Extra, extra

SINGAPORE — I’m here for the big air show this week, and I know there’s going to be a lot on people’s minds not only here at Singapore, but as I travel throughout the year. No doubt one of the major topics for discussion will be the future of a very capable airplane which happened to have an outstanding year last year - the 777.

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Orders … Jakarta-based Garuda Indonesia announced an order for 4 777-300ERs at the Singapore Air Show today.

Boeing had 141 orders for the 777 in 2007 - and now has a total of 1,050 for the program to date.

The 777 has a growing customer base, now at 55, including 6 new customers in 2007 - and a total of 17 new customers since January 2005.

Yet, even with the success of the 777, people will continue to ask, “Randy, how will the 777 do against the A350?” And my answer, as we plunge ahead in 2008, is that I see the same fundamentals in place now as I did last year.

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And a delivery … Last week, KLM Royal Dutch Airlines took delivery of its first 777-300ER.

Let me first say, I think Airbus is going to continue to be a formidable competitor, for sure. But I also expect the 777 to continue to do well in the marketplace.

Here’s why: First, given the strength of the 777 today, with a very high quality customer base, we think this airplane will continue to produce new follow-on orders as we saw last year.

Second, the 777’s efficiency and dominant position in its class will continue to attract new carriers who are seeking to grow existing markets, to open new markets, or to compete with current 777 operators.

And we haven’t even talked about the wider, more spacious 777 passenger cabin - which in the case of the 777-300ER, will actually carry more passengers. Two out of three A350 models are claimed to be “777 sized,” but the A350 cross-section is actually about a foot narrower than the 777.

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The 777 cabin provides flexibility for airlines to earn revenue with either wider seats and aisles or more seats in each row. So, for example, when comparing “like comfort” it’s important to use a 10-abreast economy configuration for the 777 versus a 9-abreast economy configuration for the A350. (The cross section detail above is our best estimate based on the data that Airbus has provided in public presentations.)

The 777 is in service now, and it is performing extraordinarily well. Because of its remarkable service record it enjoys strong respect from the industry - which widely regards it as the benchmark in its class. So, it’s respected, proven, and low risk. And it has a heritage of continuous improvements: the airplane that will deliver in the future will more than likely be even better than the airplanes that are flying today.

There’s been a great deal of talk about the performance attributes of the A350. Well, I’d say that when it comes to the economics and the range of the A350, there are still a lot of questions.

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Airbus has been changing the range capability of the A350-900 and A350-1000. The 777 airplanes provide proven range.

What we have noticed, as you can see in the chart above, is that the competitor’s statements on the range of the A350 have changed over time. Fact is, the airplane is yet to be defined. The 777 more than likely flies as far as, if not farther than, the competition will be able to.

Yes, the competition on the horizon to the 777 is the A350. But that offering is still 6 to 8 years from entry into service according to Airbus’ announced schedule. The 777 will not be standing still. It will - as do all Boeing airplanes - benefit from continuous innovation and improvement. So a 777 delivering 6 to 8 years from now will benefit from this Boeing practice of improvement and innovation.

And there’s another key consideration that potential 777 operators will discover as they evaluate the choices. The 777 is so efficient even today that a choice for the 777 made 4 to 5 years before an A350 becomes available will provide the opportunity to generate a significant profit advantage over the typical life of the airplane relative to waiting for an A350.

So how will the 777 do? As the newsboy in those old movies used to say, “Extra, extra, read all about it!”

And now, let’s get on with the show.

Comments (28)

Chris C (South Africa):

Simply an excellent article Randy! Clearly, the Boeing 777 is a formidable airplane, and indeed, as you quite correctly said: It is respected!

daMacNut (Encinitas, CA):

The Boeing 777 is an established, formidable competitor in this segment, arguably without equal.

When the A350 arrives, the Triple-Seven will benefit from continual advancement in powerplant technologies which, like the 747-8, will further extend its longevity.

As the ol' saying goes, "if it ain't broke ... don't fix it!" ... truly applies to this magnificent aircraft.

Ed (Dublin, Ireland):

Randy, regarding range, its true that the A350 range has been adjusted as it has evolved, but this is typical for a new design, and the 787's range was also adjusted downwards in exactly the same way. Also, for some reason the above chart pits the A350-900 against the ultra long range 777-200LR. Fact is that Airbus are aiming the A350-900 at the 777-200ER in terms of range and efficiency. There will likely be an ultra long range varient, currently dubbed the 'A350R' which will offer comparable range to the 777-200LR.

I believe that the 777 will continue to do well in the marketplace until the A350 enters service in 2015, and much of the 777's sales over the next decade will come from the 777 freighter. In fact I would go as far to say that there was never any need to launch the 747-8, as it has not materialised as a popular passenger aircraft and there is a case to argue that the bulk of sales that constitute the 747-8F orderbook would have gone to the 777F or the 747-400F, had Boeing not launched the 747-8 model.

Jim Bearnes (Dakar):

Nice (and predictable) comments on the B777. But the burning question really is "Will the B787 have flown before the next Singapore Show?"

John:

The 773ER is dominating the big 'iron' long haul class and will continue to do so for quite a few years until technology produces something superior.

The same goes for the GE-90-115B engine.

I'm still dreaming for that big unmanned Boeing freighter packing a couple of GE-90-150s.

Yep, -150s, as GE noted that the core has 'growth potential out to 150k lbs.

Gary (Fremont, CA):

The charts did not mention 772ER, while I think the major competition is in this segment.

Does that imply Boeing is going to do something to replace 772ER?

Paul Brennan (Wellington NZ):

Our airline is in love with the B777 having announced recently an order for 777-300ERs to go with the current 777-200ERs.

Surely at some point though the current 777 will be heavy compared to composite, this will have to be addressed.

Norman (Long Beach, California, United States):

I am glad that the 777 is still competitive today even with the A350 looming in the horizon.

I think that Garuda Indonesia's plan to renew it's
fleet will serve to meet the Indonesian government's
requirement that airliners older than twenty years
of age be replaced, the 777-300ER will be a good
replacement for the 747-400, the 787 to replace the
767 as well as gain new roots, and the 737-800 to
replace the 737-300 and 400.

Ever since Airbus has been trying to change the
shape of the the A350 the range has been rising and
ebbing.

If the Airbus A350 is supposed to be a nine abreast airliner similar to the 777 and is is twelve inches narrower than the 777 doesn't this make the A350 one foot more cramped than the 777, the ten abreast 777 is only the exception to the standard nine abreast 777 but the nine abreast A350 is not.

Chris Wallace (Seattle, WA):

Airlines are buying the 777-200LR not because it can fly 9000nm or or more, but because it can carry more payload the same distance a 777-200ER can fly more efficiently.

So I do believe it is legitimate to compare the 777-200LR to the A350-900 because the 777-200LR has outsold the 777-200ER since 2005 and a few carriers have converted 777-200ER options to 777-200LRs.

G Dixon (KL):

Nice 'plane. By commenting on the 9/10 abreast argument, I guess you are suggesting the economics of the 777 will be comparable with the A350. That would be good, but it is bean-counter territory and they may take a different view. Nice spin; sell 'em while you can.

Peter Long (Fremont Ca):

Randy, Boeing 777-300ER is dominating the twin long range market right now, and along with the 777-200LR. The Airbus A350 can't touch us. From day one, when Alan Mulally took on this project 10 years ago, I knew that we have a winner in our hand. Since the introduction of the Boeing 777, and it has been evolved into many different variants, ranging from freighter to passenger version. Keep up the good work. And keep the working together slogan going.... Now Alan is our CEO for FMC.... Without him, the 777 won't be possible....

Peter Mayer (Germany):

Yes the 777 will sell well in the next years, but it will never be a real competition to the A350XWB in terms of maintenance and trip costs/fuel efficiency.

Even with a update it won't be able to match it. Also the A350 will feature same as the 787, higher passenger comfort even at cost of a smaller cross section. Apart, the TrentXWB will be as big as the GE-90 but with a much newer technology.

I think it would be much wiser to develop a 787-10 as the 787 is an incredible capable plane.

G (France):

Here's an interesting new entrant in the blogosphere Openskies

They say, "We’re OpenSkies. And we’re building an airline".
They could have added, "We're an airline. And we're building openskies".

Open Skies & Aviation Services
The United States and the European Union signed a historic agreement to further liberalize air services, which will take effect on March 30, 2008.

Don (Mangalore, India):

Point to be noted Randy but its only a part of the debate, the 777 is a great aircraft! but it is pointless to argue about the 777 because within the next 10 to 15 years the 787-1000 & 787-900 together with A350-1000 & A350-900 would make the 777's obsolete because the 787's & A350 will be a new generation of aircrafts with better economics than the 777 until then the 777 will be the best seller in its class...

Buzz (Brazil):

And that's why Boeing is not going to replace the 777 in the following years (i.e. until 2015 or so).

But what I still don't get is why Boeing is so rumored to build the 787-10, which in theory could "kill" the 777-200.

So, what's Boeing going to do? 777 "enhanced"? 787-10?

I really agree with this message... The 777 is a great airplane and the numbers are there to prove it. Airbus isn't sure yet about what to do and orders haven't been so high for the A350XWB.

T C (Mt. Vernon, WA):

I would frame the competition for the next 8 years as between the 300ER, 200LR, A380, and 747-8i, for the 5000nm+ flights.
I'm betting on the success of the 200LR. If it proves to burn the least fuel per pound of payload, that will be the key factor, not it's longer range or it's smaller size.

Does Boeing need a larger CRFP section to compete with the A350? No, just a smaller 767 size CRFP section. Why compete when you could fill an uncontested void.

Reece Lumsden (Everett, WA):

I think the fluidity in the A350 figures is representative of the requirements not yet being locked in, which further indicates they're still very early on with the design. Once the figures solidify, this'll be our indication that Airbus is further along in their design of the A350.

P (France)::

Are the CFRB fuselage barrel wrappers expandable to make increased diameter fuselages for the 777NG.

BA were the loudest whiners against Open Skies and now they are calling their product OpenSkies and launching it in the face of a recession!!

Dan:

The 777 certainly is a great plane and certainly the current market leader in its category. But it doesn't make sense to talk about fuselage widths without considering seat widths, which is mostly the width which counts to an airline.

The majority of operators fly the 777 with 9 abreast in economy, which gives an 18.5 inch seat. That's really far too wide for an eco seat, which I guess is why the 787 in 9ab has only a 17.2 inch seat. It seems to me that the 787 architects took a look at the 777 width and concluded it was unnecessarily wide.

Wasted width clearly means a less efficient airframe. Together with the technology gap, that's what'll hurt the 777 as soon as there's any aircraft around to replace it, be it a Boeing or an Airbus.

Chris C (South Africa):

Naturally, the cabin dimensions of commercial airplanes, be it the width of the cabin, aisles, seats, headroom height, over-head baggage space, openness of the cabin, size of the galleys etc., are all important factors to take into account when opting for a new airplane.

The 777’s cabin width is ideal for all operators looking at replacing/supplementing their 747-400 fleets as the airplane can easily accommodate 10-abreast seating, with the same comfort levels as the industry standard 747-400, all while offering unique spaciousness and convinces such as over-head crew rest facilities, which was pioneered on the ‘ageless’ 747-400.

Cathay Pacific Airways was one of the 777’s Working Together working group airlines that was instrumental on pushing the fuselage size of the 777 close to that of the 747, for example.

Roger:

The 773ER and the GE90-115 are a winning combination and engine exclusivity was a prudent choice.

Ivan Charvat (Oakville, Ontario, Canada):

The big point you didn't address is fuel consumption, and fuel cost.

The 777-300 ER runs 115,000 lb thrust engines and the biggest A350 will have 95,000 lb thrust engines.

As a rough estimate, the A350-1000 will deliver at least 20% fuel cost trip-savings, and this is going to be a real big deal in the future as oil gets ever scarcer and more expensive. This difference alone will kill your plane stone dead!

Your company had better radically lighten your airframe and chop those engines down in size (or use the same engines for at least 15% more passenger load than the biggest A350). Its a simple as that. No-one will buy a "thirsty" airliner in the next decade. What is "best of breed" now, will no longer be so, 5 to 7 years from now.

Rob:

The 773ER will continue to sell well as it does not have an equal competitor and has barely reached it's sales plateau.

Timing is everything in this game and I believe that Boeing will continue to be the sales leader in this size of airliner class.

I doubt very much if the A350-1000, which is still very much a paper airplane will deliver 20% fuel savings. Not with triple spooled RR engines as their fuel efficiency drops off after 2000nm.

GTF Pratts or upscaled GEnx engines would provide superior fuel efficiency to RRs.

Navtej Kohli (UK):

Ivan I completely agree with you regarding the fuel consumption and fuel cost. Inspite of that many companies are shifting towards Boeing 777. Airline Garuda is spending $2 billion to convert 6 of its planes to 777.

Chris Gibson (Australia):

Let's wait and see. Remember Airbus "paper planes" always fly higher,faster, carry more people, and are cheaper to run than Boeing. The 777 is an great aircraft and will be the market leader well into the next decade.

Adam (Colorado Springs, CO):

Ivan, your concept of max engine thrust vs fuel consumption is incorrect. Just because an engine has a higher maximum thrust output does not mean that fuel consumption will rise in direct proportion. While a larger engine will be slightly less fuel efficient, it is nowhere near 20%. Remember, these engines don't run at there maximum rated thrust for most of the time. For example, if you need 40,000 lbs of cruise thrust, both engines will simply be throttled back to that thrust level, with differences in fuel consumption being insignificant.

The biggest advantage of a more powerful engine is a higher MTOW (Maximum gross Take Off Weight), meaning you can carry more passengers and cargo for additional revenue. What really matters is the total cost per passenger, which is why the 777 is so popular. The 777 is very fuel efficient, as well as having very powerful engines, allowing to carry large numbers of passengers. It essentially has the best of both worlds, and is a major key to its success.

Steve (Siggenthal Station, Switzerland):

I think a few items may have been overlooked in the cabin width debate.

A. If (or when) Boeing does a CRFP 777NG the inside cabin width will likely grow, even with the same external barrel diameter, as the CFRP technology appears to offer "thinner walls", by a few inches. Thus a 10 abreast seating 777NG could likely provide the same seat width (17.2in) in Eco, as the 787 9-abreast seating, if not actually a bit more. Keep in mind that the present 777 has 17.0in seat width at 10 abreast, and all you need to add is 2 inches to get to a 17.2in average. There may even be an extra inch or two to increase the aisles a bit.

B. The commonality of cargo containers/pallets, with the 747, is a very nice benefit of the similar barrel diameters. It's a great selling feature of the 777F, since over half the worlds air cargo is moved on 747s for at least part of the journey. Also, all the present 777 containers would be reusable on a similar size 777NG.

C. The 777NG's "747-like" diameter may allow the same form of "above cabin" bedrooms, or meeting rooms, like the 747-8i, if the same techniques are used to move all the "systems" from this area.

I think I would place my bets on any future 777 versions maintaining the same outside diameter. There's no good reason to change and a lot of good reasons to keep it the same.

Wessel (Oss, Noord-Brabant, The Netherlands):

Wel, I think that Boeing will come out this race better. The 777-200LR and the 777-300ER are great planes and are almost the cleanest aircraft looking at the range. The 747-800I is a cleaner. I've heard that Boeing is designing an upgraded 777. If there smart, they will make carbon fuselage barrels. Als they could ask GE to make the GEnx 3-b. The cleaner and more efficient GE90. By the time the A350 is built, the 777 will still lead. And looking at the Law of the handicap of a head start, the 797/777-900\1000 will be better than the A350. And hopefully the fonds will turn there backs at airbus.
Please answer at my mail adres Randy!

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