Is propulsion falling behind airframers’ ambitions? Listen in as our editors break it down.

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Rush transcript

Joe Anselmo:

Welcome to this week's edition of Aviation Week's Check 6 podcast. I'm Joe Anselmo, Editorial Director and Editor-in-Chief of Aviation Week magazine. Brazil's Embraer has put on a brave face in the two and a half years since Boeing abruptly dropped plans to acquire a majority stake in the company. A key part of Embraer's plan forward was to launch a cutting edge, environmentally friendly turboprop that could carry 70 to 90 passengers. Word was that Embraer might even launch the turboprop at next year's Paris Air Show. But now all of that is on hold.

So what's going on? Well… you're going to find out at the same time I do as two of our editors, Jens Flottau and Guy Norris, literally just hung up the phone with Arjan Meijer, the CEO of Embraer's commercial business. Also joining us today is our European technology editor, Thierry Dubois, who closely follows turbo prop Builder ATR. So Jens, I’m dying to know, what did Mr. Meijer have to say?

Jens Flottau:

Well, he described it as a pragmatic step, which means they didn't kill the program, they're delaying the launch decision. And the reason is, as he says, that the system suppliers aren't ready yet to commit to the kinds of performance characteristics that Embraer requires. He didn't name any companies, but I guess it's fair to say that we're talking about engine manufacturers.

Take it a step back, obviously there were discussions with all three of the usual suspects Pratt, Rolls and GE. GE told Embraer a few months ago that it wouldn't build an engine, so there were two left. And my interpretation of the situation is that they're just not where they should be right now. Embraer had told the market that it would make a call towards the end of the year. Now we are at the end of the year, so they had to say something and it's taking longer. The good news is that Meijer was very clear that market interest is still strong, airline interest is still strong. Last year in Farnborough they had announced 250 LOIs for the program, and he says that that number has only been expanding.

Joe Anselmo:

Okay, Jens, but this same Mr. Meijer told you earlier this year that the window of opportunity to launch a new turboprop was very tight and that if Embraer didn't move quickly that window would quickly close. Does this really mean that they're just going to delay a little bit, or does this put the project in jeopardy?

Jens Flottau:

It depends on the extent of the delay. If it's a few months, half a year, I would say they probably are still within the window that they imagined, although it is getting tight. But if the delay is getting a lot longer, then yes, absolutely they're running against new technologies that may come up in the 2030s. The lifespan of their program would be much shorter and obviously the investment would be much harder to justify. So yes, time is of the essence, unless they at some point decide that they would open it up again for other technologies. But they're far from making that call yet.

Joe Anselmo:

Thierry, you're our European Technology Editor, Guy is our Propulsion Editor, do you guys really buy that the propulsion technology isn't available yet?

Thierry Dubois:

Guy first.

Guy Norris:

It depends how much you need out of these new engines, that's the bottom line. What the message we certainly got, that Jens and I got from Embraer was that they're pretty close to what they wanted for direct operating costs for this, of which a huge part, of course, are these new engines. But it's more than just fuel burnt in the air. It's about maintenance costs, it's about the support for the engine, the maintenance requirements. It's a massive, huge complicated calculus which they have to go through. The technology itself, of course, is fundamental and it's vital, but it's not the be all and end all of these equations.

So, I think the message partially that we were getting was that they're really, really close and they might have to go back to, particularly the engine makers to see if they can squeeze more out of them on this one. But as Jens said, the technology itself at this stage, it's not really something that's revolutionary or even that cutting edge, it's just state of the art and right at the leading edge, not the bleeding edge kind of thing. I think that's just an important consideration. Thierry, what do you think?

Thierry Dubois:

Just agree with you, and I think ATR in Toulouse is watching very closely that decision or that suspension of a decision, as ATR has announced that it would like to launch the ATR EVO for entry to service by 2030 and ATR has an RFI, a request for information with the engine makers. I don't know whether they're pursuing the same kind of technology, to be honest, but again, this is leading edge technology it's not revolutionary, new technology that ATR is pursuing.

Joe Anselmo:

Thierry, from a business point of view, this has to be good news for ATR, no? It's competitor is delaying bringing an impressive new product to market.

Thierry Dubois:

I wouldn't say so. I think ATR would've loved to see Embraer launching this sooner rather than later because it gives credibility to the turboprop market. And credibility is something that the turboprop market is certainly missing, certainly lacking. ATR company executives keep saying that the market fundamentals are there, they're good and they see a need for connectivity everywhere in the world. They often mention small countries with many islands, in Asia, for example, in Southeast Asia, they refer to the need for fleet renewal. They always say that ‘The market is here, and we are just about to see plenty of orders coming.’ And yet the reality of the market is different so there is a real discrepancy between ATR’s  outlook and the sales number we see.

I've noticed that well before the COVID crisis a decline started to be seen in ATR deliveries. For example, in 2017 they delivered 78 aircraft, in 2019 this was down to 68. Of course, then the COVID crisis brought those numbers very low to varied levels. But now for this year and next year, they are only planning on somewhere between 20 and 30 deliveries per year, which is very low. I'm really not sure about the solidity of the market and maybe looking at ATR deliveries was a discouraging factor, or is a discouraging factor for Embraer. Jens, what do you think?

Jens Flottau:

On the other hand, you could say that the ATR currently is pretty old technology, engine in particular, and that the market is waiting for something new. If you know that someone else is about to enter the market, the turboprop market, you probably will wait until you know for sure what's happening and then decide whether you go for the Embraer or for the ATR. I think the timing just wasn't right for big ATR orders in the last few years.

Joe Anselmo:

Jens, let me ask you. There's several aspects at play here. Embraer is obviously much smaller than Boeing and Airbus. Is this about Embraer not having the financial resources to move forward, is it about the market not being as robust as people thought, or is it really just about the propulsion guys not being ready to support this project?

Jens Flottau:

I think at this point it’s about propulsion, direct operating costs. I got the impression, and Guy, correct me if I'm wrong, but I got the impression that it's not about the market and it's not about money. Yes, the business case is obviously an important element in this and the longer they wait the more difficult it gets, but the crucial aspect here is the engine.

Guy Norris:

And just a second, Jens, let's just be clear here, Embraer were quite specific saying the market is there, there's no doubt about it, they've already done a lot of investment in wind tunnel testing, they're happy with the architecture of the airframe as the market is apparently too. It really is down to this fine line as to whether they can meet these requirements that they really need to make a big difference from the operating economy perspective. And I think if they can close that gap then we may see this revived pretty quickly if the engine makers can rally this round. If not, then I think they're going to go a little bit back to the drawing board a little bit.

Jens Flottau:

The question that I'm trying to answer for myself is whether the engine OEMs have their priorities right. They're in this phase where they have to make choices, they have to make choices. How conventional will the next engine be? How futuristic, how new technology will the new engine be? They can't do everything. I wonder whether in the background there's some optional weigh in going on on the engine side that is kind of currently working against Embraer.

Joe Anselmo:

Guy, the aviation industry is just under the most intense pressure to become more sustainable, and yet we look and the established OEMs are utterly unable to bring a new aircraft to market that is responding to those pressures. You've got Boeing CEOs saying they might not launch a new program until 30 years after the 787, Airbus is in no rush to do anything, and now Embraer is delaying the turboprop project.

Guy Norris:

Yeah, and it's all about the engines. Let's face it, our business is all about engines, isn't it? I do like to say that because I love propulsion, but it seems to be the bottom line here in very definitely this case, what's holding up this next generation. Now, it's really interesting also, because when you look back through history through, say, the last 60 years of gas turbine development and airliner development, it's been driven by smallish progressions in technology that have allowed usually single digit improvements in propulsion efficiency. And on average the golden, and Thierry knows this very well, the rule is 1% per year is roughly what the industry's done historically. If you amalgamate those and you're able to get up to a double digit improvement, which is what the industry at least requires these days, that's the sort of thing which we'd normally expect.

You're seeing Airbus pushing it back on a new development because they've got all these other R&D priorities right now and pushing towards hydrogen. You've got Boeing, which basically can't afford to do anything unless they've got a compelling case. And you've got Embraer now just stalling at the first hurdle here because of propulsion. They've all got very legitimate reasons for holding back but I think, and Jens and I have just had this discussion, one of the big worries we've got now is if we don't launch something soon, if somebody doesn't go ahead with something, we've got this chasm for 10 years probably. And one of the best ways of reducing global carbon dioxide emissions is by going to new equipment, and whether it's 10% or 25% it makes a huge difference if you can re-fleet with new equipment. I think it's beholden on somebody in the industry to put its money where its mouth is and take advantage and go into this gulf. I would say the market pressure is going to grow enormously.

Jens Flottau:

But we were talking only the engine and then we're ignoring the airframe. There's something coming from a more efficient airframe as well. If the engine is 10% and, I don't know, the airframe is five, you've got a very good aircraft right there.

Guy Norris:

There's no doubt about it that there's airframe improvements all coming all the way along, whether it's integrated structures, more advanced composites, better aerodynamics of course. It's just part of that incremental chipping away each time, whereas with the fundamentals of either propulsive efficiency or thermodynamic efficiency, you have the opportunity to make much more significant steps. That's assuming of course you don't get hold of the holy grail of laminar flow, for example, over 80% of your wing and that sort of thing. But those advances may be coming, but they'll be part of a bigger package as advances take place across the board, I think. But the market is desperate, I think, for some sign of hope in the next decade of something new.

Joe Anselmo:

Guy, let's follow that train of thought. Does that open the door for something to come out of the blue that we're not even looking at? You write about blended wing body, truss based wing. NASA's looking at all these things now. Could we see some kind of radical concept come out beyond engines?

Guy Norris:

Well, the problem is that our industry is dominated by the big players because they've spent the last half a century building up their positions and getting themselves in the marketplace. When it comes to the air transport industry it's incredibly difficult for new players to break in. One of the outliers in this entire picture right now is Boom. Boom Supersonic, which today as we're recording this, is just about to announce a new engine for a new airframe. These are inconceivable developments only a few years ago that anybody outside of the traditional air transport business would not only be even contemplating launching a large airliner, but secondly that it's supersonic and thirdly that they're going to do their own engine. Unprecedented.

And just to quickly tell the listeners, this new engine, it's not Rolls-Royce, it's not Pratt & Whitney, it may be partially GE, but basically it's a bunch of former Pratt & Whitney fighter engine designers working for Florida Turbine Technologies working with a GE Additive, which is going to be responsible for making, manufacturing the vast majority of additive parts for this engine, together with StandardAero which is a well-known MRO company that has huge contract instantly overhauling GE F110 combat engines. They've brought together this amazing group, but can it do it? I don't know. It's going to be fascinating to watch.

Joe Anselmo:

Well guys, we are unfortunately running short on time. Thierry Dubois let's give you the final word.

Thierry Dubois:

Thanks. I'd like to pick up on Guy’s theme of startups, but not startup when it comes to GE. But anyway, new players coming. Embraer has suspended its decision, it seems ATR has one less incentive to go ahead with something really new, one less incentive from the top. But there is a lot of activity at the bottom and ATR might feel pressure from the bottom. There is a myriad of small companies, startups developing hybridization projects or hydrogen projects based on existing turboprops. For example, one of the most advanced is Universal Hydrogen, which is about to ground test and flight test, they are very close to flight test hydrogen fuel cell on a modified ATR 72. That pressure from the bottom might incentivize ATR to do something.

Joe Anselmo:

And with that we will wrap things up. You guys certainly leave plenty of fertile ground to cover in 2023 on many fronts here, technology, propulsion, airframes so we will return to this topic, no doubt, next year. But in the meantime, I wanted to thank all three of you for your time today and for sharing your insights.

Special thanks to our producer in London, Guy Ferneyhough.  Join us again next week for our final Check 6 episode of the year. Meanwhile, look out for this week's episode of Aviation Week's Window Seat podcast, which wraps up the year in air transport. Airlines came roaring back from the pandemic, but the industry is now reckoning with new challenges. You can find Window Seat wherever you're listening to Check 6. And one last request, if you're listening to us on Apple Podcast and want to support this podcast, please leave us a star rating or review. Have a great day, and thank you for your time.