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Jul 24, 2013

Boeing commits to ambitious 737 MAX promises

Boeing pitches hard for a Qantas order for its MAX family of new tech 737s, but is anyone in the airline listening at the moment?

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737 MAX family snapshot: Boeing graphic

Speaking of gauntlet throwing, it’s Boeing’s turn today with some detailed promises about where its 737 MAX program is going, and when, and while using specified lesser amounts of fuel.

In the local context, Qantas could be considered a major prospect for an order for the new technology edition of the 737 range, notwithstanding a large commitment to the competing Airbus A320 NEO family for its Jetstar franchise.

Boeing’s statement is pinned to the completion of ‘firm’ configuration of the 737 MAX 8, which corresponds most closely with the 737-800 in the NG series of the single aisle jet now in production.

The MAX 8s will kick off the Boeing family with first deliveries in the third quarter of 2017, followed by the larger MAX 9s a year later, and the smaller MAX 7s two years later.

Boeing’s challenges include being second out of the blocks with new technology engined single aisle jets, two years behind Airbus, and offering only the French-American engine option in the LEAP design  from CFM International, while Airbus offers a version of the same engine or the much talked about GTF or geared turbo fan design from Pratt & Whitney, which is too wide to fit under the MAX family wings.

This what Boeing said:

RENTON, Washington, July 23, 2013 — Boeing (NYSE: BA) has completed the firm configuration of the 737 MAX 8. This milestone marks completion of the major trade studies that define the capabilities of the 737 MAX family.

“We have defined the design requirements for the 737 MAX that provide our customers with the most value in the single-aisle market,” said Michael Teal, chief project engineer, 737 MAX, Boeing Commercial Airplanes. “We continue to follow our disciplined process to ensure that we have completed all the requirements for the development stage of the program and are ready to begin the detailed design phase.”

As detailed designs are completed and released, production can begin. Final assembly of the 737 MAX 8 is scheduled to begin in 2015 with first delivery scheduled for the third quarter of 2017.

The 737 MAX will be 13 percent more fuel-efficient than today’s most efficient single-aisle aircraft and 8 percent more fuel-efficient per seat than tomorrow’s competition. The configuration includes new LEAP-1B engines from CFM International that are optimised for the 737 MAX, a redesigned tail cone and the Boeing designed Advanced Technology Winglet to reduce fuel use. Other changes incorporated include upgrades to the flight deck displays, an electronic bleed air system and fly-by-wire spoiler flight controls.

“The 737 MAX will not only be the most fuel-efficient aircraft, it will maintain the 737’s industry-leading reliability,” said Keith Leverkuhn, vice president and program manager, 737 MAX program, Boeing Commercial Airplanes. “We are working closely with our customers and industry partners to ensure that the aircraft we deliver will perform as promised.”

Additionally the MAX will take advantage of advancements in connectivity. “As we continue to improve connectivity on the 737 platform, the 737 MAX will offer customers the capability to use real-time data to make operational decisions around maintenance on the ground during flight,” said Leverkuhn. “This will allow airlines to more efficiently manage their fleets. Enhanced connectivity also will benefit passengers as the demand for more wireless access to information and entertainment in flight continues to grow.”

The 737 MAX family includes the 737 MAX 7, 737 MAX 8 and 737 MAX 9 and will serve the 100- to over 200-seat market. The 737 MAX will extend the Next-Generation 737 range advantage with the capability to fly more than 3,500 nautical miles (6,482 km), an increase of 400-540 nmi (741-1,000 km) over the Next-Generation 737. First delivery of the 737 MAX 9 is planned for 2018 followed by first delivery of the MAX 7 in 2019.

Statements like the above from Boeing and competitor Airbus are always ‘forward looking’ meaning they say what will be, not what was. In the real world large users of the 737 and A320 lines are said to be very happy with their current choices, but always armed with dossiers that contradict some of the claims made by both Airbus and Boeing about how well those jets would have performed prior to sale contracts being signed.

No-one is going broke because they chose 737s over A320s or vice versa today, and no one is likely to suffer such a fate simply because of their choice of new technology single aisle jets in the foreseeable future.  Airlines go broke because of poor management, errors in product offerings, or because of  broader economic reasons relating to supply and demand, recessions and boom bust cycles.

The biggest immediate threat to a 737 MAX or an A320 NEO seems to be a bargain priced run-out purchase of current model 737s and A320s  in which the benefits of lower acquisition costs exceed the fuel savings and other efficiencies of the new versions purchased at a higher cost.

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