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Paris reveals Airbus well placed in small jets, Boeing in big jets
Posted by Dominic Gates
The Paris Air Show has unexpectedly made starkly clear that the rivalry between Airbus and Boeing is playing out very differently in the two major airplane categories.
In sales of narrowbody jets, Airbus is clearly on the ascendant.
Airbus announced more than 700 A320 sales in Paris, compared to less than 90 Boeing 737 sales.
Airbus CEO Tom Enders said even he has been surprised by the wild success of the upgraded A320neo, which now has more than 1,000 orders and commitments following blockbuster sales in Paris.
"When I went to the board for approval, I promised strong sales," said Enders. "I didn't think it would be such a best seller only six months after the launch."
But in the market for bigger widebody jets, Boeing has the upper hand. Airbus has to fix problems with its now-delayed A350 family.
As a result, Boeing can look forward to a bonanza of 777 and 787 sales for several years with some sales campaigns almost uncontested because Airbus won't have a competitive jet to offer.
Pat Shanahan, head of airplane programs at Boeing, said that with the 787 Dreamliner soon to enter service and the 777 without any viable competitor until 2017 at the earliest, Boeing's position in the large jet market is "better than good."
Narrowbody strategic moves
Airbus has set its strategy for narrowbody jets. It will put new fuel-efficient engines on its A320, to create the A320neo.
Sales in Paris provided strong evidence this is a winning approach.
Worryingly for Boeing, Airbus sales chief John Leahy said that all those A320neo sales in Paris were new; none were conversions of existing A320 orders.
In contrast, Boeing doesn't yet have a narrowbody strategy.
It wants to decide by year-end whether to follow Airbus and put new engines on the 737 or to design an all-new small airplane to replace it around 2020.
Boeing's leadership insists it isn't floundering, but it doesn't look good right now.
Rumors swirled in Paris that Leahy may by year-end convince a major U.S. carrier -- American and Delta are most often mentioned -- to defect to Airbus and order the neo.
Airbus's Enders said "737 customers are very interested in what we are offering."
Boeing's head of sales Marlin Dailey said Airbus is "peppering the marketplace with A320 proposals."
That puts his sales team in a difficult position. As they consider a purchase, customers want to know what Boeing will have to offer.
"They want some certainty," said Dailey. "We need to move with velocity."
Yet he, like all top Boeing executives, insists that year-end is time enough and that the momentous decision of whether to launch a new small airplane that would be produced for 30 or 40 years can wait six months.
"I see nothing but opportunity," in the future narrowbody market, Dailey said.
That seems like whistling in the dark to Airbus's Leahy.
He thinks skyrocketing neo sales will force Boeing executives to back away from a new plane and follow Airbus by re-engining.
And if they don't, he said, it'll be a mistake.
He said he believes Boeing cannot get enough of an efficiency boost by 2020 to make the plane significantly better than the neo.
"I'd really break out the champagne if I heard that they just invested $12 billion to come out in 2020 with an airplane that is essentially an A320 wannabe," said Leahy.
Airbus A350 shock
Yet on the widebody front, Leahy is the one in a difficult position, though of course he doesn't admit it.
Airbus announced in Paris on the eve of the Le Bourget show that it will delay two models of the three-jet A350 family and change the largest model radically.
That tore the veil from a program in trouble.
"They stretched that family to cover the 787 and the 777," said Boeing's Dailey. But spanning that range of aircraft sizes -- roughly 240 seats to 350 seats -- has turned out to be too difficult to do with a single wing size.
Now Airbus must make serious alterations to the wing of the larger A350-1000, and give it heftier landing gear and more powerful engines.
With that model pushed out until 2017, Boeing can look forward to a bonanza of 777 sales in the interim.
The 777 currently has no viable Airbus competitor.
In addition, Airbus customers are migrating away from the smallest and weakest A350 model, the A350-800.
And Airbus chief operating officer Fabrice Bregier conceded that getting the middle-sized A350-900 delivered on time is "a heavy challenge" and "a race against the clock."
That's the only model not formally delayed.
With that outlook, the rival Boeing's Dreamliner family now looks certain of further sales too, provided Boeing can get production running well in Everett and at its supplier plants.
If Boeing goes ahead with the 787-10, that will strengthen the family even more.
In Paris, Airbus CEO Enders insisted that all will be fine when the A350s finally arrive. But until then, he conceded Boeing's first-mover advantage with the Dreamliner.
"When you start programs earlier, for a while you are better positioned," he said.
Then Enders went off on a rationale to defend the extra time spent on the A350 that eerily resembled what Boeing is saying about its narrowbody problem.
"It's most important we get the concept right," he said. "That takes a bit more time. That may be unfortunate, but it's worth waiting."
As Airbus and Boeing separately wonder if their customers will wait for them, they are feeling the pressure in different places.
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