16 September 2012

What is Boeing waiting for to strangle the A350 XWB with the launch of new 787-10 and 777-X?

In this interesting post at AirInsight it is analyzed the future of Boeing after 787 has began deliveries, is already in service and is facing the ramp up.

Now, the 787-10 and 777-X are the next targets as Boeing readies its 737 Max series to compete with the A320 neo family.  But Boeing, which had favorable reactions to information on both new wide-body models after discussion with airlines, appears to be waffling from previous, unofficial commitments to launch these programs in 2012, after the change in CEOs at Boeing Commercial Aircraft.  Former CEO Jim Albaugh appeared ready to take recommendations to the Board of Directors by year-end. His successor, Ray Conner, will only say the recommendation will go to the Board when it’s “ready,” but still vows an EIS by the end of the decade.

With two new models that could bracket the A350XWB in the marketplace, industry pundits are speculating on why Boeing appears to be nebulous.

The A350-1000 has much better trip costs and is a far more economical and superior product than today’s 777.

All new 777-X or 777-300ER re-engining and major overhaul?
Boeing is undecided more than ever before whether a major make-over In the form of  the 777X is the best course or a minor makeover of the 777-300ER will be as good as the A350-1000.

The recommendation in the article is clear: “Boeing needs to rapidly have a competitive answer, having lost a key customer to the competition, but appears to have its finger in the air trying to figure out which way the winds are blowing. Reacting to Competitors is Not Market Leadership. Boeing management today appears reactive rather than pro-active, as demonstrated by the launch of the 737 Max”

Reasons: engineering shortage and/or money shortage?
Has Boeing the capability or the ability to develop and deliver on multiple programs?. Can Boeing rebound and handle multiple developments at once? Has the 737 Max, which will be a tough development to meet its design goals, taken top priority?
Fund shortage forced with 787 to fundamentally change Boeing’s strategy to include risk-sharing from suppliers to get the program approved. Is Boeing ready to repeat the risk-sharing partners experience in new developments?

Based on article “Boeing and the Sporty Game of Product Strategy” published in AirInsight

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