Boeing confirms development of new smaller, faster commercial jet

Airline Industry Information, March 30, 2001

AIRLINE INDUSTRY INFORMATION-(C)1997-2001 M2 COMMUNICATIONS LTD

Boeing Co's Commercial Airplanes division has announced that it is now focussing its aircraft development efforts on the production of a faster, longer-range aircraft.

Alan Mulally, the President and CEO of Boeing Commercial Airplanes, stated: 'This is the airplane our customers have asked us to concentrate on. They share our view that this new airplane could change the way the world flies as dramatically as did the introduction of the jet age.'

Mulally said that the company's consultations with customers had shown a preference for an aircraft that 'can fly faster, higher and more quietly over very long ranges.' He added that the combination of 'higher speed, longer range, the comfort of flight at higher altitudes, and the environmental benefits of quieter landings and takeoffs' would 'open a new chapter in commercial aviation.' A concept model of the aircraft can be viewed at Boeing's web site (http://www.boeing.com).

Boeing Commercial Airplanes will now change its product development strategy to focus more strongly on the proposed smaller aircraft. Mulally also said that customers had indicated that improvements to the 747-400 family would satisfy larger aircraft needs and noted that a high gross-weight version of the model had already been launched and is scheduled for delivery to Qantas, an Australian airline, in November 2002. He also stated however that the company was going to 'protect the ability to do a larger 747 if and when our customers tell us they need one.'

Finally, Mulally stated that the company would be slowing the development of the Longer-Range 767-400ER, a proposed re-engined version of the 767-400, because customers have indicated that they are satisfied with the performance of this aircraft.

In related news, aviation analysts have been speculating about the effect on European aircraft manufacturer Airbus Industrie of Boeing's decision to develop a new, smaller aircraft.

Airbus Industrie has recently committed to launching a new 555-seat superjumbo jet aircraft, the A380, which analysts have suggested will dominate the larger-aircraft market, as did Boeing's 747-400.

Analysts have also predicted however that Boeing will gain a new dominance in another part of the aircraft market with its new aircraft concept, and have suggested that Airbus Industrie's mid-size aircraft market is particularly vulnerable to challenge because its aircraft fly at the lower end of the speed range for these aircraft. Chris Yates, an editor of Jane's Security Aviation, has stated though that Boeing's speed advantage would only be noticeable on longer trips and the speed advantage might not be a 'significant benefit' to the US company on short routes, according to Reuters.

Meanwhile, JP Morgan aviation analyst Chris Avery has stated that the cancellation of Boeing's 747X Stretch could prove profitable for Airbus Industrie, although it was noted that the new smaller, faster Boeing aircraft could steal customers from the A380.

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