It’s official: 737NE launched

Here is Flight Global’s story with a couple of artist renderings of the airplane.

Boeing made it official this morning: launch of the 737NE (New Engine) has been approved, bypassing the Authority to Offer.

Boeing said it has commitments for 496 NEs from five airlines. Only American Airlines has been announced, for 100. We expect Southwest Airlines to be another. Delta Air Lines’ order for 100 737-900ERs did not include conversion rights.

Boeing claims the 737NE will be 7% more efficient operating costs than the A320neo, but in its announcement today did not detail how. Boeing also says the 737NE will have 16% lower fuel burn than today’s A320 and 4% lower than the neo.

At the pre-Paris Air Show briefing, however, Boeing indicated that the cost advantage came from the 737-800’s 12-seat advantage over the 150-seat A320neo; that Boeing assumed performance improvement packages for the 737NE by entry-into-service and none for the A320neo; and instead of the 15% fuel reduction Airbus claims for the A320neo, Boeing assumed only 13%. Boeing also calculated ownership costs for both airplanes and gave the 737-800NE lower maintenance costs than for the A320neo.

“We are seeing overwhelming demand for this new and improved version of the 737,” said Jim Albaugh, CEO of Boeing Commercial Airplanes, in the press release.

The 737NE will be powered by the CFM LEAP-1B, but Boeing didn’t reveal the fan size or any other technical details in the press release. EIS is scheduled for 2017, a year later than many thought and two years after the A320neo–which has a promised EIS of October 2015.

31 Comments on “It’s official: 737NE launched

  1. Sure hope the PPRs get it right ( power point rangers ) this time. Airplanes are NOT the same type of commodity as post it notes . . .

  2. How are the competitive advantages substantiated? Are these just marketing “guesstimates”?

    Since these plans are just in the design phase, there is no basis to compare except for the representations of the OEM’s and the engine makers. The Carriers certainly know this but must confer and then make a decision. Is it usual to have committments that are based on performance levels?

    Can anyone weigh in on this topic. Thanks

  3. Congratulations to Boeing for launching the 737NE. I just wonder how they can claim such benefits over the A320neo? I know the 737 seats slightly more but it seems a big difference.

  4. Nearly 500 orders for the B-737NE so far? With the AA ‘order’ for 100 B-737NE-8s, and the assumption WN has ordered the B-737NE (probibly a mix of -7s and -8s), that leaves UA as a possible launch customer, too. That is unless they secured some orders from overseas airlines, like FR, SV, EK, GF, QR, and others. I am not saying Boeing has orders from any of these airlines, I am just pointing out these are possibilities.

    • Boeing : “… commitments for 496 NEs from _five_ airlines.”

      two known, three unknown? all batches of a ~100 each ?

      What goes as commitment? purchase order, LOI or not having said no to an offer 😉

    • Another one that springs to mind is Alaska. They were interested soon after the AA order announcement.

  5. The overall improvements to the 737 does not include only the new LEAP engine, but aerodynamic and structural improvements (weight reduction) as well. So when taken in totality, the new 737 could be over 7% more efficient than the A320NEO.

    • And yet I can bet sales for both planes will still be 50-50 or even with Airbus slightly ahead with the current A320 v 738.

      Anyways, I heard it’ll be called 737MAX, that’s a horrible name, they should have gone with RE. I’d rather boring than silly.

  6. Good news for Boeing but not particularly surprising.
    I love this part…
    “We are seeing overwhelming demand for this new and improved version of the 737,” said Jim Albaugh
    Ohhh really? They singing a different tune only a few months ago.

    As far as the performance comparisons are concerned you would not expect them to say anything different… Leahy already commented on that 😉
    http://www.reuters.com/article/idUSWEA240220110830?irpc=43

  7. 500 is good news for Boeing. Lets hope they offered them for a reasonable price.

    On the sfc advantage, just marketing. If they say the 737 RE will be better, most will assume they are about equal. Also when they aren’t.. smart.

  8. Is it the practice in this industry to include specific (or range) of performance requirements in the committments or sales contracts?

  9. You could be right, keesje. SFC could be just marketing (actually at this point that is all it is for both OEMs). But, even at this point Boeing does have a seat advantage and a weight advantage, and range for the B-738 over the A-320. The weight difference between the B-739 and the A-321 is even bigger. The B-73G also has the same over the A-319, but they are more closely matched in range.

    But we will have to wait at least 5 years to find out which reengined airplane is actually better than the other, won’t we?

    • With the existing signed contracts for the NEO Airbus must have made some hard commitment
      on performance. And even going by the NEO announcement from last fall numbers were more tangible than what Boeing is presenting now.

  10. Why does it take over 6 years to introduce a plane with a new engines? My understanding is that they will change little else beyond the engines. You would figure they would be all hands on deck to get this out and start generating revenue.

    • Originally it was six years for the NEO, too: Dec. 1, 2010, announcement, March 2016 EIS. Airbus and PW agreed to advance the date six months.

      Boeing’s Albaugh addressed the timeline this way, paraphrasing: having screwed up (our word) the 787 and 747-8 schedules, they are not going to over-promise and under-deliver on the MAX. Nicole Piasecki said in a sidebar press conference that Boeing may try to advance the timeline, but they are being conservative for now.

  11. keesje and KC135: Is the B737Max family just an interim offering to maintain the delivery of Boeing’s substantial backlog and prevent the migration of certain Carriers to the competition. It is really a defensive move rather than an offensive and strategic development.

    In five years, if all else goes well, BA can decide whether it is technologically and financially viable to design an all new narrowbody. Five years is sufficient time to see whether composite application and engine dynamics will allow it to make a sensible future committment to create the plane it was originally planning on

    • What you say makes sense to me except for your timeline. In five years the MAX might not even be flying yet. I think they are now committed for quite a long time before they can invest in an NSA.

      Unless the MAX turns out to be a MIN. In which case they would have to get back to the drawing board as quickly as possible.

  12. Mr Albaugh seems determined in giving Boeing development engineering a permanent headache tasking them to squeezing the impossible out of the 737 one imagines that prior to any press announcement or PR meeting they must be shuddering in their boots of what he may utter & how they can convert his claims into a flying reality.

    Conversley Leahy, is very brash & certainly no marketing managers dream, he does however appear to have a grasp of awareness & respect for what his engineers can acheive.

    Others here have rightly questioned & critisised the bleeding obvious, so no need for me to repeat the inconsistencies.

  13. leehamnet :
    Maximum performance.
    Maximum profits.
    Maximum this and that.
    That’s how MAX came about.

    Missing:
    Maximum rebates
    Maximum bull 😉

  14. Max is all about protecting Boeing’s backlog, forestalling new competition, offering an interim improvement to buy time and maintain cash flow and create enough time to eventually bring out a new plane that will attempt to reinforce BA dominance in the narrowbody sector.

    The new plane, when technology permits, will be an altogether new offering…perhaps called a 787 varient or a 797. Its timeline will be determined by real possibility and will include all the technological gains that have accrued during this extended period.

    This was the original idea before the 787 consumed too much time and money . That strategy has to be postponed and the Max is the interim step before returning to that approach several (5-7-10 )years from now .

  15. leehamnet :
    Maximum performance.
    Maximum profits.
    Maximum this and that.
    That’s how MAX came about.

    How creative, going by that EVERY Boeing and Airbus plan ever made can have the MAX tag attached, afterall isn’t that what they aim for with every programme they launch?

  16. Only 500? Probably the sales didn’t have time to schedule the meetings.
    For most B737 operators buying the RE as soon as possible makes sense.
    Why?
    A320NEO is sold out until 2018ish.
    Switching for a few percent of advantage?
    Boeing probably sells cheap.

    I expect most North American operators to run for the RE. Early B737NG will be 15 years old when first REs arrive. Those will probably replace old MD80ies. The REs are the right machines for longer distances.
    Southwest will probably replace its -300 fleet.

    I still consider the A320NEO as superior aircraft, more superior than the regular A320 was over the B737 (if it was at all).

    • Yes, only 500 sold……in a little over 1 month. Even the NEO didn’t do that. Yes, most North American airlines will, most likely, go for the B-737MAX over the A-32X-NEO family. But Boeing also said some of the 5 airlines that have now ‘ordered’ the B-737MAX are airlines from outside of North America. My guess is that is 2-3 of the airlines that have ordered it.

  17. That is just about the best news I have seen coming from
    Boeing for a long long time!
    So, let’s stop the nitpicking about how much better aech
    737MAX is compared to it’s A320NEO equivalent model and
    celebrate the fact that the record-breaking 737 program
    is NOT coming to a premature end!
    On the contrary, the replacement market for these two
    mediam-range aircraft types is so huge, that both Boeing
    and Airbus are likely going to again secure an even share
    of that maket for many years to come, with a smaller
    share of the remaining market going to the new entries
    fom Bombadier, Embrair and other new and smaller aircraft.

    The irony of this whole excersize, is the fact that Boeing
    was caught sleaping at the helm, claiming that they had
    ample time until the end of the year, before deciding to
    offer an all new or re-engined 737.
    If it had not been for GE/SCECMA willing to reduce the
    fan-diameter of the LEAP-X engine at the very last minute,
    to keep our foot in the door at AA, the 737 program would
    have faced a certain death inthe foreseable future!
    Why Boeing and GE/SNECMA did not think about this symple
    and inexpensive solution much earlier, is a real mistery,
    because almost exactly 3- years ago, they did exactly the
    same with the original CFM56-5 engine and produced the
    smaller diameter -3 version of the engine so it would also
    fit underneath the 737-200 wing, without major and costly
    structural changes!
    Inexperience, a serious lack of l.r. planning, or both?

  18. Small correction.
    Sixth line from the bottom, should read:
    “because almost exactly 30 years ago,”

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