American Airlines has kept its allegiance to Boeing while ordering its first Airbus narrowbodies through a massive order for 460 aircraft.
American has pledged to purchase 200 Boeing aircraft, spilt between current Next Generation 737 models and "Boeing's expected new evolution of the 737NG, with a new engine", which will be the CFM International Leap X. Deliveries of the current model aircraft begin in 2013.
The Airbus order includes 260 A320 aircraft with flexibility to convert its delivery positions into the A319 and A321. Deliveries of 130 current generation A320s start in 2013, said American, followed by deliveries of 130 A320neos beginning in 2017.
"Under the new agreements, American plans to acquire 460 narrowbody, single-aisle aircraft from the Boeing 737 and Airbus A320 families beginning in 2013 through 2022 - the largest aircraft order in aviation history," touted American.
Key to the deals is $13 billion in financing committed by Airbus and Boeing in lease transactions covering the first 230 deliveries.
Coinciding with American's revelation of the massive narrowbody order, the carrier posted net $286 million loss for the second quarter, and is the only major US network carrier expected to lose money for the April-June timeframe.
Here it comes the first "jump of the barricade".... long feared by Boeing...
Only Boeing, with its delays in taking a position on its narrowbody programs, can be blamed for this...
Boeing, the aviation circus can't stop and wait for you.... they did it for the 787, but they can't do that for a plane that is not even on the paper!
.... and the winner is......"CFM International" powering all the above aircrafts!
260 Leap-X1A (A320neo)
200 Leap-X1B (new 737)
260 CFM56-5B (A320)
200 CFM56-7BE (737NG)
920 engines, probably coming to 1000 if we include spares....
HAL,
Remember this is a decision that involves Billions in investment and will affect production for decades to come. Boeing wanted to see if they could justify the investment in an all new aircraft and it appears they can't. So be it. Both the A320Neo and the re-engined 737 will be built by the thousands.
And don't forget all of the delays and redesigns associated with the A350. The current proposal is a far different airplane than Airbus originally proposed and it is experiencing it's own multi-year delays.
Hunter,Yes, you are right, no doubt that the new 737 will be a best seller, I' do not agree on the business strategy followed by Boeing: the delais in coming up with a decision made the A320new success possible... or at lease of that size!They are late, and they are paying for it!The PAS2011 was expected to show to the world the "New 737".... and all know what it come out...Of course Boeing can take all its time to come to a decision, yes, but they should not expct customers will wait indefinitively for them.... with AA and DL running hundreds on MD80, with fuel prices rocketing up, Carbon Taxes discussions coming up all around the world... take your time, but don't expect customer will do the same.... that's basic business strategy.It is for me quite a surprise that AA ordered one hundred new-737 before the project formal launch.How can an airline sign a billion dollars order for a plane that doesn't have a clear performance datasheet or even a name?"Oh a new Boeing? Cool, ok!.... let's buy one hundred of that... mhmmm... that new stuff...."
American Airlines made a desperate move to offset the fact that they are the only domestic major to still be losing money. Their planes are some of the oldest and least efficient in the industry, that's why they aren't just ordering Neos or updated 737s, half of their order is for the less efficient current models of both aircraft.
As far as paper airplanes, don't forget the debacle Airbus had with the A350. Customers signed contracts for what was essentially a re-engined A330 with lithium aluminum construction and will end up getting a new design with composite panel construction. And that process was spread out over many months and included interim designs as well. Both companies have a reputation for delivering what they promise in the end and airlines are sometimes willing to make a leap that they'll get what they need. Of course that leap is backed up by contractual guarantees.
So where did the 737RE come from all of a sudden, sources say that only AA and Boeing knew about the 737RE Many airlines have asked Boeing about their plans for the 737 and have got nothing substantial from the company, and now we have a 737RE
Goose,
It looks to me that Boeing had to act very fast and prevent Airbus from taking the total AA order. Therefore the "new" 737RE
Boeing Board Next to Weigh In on Surprise 737RE, Re-Engine
Renton Paint Hangar P1 Reopening Ceremony as Boeing gears up production of its 737Back in February, when Boeing CEO Jim McNerney surprised everyone with his “bias” for a new version of the 737, more than a few people said it didn’t pencil out, Boeing was bluffing to steal some Airbus 320neo thunder, and would have to re-engine.
This week, the Seattle Times‘ Dominic Gates reported on Boeing’s “striking turnaround” to win back long-time Boeing buyer American Airlines from making an all-Airbus order:
Before anyone at Boeing knew about it, last month the airline signed an initial memorandum of understanding to buy A320neos, which will come with new fuel-efficient engines.
To head off that loss, within the last 10 days Boeing gave American a new proposal that offers the 737 jet equipped with similar engines, the sources said.
At the time the deal was announced, American said that orders with both companies were necessary because neither could provide the number of jets the company needed. Boeing would supply 200 narrowbodies: 100 Next Generation 737s and 100 of a new, re-engined 737, powered by CFM International’s LEAP-X engine.
Airbus would provide 260 of its A320s. Gates quotes the reaction of John Leahy, head of sales at Airbus: “If we had sold American 26 aircraft, it would have been a victory for Airbus because it broke Boeing’s 15-year monopoly.”
At Forbes, eyebrows are lifted at Boeing’s fire drill: “The re-engined 737 has not even been approved by the Boeing board,” complains RBC analyst Robert Stallard. (Directors will vote on the decision this August.)
Boeing, sounding a little like that British sketch about “the colonies we’ve still got,” listed the other American orders in the works:
The agreement builds on American Airlines’ existing backlog of 64 Boeing airplanes consisting of 51 737-800s, seven 777-200ERs (extended range) and six 777-300ERs. In addition, American Airlines has an existing purchase agreement with Boeing to acquire an initial 42 787-9 Dreamliners, with the right to purchase up to 58 additional 787s.
If the exact circumstances are embarrassing for Boeing, it’s more worrisome to hear Boeing Commercial Airplanes head Jim Albaugh admit that, internally, Boeing could not come up with a way to produce a new plane with sufficient speed: 40 to 60 per month. Their customers, waiting on 787s and 747-8s, can be forgiven a little concern over whether Boeing still knows how to ship a new plane on time and on budget.
You hear a little of that in Alaska Air CEO Bill Ayer’s phrasing when he says of the re-engined 737, “If Boeing can do this sooner rather than later this is a good thing.” If.
“Our customers wanted more efficiency now and certainty of delivery. We know we’ve made the right decision,” said Albaugh. It probably is, it’s just “regrettable is that it took an established Boeing customer to convince them that a response to the neo was needed in the near term,” Michel Merluzeau of G2 Solutions told Bloomberg. Fuel costs are killing airlines‘ profits, and you don’t need to be a rocket scientist to know that an engine is one of the major fuel-devouring parts of an aircraft.
Still, first things first. Boeing’s immediate goal is to clear a 7-year backlog of 737 orders, hopefully finishing up in time for the re-engined model to take off from airports near you around 2018. “The 737 program currently produces 31.5 airplanes per month and expects to go to 35 per month in early 2012, 38 per month in second quarter 2013 and then to 42 per month in the first half of 2014,” says Boeing.
Accomplishing that goal will do a lot to reassure buyers that Boeing’s 787 debacle wasn’t a sign of an organization that has completely lost its way. (Cue the McDonnell-Douglas haters.)
by Michael van Baker, The SunBreak, July 22, 2011
Gravity always wins!
Smoke and Mirrors, American's narrowbody order lacks substance
I came across this article in AWST and it surely puts a damper on the celebrations at both Airbus and Boeing.
The fanfare was loud and generated the desired attention, but now that the euphoria has subsided it is apparent that AMR Group's deals with Airbus and Boeing to overhaul American Airlines' narrowbody fleet are more wishful thinking than concrete achievement.
For one thing, there is no firm order for 460 aircraft. Under American's labour contracts - notably its agreement with the Allied Pilots Association - the carrier cannot add a new aircraft type, even a different variant, until a pay scale has been negotiated. From this perspective, American only has the authorithy for the 100 leased Boeing 737-800s it plans to add from 2013-17, while the remaining deals for both current model and new engine option Airbus narrowbodies, never mind the nonexistent re-engined 737, must now go through the rigors of employee approval.
Time is not on American's side. President/CEO Gerard Arpey may believe the deals will "be a catalyst" to jump-start stalled labour negotiations, but similar expectations from the operator's 2008 arrangement for up to 100 Boeing 787s have yet to yield an accord and that order still remains absent from Boeing's orderbook, despite a supposed 2014 first delivery date.
This aside, American's ambitious plan also calls for the replacement of its aging MD-80s and Boeing 757s (almost 340 aircraft as of July 20, 2010) in just five years, but offers no details on how it will integrate so many aircraft that quickly or even how many narrowbodies it eventually wants in its fleet.
The carrier also leaves open the idea that similary sized Airbus and Boeing aircraft could be assigned to similar operations, even the same route, but with no clarification on how or why, this would be implemented.
The aircraft order may be the saviour that Arpey and his management team have trumpeted, but for now, they appear to be the only ones to share that vision.
I would get my eyes checked and stop using my rose coloured glasses.
Darren Shannon AWST