The games people play

AMSTERDAM - Greetings from the Amsterdam Hilton (where the Ballad of John and Yoko comes to mind). As I sit here, it gives me the chance to write about something that’s been bugging me for weeks. Over the holiday break, I had a chance to catch up on my reading. That’s when I came across some advertisements by Airbus on the A330 that frankly didn’t make sense to me. The recent ads, which were all over the trades and the Airbus website, claim when it comes to cash operating cost per seat, the A330 has a dramatic advantage over the 777-200ER.

When I first moved over to Boeing’s marketing department in 1989, I joined the Airplane Economics Group and had the chance to do some very detailed analysis of how our airplanes compared to the competition. I’ve lived and breathed the “economics” (both costs and potential revenue) of these planes ever since. That’s why I knew these Airbus ads didn’t ring true. I then went on a mission to find what would lead them to make this claim.

I soon discovered a chart Airbus previously used in public at the Farnborough Air Show. That chart (seen below) claims the A330-300 offers a cash operating cost per seat that is 15% lower than the 777-200ER. The Airbus chart also showed a seat count difference of only two. When I saw the chart, I immediately knew what was up— Seat Count Games.

image/photo

First of all, we all know the 777-200ER is an extraordinarily capable airplane. When purchased at its maximum capability (656,000 pounds maximum takeoff weight), it can carry a full load of passengers and bags 7725 nautical miles—almost 2000 more than the A330-300.

Second, the 777-200ER has at least 12 percent more area for seating. After adjusting for the 777’s wider seats and wider aisles, that means it can carry between 8 and 9 percent more passengers than the A330. Knowing this, I decided to run a true “apples to apples” comparison of their performance capabilities to arrive at numbers that are analytically honest.

In the example below, I used the following scenario:

  • Same trip length as shown on the Airbus chart (4000 nautical miles)
  • Same range capability for both (Boeing:580,000 pounds Airbus:507,000 pounds)
  • Same engine manufacturer
  • 9-abreast seating on 777-200ER (375 seats due to larger cross-section)
  • 8-abreast seating on A330-300 (344 seats due to narrower cabin)

When you crunch the numbers, the end result is dramatically different than what Airbus’ ads claim. What our competition says is a 15 percent operating cost disadvantage for the 777-200ER is actually a 3 percent advantage (see my chart below).

image/photo

Extensive research shows the 9-abreast 777-200ER is far more preferred by passengers than the narrower cabin, 8-abreast A330. The 777 has been voted favorite airplane to fly by readers of Executive Travel Magazine in 2008, 2009, and 2010. When it comes to comfort level, a 10-abreast seating configuration on the 777-200ER would be an even closer comparison to the A330, which grows our operating cost advantage to more than 7 percent.

We all try to market our airplanes by putting our best foot forward. But sometimes, the numbers just don’t add up. This is just another example of the games people play.

Comments (40)

Vasuki Prasad (Bangalore, India):

I appreciate your technical field levelling effort. Its nice to see people comparing apples to apples. Thanks Randy!

Just one suggestion though : Can you retract the 787 spoilers on your header image on this page? It would be nice to see the 787 climbing out with no restrictions whatsoever! :)

Stephen Jessup (Everett, WA):

Good response, Randy. Waiting to see if Airbus gets back to you.

Angel (Spain):

Good article Randy,

without a doubt the triple 7 is the best aircraft in its class. It's a pleasure to fly in.

Regards

Arlon Rosenoff (Renton, WA):

Great article. Our airline customers live by seat cost economics and it was really fun to read this comparison. Almost all of the international trips I have flown on have been on the 777. As a passenger, I love the airplane. Thanks.

ML (Kent, WA):

This is why I pay no attention to commercials and advertisements, and why my TV's mute button is over-used. It's criminal; there ought to be a law.

T. Hazari (Renton, WA):

Excellent response, Randy. Spot on with the 10 abreast story on 777 as well. We have seen a fair amount of customers over the last 3 years choosing 10 abreast instead of 9 in tourist economy on the 777. Cheers.

Andrew (Seattle, WA):

Yet another example of Airbus using shady tactics to gain market share... Boeing should start an aggressive "Truth in Advertising" campaign.

Paulo M (Johannesburg, RSA):

Guess what this post made me think of first?

Weight A Minute

The 777-200ER is a significantly larger & more capable aircraft than its direct competitors in the A330/A340 family. This means that the 777-200ER is built in such a way that it will carry greater payload than the A330/A340 on any given mission of comparable range. To support this capability, the aircraft has a higher operating weight empty (OWE) than either A330's models (stronger, larger structure) and higher maximum take-off weight (MTOW) - (more payload, fuel capacity potential). The 777-200ER is in fact a heavier aircraft than the A340-300. It outsold the A340-300 by an enormously huge margin. That then means it was sold on the merit of superior capability & efficiency.

But what then for those airlines in this world that do not have any focus on cargo? Well, the answer is the lighter, smaller structure of the A330. That plane, specifically, the -300 is about 12.5% lighter per seat -- OWE; 295 pax on the -300 & 301 pax on the -200ER -- as well as having a smaller volumetric cargo capacity, and a much smaller wing area, about 18% less.

Of course, this ignores the 12% more floor area - as you say. i.e. to reach seating space parity, either remove some seats of the -300 or add some to the -200ER.

hmmm... fun. Great linked tracks!

Sandy (Huntsville, AL, U.S.A):

This is a great article. Glad you called Airbus on their claim. I have never flown on a 777, but this really makes me want to do so if the opportunity arises.

Vero Venia (Montreal, Quebec):

That's an interesting comparison. But when you examine the A340 data in wikipedia, the A340-300 compares to the 777-200ER better than the A330-300 in term of payload-range.
Unfortunately, I don't know how the A340-300 compares in term of economics against the 777-200ER on a 6,000 nm trip.

Ron D. Smith (Everett, WA):

Good detective work Randy. The truth is in the details and you dug them up for all to see.

It's amazing how our competitor continues to resort to deceptive advertising. Any customer with operational expertise who also believes in Reagan's "trust but verify" approach will see through it. And when they do, someone's credibility takes a hit.

Timothy Barto (Renton, WA):

Excellent analysis Randy,

I cannot imagine an airline making a major purchase based a pocket brochure or newspaper advertisement – I’m sure they’d have a dedicated task force to study the operational economics, and so on… So it begs the question – who is the real target audience for this misinformation? And for what purpose? Hmmmmmmmmm.

keesje (Netherlands):

Hi Randy, great responds. The 777-200ER proved excellent performer specially on the long flights to Asia. That 3 percent advantage for the 200ER is even more amazing because of the additional 20t steel it flies around and it's more impressive frontal area! Rgds.

John Leake (San Jose CA):

Randy, great factual comeback to the partial truth people across the pond. Their chief cheerleader has never been shy about distorting facts and using them to his advantage. I for one discount everything that guy has to say.

Have fun certifying the 787, 747-8 and 747-8i this year, that has to be a big headache as well as meeting production commitments.

Daniel Tsang (Hong Kong):

I wrote an article before Randy voiced this concern here, which also included Boeing's response at the time.

Unfortunately, the coverage of my article is uncomparable to Randy's one and hence did not spur heated debates back then.

http://www.aspireaviation.com/2010/12/08/boeing-777-way-much-better-than-a330/

Most importantly, according to my sources at a major Asian 777 operator that is based in Hong Kong, only the 77A (777-200) has an inferior COC versus the Airbus A330, with every, EVERY other 777 variant's COC being lower than the A330.

Denis Zotov (Moscow, Russia):

The moment I saw the title, I was expecting a link to Alan Parson's "Games People Play" (http://www.youtube.com/watch?v=-BR6NJlk1_A) but this song by Joe South fits the post much better.

Neil Doh (Bothell, Washington, US):

I pity the Airbus sales force. They have to go this low because their products can't stand against Boeing's Higher Performance Airplanes.

Even the B-767 beats out the A-330 for the USAF tankers.

Sergey (Moscow (Russia)):

Something doesn't add up Randy...
If your analysis made sense, then why -200ER backlog is only 14 airplanes while Airbus has 140 -300s to be produced?

I guess you have to introduce the DOC comparison to find the truth...

Ed (Dublin):

Its a pity you wont do a similar comparison on the A380 Vs 747-8 intercontinental. Boeing runs its seat cost comparisons with 467 seats on the 747, a wildly optimistic number! Airbus states the A380s average seat count at 525.

Lufthansa is putting 386 seats in its 747-8's and has 526 seats on its A380s. Under such standard seat count numbers the A380 has at least a 5percent+ advantage over the 747-8 in fuel burn per seat.

Christopher Dye aka CubJ3 (Plainfield, NH):

The one problem Randy does not address is why the
A333 is selling and the 772ER is not. Paulo M points to the answer: The airlines that buy the 333 do not need the ER's superior payload/range performance. The 333 fits very nicely into the fastest growing avpax mkt area in the world, the intra-Asian mkt. This includes RT between E. Africa/Persian Gulf to India, SE Asia and Australia; and the Japan/Korea/China/Thailand/Singapore/Indonesia/Australian mkt.

PS Verovenia, do you still have your blog? What's the address?

Syed Kadri (Houston, Texas, USA):

Good work Randy. I remember when this airplane was being built a lot of input was taken from the Customers and incorporated into the design.
As a result it has many creature comforts.
I was very eager to fly on it, I got the opportunity when Emirates became one of its major Customer. Since I fly this airline quite a bit, I got to experience this beautiful aircraft first hand.
Enjoyed every bit of it.

Grace Hotchkiss (Seal Beach, CA):

Thank you for posting this. It is great to have quick opportunities to understand more about the business environments across our products.

Mike Goldberg (Bellevue, WA):

It is no surprise that Airbus/EADS Marketing uses bogus numbers in trying to justify their comparisons. (I can hear their voices in the background, "Government support? We don't need no stinkin' gov't support! [Well, we get it anyway, but so what!])
But I'd really like to thank you for that great link to what is (IMHO) one of the best Beatles songs, the Ballad of John & Yoko. I am especially pleased that being in The Amsterdam Hilton reminded you of it. 777-200ERs are excellent aircraft indeed, but it is nice to know the Executive team has other interesting things on their minds, too!

Kevin (Los Angeles, CA):

True that some markets/routes favor the A333 over the 772ER, and some airlines do operate both.

Then, the same must be true of 748I vs. A380, and that's why LH and KE will be operating both types.

Curt W (Everett):

I believe the 787-9 is taking sales away from the 777-200.

TC (Mt. Vernon, WA):

As long as Airbus is making illogical comparisons, why not show the cost per seat on the 7000nm New York to Hong Kong route. The 333 costs might not look good spread over a handful of seats.

Anyway, the 333 and 767 mid size, mid range aircraft still face no new optimized competition.

Thiagarajan K Rengasamy (Kuala Lumpur, Malaysia):

Top Marks Randy!

Did a good analysis.

Norman (Long Beach, California, United States):

I am sure Airbus did not anticipate that their analysis would be scrutinized, I wonder what they have to say to their defense if any.

Sergey (Moscow (Russia)):

>I believe the 787-9 is taking sales away from the 777-200.
It's rather A330-200 which is taking away the B787-9 sales.

Tom (Germany):

Randy,

what's wrong with the 777-200(ER)?
I think the A330-300 is not so noisy!
If there are about 300 pax - the A330-300 is the better choice.
If there are about 350 one may check the 777, the 777-300er.
Quite simple!

Tim K (Ont Canada):

Anybody that deals with numbers knows that they are open to interpretation by the person or company that is presenting them. Marketing and sales departments do this all the time by trying to apply smoke and mirrors to their numbers to make a point and we just witnessed a classic example between Airbus and Boeing. In this case both are technically correct in their mathematics but the slight of hand happens in how they apply it in their arguments.

Airbus is clever in using their midrange 330-300 against a heavier and longer range aircraft for comparison. They should have stopped with the baseline 777-200 but they understood that by using a standard common seat count (which is actually the correct way to do it) they could make the larger and heavier plane look bad in the numbers comparison. Boeing counters by upping the seat count to a very unrealistic figure (375, most airlines that fly the 777-300ER don’t even have that many seats) and saying that their product is superior when compared their way.

Unfortunately it is up to the consumer to learn to look beyond the exaggerated truth and just look at the facts that are being presented and remember that both companies like to play the numbers game and in fact they do it very well…

Daniel Tsang (Hong Kong):

Dear Randy,

I'm just curious at Boeing's calculation, including what Boeing has provided to me previously, whose link is attached above.

Is the A330-300 variant used in Boeing's comparison the A330-300E (Enhanced) version that features Rolls-Royce Trent 700EP and improved fuel efficiency and range?

If no, would you please talk about the figures relating to an A330-300E/A330-200HGW versus 777-200ER comparison?

Notwithstanding this, I believe that the A330-200HGW nor A330-300E can even match the 777-200ER's payload performance.

Thanks a lot~!

Hughston (Australia):

I would like to know how the cargo lift/capacity of these two aircraft affects the figures. The revenue from bellow the seats must also have a big effect on the longer range flights.

Russel Ahmed (Dhaka, Bangladesh):

Excellent Comment shown by THE BEST BRAND AVIATOR RANDY. My first appreciation is that BOEING always proved the best when cost per seat economics is being calculated. 777-200ER always a promising option for the airlines when revenue is the only magnitude for airlines marketing intelligence. Being an aviation freak, I must say Airbus should put highest consideration before submitting any info regarding DOC of specific aircraft like A330-300 or A330-200. I MUST ADMIT THE TRUTH.....BOEING ALWAYS PROVED THE EFFICIENCY OF AN AIRCRAFT LIKE 777-300ER/777-200ER. When airliners are concern, it is the best option to take ALL BOEING FLEETS that is arguably the fusion of EXCELLENCE. ROCK ON THE SKY WITH 777-300ER,747-8, 787-8, 787-9.

keesje:

Airbus responded that, according to OAG Aviation data : “(T)he average seating for all A330-300 aircraft in service is 294 seats, whereas the 777-200ER average in service is 287 seats.

She also noted that the 777-200ER has a 15 percent higher empty weight and 26 percent higher takeoff weight, is 30 percent higher in thrust and, therefore, burns 13 percent more fuel on a 4,000-nautical-mile trip, translating to a 15 percent higher operating cost.

“The A330’s efficiency is really a matter of physics – lower empty weight means lower thrust required and lower fuel consumption,” she wrote. “That all results in lower cost.”

Prettyman also noted that Airbus has 145 outstanding A330-300 orders, compared with Boeing’s 16 for the 777-200ER.

Not sure what to think now.

http://blog.seattlepi.com/aerospace/2011/03/04/airbus-laws-of-physics-refute-boeing-claims/


JL (Toulouse, France):

Why would your comparisons be fairer?
Singapore Airline operates both types and their web site shows more seats on the A330-300.

One could also argue that 6 abreast business class is preferable to 7 abreast business class.

I'll credit you for showing your side of the story but to call only one side of the comparison unfair is particularly biased.

At the end of the day, which aircraft among the 2 has the highest backlog? That has to mean something in terms of how airlines are evaluating both aircraft.

Simon (The Netherlands):

In this case its hard to compare 'apples' and 'apples' as both aircraft for fill a different purpose. The 333 is more a mid range aircraft compared to the 777, these aircraft are both as efficient as can be, for the route/range they were designed for!

Major airlines use both types like Singapore & AirFrance, flying the routes they are best suited for!

Bill (Seattle, WA):

If its not Boeing, I'm not going!

Dan (France):

The data in this post is far too spare to make any claim to being an apples to apples comparison. In the cabin, there is no way to ensure the playing field is level without looking at images of the cabin layouts for both aircraft (the LOPAs), which are not posted.

Nevertheless, the numbers of seats mentioned in the post allows to identify that Boeing is using a full economy configuration in their analysis, whilst Airbus is using a 2 class configuration.

The seat counts used in this one class configuration seem so high it is unlikely that there are sufficient lavatories or galleys for typical airline operations.

Using a one class configuration such as this will inflate the gap in total number of seats on board in favour of the 777-200ER, and therefore reduce its per seat cost.

Solferino Lombardi:

Dear Randy,
While it is a honorable task to fight for the
reputation of products of the company you're paid by,
even such loyalty can be overdone.
Believe me, there are solid reasons, why the A330 is
going so incredibly well actually.
If Boeing manages to sell 179 aircraft to the US
air force, this does not necessarily mean Boeing
will be able to sell their aircraft to private
airline companies too. Airlines do not decide on
political grounds but on economical grounds.
Self delusion is a dangerous thing, usually the
damage done by it is uncovered far too late for
a timely response.

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