With the launch of the Boeing 777X expected to be approved this month by the Boeing Board of Directors, followed by the public launch at the Dubai Air Show next month, the future sales of the in-production 777 will be closely watched by the industry as well as by Boeing itself.
It is conventional wisdom that sales will fall off as entry-into-service nears for the 777-9X, said to be “late this decade” by Boeing but more likely 2020 or even 2021, according to customers.
Sales of the Airbus A320ceo and Boeing 737NG families have, so far, held up surprisingly well despite the launch in 2010 of the A320neo and in 2011 of the 737 MAX families. Most of the neo and MAX orders have been combined with the current generation aircraft. This has been viewed as a way to keep the production lines full in advance of the EIS of the new airplanes.
Further, Airbus and Boeing plan an overlap of production of the two generations of about two years. This contrasts with Boeing’s decision to cease production of the 737-300/400/500 concurrent with the launch of production of the 737NG, a move Boeing today says was an arbitrary choice.
Boeing plans to begin building the MAX on a third line in its primary Renton (WA) factory before phasing out the NG. Airbus hasn’t specified how it plans to integrate the production of the ceo and neo.
What will happen for the current Airbus A330 and Boeing 777 lines as the A350 and 777X come on line?
Airbus has long said it expects to continue production of the A330 into the 2020 decade. Timelines alluded to suggest the early 2020s will see the end of A330 production, and our Market Intelligence suggests production will end around 2022, with a successor airplane to the A330 becoming available rather than it being completely phased out in favor of the A350.
We expect Boeing to have at least a two year period in which the 777-300ER is produced alongside the 777X. We believe the shorter 777-200LR will actually live on longer in the form of a KC-777 aerial tanker that will replace the KC-10. We think 777 sales may well follow the pattern of the 737NG/MAX, with a combination of orders intended to support the production rates.
Sales of the A330 and 777 have softened. The following chart shows the orders since 2004, when the Boeing 787 recorded its first sale, coincidentally 10 years ago. The first order for the A350 (Version 1) was placed in 2005, in response to the 787 program. Data for 2013 is through September.
Sources: Airbus, Boeing
The sales figures are gross orders, and exceed the reported net orders by both companies. All A350 Version 1 orders were replaced with those for the A350 XWB. All programs have cancellations. What is more important than the gross sales figures are the trend lines. Those for the A330 and 777 are the focus.
A330 sales picked up after launch of the 787 and peaked in 2007, just as delays to the 787 program were beginning to emerge. Airbus likes to dismiss the impact of 787 delays as a positive to A330 sales, but there is plenty of evidence to support a partial cause-and-effect. But it is also clear that Airbus’ Performance Improvement Packages (PIPs) and low capital costs helped boost sales. Sales dropped in 2009 following the global financial crisis, but picked up in 2010 and remained fairly steady in 2011 and 2012. Sales have fallen dramatically this year through September.
Boeing’s 777-300ER enjoyed a monopoly for its size until Airbus launched the A350-1000, but the latter is slightly smaller at 350 passengers vs 365 in typically three-class configuration and tinkering with the design created a long gap in orders. Meantime, Boeing capitalized on the Airbus ambiguity, with an explosion of sales in 2011 that was extraordinary. A better-than-average 75 orders were recorded in 2012. Sales have dipped for the 777 through September and are on a pace to end the year with 48 orders. We think it possible some 777-300ER orders could be announced at the Dubai Air Show concurrent with the 777X.
It is too early to draw conclusions if orders for the A330 and 777-300ER are in a low-level trend, but we believe it obvious that orders have peaked for both types. We know from Market Intelligence that Airbus had gaps in its production near-term for the A330, but these have been filled and we expect some good-sized fourth quarter orders announced. The launch of the A330 “Lite” is an effort to broaden the appeal of the airplane for high-demand, short-haul routes (i.e., China in particular) where high gross weight and long range is not needed. The new-build A330 freighter has not been the success hoped for, and the loss of the USAF KC-330 tanker contract to Boeing had a large negative impact on the future of the freighter program.
We see sales of the A330 and current 777 being modest at best going forward.
Depending on the model, the initial Next Generation 737-600/-700/-800’s overlapped the final 737-300/-400/-500’s by one to two years:
– First 737-700 – October 1997: Final 737-300 – December 1999 [26 months]
– First 737-600 – September 1998: Final 737-500 – July 1999 [11 months]
– First 737-800 – November 1998: Final 737-400 – February 2000 [16 months]
[The 737-900 followed in May 2001, replaced by the 737-900ER in August 2007;
the 737-600 is out of production]
It will be several years before Boeing determines the actual delivery dates of the final 737NG -700/-800/-900ER vs the initial 737MAX -7/-8/-9. Until then, there is no way to determine by how much these production streams will actually overlap
Thank you for the instructive table and the comments. Of course, now I want even more ! For a complete picture, cancellations/net orders would be useful as well …
I’d see it more like “everything peaked just before the GFC ( goldrush like strive towards buying “any” tube with wings for expansion just around the corner )
Corelation is not causality. 2008/9 put an end to that, though.
Interesting to see that for the last 5 years A330 and 777 go in lockstep except for the “A350-1000 2 years later” 777 peak.
I would like to hear what the 77W will do to stay relevant until 777x EIS. There has been talk of a PIP and some aero improvements but its been a long time since anything new has been mentioned. In 2018 can the certified GE9x be hung on 77W wings?
Re 330 replacement in the early 2020s, why won’t that be the A358, at least in part? Isn’t it clear that the plane’s current performance problems can be remedied by a new wing and reduction in fuselage weight, and that A cannot do that now because they need the resources for the A359 and -1000? Referring again to CM, a while back he said A would be foolish to put billions into a 330neo or other improvements when the same money (or less?) would turn the 358 into a world class, true state of the art product. Also, those 358 improvements would take far less time than a new family of planes, and be available at the end of this decade early the next, far earlier than a new family of planes. IMHO, A needs the 358 ASAP to blunt the 787, which is likely to sell increasingly well as B up production and it becomes more reliable.
I suspect that going forward, A and B will at least in large part focus on improving their current offerings, which in each case means at least a new wing, for the A358 and also for the 7810 to improve it’s range. LH at their press conference said that they did not buy the -10 because its range was insufficient, because it was only 4000 miles! That’s right, 4000 not 7000 miles. LH did not comment further, the press did not pursue the matter, and so far as I know no one else has in the blogesphere. , No doubt LH was referring to the 7810’s range with full pax, baggage, and freight, but even so its supports the views of some, including Keesje, that the 7810’s real world payload/range will be far less that 7000.
Yes , the A330 fuselage is legacy constrained. It would pretty stupid to spend 5 billion on a new wing etc.
However, Airbus IMO doesn’t have to rush things.
A350-800 could EIS in 2020/2021 with a reduced MTOW of around 230 tonnes, and with an all new engine lower thrust that would be at least 5 percent more efficient than the TXWB and 1.4 tonnes lighter (per engine). That engine could also be used on a re-engined A380-800. It should have the same fan diameter and naceller.
A payload-range is always bound to a field performance requirement. If the airframe is maced out (like the B787-10) and has high payload, the range drops very quickly when I am constrained by field performance.
Is there any analysis out there that holds the growth in number of airliners against the growth? We also have the effect of increasing load factors and slightly denser cabins. I always fear that aircraft are pumped into the market helped by record-low interest rates, but that the demand cannot keep up. This is a bit Aboulafia-style “dark painting”.
Output of twin aisles in 2012 was not that much higher than output in 1999 (in shear numbers).
The OEMs are thinking Aboulafia-style and are being careful to keep rates realistic. A lot of slots are double booked. A+B could invest more in the suppliers if they really wanted to pump up rates. QED A+B are expecting a lot of cancellations.
IMO the 787-10 is a mid range super efficient platform. Draw 5000NM circles around Chicago, Singapore and LHR and becomes clear there is a big market. Just not to / from Asia. The wingload, engines etc. are constrained.
I think the A330/A350 interaction is different from A320CEO/NEO, 777NG/X and 737NG/MAX. The A330 and A350 do not share the same productionlines, tooling and supply chains. So Airbus has relative freedom to work the product and its development cycle. Turning it into a <100t OEW up to 4500NM 200-300 seater (again) would mean the best positioning, right inbetween the current NB's and WB offerings. It would complicate the A330F though, that needs the big A330 MTOW / wing.
Simply putting on a new GenX and/or Trent engines and Sharklets would lead to approx -15% better fuel consumption. Further cabin enhancements (e.g LH A346 style lavatories), bigger bins, cockpit enhancement; HUD, A350 style displays/ touchscreens, A350 mk1 style aerodynamic enhancements etc. are all available and can be implemented withhout enormous investments. Maybe add a few inch cabin width to make 9 abreast more acceptable?
15% Less fuel. Maybe it could have lower CASM then 787 on short flights? Sales?Maybe a percentage of the enormous customer base thinks commonality, existing global infrastructure (maintenance, parts, qualified pilots) and price beats some of the A350/787 advantages.. who knows.
.. and ask the airlines what 2 fuselages lenghts they think would be ideal for their next 20 year requirements in combination with the rest of their fleets. Maybe add a few frames to the -200 and -300?
Pingback: Airbus, Boeing production backlogs stretch to late this decade, early next decade | Leeham News and Comment