Boeing lambasts Airbus's product strategy

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Boeing lambasts Airbus's product strategy

By Kevin Done in London

Financial Times

 

Updated: 9:42 p.m. ET July 12, 2006

 

Boeing, the US aerospace group, on Wednesday launched a sustained attack on the product strategy of Airbus and blamed its troubled European rival's current problems in the market for wide-body, long-haul jets on the decision to develop the A380 superjumbo.

 

The industrial development of the 555-seat A380, launched at the end of 2000, had diverted Airbus's financial and engineering resources from the core of the long-haul market, where 90 per cent of the aircraft required in the next 20 years would be in the smaller 200-seat to 400-seat segment, according to Boeing's latest market forecasts.

 

The loss of credibility byAirbus among its airline customers for twin-aisle jets has shown up clearly in the world market during the first six months of this year.

 

Airbus said on Monday its new aircraft orders booked in the first half of the year had more than halved, falling from 276 a year ago to 117.

 

The level of orders highlighted its difficulties in the most lucrative part of the commercial aerospace market, where Airbus secured only 21 new orders for wide-body jets, compared with 96 for its A320 family of single-aisle aircraft.

 

By contrast, Boeing announced a jump in overall gross orders from 439 to 487 in the first six months.

 

It won 96 orders for wide-body jets led by its 787 Dreamliner programme, to which Airbus has been struggling for more than a year to develop a response with its A350.

 

A fresh proposal for an all-new aircraft family to counterBoeing's 787 and 777 ranges, which could cost up to $10bn to develop, is due to be considered by the board of EADS, the Airbus parent company, tomorrow and could be announced at next week's Farnborough airshow.

 

The four-engined A340-600/500 range from Airbus is also being eclipsed by the latest versions of the more fuel efficient twin-engined Boeing 777.

 

Last year Boeing won orders for 154 777s; Airbus sold 12 A340s.

 

Randy Baseler, marketing vice-president for Boeing's commercial aircraft division, said Airbus was "in the middle of revising" its A350 offering but maintained the European company's response would be four years late into the market.

 

The 787 is due to enter commercial service in 2008.

 

Mr Baseler said Boeing had begun discussions with airlines on their future needs in thesingle-aisle market where the 737 and rival Airbus A320 family are the workhorses of the global aircraft fleet.

 

He said that 2012-15 could see the entry into service of the new generation 737. It would be "no earlier than 2012" and would probably be an all-composite aircraft drawing materials and manufacturing technology from the current 787 programme.

 

The decisions on the timing for the replacement of the current 737 and A320 aircraft will bea crucial factor in the commercial performance of Boeing and Airbus over the next decade.

 

Boeing's latest annual market outlook published on Wednesday forecast an average growth of 4.9 per cent in air passenger traffic and 6.1 per cent in air freight for the next 20 years.

 

This would require approximately 27,200 new passenger and freighter aircraft, a market worth $2,600bn.

 

The largest market by value would be Asia-Pacific with 36 per cent of the total compared with 28 per cent in North America and 24 per cent in Europe.