Boeing skeptical of CSeries, C919, MS-21 EIS
We wrote the following article for Commercial Aviation Online, which appeared yesterday. In case anyone wonders, there is no relation between John Hamilton and us.
The chief engineer of the 737 program is skeptical of the emerging competitors’ airplanes and the announced entry-into-service (EIS) dates, and this has a clear influence on what Boeing will do to enhance, re-engine or replace the 737 in the coming years.
John Hamilton, in a media briefing on the roll-out 26 October of the 737’s Boeing Sky Interior and a refresher course on the technical enhancements that will be in place next year, said Bombardier is facing new technologies it hasn’t worked with before that places in doubt the promised 2013 EIS of the 110-130 seat CS100. This is a potential replacement for the Boeing 737-500 Classic and the 737-600 Next Generation aircraft.
Likewise, Hamilton expressed doubts about the competitiveness of China’s first mainline jet, the COMAC C919. This 150-200 seat aircraft will compete with Boeing’s bread-and-butter 737-800 and 737-900ER, with a promised EIS 2016. Hamilton doesn’t think the C919 will be competitive with the 737, despite having the new generation CFM International LEAP-X engine power the aircraft. Rather, the next round of COMAC airplanes will more likely be competitive, but these will be much further in the future than 2016—and COMAC may be unlikely to hit this target, Hamilton said.
The C919 has an advertised seven year launch-to-EIS cycle, but China’s other new airplane—the 70-90 seat AVIC ARJ-21—is already two years late on a nine-year cycle. If the C919 matches this, a 2018 EIS is more likely.
Hamilton said the same issues may be true of Russia’s Irkut MS-21, a 160-212 seat airplane.
The timing works in Boeing’s favor; executives are talking about a replacement for the 737 around 2019-2020. Hamilton said a decision-date would likely be about seven years in advance of EIS, or 2012-2013.
Hamilton reiterated what executives have been saying: a re-engined 737 is not garnering a lot of support from airlines and lessors. If Boeing can proceed with a replacement airplane by 2019-2020, then further incremental improvements in the 737—and a delayed competitive landscape—may suffice for now.
Boeing officials have previously said the prospective Airbus A320 New Engine Option, or NEO, will only have a direct operating cost improvement of 3%-4% over the 737 (which Airbus disputes, without providing a definitive figure in rebuttal). So Hamilton said that Boeing is considering ways to close this gap, both through reducing fuel consumption and maintenance costs. Hamilton isn’t sure if Airbus is going to proceed with NEO, remarking he believes Airbus is hearing the same lack of enthusiasm about NEO that Boeing is about re-engining the 737.
Airbus previously has said its customers like NEO.
As for the 737 technical enhancements that will enter service next year, these will cut fuel costs by 2%, according to studies. Test flights begin in November and continue through April to validate the aerodynamic improvements. The new CFM 56-7BE Evolution won’t be ready until next year for testing. Boeing believes that on a net present value basis, the 2% translates to $1m over 20 years, or about $120,000 per year.
Hamilton said 7% in operating costs have been wrung out of the Next Generation 737 since its introduction in 1994.