Boeing to Step Up Long-Haul Jet Battle
25-Jun-2009 da charterx.com
Boeing, the US aircraft maker, is planning to intensify the competitive pressure on Airbus, its European rival, in large capacity, long-haul aircraft with the eventual development of a new family of all-composite jets to replace its current 777.
Jim McNerney, chief executive of Boeing, said the group also expected to build a second production line for its 787 Dreamliner, which is facing two years of delays in development, but is finally due to enter commercial service in the first quarter next year.
The eventual planned replacement of the 777 is being prepared in response to moves already under way at Airbus, which is developing its own new range of long-haul aircraft, the A350 with the investment of about €11bn ($15.2bn).
Boeing fears the highest capacity version, the A350-1000, will prove a tough competitor for the 777, which has been one of its most successful long-haul jets and has eclipsed the Airbus long-range jets, the A340-600 and A340-500.
The A350 and the 787 are already at the centre of a trade dispute at the World Trade Organisation between the US and the European Union over state subsidies for the development of large commercial aircraft, and Boeing and Airbus yesterday fanned the flames of the row.
This week European governments made clear they were preparing soon to agree a package of repayable launch loans to Airbus totalling about €3.5bn to help fund development of the A350, which is due into service in 2013.
Mr McNerney said the move suggested the EU and Airbus believed the WTO process was "irrelevant". A spokeswoman for the US Trade Representative said the commitment of launch aid would be "a major step in the wrong direction. We want to resolve the problem of WTO-inconsistent aircraft subsidies, but the commitment of billions of euros of additional launch aid would make that even harder to do."
Tom Enders, Airbus chief executive, said the European launch aid was aimed at "levelling the playing field". The EU believed the rival 787 was the "most highly subsidised aircraft ever," he said. "It is a bit of a hypocrisy to keep their highly subsidised aircraft and to deny us," he said.
The battle to dominate the lucrative market for long-haul jets will be intensified by Boeing's eventual plan to replace the 777 and to raise output of the medium capacity, long- range 787.
Mr. McNerney said Boeing would reach full production of about 10 787s a month in the second half of 2012. It has an order book for more than 860 787 Dreamliners and he said: "We are actively looking at a second line that would take the rate up". He believed the plant would be built, "the question is timing".
The second assembly line could be built at a different location in the US to Boeing's main base around Seattle in the state of Washington, Mr. McNerney said.
Several leading airlines are pushing Boeing to commit to an all-new 777 rather than an extensive upgrade of the current aircraft.
Mr. McNerney said, "eventually we will have an all-composite 777 replacement", but the timing would depend on the success of the rival A350-1000
