Update, Aug. 1: Dominic Gates of The Seattle Times has a long article with the views on the 777 successor from Tim Clark, CEO of Emirates Airlines–which operates more 777s than any other airlines.
Boeing has a wide-open mind about how to meet the competition coming from the Airbus 350-1000 to its 777-300ER, says Jim Albaugh, president of Boeing Commercial Airplanes.
The possibilities include and entirely new aircraft; re-winging the -300ER; putting new engines on; and putting a composite fuselage on the airplane.
The latter point is a bit of an eyebrow-raiser. Reskinning the 777 would be a massive undertaking and essentially amount to an entirely new airplane.
A new wing and new engines is also the route Airbus tried with the first version of the A350, doing a major upgrade of the A330 to meet the competitive threat of the new Boeing 787. A350 V1 was a market dud, and Airbus redesigned and revamped the concept five more times before coming up with the A350 XWB. This design has proved a success, but Airbus is trying to cover two airplane types and three sub-types—the 787-9, the 777-200 and the 777-300 with the A350-800/900/1000.
The A350-800/900 have sold well but the -1000 so far has officially sold just 75 and possibly 90. Sales have been inhibited in part by the global recession but there is a strong market perception that the -1000 still has a ways to go (final design freeze has slipped from 2010 to 2011 as engineering resources are assigned to the -900, the first scheduled to enter service in 2013), creating uncertainty. Boeing has also done a good job of casting doubt on the -1000, saying it cannot respond for the 777-300ER until more clarity about the -1000 is achieved.
In an interview with Albaugh during the Farnborough Air Show, we asked him about the forthcoming Boeing response to the A350-1000.
“A lot has been said about the A350-1000. Is it real? Do they have to do a new engine to get it done and how soon will they get it done? That’s the one that competes with the 777-300ER,” Albaugh said. “My sense just looking at the airplane is that it is further out than we think and that it will take a more significant investment than we think and probably will require a new engine which will drive a lot of cost into the airplane and drive the cost of that airplane up. I guess what I am saying is that with the -300ER, the economics on paper right now of the -1000 look pretty good but I think that’s going to shrink over time. But my view of competition is that you have to assume they are going to be successful and you have to have something to respond to where the competition is going to go.”
“That’s the most self-serving bullshit I have ever heard,” John Leahy, Airbus COO-Customers, told us Monday. “I’ve sold 90, I’ve got legally binding contracts with performance guarantees. The -1000 is still on track [to 2015 EIS] as far as I know. It absolutely will meet specifications. Our airplanes meet their specs and meet their guarantees.”
(Note that Leahy said he has sold 90 A350-1000s. The June 30 Airbus website shows 75. An MOU for 15 A350s from Hong Kong Airlines was announced at the Air Show, without specifying sub-type.)
Update, July 28: During the 2Q10 earnings call today, Jim McNerney, corporate CEO, said, “I wouldn’t characterize [the A350] as a paper airplane, but it’s pretty close to that. I think we will have clarity in a year or so.
Boeing has promised an answer about the 777 by the end of the year; Leahy thinks it will be two years because Boeing will be forced to first respond to the A320 re-engine plan, expected to be firmed up in the fourth quarter, for the 737. (Leahy also thinks Boeing will re-engine the 737 rather than proceed with a new airplane.)
But what will Boeing do? Albaugh first alluded to the options at the Boeing press briefing during Farnborough, in response to a question. In our interview with Albaugh a day after the briefing, he amplified his comments about the options for the 777.
“We are looking at an airplane that is bigger than the 787, anything from a 787-10 all the way up to a Y-10, which you can think of as a new airplane,” Albaugh told us.
“We saw the 787 cannibalize the profitability of the [Airbus] A330. I think everybody understands that. What we want to make sure doesn’t happen is that the profitability of the Triple 7 and the preference people have for the Triple 7 in the market doesn’t get eaten into by the A350.”
“We’re wide open in terms of what we are considering,” he said. The possibility of reskinning the 777 with a composite fuselage would be a huge undertaking. When Airbus was trying to figure out what to do between A350 V1 and V2, we asked them at the time, Why not just reskin the airplane with composite? The answer was that this would amount to a new airplane and you may as well design a clean-sheet aircraft.
So when Albaugh mentioned the prospect of a composite fuselage for a 777 enhancement during his press briefing, we drove in on this point, relating our years-ago conversion with Airbus.
“If you reskin the airplane, aren’t you doing a new airplane?” we asked.
“Well, you are, but there are a lot of systems associated with an airplane,” Albaugh said. “But I think the only thing you ought to take from that is that Lars (Anderson) has really opened up the aperture and we’re not ruling anything out. We’re going to be driven by what the market wants, the engine companies and to a degree what we can afford to develop.”
Lars Anderson was called out of retirement by Albaugh to head up the 777 futures program.
We also asked Albaugh if a future 777 would be for the -200 and -300, the -300 alone or a -300 and larger. His response:
“Just take a look at the -200 and -300 and how do you make the economics of that airplane better?”