Can Boeing compete with the Airbus A321neo? And does it want to? | KUOW News and Information

Can Boeing compete with the Airbus A321neo? And does it want to?

Sep 8, 2016

Boeing has a problem with its airplane product lineup, and its name is the Airbus A321neo. The A321neo is bigger and longer-range than the Boeing 737 MAX 9. As a single-aisle jet, it’s a different plane from Boeing’s next size up, the wide-bodied 787.

Airlines around the world are rushing to order the A321neo, which has posted more than 1,200 orders so far. And that leaves Boeing with a question: Does it need a new plane?

Some sort of answer appears to be in the works.

“Boeing is now calling it the new mid-range airplane,” said Scott Hamilton, an aerospace consultant. “Or NMA, which doesn’t quite roll off my tongue. It’s also known as the MOM airplane.”

MOM is for middle of the market. It would be the first new design since the 787 a decade ago. And no, MOM would not be its final name. 

The NMA plane would be a mid-range jet, like the Airbus A321neo.

But industry watchers expect there will be a large difference: It may be a wide-bodied plane, with two aisles to move passengers through planes faster. Then again, Bloomberg reports the opposite, that Boeing may stretch a version of its single-aisle 737 to go after the single-aisle A321neo's market. 

Boeing said it’s too soon to talk about what the plane would be.  In an emailed statement, a spokesman said, “If we do move forward, a new airplane wouldn’t enter into service until the middle of the next decade.”

Boeing also said it was too early to talk about where the plane could be built. Washington state had to out-bid other states for the 787 and 777x production lines, offering billions in tax exemptions each time.

Boeing used to have a mid-range, single aisle plane like the A321neo. It was the 757, which sold more than a thousand before Boeing stopped making it in 2004.

But a decade later, demand for air travel is exploding throughout Asia. A new middle class wants to travel. In a statement to KUOW, Boeing specified that the Airbus A321neo “is not a 757 replacement.”

One airline that recently chose the A321neo is the no-frills carrier AirAsia, which announced at this summer’s Farnborough airshow that it had ordered 100.

Chief executive Tony Fernandes said then that many Asian airports remain too small to accommodate big planes.

“With the infrastructure problems that exist in Asia, which will be eventually dealt with…there are slot control issues," Fernandes said at the news conference. “So we want to maximize all our slots. And really the A321neo is really a fantastic aircraft and we wish it had come earlier.”

The prospect of a new clean-sheet Boeing plane raises the question of where it would be built and whether Washington state would again be drawn into a battle of the states for the right to build it.

By the time it is built, there could be manufacturing capacity available in Everett. It depends on the fate of the 747 line. Production has slowed to half a plane a month and the plane has suffered a dearth of orders for years.

Analyst Scott Hamilton said the Everett production facility would be the logical place for Boeing to put the MOM aircraft.

But SPEEA, the union representing engineers at Boeing, said it understands that the company operates according to its own logic.

“It’s important for them to have a sense of rivalry between different locations,” said Stan Sorscher, a labor representative at SPEEA. “And the rivalry can be that the workers feel the potential to take work away from your location and move it to your rival’s location."

Sorscher said the engineers want the next round to be different, with performance conditions that ensure that jobs in the state are preserved. Despite winning the 777X line, Boeing has moved engineering jobs out of state.

Sorscher also said Washington’s results might be better if it started the conversation with Boeing sooner rather than later. “Try not to make important decisions under these high pressure circumstances where you have a special session in three days,” he said.

“It’s never too early to start talking about it,” said Richard Aboulafia, an aerospace analyst based in Washington, D.C. “And it’s absolutely essential from the standpoint of Washington state that they get this next new jet.”

Aboulafia said Washington state was successful in convincing Boeing to build its 737 MAX line in Renton without embroiling the state in a national competition.  

But Boeing hasn’t made the decision to develop the MOM plane, and Aboulafia said there are strong reasons not to do it.

Much of Boeing's development money is going to the 777X, so it is not the greatest time to start a new clean-sheet plane any time soon. He also said there needs to be a strong business case to build a twin-aisle, which is more expensive to build than a single aisle like the Airbus A321neo.

“If the market demands a response, we’ll be ready,” a Boeing spokesman told KUOW in an emailed statement.