22 January 2016, ©. Leeham Co: Today’s Corner should have been about something else. But we learned yesterday that yet another order did not go Bombardier’s way, the 125 seat aircraft order of 40 units for United Airlines.
Normally I don’t care about who gets a single aisle order; the players that are active are all producing very good products and which one that gets chosen in not a big deal.
Boeing took this business with its smallest 737NG member 737-700. The 737NG was scheduled to take on aircraft like the CSeries and the re-engined A320neo while Boeing perfected a clean sheet single aisle for the end of this decade.
This corner is about national characters and what happens when this character gets under pressure. It’s also about the fact that the coin has two sides.
Boeing was deep at work on its clean sheet aircraft when Airbus proved with the A320neo at American Airlines that what the customers wanted was something more tangible, a “good enough” product that was available tomorrow. Out of this situation came the 737 MAX.
The MAX is a testament to the American creativity when push comes to shove. (I have 40 years experience of working with Americas, so I know a thing or two about their character).
Given the situation, the MAX started out as very much a band aid update of the 737NG. I remember thinking, “this will be ugly.” The 737 is a 1950s fuselage and 1960s systems design that has now been re-engined and re-winged four times. The fourth time did not come natural as described. Boeing had prepared a bit, they had looked in a few corners what could be done with this amazing granny of an aircraft.
They put the MAX name on the creation and it kind of said “this is the last shot and it will be far.” The first announced 737 MAX configuration was not that impressive, neither in efficiency nor in technology. But gradually, one clever solution after the other was added and the present definition is competitive. Whether you think the 737 MAX or A320neo is the best choice for the job is about your preferences rather than outright “one is clearly better than the other.”
The US character showed how they bounce back when pressed. Bombardier is Canadian and I don’t know the Canadian national character that well. If they are tough and resilient, they will need it right now. The United order as I understood it was theirs to lose and they lost it.
Lets look at the loss of the United order for CSeries from its two sides:
One is for those that see a glass filled with water as half empty:
The other sees the glass as half full:
I can comment on what I’ve seen when I have investigated the CSeries and how it came about. An aircraft is one long list of trades to pick the right technology and solutions to different problems. When you are in the middle of doing these trades it’s challenging. You neve have enough of information. Every decision carries a lot of risk. Been there, done that.
Afterwards it’s totally different. Once enough time has passed, its easy to see whether these trade decisions were correct. We are now approaching aftermath and one can start to draw conclusions.
I’m impressed by at how many trade points the Bombardier team managed to take the correct path. On the pure technical side, it is hard to find decision they should have made differently.
On the strategic level, it becomes less clear. Here, Bombardier had to decide which market segment coverage it should go for. I would say the jury is still out on that decision.
With the decision that was taken, the Canadian national character better include perseverance.