While the competition between them is primarily responsible for spurring the NEO versus MAX reengining contest, Airbus and Boeing are mindful that others want to break open their market dominance. Not since McDonnell Douglas merged with Boeing in 1997 has there been anything other than a U.S. versus European contest in the narrowbody market. So far, the competitors have not produced a single airplane, but they are on their way.
The most established figure among the challengers is Bombardier and its CSeries. Airbus has been disdainful of the Canadians; Boeing has mostly ignored them. The CSeries challenges the Airbus A318, a negligible seller, and the A319. Against Boeing, the CSeries is an alternative to the 737-600, but that two-class 110-seater has not taken an order since 2005 and will not be updated in the MAX series, so the challenge exists mainly if it is assumed that Bombardier is looking at the initial CSeries as a stalking horse for larger aircraft to come. Bombardier says it has no such intentions.
Instead, the better-known Canadians are happily pursuing the niche sub-150-seat market. So it is the Chinese and Russians who have the larger agendas. As yet, they have not sold outside their domestic turf and their programs have fallen behind schedule. But that is hardly a disqualifier since Airbus and Boeing are famous for that.
Comac's entry into the narrowbody race is taken most seriously because the Chinese government-backed entity has access to enormous resources and enjoys a single-minded focus, even if it takes some time to find its way. Says Wyse: “China is a credible entrant over the long term.”
The 2012 edition of Boeing's annual forecast gives ample evidence of why outsiders want to enter the single-aisle market. It says single-aisle/narrowbody aircraft seating 90-220 passengers will collect $2.03 trillion in revenues from the sale of 23,240 single-aisle jets through 2031. As such, they will account for 68% of the 34,000 airplanes that Boeing expects to be delivered over the next 20 years. The forecast says widebodies will bring in slightly more revenue—$2.08 trillion—but these larger, more expensive aircraft will account for only 24% of sales, 7,950 aircraft.
In total, the global fleet will number 39,780 aircraft in 2031 compared with 19,890 in 2011, Boeing estimates.
The Airbus market analysis focuses on a slightly smaller pool, one that excludes 90-seat regionals. In its 2011 forecast, the most recent, Airbus predicts that single-aisles will account for 73% of the world fleet by 2030. Interestingly, by Airbus's reckoning, that represents a dip from the 78% total market share that narrowbodies held in 2010.
Attractive or not, the single-aisle niche is not easy to enter in no small measure because the duopoly's marketing strength is formidable. Airbus holds 1,425 firm orders for the NEO, a massive lead over the 451 that Boeing holds. The order uptick Airbus has achieved in only 18 months is unprecedented for any commercial jet, new or reengined. John Leahy, Airbus chief operating officer for customers, expects Boeing to claw back some of the gap, but he still projects the NEO will retain a 60% market share in the long term.
Boeing Chairman and CEO Jim McNerney says he is “highly confident that the historical market-sharing” will not change between the nearly 50:50 split Airbus and Boeing hold on narrowbody products. “I think when you look at the rate of acceptance of signed [memorandums of understanding] converting to orders . . . you may even see us out a little bit ahead of the adoption rate that Airbus had with the NEO,” he says. Former Boeing Commercial Airplanes President and CEO Jim Albaugh predicts 1,000 orders this year.
Putting that race aside, it is worthwhile thinking of the totals. Currently the combined Airbus and Boeing order ranking is for 1,876 new-engine aircraft, not counting the 550 that Boeing expects to add in 2012. That order rate underscores two trends.