Odds and Ends: ‘We’re happy with LEAP, confident it will meet target’

During the Boeing 1Q2012 earnings call, CEO Jim McNerney had this to say about the story that won’t die (that Boeing continues to look at the PW Geared Turbo Fan for the 737 MAX):

The gear turbo fan, the — yes. The — right now, as I think we’ve announced many, many times, we are working exclusively with CFM on the MAX, and we’re very happy with the development there. We’re confident that we can meet the targets that our customers need and that we’ve promised them. So that’s our plan going forward.

“Right now.” Was this a Freudian slip or an inconsequential choice of words?

Boeing likes American Airlines as stand-alone: McNerney also said Boeing prefers AA to emerge from bankruptcy as a stand-alone airline. This is no shock; the US Airways management is exclusively Airbus, and while American strayed from Boeing last year, it still placed a large order for 737NGs/737 MAXes.

McNerney talks about pricing: I think the summary on pricing is 777 steady, steady as she goes, capturing value, in many ways a uniquely positioned airplane today and significant productivity associated both with better conversion and with taking up rate. So the margin environment there, I would say, is good and favorable going forward. 37, all of the comments I just made on productivity apply. Significant productivity, both absorption kind of productivity due to increased rate as well as conversion productivity per unit. Slightly more aggressive pricing environment due to the introduction of the MAX and the NEO. So there’s launch customer kinds of pricing that have happened in a few cases. But I think at the end of the day, the — we anticipate about half of that market, which is a big number. And we see a pricing environment that’s not too different than the pricing environment we’ve had historically after we get through some of the launch customer — loss — launch customer pricing, which is part and parcel with our business.

[Source for all the quotations: Seeking Alpha Transcripts.]

We are hearing there essentially is a price war going on right now between Airbus and Boeing for single aisles, as Boeing attempts to stem the inroads and success by Airbus with the A320neo. In this case, we’re hearing Boeing is the aggressor (which follows, since it is playing catch-up).

Boeing won Delta Air Lines on the 737-900ER v A321 competition largely on price, we understand–bidding 10% lower than Airbus. We also believe price is likely the determining factor in the soon-to-be-completed United Airlines deal, where Boeing is widely reported to now be the favorite.

63 Comments on “Odds and Ends: ‘We’re happy with LEAP, confident it will meet target’

  1. So the B-737MAX powered by the GTF is still a possibility…just not right now. So, for at least the next few years, it is going to be all Leap-1B engines. It sounds to me that Boeing may be waiting for the GTF to mature a few more years before thinking about it powering the MAX, or even the NSA.

    I agree with Boeing in them supporting AA against a merger, forced or otherwise, with US. Boeing has a vote among the bankruptcy creditors.

    The B-777 is going to be a steady seller for Boeing for another few years. That gives them the time to define what the B-777-8X and B-777-9X will really be, and it also gives the B-747-8I sales staff a little breathing room to sell it in the mean time.. Yes, I know each model does not have a dedicated sales staff, the sales staff sells all Boeing models.

  2. A 10 percent lower bid on the 737-900ER vs the A321 for the Delta RFP is IMO a huge deal and possibly the beginning of a shift in the narrowbody market paradigm. We are not even talking about the NEO vs. the MAX. For years, the talking points out of Seattle was that Airbus has bought market share with the help of government subsidies and loss-making deals. Well, the shoe, it seems, is now on the other foot. If massively underbidding NEO’s is the only way that Boeing is going to secure a significant amount of future orders for the MAX, I’m afraid Mr. McNerney is gambling away the future of the company.

    • How can you mix that up? The DL sale had nothing to do with the MAX or the NEO, it had to do with pricing, and Boeing’s strategic plans to keep the NG line going until the MAX comes out. So Boeing was going to cut a deal at just about any price because it is more important for their long term business plans to keep the NG line with as much of a backlog as possible than the profit margin on one sale. DL has a common fleet of B-737-700s and B-737-800s that fit very well with the B-737-900ER.

      The 10% difference between the A-321 and the B-737-900ER also has more to do with how DL is going to use those airplanes. It could also be an indication they are not happy with the A-319/-320s they picked up in the NW merger. DL has said they were happy with the A-330s, but have been quite, as far as I have heard, about the A-32X series.

      • Sorry, no confusion on my part. My reference to the NEO vs. the MAX in this case was, among other things, in regard to the issue of United’s upcoming single aisle order and the seemingly uninterrupted loss-making fire sales of 737s. 😉

        • We don’t really know, yet, if UA is interested in the B-737MAX more than the B-737NG, or a combination of both. It does seem, according to some rumors that UA is no longer interested in the A-320OEO/NEO. But we do not know that as fact.

          According to Boeing’s pricing page, the B-737-900ER is currently offered at $89.6M USD. The DL order was last year, when prices were slightly lower. My guess, and it is only a guess DL will pay about $45M to $50M per airplane, average price. That is up to a 50% discount from listed prices. I cannot find the current pricing on the A-321, but it should be in the neighborhood of $90M to $93M USD. If Airbus offered a 40% discount, that puts there price tag around $54M to $57M USD, average, which fits in with a 10% higher price tag over the B-737-900ER. But who knows if these prices from Boeing or Airbus includes the price of the engines? Some pricing deals are without engines.

          keesje, I don’t see the 50% discount for the WN order as a big deal for a launch customer. My guess is Airbus made the same 50% discount offer to launch the NEO program.

          As to all those A-321NEOs flying around the US skies in 5 years, I really doubt it, as that is the year (2017) of the A-321NEO EIS. No US airline has ordered it, yet.

          One more thing, I too have read the GTF could have a 4% TSFC over the Leap-1A/-1B. But there is no real firm information to confirm that, as CFMI is holding their cards on both versions of the Leap very close.

    • It may not be as bad as it sounds. The 900 is more expensive than the 800 and the Max is more expensive than the NG. Boeing could offer a further discount of 10% off list and still maintain its margins. Airbus probably wants to increase its margins. Eventually it will fall in line with Boeing and forgo the premium.

      • If Boeing typically has to offer the 737-900ER at a 10 percent lower price than the A321, how much lower do they have to go on the MAX-9 if the PW1100G engine beats the LEAP-1A engine by, let’s say, 4 percent in TSFC? — Further assuming, of course, that the fan-optimised LEAP-1A engine on the neo is more efficient than the non fan-optimised LEAP-1B engine on the MAX.

  3. OV-099 :
    If massively underbidding NEO’s is the only way that Boeing is going to secure a significant amount of future orders for the MAX, I’m afraid Mr. McNerney is gambling away the future of the company.

    The same dynamic might be going on at CFMI. There is an interesting article in “Airline Economics” from which you can read some quotes and further comments at aeroturbopower.

    http://aeroturbopower.blogspot.ca/2012/04/even-more-doubts-about-b737max.html

  4. It seems Soutwest with its 50-60% discounts on the MAX -8, as confirmed by van de Ven, set a benchmark Boeing so far has not managed to leave behind. Delta (and I still feel NWAC) struck another smart against the stream fleet deal. Getting 100 cheap, efficient 200 seaters, offering low operating costs (fleet commonality). Their ability in getting usefull proven fleet at minimum costs against mainstream fleet aquisition strategies continues to impress me over the years. They did it again.

    Within 5 years I see many A321 NEO ordered for the longer US flights with many different airlines. Its a no brainer, the -9 max seems too compromised. UA, DL most likely too. Nothing to pointing in another direction sofar. A few steep Boeing launch opportunities won’t prevent it.

  5. Here we go again, on a subject which cannot decisively be talked about, until:
    1. The unresolved issues of fuel-burn/fan-diameter/n.landing gear ext’n on the
    SNECMA LEAP engine for the 737MAX, have been positively resolved.
    2. Everybody accepts the fact, that the GTF will NEVER be on the MAX, be-
    cause is has dimensions even larger than the LEAP and will thus not be a
    candidate on the MAX!
    3. Not until SNECMA/Boeing and the customers agree, that the LEAP will meet
    the fuel burn guarantees they provided when the MAX was “launched” last
    August, there IS NO and THERE WILL NEVER BE a 737MAX.
    4, If, as appears more and more likely, that the LEAP engine cannot meet the
    above requirements, Boeing will have to restart the NSA in a great hurry, to
    protect its 737 market against the NEO, if they can afford it!

    • So it is your stance that the firm orders from Southwest, Norwegian and Lion Air recorded on Boeing’s orders website are a lie? Boeing currently lists 451 MAX orders as firm in their backlog.

  6. I omitted to add under 4. “and the GTF will be one the engines offered on the NSA.”

  7. Project Pipeline is going to be revived as soon as the CSeries and NEO have demonstrated the geared-fan’s superior fuel efficiency.

  8. McNerney ‘We’re happy with LEAP, confident it will meet target’

    I guess everybody is free to value this statement from the Boeing CEO. Taking into account his position and similar statements made by him during the last few years.

    KCTB: “I cannot find the current pricing on the A-321, but it should be in the neighborhood of $90M to $93M USD.”

    Its on internet:
    2012 list price A321 : 103.6 mi USD
    2012 list price A321 : NEO mi : 113.3 mi USD

    KCTB: “keesje, I don’t see the 50% discount for the WN order as a big deal for a launch customer. My guess is Airbus made the same 50% discount offer to launch the NEO program.”

    There is a difference though. Airbus has the dominant product with fuel burn guarantees, over 2400 orders and commitment, of which most signed contracts. No need to discount very deeply to buy market share. Contrary, they raised the prices.

    KCTB : “As to all those A-321NEOs flying around the US skies in 5 years, I really doubt it, as that is the year (2017) of the A-321NEO EIS. No US airline has ordered it, yet.”

    I doubt it too, that why I wrote : “Within 5 years I see many A321 NEO ordered for the longer US flights with many different airlines. ” 😉

    KCTB : “No US airline has ordered it, yet.”

    We don’t now how many A321 are in the A320 orders. Neither how many MAX 737-9..

  9. One thing that bothers me in this and recent posts is the reference to the GTF as “innovative design” and “radical new technology”.
    The GTF concept has been around for a long time.
    In 1982 I was looking at the sad remains of an ALF502R-5 planetary gearbox from a BAe 146.
    It was a miserable engine and quite probably jaundiced my view of geared engines.
    The LF507-1F for the Avro RJ was little if any better.
    So the GTF concept is not new and has not yet been proven successful.
    I do hope P&W succeed; It would be a shame for such a pioneer company to disappear.
    And we need the competition and different approach that P&W offer.
    I very much fear that both GE and RR see the distant end of development potential for their high bypass turbofans and are both looking to UDF’s for the future; not a direction I like.
    And P&W does have some advantages; much better materials to work with today and the knowledge that they are betting the farm on their GTF – that focuses attention wonderfully.
    But getting the kind of reliability and on-wing time we have come to expect is a much taller order than getting 4% better fuel burn, and more important too in my opinion.

    And see Scott’s 14 Feb 12 post on list prices.
    The A321-200 (2012, I think) list price was quoted as $103.6 MUSD vs $89.6 MUSD for the B737-900ER, already a difference of 14% lower for the Boeing.

    • Fred, the A330-300 currently lists at an average of $231.1 million while the more capable 787-9 currently lists at $227.8 million. That doesn’t mean Airbus is capable of garnering higher prices for A330-300 open production slots than what Boeing manages to get for 787-9 open production slots, does it? Hence this goes to show that currently Airbus, percentage-wise, is typically granting larger discounts than what Boeing is doing. Also, an industry standard discount rate of 40-50 percent is more the norm than the exception. This should thus indicate that the real world price differential between the 737-900ER and the A321 should typically be in the low single-digit million range. A $10 million differential in pricing between the 737-900ER and the A321 is IMO “more than noteworthy

      Now, according to Boeing, the 737-900ER is “virtually the same size” to that of the A321 and has a supposedly better performance.

      http://blog.seattlepi.com/aerospace/2010/08/25/boeing-exec-737-900er-not-airbus-a321-best-replaces-757/

      “(T)he best possible 757 replacement already exists — the 737-900ER,” Boeing Commercial Airplanes marketing chief Randy Tinseth wrote on his blog Wednesday.

      Comparing it to the A321, he said: “(T)he 737-900ER is virtually the same size, yet travels farther for less fuel and less money and does it more reliably.”

      Specifically, he wrote:

      •The 737-900ER carries 180 passengers in a standard two-class configuration — just three fewer than the A321, according to Tinseth, but five fewer, according to Airbus.
      •The 737-900ER has a maximum range of 3,265 nautical miles — 210 more than the A321, according to Tinseth, but just 65 more, according to Airbus.
      •The A321 is nearly 10 percent heavier, and consumes 4 percent to 5 percent more fuel per seat, according to Tinseth (I don’t have Airbus numbers on that at the moment).
      •The A321 is 7 percent to 8 percent more expensive to operate per-trip, 5 percent to 6 percent more expensive to operate per-seat mile and less reliable, according to Tinseth (I don’t have Airbus numbers on that either, but Airbus says on its A321 site that: “The A321 offers the best seat-mile costs of any single-aisle aircraft.”).

      Why then, considering all “these great 737-900ER performance characteristics”, did Boeing have to underbid Airbus by some $10 million per frame in the Delta Air Lines 737-900ER v A321 competition?

      • keesje wrote:

        “KCTB: “keesje, I don’t see the 50% discount for the WN order as a big deal for a launch customer. My guess is Airbus made the same 50% discount offer to launch the NEO program.”

        There is a difference though. Airbus has the dominant product with fuel burn guarantees, over 2400 orders and commitment, of which most signed contracts. No need to discount very deeply to buy market share. Contrary, they raised the prices.”

        I truely hope CFMI and P&W can meet those performance guarantees, if they cannot, Airbus will fall flat on its face until the PIPs come out.

      • Because Boeing just experienced the partial loss of a customer, AA and didn’t want it to happen again. I am sure DL looked at the numbers comparing the B-737-900ER to the A-321-200, without all the cheerleading from the OEMs and came up with the best deal for their business case.

      • That this was, in all likelihood, a great deal for Delta Airlines is not the issue. Never mind that Boeing was panicking after AA’s A320oeo and A320neo orders. The issue is whether or not if Boeing has to discount the MAX to such an extent, just to stay competitive, that the MAX-business will not become a profitable enterprise. Boeing is seemingly still getting good and profitable sales on their 737-800s (lower CASM than the A320), but with the slightly less capable 737-900ER (vs. the A321,) it seems to be a slightly different story. In that sense, the fire sales of 737-900ER to Delta Airlines may just be an indication of things to come.

  10. Fred Bearden :
    One thing that bothers me in this and recent posts is the reference to the GTF as “innovative design” and “radical new technology”. The GTF concept has been around for a long time.

    You are right Fred. The concept has been around for a long time. Its most successful application so far has been the Garrett TFE731. They sold well over 10,000 of them, on aircraft like the original Lear Jet.

    Another application was the Lycoming ALF502 that you are referring to. It’s true that it was not a very good engine. But this has nothing to do with the concept. Canadair (Bombardier) had it on the original Challenger and they got rid of it as soon as they could.

    Engine technology has come a long way since the inception of these two initial efforts. And it looks like Pratt & Whitney has done an excellent job with it. Airbus installed a developmental GTF on an A340 and thought it was promising enough to offer it immediately on the the next generation of A320, the neo.

  11. Normand Hamel,KC135T, McNerney and others.
    If Boeing and CFM/GE have so far not been able to confirm acceptable fuel-
    burn gurantees for the LEAPX on the 737MAX since last August, because of
    their inability to enlarge the fan to deliver better fuel efficiency and avoid
    ground clearance problems, how on earth are all of you, Boeing (Bear) and
    P&W/Scott Hamilton, as well as McNerney? able to say that the GTF, with
    an even larger fan, is still in the running for the 737MAX?
    The structural changes required to the MAX with the GTF, will destroy the cost
    benefits of using the 737NG airframe and only after and only than, will the
    LEAPX be dumped and will the GTX be an immediate candidate for the NSA!

    • Indeed it is not possible to fit a GTF, nor a LEAP larger that 68-69″, underneath the 737 in its present configuration. I think we all agree on that, including you Rudy.

      Where the opinions start to diverge is whether or not it would be a good idea to carry out the necessary modifications to adapt the old 737 airframe to the larger and more efficient engines. Technically it can be done. Again no one will deny that.

      Your point Rudy is that the structural changes required would destroy the cost benefits. That is an opinion, and like any opinion it is debatable. Personally I think you have a valid point. The business case would normally call for a minimal approach. But where is the dividing line? The only people who can answer that at the moment are the Boeing engineers.

      Some people must be working very hard right now the preserve the 737 legacy airframe. And I can understand that. The old airframe is lighter than a modern one would need to be to satisfy today’s FAA regulations. And that plays into the cost/benefit equation.

      Obviously Boeing must have done due diligence and studied to death all the different possibilities. And the exercise is probably not over yet. Like here in this forum they must have heated debates. And I would love to be in the room with them to hear specifically the presentations that are supported by technical data not yet available for public consumption.

      But there is a set of data that is missing for everyone, including Boeing. I am referring here to the LEAP-1B engine data. All they have right now are extrapolations, projections and speculations. Not good when you have a multi-billion dollar project going full swing!

      And we wont find out for sometime since nothing has been frozen yet. Except possibly some customer sales. For more than a few have been put on ice because of the current uncertainty.

      • I agree with Normand. The airframe design is not the problem here. It can be adjusted anyway Boeing wants. The problem is designing a new engine core for the Leap-1B engine, not the size of the fan section, which can be clipped to fit. CFMI is designing a new core, and if P&W wants to be a player in the B-737MAX, they must do something with their engine in addition to clipping the fan section.

  12. A new core with new fan. -> A brand new engine, for a few % sfc. Unlikely IMO. The fan is the problem, not the core. A new engine is probably more expensive then a new wing/gear box / LG for the 737.

    A new wing/gear box / LG for the 737 would be feasible if the fuselage is future proof. IMO it aint, Boeing is working the tail now. The cabin, cockpit are cramped/noisy/dated & can’t hold pallets/containers.

    Rumors are United selected the 737 for a batch. I’m not convinced. Maybe short term NG’s like Delta. Hard to get NEOs before 2020 and that’s probably to long for some airlines..

    • Well, keesje, it IS a brand new engine. The Leap-1B will have a newer core than the Leap-1A/-1C engines, although it will use a clipped version of the fan section from those engines. The Leap-1B should have at least a 12% improvement in FSFC over the current CFM-56-7B engines on the B-737NG. I expect to see the core design frozen sometime in 2013, then prototype build and testing by early 2014, or so. You can bet Airbus is closely watching the developement of the Leap-1B engine and will compare it to their Leap-1A engine. Wouldn’t it be funny if all of a sudden Airbus decided to swap the -1A for the -1B, for the NEO program, as it IS the more advanced version of the Leap engine family?

      I am not convinced Airbus has sold out NEO production through 2020 already. If someone wanted to order it for deliveries beginning in 2017, I am sure Airbus will find the production slots for them. The same can be said for Boeing and the MAX. Don’t forget, both OEMs have plans to increase NB production to at least 42 per month, and possibly as high as 62 per month. Since both the MAX and the NEO are in the same NB family each OEM currently produces, there shpuld be minimal changes in tooling and on the production line/FAL.

      • For sure Airbus will watch the LEAP-1B. And if the core of the -1B is really better than that of the -1A, Airbus could tell CFM to transfer that extra technology into the -1A core as a PIP. But you will never see the -1B engine on the neo!

  13. Will Airbus stretch the A321, maybe another row in front and in back? With the new engines it should be able to do U.S. transcons for American, JetBlue, and maybe United.

    • Doubtful. Airbus has been very public with their desire to keep the NEO as a minimum change airplane. They want to keep costs low low low. Enders, Tom Williams, and Bregier have all been rather vocal about this. The only thing changing is the engine option. If they start to do things like stretching the fuselage etc. the costs explode. Given their stated desire to avoid this, and the lack of engineering resources, I doubt there will be a A322 any time in the near term.

      • That should make life easy for the -900ER and MAX 9. The A321 only has an advantage of 3% more seats, at the cost of 10% more weight and an engine that requires 20% more thrust.

  14. Reply to Normand #8. Just after the article you cite, the following appeared in ATPower, explaining why Qantas chose the LEAP for it’s 78 A320NEOs. http://aeroturbopower.blogspot.com/ It was primarilly because CFM supplied engines not just for Q’s 737s but also other planes like their A330s. This kind of mkt presence, across many different aircraft types using CFM engines, gives them huge power to cut whatever deal gets them the LEAP order.

    And then there is CFM’s history of reliability and customer support. As Fred Beardon said,

    “But getting the kind of reliability and on-wing time we have come to expect is a much taller order than getting 4% better fuel burn, and more important too in my opinion.”

    Keesje is right that CFM’s stellar history does not necessarilly mean that the LEAPs will be as reliable. But that is not the point. Airline customers know that no one can predict the future, but they can make educated estimates of what will come, and CFM’s history warrants a considered judgment that they are more likely than P&W to deliver what they say they will and support it.will deliver what they say they will.

    As much as Keesje and Normand may want to see B fail with the MAX, it ain’t going to happen. The 737 is not going to die out, CFM is not going to fail in it’s efforts to build a LEAP engine for the MAX that sells by the 1000s, and B is not going to fail to produce the MAX and get lots of customers for it. The mkt is too huge for either OEM to fail. Both B and CFM have huge installed bases. For once I completely agree with KC: B’s stategy is to keep it’s line going for NGs, and I believe for for MAXes, until the time is ripe for a new NSA, which will be after the 777-8/9X.

  15. Normand Hamel
    “Your point Rudy is that the structural changes required would destroy the cost benefits. That is an opinion, and like any opinion it is debatable. Personally I think you have a valid point. ”
    Thank you for the compliment Normand, but if there was or is a way, to instal the LEAPX
    engine on the 737NG airframe and make it cost effective, surely Boeing would have done that long before now, after launching the MAX last August!
    The net result, as far as I can determine, is the fact that THERE IS NO MAX (yet) and
    Boeing does NOT HAVE a single 737MAX customer firmly committed to that a/p, until
    they solve the engine clearance problem with the LEAP engine and 737NG airframe as
    is, with a nose gear extension. Anything else beyond that is NOT COST_EFFECTIVE, or
    they would have done that months ago!
    It’s been a long time to figure that out, while firm NEO orders continue to roll in!
    What’s up dock?

      • You may be right, Normand. If Boeing does paint themselves into a corner on the MAX, then the only way out will be, at a minimum, a new wing and wingbox. That will correct the short MLG “problem”, and allow Boeing to offer both the Leap-1A and the PW-1100G/1500G series. In that respect, CFMI is the weak link if they cannot get the Leap-1B out the door with a competitive FSFC to the GTF, and on time. That means protype engine test stand testing in late 2014, flight testing and certification by early 2016, and flying on the B-737MAX flight test airplanes in mid to late 2016, with the -8MAX certified in early 2017, then the -9MAX a few months later. Boeing has more time on the -7MAX as I don’t think it has any orders, yet.

        But a new wing/wing box could add $2B USD, or more to developement, and worse than that, it takes time. Boeing is now on take-off roll on the runway with the B-737MAX, rapidly approaching refusal/max abort speed or rotation. Everything is looking good, but it appears a large flock of European Starlings is about to fly across the runway.

  16. In reply to #31

    You are wrong Christopher. I don’t want to see Boeing fail with the MAX. I don’t belong to any camp. If I am critical of Boeing it is because I want them to continue to succeed and thrive. But what I have noticed since the mid 90s is that they are slowly going down into a death spiral. But it’s not too late to kick the rudder in the opposite direction.

    Boeing has been pondering for a while over which project they should undertake after the 787 and 748. They have been tergiversating back and forth between the NSA and 777X. It’s becoming more apparent everyday that they are going to undertake the 777X shortly, and leave the NSA on the back burner until they have better engines to offer.

    Many people seem to agree with that philosophy and I can’t blame them. It is a justifiable position. But I see it differently. I simply do not believe that there is any revolutionary engine around the corner, or for the foreseeable future. It is unrealistic to think so. We need an engine that is economical, reliable, practical, ecological and quiet. Along those lines the most promising engine so far has been the GTF from Pratt & Whitney. That company may have been buried a little too fast I believe. Actually they are still alive and kicking.

    Bombardier was not going anywhere with the CSeries until they came across the GTF technology. And they build such a nice airplane around it that they had Airbus scramble to come up with a response. After testing it on one of their own plane they adopted it. And that will give them the edge.

    Now Boeing is squeezed between the CSeries and the neo. And they are stuck with a lower potential design, the LEAP. And like if it was not enough they have to use a compromised version of that engine. It is no fault on the part of CFMI though. It is a physical constraint imposed by Boeing’s determination to preserve the 737 airframe legacy and save as much money as they can in the process.

    Well, you can’t have your cake and eat it. If they want to preserve the 737 airframe they will have to invest money to make it compatible with the bigger and more efficient engines. In my view it will come to a point, and we might already be there, where the MAX will need an entirely new wing. That might become so costly in the end that they will have no choice but to start from scratch and offer a brand new 797 to cover the segment above the CSeries.

    You say that Boeing’s strategy is to keep the NG line going. Well, that is up to the customers to decide. And ultimately it is not even the customer who decides, it’s the price of oil. And that applies to the MAX as well.

  17. I made a comment on the previous well contributed MAX session that for $2 billion extra for a new wing/ wingbox, it has surely a compelling case.
    The 1B can be scrapped in favour of the 1A, even GTF if Boeing so desire, and at an affordable price.(perhaps about $1,5 million per copy in my estimation)
    CFM would probably be more than happy as they would not need a new 1B production line.
    A new wing would of course become the long lead time item, but no doubt the market would wait.The quicker Boeing make a decision the better.

    • Where is the watershed located in respect to “upgrade” certification retaining grandfathering and a required “new” certification?
      Would be quite the achievement on Boeings side to get that neolitihic coachwork attached to a brand new wing, wingbox and engines.
      ( IMHO Boeing pushed the envelope there already with the 747-8 )

      • As long as Boeing calls the new airplane the B-737, and it retains some of the features of the original B-737-100, it will fall into the grandfather clause for certification. As you said, Boeing already proved that with the B-747-8. It is just like the NEO, which only has to meet the 1988 standards.

  18. KC135TopBoom :
    As long as Boeing calls the new airplane the B-737, and it retains some of the features of the original B-737-100, it will fall into the grandfather clause for certification. As you said, Boeing already proved that with the B-747-8. It is just like the NEO, which only has to meet the 1988 standards.

    I wonder if B could launch a DC-3-MAX then? They would have to meet even fewer standards than with the 45-year-old 737 certification …

    • The DC-3 MAX already exists. Just like they want to do today with the 737 MAX, they have installed more modern engines on the old Douglas airframe.

      But the jump was much higher for the DC-3 then it will be for the current 737. The modernization implied going from a Pratt & Whitney R-1830 Twin Wasp radial engine to the Pratt & Whitney Canada PT6A-45R turboprop engine.

      This particular DC-3 modification implied switching from a previous era technology, the radial engine, to a new era technology, the turboprop engine. And the irony here is that this is the kind of leap, if I may say, that the advocates of doing the 777X right away, instead of the NSA, are expecting before they can justify the launch a single aisle clean sheet design.

      I am sorry but there is nothing of that scale, in terms of paradigm shift, on the radar screen of even the most optimistic engine manufacturer. And by the time Boeing will have awakened to this reality it will be too late.

      • I believe the Basler BT-67 is the DC-3/C-47 conversion you are talking about. But there were two other PT-6 conversions of the DC-3/C-47, the USAC DC-3 Turbo Express and the BSAS C-47TP Turbo Dakota. But I believe the Bt-67 is the most common.

        There were also two C-47s converted into tri-motors with RR dart engines, they were called the Conroy Tri-Turbo-Three.

  19. KC135TopBoom :
    I believe the Basler BT-67 is the DC-3/C-47 conversion you are talking about.

    The one I had in mind is the USAC.

    • You missed one DC-3 version (I’m showing my age here), the Super DC-3 with R2000 engines, new empennage and wingtips, lengthened fuselage, wheelwell doors. Pan Am used one in MIA as an exec airplane in the late 50’s; they bragged it could beat any transport in the world from takeoff to 2500 feet back then.
      But back to the MAX and CFM.
      Boeing and CFM are like the pig and the chicken in a ham and eggs breakfast. The chicken (CFM) is involved but the pig (Boeing) is committed.
      Boeing has a lot more skin in the game. CFM could survive pretty well even if the MAX does not.
      So my guess is that Boeing will find a way for that -1B engined MAX to compete with the NEO, even if the MAX is not the best airplane for every mission. Boeing cannot surrender its position as a player in the narrow-body market for a decade or more until the better new engine(s) emerge.
      One thing usually ignored is that we are nearing the end of the technological plateau of the metal skin and stringers airplane, and moving on to a new composite construction ultra-high bypass technological plateau.
      Today’s production narrow-body airplanes have markedly shorter useful lives than their predecessors had at the start of their production runs.
      That makes them harder to finance but easier to replace.
      Keep in mind that the MAX/NEO are just intermediate aircraft; both are stopgap measures to “do the best with what you have” until better engines come along (and composite construction matures, and bleedless systems prove themselves, and, and, and…).

  20. KC135TopBoom :
    There were also two C-47s converted into tri-motors with RR dart engines, they were called the Conroy Tri-Turbo-Three.

    Something new every day : A Ju52 with the ripples hammered flat 😉

    The Basler conversions are the ones I knew about. ( And done rather well imho, filling a slot that hasn’t sufficient demand to make a new design feasable. But afaik Basler worked against raised certification requirements )

  21. It’s been too long without a decision from Boeing on the 737MAX, after program
    “launch” last August! This is how I see the dillydallying and why:
    1. The LEAPX engine obviously cannot be made to fit on the NG, maintain mini-
    mum ground clearance and acceptable fuel-burn qualities, even with an 8 inch
    n.l.g. extension, after eight months of trying.
    2. Any other structural modifications, are too costly and apparently wash out the
    fuel burn advantages of that engine.
    3. The GTF, apparently has the same problems and is also NOT applicable.
    4. In the meantime, none of the so-called contracts for the MAX are firm, while
    Airbus continues to sign up firm contracts for the NEO!

    I believe and who am I, except an old but experienced a/p salesman, who was
    directly involved in the neg’s between one of the most engineering-minded int’l.
    airline customers and B., which directly influenced B. during the design of many
    B. airplanes, it is time to cut bait and:
    A. Dump the MAX and increase the 737NG production-rate as much as poss.
    B. Offer the NG at a rock-bottom price beyond 2017/8, to fill the production line
    as far as possible, because Airbus is just about sold out on the NEO thru that
    time period.
    C. Make an early choice between doing a new/modified 777 and an NSA, the
    latter GTF powered for delivery around 2018/9 and if the 777 has a higher
    priority because of the A350, which I believe is the case, recommendation 1.
    above, will make that choice possible.

    Just a few thoughts for discussion, instead of the DC-3/C-47 issues.

  22. Rudy,
    I always enjoy your inputs to the forum, but on this occasion I must respectfully disagree.
    Boeing cannot go back to the NG in lieu of MAX.
    If South West is to be believed, they almost went to NEO, and they were very vocal in pushing Boeing in the direction they eventually went.
    Fuel economy is going to be King, and no major airline will go back to NG with so many percentage points involved between NG and whatever they eventually get from MAX.

    • I agree with Andrew. Boeing reallly didn’t have much options after AA and SW made clear no, the -800 doesn’t beat everything and no, we won’t wait until 2020 or even later. This situation could have been prevented yrs ago, but killing a cashcow while keeping the Dreamliner afloat wasn’t logical either at that stage. Now they are making the best of it and looking brave and happy.

      I think late 2012 it will become clear if the MAX can be sold at reasonable prices and if a market share of at least 40% this decade is feasible. If not everything is possible..

      • Well, Uwe is right with one thing….we are all guessing at this point, including you, keesje.

  23. Andrew.
    It’s not going back to the NG from the MAX, it’s facing the reality, that Boeing
    has been unable to produce sufficiently adequate fuel-burn efficiencies, after
    fiddling around for 8 months, reducing the LEAP eng. fan-diameter and ex-
    tending the NLG by 8 inches, without spending much more money on (major)
    structural changes to accommodate the lager engine, which would wash out
    any fuel burn advantages that eng. would offer!
    That’s why, after all this time, Boeing has NOT even mentioned going anything
    beyond the N.G. extension!
    Unless I am wrong about this, the A.B.C options available to Boeing I mentioned
    above, appear to be the only once open to Boeing, with all ramifications to orders
    from SWA and others, I agree.

    • My guess is Boeing will achieve about what Airbus predicted : ~8%.
      Maybe even slightly more but will stay below 10%.

      There will be a lot of communications in Newspeak from Boeing PR.
      MAX will be offered cheaper and the world will keep on turning.

  24. Airbus are assumed to be looking around in the US for a place to put an FAL for increased A32X Series throughput … if Rudy is correct, instead of his recommendation to push up the throughput of (obsolete !) NGs, Boeing could rent out a production site to Winner A. for serving Leahy’s US NEO Customers, whereof the list is soon going to expand ?

    • Are B’s and A’s production methods compatible enough to make this feasible?
      Large enclosed spaces aren’t all that expensive to build.

      Existing infrastructure could be relevant though ( like rail and road access, a “beluga pool” 😉

  25. KC135TopBoom :
    As long as Boeing calls the new airplane the B-737, and it retains some of the features of the original B-737-100, it will fall into the grandfather clause for certification. As you said, Boeing already proved that with the B-747-8. It is just like the NEO, which only has to meet the 1988 standards.

    First, Boeing proved that with the 737NG. But as far as your authoritative assessment of neo is concerned, you are wrong. Any development of an a/c in service is split into minor, major non significant and major significant. All are decided by the amount of structural changes required and following negotiations with the authorities. During the negotiations, OEMs could gain reversions on some of the new requirements (I am sure Boeing is frantically lobbying FAA on that). In neo’s case, it will be up to date with a lot of the new loading requirements outlined in CS25, well above those it was certified for in 1988.

  26. UKair :
    If I wasn’t, I wouldn’t be writing it.

    Know anything about 737, 737NG conformance levels ?

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