Wednesday, August 31, 2011

Launch of 737 MAX restores competitive balance between Boeing and Airbus for narrow-body jetliner market

Posted by John Keller

So Boeing's finally done it; they've introduced a fuel-efficient narrow-body jetliner -- the 737 MAX -- in response to the Airbus launch last December of the A320neo family of single-aisle medium-range passenger jets. It had been anticipated for a while, and was seen as an imperative for Boeing to come up with an alternative to the Airbus A320neo, and fast.

Airbus introduced the A320neo -- short for new engine option -- less than a year ago, and at the Paris Air Show last June absolutely wiped the floor with Boeing in the perpetual two-company struggle for a dominant share of the global airliner market.

Normally the big international air shows like Paris and Farnborough see roughly equal aircraft sales among Boeing and Airbus, but this past June it was different. Airbus took orders at Paris for 730 aircraft worth a total of $72.2 billion -- 667 of those orders for the A320neo. Boeing, by contrast, sold 142 commercial aircraft at Paris.

One of the big reasons for the lopsided sales performance at Paris was the lack of a Boeing offering to counter the A320neo, which at the time was promising to be the most fuel-efficient, environmentally friendly single-aisle medium-range aircraft available in the world. by the end of the show, orders for the A320neo family had reached 1,029, making it the best selling airliner in the history of commercial aviation, Airbus officials claimed.

The sales showing at Paris was so lopsided, that experts believe Boeing had to come up with an alternative, or continue losing sales to Airbus. That alternative was announced on Tuesday, but with strikingly few details about the 737 MAX. We know it will be a variant of the venerable Boeing 737, with three different versions, but no details on lengths or seating configurations released, as of yet.

The twin-engine 737 MAX will have will have LEAP-1B engines from CFM International S.A. that will be optimized for the new Boeing aircraft. The A320neo, by contrast, will offer a choice of the CFM International LEAP-X or the Pratt & Whitney PW1100G PurePower engines. The A320neo is scheduled to enter service in 2015 or 2016, while the 737 MAX most likely won't enter service until 2017.

Boeing's announcement Tuesday of the new 737 MAX claimed orders for the new jet, but gave no details on which airlines might be most interested in the new aircraft. At least one tantalizing possibility for the future 737 MAX might be Southwest Airlines, which operates versions of the Boeing 737 exclusively, and by 2017 might be ready to replenish its hard-working fleet.

We know something more about the A320neo than we do about the 737 MAX. The A320neo will consists of variants of the Airbus A320, A321, and A319, seating from 124 and 220 passengers in a variety of seating configurations. No details yet about seating configurations for the 737 MAX. We'll learn more as time goes on.

On hindsight, it seems Boeing had little choice in offering up its 737 model for upgrades to the 737 MAX configuration, given time constraints and intense pressure from Airbus. Still, I had been hoping for something a little different, and perhaps much bolder.

Boeing has been heavily touting its latest all-new passenger aircraft design, the 787 Dreamliner, for years. The composite-design, fuel-efficient 787 is a long-range widebody aircraft designed to compete on international routes. For an answer to the A320neo, I had hoped for a narrow-body version of the 787, with composite construction and those large passenger windows that Boeing makes so much of on the 787.

We may see a miniature single-aisle version of the 787 yet, but probably not for a while, if ever. As it is, however, we've see a restoration of the competitive balance between Boeing and Airbus for the future single-aisle jetliner market.

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