boeing 787-9 and has 10 of these stretch versions of the 787 on order. This first test flight is known as a B1 flight where the two pilots put the aircraft through its paces thoroughly exercising its systems to verify performance while at the same time the functionality of every aspect of the cabin is tested in-flight. The distinctive black aircraft departed from Paine Field airport north of Seattle at 1:45 pm (1345) local time. It reached an altitude of 11,800 meters (39,000 feet) and an airspeed of 360 knots which is standard for a B1 flight and returned to Paine Field three hours and ten minutes later.

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Airbus plans to make more A320 jets

Airbus is studying further increases in production of its best-selling A320 jet family from 2018 after reaching a targeted level of 46 a month in 2016, the chief executive of parent Airbus Group said yesterday.

Each month, Airbus currently produces 42 of the narrowbody jets, which compete with the Boeing 737.

It plans to make a transition to an upgraded A320neo version between 2016 and 2018, after which it will consider further output increases, Airbus Group CEO Tom Enders told shareholders.

The A320neo project is on track, as is the A350, the company's latest wide-body jet which is due to be delivered as scheduled this year, Enders told the annual meeting of Europe's largest aerospace group.

He said the A350 was entering a "red hot phase," in which efforts to ramp up production coincide with last-minute changes.

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Boeing Surpasses 2,000 MAX Orders, Says Delivery Target on Track

Boeing surpassed 2,000 orders for the next-generation single-aisle 737 MAX this week, marking the fastest-ever it has reached that mark for a new aircraft. The company also said Tuesday it is on track to begin final assembly of the jet in mid-2015, with plans to have it in the air by 2016. First deliveries are expected to get to launch customer Southwest Airlines  in the third quarter of 2017. Boeing said the MAX reached the 2,000 mark faster than any other of its planes in history as carriers rush to replace dilapidated, gas-guzzling fleets. 

“This unprecedented demand is fueled by air traffic growth and the need for more fuel-efficient airplanes,” Boeing said.

The Chicago-based jetmaker said it received another 30 orders from unidentified customers this week, pushing total orders for the new fuel-efficient jet to 2,010 from 39 customers worldwide, valued at $209 billion at list prices.  The aircraft will be 14% more fuel-efficient than today’s more efficient 737s. Boeing says it is also more efficient than the A320, manufactured by European rival Airbus, with airlines operating the MAX seeing an 8% operating cost per seat advantage over A320neo.

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Brazil airline Azul to order Airbus wide-body jets

Azul Linhas Aereas, Brazil's third-biggest airline, is set to announce a fleet expansion on Wednesday including an order for its first wide-body aircraft from European planemaker Airbus, according to two people with knowledge of the deal. The order vaults Azul, which is controlled by JetBlue Airways Corp founder David Neeleman, into the international market with long-range jets challenging regional heavyweight Latam Airlines Group SA.

Airbus and U.S. rival Boeing Co battle intensely for such orders. Airbus recently offered deep discounts on its wide-body A330 to tempt lower-cost airlines away from Boeing's more modern 787 Dreamliner. Airbus and Boeing officials declined to comment on the matter. Azul announced it would hold a press conference on Wednesday but offered no details of the announcement.

Missing out on a major deal from Brazil's fastest-growing airline would be the second big blow to Boeing since December in a key emerging market where it has been ramping up its presence. Swedish planemaker Saab AB snagged a coveted $4.5 billion fighter jet contract with Brazil's air force at the end of last year after news of U.S. spying on Brazilians helped derail Boeing's chances for the deal.

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The Azul order also highlights a surge in competition for Brazil's more lucrative international routes as domestic passenger traffic growth has cooled after more than tripling since 2000.

The TAM division of Latam Airlines, Brazil's biggest airline, and second-largest carrier Gol Linhas Aereas have both added flights overseas while cutting domestic routes as they lost billions of dollars in recent years. American Airlines and other foreign airlines have also boosted flights to Brazil, which is set to host the soccer World Cup starting in June and the Summer Olympic Games in 2016. Azul is taking on those global players just six years after founder Neeleman left JetBlue and started the low-cost Brazilian airline in the country of his birth.

A takeover of rival carrier Trip in 2012 helped Azul threaten the dominance of the traditional TAM-Gol duopoly in Brazil, and the upstart airline now carries 16 percent of domestic passengers. Still, Azul currently flies only Franco-Italian ATR turboprops seating 50 to 70 passengers and larger regional jets made by Brazil's Embraer SA with up to 120 seats.

Last year, the company announced plans for an initial public offering estimated at up to 1 billion reais ($445 million). Plans were frozen in August amid turbulent financial markets and questions from regulators about a proposed ownership structure that would keep Neeleman in control of the airline.

Azul continues to mull an IPO, the company's head of communications, Gianfranco Beting, told Reuters late last year, adding that Azul was confronting its most adverse environment since it began flying in 2008.

($1 = 2.245 Brazilian reais)

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