The Next-Next Gen

The order for what has been dubbed the ‘737RE’ will be confirmed once the Boeing board approves the launch of the new model narrowbody. That is currently expected to take place during the fourth quarter of the year, with the airframer currently finalizing the configuration and finer details of the aircraft in the meantime. At this stage, it is expected that the first delivery will be in the middle of the decade.

About the only detail that has been released is that the sole engine option for the new aircraft will be the CFM International LEAP-X engine, which would deliver 10-12 per cent gains in efficiencies over the current 737NG series. The LEAP-X is also one of the options on the A320NEO, and has also been chosen to power the 150-seat COMAC 919 aircraft being developed in China.

There are likely to be other modifications to the aircraft to accommodate the new engines, as well as other minor aerodynamic enhancements. In particular, there is strong speculation that the aircraft’s landing gear would need to be redesigned in order to give the right amount of ground clearance for what are expected to be larger engines.

Although such modifications could pose technical challenges, Boeing CEO Jim McNerney told reporters during a recent conference call that these were manageable. “We do have confidence that CFM can produce the engine, and we see very manageable risk on incorporating it into and integrating it into the airframe,” said McNerney.

“We are confident that our re-engined 737 will maintain the value proposition we have in the marketplace today, and we expect to see strong demand for this product. It will be the most fuel-efficient airplane in its segment and have the lowest operating cost while also meeting customer needs for range, payload, standardisation, reliability, and fleet compatibility,” he added.

It is understood that the goal is to deliver a fuel burn that is two per cent less than that projected by the A320 NEO. Boeing already claims that is the margin of difference between the 737NG and current generation A320. The new engine is also expected to give a significant boost in range for the 737, and could put it in the frame to replace the 757 with a number of US and European carriers which have used 757s on long-ranging but low-loading routes.

Many commentators have been quick to point out that Boeing has been forced to act due to the success of the A320 NEO, which has already chalked up orders and commitments for over 1000 aircraft within months of launching. Although most of those orders have come from existing A320 operators, Boeing faced the possibility of losing existing 737 operators to the NEO unless it acted quickly.

“It has always been our view that if it looked like we were putting meaningful market share at risk by waiting to do a new airplane, we would re-engine instead,” McNerney said. “That, combined with our new engine technical production assessment against leadtime for a new engine decision, led us to the judgment that we have made.”

“I think the significant economics that we can deliver with a re-engine are more highly valued over the next five to seven years than even better economics after that point,” he added.

Although it expects to see more sales activity once the aircraft is formally launched, a number of carriers have expressed an interest in the 737RE. These include former 737NG launch customer Southwest Airlines, while fellow all-737 operator Alaska Airlines is also seen as a natural target. Similarly, other major 737 operators such as Ryanair and Brazil’s Gol Linhas Aeras are likely to be sought out as early customers.

In Australia, Boeing is expected to push the 737RE to Qantas and Virgin Australia to ensure that they continue to operate 737s into the future. The entry into service during the middle of the decade could coincide nicely with the expected retirement of both carriers’ oldest 737-800s.

Working in Boeing’s favour is that both Qantas and Virgin still have 737-800s on order, with 20 and 57 still on the backlog respectively. That could allow Boeing to seamlessly roll over to the 737RE once the current orders are filled. Such a tactic has been used to good effect by Airbus to drive the early sales success of the A320 NEO.

In the case of Virgin Australia, the operating cost advantage and additional range for the 737RE are likely to make it a compelling case, particularly given that it already operates its 737-800s on long services to Denpasar and Phuket. Any buy of the 737RE from Virgin would then likely force Qantas to follow suit, or face being at a disadvantage to its growing competitor.

It is expected that A320 operators, such as Air New Zealand and Jetstar would be much harder to convince. Although the two carriers have orders for current generation A320s, Airbus is expected to also put forward competitive proposals to gradually replace those with the NEO.

In the case of Jetstar, its hand may be forced by the major order AirAsia has placed for the A320NEO, which could see its Asian operations at a competitive disadvantage against its ambitious rival. Interestingly, two years ago both carriers entered into an agreement to jointly specify a new narrowbody aircraft, but this appears to have fallen by the wayside.

Waiting for the future

With both Boeing and Airbus now committed to re-engining their existing narrowbodies, it appears that the timeline for a new small aircraft has been pushed out until the at least the late 2020s. That could see some radical new designs emerge, particularly as new engine and airframe technologies develop.

On Boeing’s part, the 737’s eventual replacement is likely to feature a twin-aisle configuration, which it has a patent previously patented. While likely to be considerably shorter than existing narrowbodies, a dual-aisle replacement is likely to have a faster turnaround due to the more efficient movement of passengers on and off the aircraft on the ground.

Another possibility is that the manufacturers could consider more radical fuel-saving alternatives, such as open-rotor engines. Although the technology was trialed by McDonnel Douglas in the 1980s and shown to have great potential fuel savings, concerns about the safety of an aircraft should one of the rotors fail in-flight have largely restricted them to the drawing board, but given likely advances in technology it may gain a serious look in for a new aircraft design.

With both Boeing and Airbus now offering new engine alternatives, some analysts have started to sound the death knell for other new narrowbodies which have launched with LEAP-X or Pratt & Whitney’s PW1000G geared turbofan engines.

The greatest threat is likely to be to the LEAP-X powered C 919 and the PW1000G powered Irkut MS-21 which are both being touted as alternatives to the Airbus and Boeing narrowbodies. With both airframers now committed to offering the same generation engines, these aircraft are now likely to only be sold to carriers where political pressures apply.

In particulary, some analysts believe that the Bombardier CSeries could be directly threatened, particularly if Boeing chooses to offer the new engine on the smaller -600 and -700 variants. However, recent market trends seem to suggest that most operators will favour the larger -800 and -900ER models, with the latter particularly expected to be the natural replacement for longer-ranging Boeing 757s with some carriers.

Nevertheless, it appears that there at least one carrier, Qatar Airways, is open to operating the CSeries and A320 NEO side-by-side, even though it has yet to formally order the CSeries. Given that the CSeries has been optimized for the 100-130 seat category, there is definite potential for other carriers to do the same.

Interestingly, Embraer has not yet ruled out pushing up further into the airliner market, with the Brazilian airframer recently reported to be examining a 130-150 seater aircraft, which would be lighter and shorter-ranging than the long-range CSeries, 737RE and A320 NEO. Options under consideration include a further stretch to the E-Jet series with new engines or a new design. Embraer is also expected to decide on this by the end of the year whether to proceed down that track.

With Boeing now joining Airbus with a re-engined offering, Bombardier and possibly Embraer also entering the fray, the narrowbody market over the next decade is shaping up to be every bit as competitive as the past decade. And as technologies in materials, aerodynamics and engines advance over that time, it will be interesting to see what designs will emerge once the 737RE and A320NEO reach replacement time.