is Boeing Going?
Part 4 : Boeing Today - but
perhaps not Tomorrow
The Sonic Cruiser
represented an interesting opportunity for Boeing to advance
into new technologies and designs and new airplane
performance. Alas, Boeing lost its nerve and cancelled the
project in December 2002.
Worse still, its
Commercial Airplane Division CEO reportedly is refusing to
even consider a promising new technology that could allow
Boeing to reclaim its market leadership role.
4 of a 5 part series - click for Parts
'The seeds of our destruction
can be found in the fruits of our success'.
Boeing was forced to take risky
gambles to win its marketplace leadership in the 1950s and
1960s. But then it changed from being a pioneering innovative
company, and instead became one more concerned with perpetuating
the status quo. In doing so, it lost the forward momentum that
is essential in the still evolving technology of airplane design
and construction. After years of unquestioned market dominance,
it became complacent and failed to recognize the reality of a
new threat - Airbus.
Boeing's new 7E7 (now renamed
the 787) runs the risk
of being 'too little too late' and is unlikely to restore the
company to market leadership. It is essential that Boeing return
to its roots, and reclaim the initiative by developing a
revolutionary type of airplane. Failure to do this will doom
Boeing to a dwindling role as the smaller of the two remaining
major jet manufacturers.
Such a revolutionary type of
airplane has been identified. But Boeing's senior management
seems too timid to even consider the potential for this
remarkable new plane.
The Super Jumbo : 747-500 or
747X or nothing
All through the 1990s,
Boeing was mulling over a new super jumbo jet - something based
on a reworking of its 747 design, but substantially larger.
Various designs were
proposed and then discarded. For a while, Boeing looked at
building a new super jumbo as a joint venture with Airbus, but
then chose not to do that, either.
Meanwhile, Airbus was
steadily creating plans for the super-jumbo plane it now calls
the A380. This is a two level plane carrying 555 passengers in
three classes, with generous amounts of extra room allowing for
(in theory) lounges or shops or other amenities. Airbus set
itself the target of getting 50 firm orders for the plane - if
it could secure 50 orders, it would proceed to invest the $10+
billion that the project would cost and commit to producing the
Boeing developed a competing
design for a plane it called the 747X, which would carry 525
passengers. In 2000 Boeing claimed to have received almost $5
billion in orders for the new plane. At the end of 2000, Airbus
succeeded in getting its 50 orders, and so confirmed its
intention to proceed with the A380 project.
At the end of March, 2001,
Boeing announced it was canceling its 747X project. While Airbus
had by then increased its order book to 66 orders for the A380,
Boeing admitted it had actually received no firm orders at all
for its 747X. Indeed, Boeing's last order for a passenger
model 747 was in Nov 02, and it is currently rumored (Jan 05)
that Boeing may have to close its 747 production line in 2006.
And so, Airbus ended up
taking over Boeing's formerly exclusive role as manufacturer of
the largest passenger airplane in the world. Since March 2001,
Airbus has continued to steadily build its orders for the A380,
and now (Jan 05) has 149 orders for the plane. At an estimated
list price of $250 million per plane, that is $37.25 billion
worth of business that Airbus has secured, and which Boeing has
Is there a Market for a Super
Is there indeed a market for
a super jumbo? Boeing says there is a trend away from 'high
density' routes (ie between two major hubs) and a trend towards
nonstop secondary routes that don't need to connect through
hubs. A 'high density' route would be, for example, between
London and New York. A secondary route would be, for example,
between Pittsburg and Geneva. Secondary routes don't need very
big planes due to the smaller number of people that fly them.
Boeing is correct - there is
a growth in secondary routes, but that is only half the story.
There is also a steady growth in all passenger traffic - Boeing
itself predicts a growth of more than 5% a year for many years
into the future. Total passenger traffic will double within the
next ten to twenty years, and this growth, combined with finite
airport and runway capacity and limited numbers of 'slots' for
flights in and out of airports, is pushing the need for bigger
and bigger planes. Medium density routes are becoming high
density routes, and high density routes are becoming too-high
Congestion at airports and
in the skies all increase the need for larger capacity planes.
Yes, there is a market for a super jumbo.
While Boeing still maintains
there is no market for such a big plane, the 149 orders that
Airbus already has for its A380 shows the nonsense of this
claim. Industry analysts also reject Boeing's claim - for
example, London's Heathrow Airport (the world's third busiest
airport) is projecting that by 2016, one in every eight flights
through its airport will be an A380. In comparison, only one in
every nine flights at LHR today is a 747. In other words,
Heathrow is expecting that, within ten years of its release, the
A380 will be more popular than the 747 is today, 30 years after
Airbus needs to sell only
200 A380s for the entire project to be a success. At its present
rate of sales, it seems possible it will have sold more than 200
even before the first plane ever flies (in 2005).
Some analysts believe that
Boeing tried to bully or bluff Airbus into not proceeding with
the A380 project. Plainly, if neither company developed a super
jumbo, then Boeing's 747 would remain the largest plane in the
skies - and so Boeing had no motivation whatsoever to develop a
costly replacement to the 747, and did all it could to dissuade
Airbus from developing one as well.
This strategy clearly
back-fired on Boeing. Boeing was probably half correct - there
is insufficient market demand for two super jumbos. But by
concentrating its effort on doing nothing, it has allowed Airbus
to steal this very profitable part of the market away and Boeing
now has no hope of supplying very large sized passenger planes
for the next 30 years or so, until such time as the A380 design
becomes obsolete, in the same manner as the 747's obsolescence
created an opportunity for Airbus.
Better than a Super Jumbo? The
Sonic Cruiser's Short Life
When Boeing made its public
announcement in March 2001 that it was canceling its 747X
program, it chose to put a brave face on this situation by
announcing its new 'Sonic Cruiser' concept, and said in a press
This is the airplane our customers have asked us to
concentrate on. They share our view that this new airplane
could change the way the world flies as dramatically as did
the introduction of the jet age.
What was this allegedly
revolutionary new plane? Remember that the introduction of the
jet age brought about a doubling in plane speeds, and a doubling
of passenger capacities.
Alas, the Sonic Cruiser
promised to fly merely 15-20% faster than a regular jet plane
(at Mach 0.95 - 0.98), and would carry only 200 - 250 passengers
(half as many as a 747), with a range of between 6,500 - 10,000
miles (similar to a 747). The plane was described as using about
the same amount of fuel to carry a passenger as a 747 or 767.
The promise of a 15-20%
increase in speed (15% faster than a 747, 20% faster than a 767)
is not the same as a 15-20% reduction in travel time. 20 - 30
minutes of any flight is spent on the ground, taxiing to and
from the runway. More time can be wasted with air traffic
control delays. When planes are flying below 10,000 ft in the US
they are limited to 250 knots maximum speed. Planes don't fly at
full speed when climbing up to cruise level. On an 8 hour
trans-Atlantic flight, the Sonic Cruiser would save about one
hour - hardly a revolutionary change in flying time at all.
Furthermore, when you add in
all the other factors that make up a total travel experience
(driving to the airport, checking in, going through security,
boarding the plane, disembarking at the other end, waiting for
luggage, then traveling on from the airport to your final
destination) there is as much as 5 or more hours of additional
traveling time. A one hour saving on a 13 hour total travel
experience is a negligible saving - sure, it is welcome, but it
hardly 'changes the way the world flies as dramatically as did
the introduction of the jet age'.
Shorter flights offer almost
no perceptible improvement in travel time at all. A typical
domestic flight of 1000 - 1500 miles would offer an
inconsequential 10 - 20 minutes of reduced travel time. The
plane would only offer measurable time savings on very long
On the positive side, the
plane looked futuristic and exciting and 'sexy'. But such
considerations rarely sell $125 million dollar airplanes, and
after a period of intense hype, Boeing cancelled this project.
The official reason given was that after 9/11, airlines became
more sensitive to cost savings, and they'd prefer a cheaper
slower plane. In reality, it is equally likely that the illusion
of greater speed was finally punctured and when airlines
realistically looked for the value and benefit of the Sonic
Cruiser, they found it completely lacking.
Another interpretation is
that the airlines, in a manner very similar to Boeing, wanted to
preserve the status quo. If Boeing had proceeded to develop the
plane, some airlines would have purchased it, and that would
have then forced the other airlines into purchasing the plane
too, so as not to give an advantage to their competitors. Boeing
should have called the airlines' bluff and pressed on with
21 months after Boeing
announced the Sonic Cruiser program, it cancelled it in December
2002, replacing it with another new concept, the 7E7.
More Lost Opportunity
A little known fact about
the Sonic Cruiser is that towards the end of its development
project, the design evolved to allow it to fly faster than the
speed of sound. At the Farnborough Airshow in 2002, Boeing VP
Walt Gillette explained that it would have a maximum speed of
Mach 1.04, and - amazingly - there would be no sonic boom
problems on the ground. The plane would cruise at Mach 0.98 for
fuel efficiency reasons, but could go through the 'sound
barrier' if it chose to.
This was an exciting
development. The 'sound barrier' is no longer the insurmountable
obstacle it once was, and neither also are sonic booms
impossible to overcome. In addition to Boeing's positive
experience in 2002, Northrop Grumman also did testing of a new
design of plane nose on a modified F-5E in August 2003, which
confirmed earlier expectations that sonic booms can be greatly
The main obstacle to
building faster planes is not a 'law of nature' but rather the
unwillingness of private industry to invest in the research and
development that is needed to address the present limitations
and to find solutions to present problems.
Contrary to popular belief,
the Concordes operated by British
Airways were consistently and outstandingly profitable (the
analysis on this linked page conclusively rebuts all the
misperceptions about the Concordes losing money). And there were
exciting plans for a 'Concorde II' that would have been bigger,
flying further and faster than ever before, but, just like the
Sonic Cruiser, these never were fully developed.
While subsonic planes have
seen fifty years of consistent development and enhancement with
many tens of billions of dollars invested into R&D, supersonic
planes have never progressed beyond an original 'first
generation' design. A state of the art supersonic plane today
could be as improved and different to Concorde as an A330, A340,
A380, 7E7 or 777 is from an original
The Sonic Cruiser, while an
unimpressive plane in and of itself, was nevertheless a valuable
transitional plane between the current technology of subsonic
planes and a new technology of efficient effective supersonic
More speed is clearly a
prime area of future enhancement for airplanes. The Japanese are
steadily working on developing a supersonic passenger plane, as
are the Europeans, with credible projections suggesting that
they will have a 1200 passenger (!) supersonic plane in
commercial service by 2020.
What is Boeing doing to
respond to these current competitive developments? Apparently
The 787 - Savior or More of the
Industry watchers could be
forgiven for being skeptical when Boeing announced it was
replacing its Sonic Cruiser program with the 7E7 program
(subsequently renamed, to no-one's great surprise, as the 787)
instead. Boeing had gone from being 100% committed to the 747X
to canceling it, and in less than two years repeated the process
with the Sonic Cruiser concept.
The 787 will replace both
the 757 and the 767 series of planes. The concept developed into
three versions - a standard version, carrying 200 passengers, a
stretch version carrying 250 passengers, and a short range
version carrying 300 passengers. Using the latest design
technologies and materials, the plane will be largely made of
composite materials, with very little aluminium. Because a plane
uses up a weight of fuel equal to 3% of its total weight every
hour it is flying, any saving in weight means a direct and
valuable saving in fuel. The 787's use of lighter composite
materials enable it to be more fuel efficient.
The 787 was originally promised to have
extra passenger comforts. It will be quieter, the windows will
be larger, the seats and aisles will be slightly wider, and the cabin will
have more air pressure (equivalent to a 6000 ft altitude rather
than today's standard 8000 ft pressurization) and with an
increase in air humidity from 5% to 20%. Of course it doesn't
require a completely new plane to introduce such extra comforts,
but it is wonderful to see a slow return to an improved
passenger environment as part of the 787's design.
Unfortunately, the airlines
discovered that, by amazing chance, they could choose to fit
either eight wider more comfortable seats across the plane, or
nine standard narrow seats such as are on most other planes
currently. The opportunity to increase passenger capacity
by 12.5% simply by cramming more seats into the available space
has proved way too tempting, and most 787s will now offer no
greater comfort than the planes that went before them.
The 787 will also use the
latest and best new jet engine technologies, enabling further
fuel efficiencies to be developed. In total, the 787 is claimed
to offer airlines about a 15-20% reduction in fuel consumption.
This is of course a good
thing, but it is evolutionary, not revolutionary. And to put it
in perspective, fuel costs are only about 10% of the total costs
of an airline.
However, a weakness of the
787 is that much of its promised savings come from the new
engines that will be fitted to it. Airbus not only disputes the
basis of Boeing's claims for extra efficiency in the 787, but
has of course also said that it will arrange for
the same engine technology to be applied to its planes (this
article is well worth reading). If so, then most of the claimed
advantages of the 787 are immediately lost!
Sonic Cruiser or 7E7 - Why not
Simplistically, Boeing found
itself with two choices - the Sonic Cruiser, that would have the
same fuel consumption as present planes, but fly 15-20% faster;
or the 7E7, that would fly the same speed as present planes but
use 15-20% less fuel.
Why choose only one or the
other? Why not develop both planes at the same time? Boeing did
this before with its 757 and 767 program. Why not repeat the
Boeing Ignored Airbus at its
Boeing has for too long
chosen to ignore Airbus, and even to mock Airbus, or to pretend
a complete lack of concern about Airbus. Sometimes it has also
alleged that Airbus is an unfair competitor because it received
government handouts from EU governments.
It is true that Airbus has
received substantial government support in the past, although
this probably no longer occurs. And when Boeing accuses Airbus
of this, it chooses to selectively ignore its own massive
government support, which it receives in the form of getting
much development work funded by Defense contracts. For example,
both the 707 and 747 were spin-offs from military projects. And
Boeing's new 787 project is benefiting from, amongst other
things, a $3+ billion package of tax cuts and incentives from
the State of Washington so as to induce Boeing to assemble the
plane in WA.
After adopting the stance
for many years that Airbus was too small to take any notice of,
Boeing now pretends it doesn't care. For example, in
September 2003, Boeing VP of Marketing for Commercial Aircraft
Randy Baseler said, speaking of Airbus,
What do you mean by market leader? Do you mean who can
deliver the most discounted airplanes? If that's the case,
then okay, Airbus wins.
Doesn't this sound familiar?
It sounds just like the comments of Boeing's clients, the
dinosaur airlines, who all pretended not to care what lower cost
airlines were doing, and now are suffering massive losses and
reduced market share as a result. The ability to deliver a lower
priced plane of comparable performance to its competitor is a
key parameter for marketplace success.
Boeing has been losing
massive market share to Airbus in almost all markets, and all
Boeing can do is to sneer at Airbus as being a supplier of lower
priced airplanes (as if that is a bad not good thing!) and say
'then okay, Airbus wins'???
And in December 2003,
responding to the news that Airbus was delivering more planes
than Boeing that year (more than 300, compared to a Boeing
target of 280), Boeing spokesman Tom Brabant made the following
[Airbus] may have more deliveries, but what does that mean?
In an industry that has two large manufacturers, if you're
looking at deliveries, some years Airbus may deliver more,
some years Boeing may deliver more. What matters most is
making airplanes that passengers prefer to fly on and
providing value to our airline customers.
Let me explain to Mr Brabant
what that means, seeing as how he is asking the question. It means
Airbus is making the airplanes that passengers prefer to
fly on, and providing value to its airline customers - which
just so happens to be what he went on to say is what matters
This event represents the
first time, ever, that Airbus has exceeded Boeing's annual
deliveries. Only three years ago, Boeing was delivering twice as
many planes as Airbus, and now Airbus is delivering nearly 10%
more planes than Boeing, and with 36% greater forward orders.
And it isn't just a one-off
random thing, as he might wish. Airbus' order backlog stands at
1,500 planes compared to only 1,100 aircraft for Boeing. Airbus
will continue to deliver more aircraft per year in coming years.
Boeing needs to ask what
this means? It is time for Boeing management to take their heads
out of the sand and stare at the reality that has overtaken
The Total Death of Innovation?
In August, a Boeing
spokesman was proudly claiming the 7E7 would last until the
The plane is projected to
first fly in 2007. It is replacing the 757 and the 767, which in
turn replaced the 707 and 727. These planes were in production
for 21, 20, 21, and perhaps 22 years. Let's say that the 7E7
stays in production for 30 years, meaning that the last plane
will roll off the production line in 2037.
Are Boeing seriously
claiming that any airline will be flying a 63 year old plane in
the year 2100? How many airlines do you know, today, that are
flying planes built in 1940!
It is rare to find a plane
that is 30 years still being flown.
Maybe, when Boeing predicts
that 7E7s will be still flying in the 22nd century, it is
suggesting that it will be producing 7E7s for 63 or more years. Which, in turn, begs the question - what plane has been produced
continually for 63 years? Of course, no planes have had that
long a life.
It is impossible to
understand the logic of this statement from Boeing. But it
certainly doesn't sound like a positive promise of ongoing
development and innovation.
What Boeing Must Do to Survive
Boeing speaks proudly about
its past 'gambling the future of the company' on new airplane
designs. Both these gambles (707 and 747) were brilliant
successes. Ironically, Boeing is now gambling its future because
it is no longer taking risks with new bold innovative airplane
Spending less money on
development means that, short term, there is a boost to
corporate profitability. But this short term boost, no matter
how alluring it is to Wall St and short sighted managers, comes
at a grave cost - the erosion of Boeing's future market standing
and market share.
If Boeing wishes to remain a
viable airplane manufacturer, it needs to turn away from the
temptation of short term profit and invest enormously in risky
new airplane developments. It needs to come up with a plane that
is tangibly different to all other planes in the sky today. The
787 is not that plane. The 787 is a catchup plane, not a
revolutionary new type of plane. The 707 was revolutionary, the
747 was revolutionary, the Airbus A380 will be revolutionary.
A revolutionary plane could
be a supersonic plane (a minimum of perhaps 50% faster than
current planes and preferably twice as fast). There is a
definite need for speed on long-haul journeys.
A revolutionary plane could
be one that offers massive new economies. Such a plane would
almost certainly not be a traditional long narrow fuselage with
wings and tail - that technology has been pushed about as far as
it can go. It might instead build on some of the 'flying wing'
research that was first done in the 1920s, with a blended wing
plane (the B-47 bomber) appearing in the late 1940s, and which
most recently can be seen in the form of the B-2 bomber.
Boeing has done extensive
studies of such technologies, and in 2002 released information
on a design that it had created with NASA's assistance
(illustration in part five). This 'Blended Wing Body' plane (BWB)
would carry 480 passengers. It would use an incredible 32% less
fuel per passenger mile than an A380, be 19% lighter (= cheaper
to build) and require 19% less engine power, meaning cheaper
engines and less pollution. Almost certainly, the extra
development to evolve this from a prototype concept to a
production model would see even greater savings and
Alas, it appears that Boeing
Commercial Airplanes CEO Alan Mulally refuses to consider this
as a potential area of development, and won't even allow the
person who headed the research program to brief him on its
results! Has Boeing become a black hole that sucks in any
innovative concepts and causes them to vanish without trace?
concept is the 'Wing-in-ground' type vehicle which is a cross
between a plane and a hovercraft. It uses the 'ground
effect' to provide a very efficient lift at a very low altitude
- perhaps no more than 10 feet. These vehicles would
travel on the water at speeds of about 150 mph and provide a
very fast and efficient means of transporting freight and
possibly passengers too.
The plane is in development
- but in South Korea. In 2005
it was announced that planes may be placed into production
as early as 2010.
A revolutionary plane will
almost certainly look different to the airplanes of today - I
can't tell you how it will look, only how it will not look. We
already know that the next revolutionary plane is an Airbus, not
Boeing plane (the A380) and at this stage, there is little
reason to hope that the one after that will again be a Boeing
Update, May 2006 :
interesting piece in the Seattle Times (often a good source
for Boeing gossip) about various doodlings and developments
Boeing has been looking at. Encouraging? Not really.
None of these concepts seem to have the funding that would be
needed to take them from drawing board dreams to production line
Update, March 2007 :
At last, it
appears Boeing is starting to do something with BWB type
aircraft, albeit at glacial speed - a military version may be
deployed by 2022, and a passenger plane by 2030.
Boeing is a once great
company that could become great again. But to do so, it will
need to change its ways, and to once more 'bet the company' on
an innovative new type of airplane.
This is not urging an
irresponsible approach and suggesting money should be spent
foolishly on wildly impractical projects. It is a necessary
approach, requiring willingness to move beyond 'conventional
wisdom' and to 'think outside the box'. For example, it seems
that one of Boeing's biggest worries about a BWB design is that
passengers would not have windows to look out. Just how much
window do they think passengers in the middle block of seats on
a wide-body plane get to enjoy at present? This is not a reason
to abandon the entire revolutionary concept and the massive
benefits it offers; it is just a minor issue to be surmounted.
In the past, when confronted
with a problem, Boeing would see it as a challenge and a reason
to try harder and triumph. At present, when Boeing is confronted
with a problem, it seems to see an excuse to give up.
Until Boeing reverses this
situation and becomes once more a bold pioneering leader, it
will face continued declining market share. Its sales will be
reduced to tactical and 'sympathy' orders from airlines
reluctant to let Airbus become the sole provider of commercial
airplanes in the future.
Read more in the rest of this
five part series
Part 1 : Boeing's early
Part 2 : Boeing's best
Part 3 : Boeing in decline
Part 4 : Does Boeing have
Part 5 : Key facts and
figures about Boeing, its planes, and its competition
If you liked this, you might also enjoy our multi-part series 'Airbus
Fires the First Shot in the New A320/737 War with Boeing'.
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26 Dec 2003, last update
28 May 2011
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