Just days after taking the position of Chief Executive Officer of Boeing, David Calhoun has told the company to rethink what will come of the ‘797’/New Midsize Airplane (NMA).
The decision effectively sees Boeing shelving $15-20 billion in design and engineering plans; however this puts the company in a better position to address the 737 MAX crisis,also to develop an aircraft that better suits current and future market demand.
Calhoun suggests that the competitive playing field had changed, likely meaning that the highly-successful launch of the Airbus A321XLR, at the 2019 Paris Airshow, has resulted in too little market share left for Boeing to make the current ‘797’/NMA design worth it.
Airbus’ answer to the middle of the market question is a fleet pair of the A321neo and A330neo, however airlines have been interested in a single type with variants that can cover the role.
“Since the first clean sheet of paper was taken to it, things have changed a bit … the competitive playing field is a little different. We’re going to start with a clean sheet of paper again; I’m looking forward to that.”
Chief Executive Officer of Boeing, David Calhoun via Reuters
With the decision in place, employees working on the project have been tasked with studying the market, and speaking with airlines, to determine what aircraft is really needed.
Reuters notes that further evidence about the reassessment is brought to surface by the cancellation of a meeting with a potential major supplier, with no new date and time locked in place.
Additionally it is also understood that just weeks ago, Boeing was producing content for airlines outlining key features of the aircraft; with the working title “theNMA” and an advanced composite structure being used, according to slides seen by Reuters.
Whilst new aircraft generally take six to seven years to enter the market, Boeing has said that they aim to reduce this time to around five years; by using various digital technologies and a new business model that has the ‘797’/NMA as the central product.
Original market assessments and initial key design specifications were made about two and a half years ago, notes Calhoun, however the new study would see the company built on what has already been learned in design and production.
The original plan with the ‘797’/NMA was to produce an aircraft seating 220-270 passengers, to fit in between the 737 MAX and 787 Dreamliner. A launch was expected to occur last year, however the second crash of the 737 MAX placed the company in a fragile position; especially with delays already building on the 777X.
Since the 737 MAX crisis began, Boeing has been questioned about the ‘797’/NMA decision; the 737 is at the point where a complete replacement would be a valuable addition to the company’s portfolio and the Airbus – Boeing competition.
With the company recently seeking a loan of $10 billion to cover costs of the 737 MAX crisis, does shelving plans in favour of a new, evolutionary development make sense?
What are your thoughts on this development?