Monday, June 20, 2011

Boeing starts strong at Paris Air Show

Boeing opened the Paris Air Show with some bold statements, such as a claim that its 747-8 Intercontinental had superior trip and seat-mile economics to the Airbus A380, and backed up its declarations by announcing a slew of new orders.

Addressing media at Le Bourget, Boeing Commercial Airplanes President and CEO Jim Albaugh said the manufacturer is the leader in every market segment but believes its seven-year backlog is too great. "We are working to bring this down to three to four years," he said. "We have [made plans to increase] the 737 rate to 42 a month, [increase] the 777 to 8.3 and will build the 787 to 10 a month. And we want to get that to 12. We have to be able to respond to our customers’ needs or they will be forced to make decisions they don't want to [make]."

Albaugh added that all of Boeing's numbers are in positive territory. "Our customers are blue chips, our margin is 7.2% and our backlog is $263 billion," he said.

Adding to the backlog Monday at the air show were Qatar Airways and Air Lease Corp. Qatar added six more 777-300ERs to bring its 777 commitments to 40, while ALC committed to 33 aircraft: 24 737-800s, five 777-300ERs and four 787-9s.

Looking to buttress its claim of better economics than the A380, Boeing announced orders for 17 747-8Is from two unnamed customers. This takes firm orders for the passenger version of the newest 747 model to 50.

Going forward, Albaugh said the manufacturer is receiving "strong interest" in the 787-10X, which will be a 5.5 meter stretch of the 787-9 with a capacity of between 290 and 330 passengers, about 40 more than the 787-9. Albaugh asserted that the 787-10X's economics are "brilliant," with operating efficiency 10% better than the A350-900 and 5% better than the A350-1000.

He reiterated that a decision on a 737NG replacement or re-engine would be made at the end of the year. Boeing VP-Business Development and Strategic Integration Nicole Piasecki said that the baseline Boeing would protect for a "737 replacement is 125 seats."

The company is looking at both single-aisle and twin-aisle models as a replacement for the 737. Answering a question from ATW, Piasecki said that even at 125 seats, a twin-aisle solution would work. Boeing VP-Advanced 737 Product Development Mike Bair said that a twin-aisle aircraft would reduce turn times, enabling airlines to add more sectors per day. The twin-aisle would only incur a fuel burn penalty of 2%-3% compared to a single-aisle, he added.

Piasecki told ATW that the twin-aisle option is getting strong support in Asia and China.

(Geoffrey Thomas - AtWOnline News)

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