Will United’s A321XLR Order Impact The Proposed Boeing 797?

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There’s certainly cause to celebrate United Airlines’ new A321XLR deal. The order is pivotal in rejuvenating the air carrier’s fleet but United Airlines also expressed interest in the yet-to-be-executed Boeing 797 or NMA. Will this recent order thwart Boeing’s chances of securing any 797/NMA orders from United Airlines?

Will United’s order of 50 A321XLR affect a Boeing 797 order? Photo: Airbus

United places Airbus orders over Boeing 797 concept

It was back in April that speculation began about United Airlines’ potential deal with Airbus. The airline was rumored to be in talks with the airframe manufacturer for A321XLR aircraft to replace its aging Boeing 757 fleet.

But now all speculation has been dispelled. Yesterday (3rd December 2019) the airline confirmed it had ordered 50 A321XLR to replace its Boeing 757s. It’s all welcome news for United Airlines but is this order bad timing for Boeing whilst it continues its toil to provide an exciting NMA/797 for the market?

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The answer to that question is: potentially. Certainly, at the moment the stakes don’t look good for Boeing with a potential customer swinging in favor of a competitor. But it wouldn’t be right to say that the fight is over. United Airlines has reasons for choosing the Airbus, including the interest of time, but it’s also not completely ruled out the Boeing 797.

The A321XLR fills the gap

Is the A321XLR everything that United is looking for? Photo: Airbus

First, let’s take a look at the evidence that suggests the A321XLR order will impact United’s future with the 797/NMA.

Irrevocably clear is the fact that United has chosen Airbus to replace Boeing aircraft. According to Planespotters, the airline has 74 Boeing 757 aircraft most of which will now be retired and supplanted from 2024. So an order of 50 Airbus aircraft is going to completely revolutionize that portion of the fleet.

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United Airlines has not, for obvious reasons, ordered a small number of A321XLR. In fact, it’s grown impatient in needing a replacement and Airbus is the manufacturer that can guarantee it faster. If we look at Boeing’s track record with delays in the 737 MAX and 787, it’s already working on a backlog of orders, even without the development of the 797. For a fleet that only grows older by the day, it makes sense for United to invest in Airbus now.

What’s more, United already has some Airbus aircraft in its fleet, with more on order. These new additions could allow the airline to see the potential in investing more heavily in Airbus in the future. In fact, the A321XLR does a good job of providing what United Airlines was looking for. The aircraft has a range of 4,700nm which is only 300nm less than the proposed 5,000 from Boeing’s NMA/797. There might be unexplored Airbus potential which United has not tapped into. And that’s worrying for Boeing.

Strategical investment

But the aircraft also provides for United in terms of strategy. In a press release, the Executive Vice President and Chief Commercial Officer at United Airlines said:

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“In addition to strengthening our ability to fly more efficiently, the A321XLR’s range capabilities open potential new destinations to further develop our route network and provide customers with more options to travel the globe.”

So when it comes to replacing its 757 fleet, United has already filled that gap. It might look dismal but let’s not forget that United Airlines wasn’t expecting the Boeing 797/NMA to come soon. Perhaps the 797/NMA was never a serious contender for the speed with which United wanted to replace its fleet. But, it does still have an aging 767 fleet it wants to retire…

Would the Boeing 797/NMA be a good replacement for aging 767? Photo: Thomas Boon/Simple Flying

Is there still hope for Boeing 797/NMA orders?

In an interview reported by Flight Global earlier this year, the Chief Financial Officer at United said that the airline had not totally ruled out Boeing by any stretch. Before the A321XLR order, Gerry Laderman said:

“The XLR doesn’t solve the 767 replacement issue.”

And to further back up the suggestion that United is still interested in investing in Boeing’s 797, the airline said it was under no pressure to make a quick decision. In the same report by Flight Global, Laderman told investors that:

“We would like to see some clarity so we can make the choice [on investment in Boeing’s 797/NMA], but we do have a little time; we can wait.”

And it’s playing the waiting game because Airbus has not developed an exact NMA/797 alternative. Boeing’s model still plays to a niche that has not yet been filled. There is still value in this aircraft and it could be a genuine option for the airline.

Boeing’s 797/NMA fills a niche that the A321XLR does not. Photo: Airbus

However, Laderman’s comment came back in July and there’s still no release date for the 797/NMA. Which prompts the question: how long exactly has United Airlines given itself to wait for Boeing?

Conclusion

Ultimately, United Airlines’ need for new aircraft has come at a bad time for Boeing. With an order already secured with Airbus, its apparent that Boeing won’t be getting as many orders as it would have hoped from United. But that’s not to say that it won’t get any.

However, Boeing must also be aware that the world is waiting and not just for it to deliver the NMA/797. The sooner it can coordinate the delivery of all of its pending aircraft, the better. In United’s case, it entirely depends on whether another aircraft manufacturer can produce an aircraft that can do a sufficient job of what the 797/NMA hopes to or not. That will ultimately determine where it invests its capital.

Do you think the United A321XLR order will affect the Boeing 797? Let us know in the comments!

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Bryce

Given that many (if not most) airlines are upsizing the aircraft types that they’re ordering (e.g. switching A320s to A321s), is there really a desire/need to replace a 767 by an aircraft of exactly the same size?
Any 767 operator that’s looking for a replacement can find a worthy alternative in the 787-8 or the A330-800, and they can upsize to the 787-9 or A330-900 if they want some growth potential.
This whole NMA discussion is a load of hot air (my opinion).

J M Y

United has demonstrated that they won’t wait around for a company like Boeing and Airbus to twiddle their thumbs on new products. Boeing’s answer to the 757 replacement is not only long overdue, but now it’s pretty much too late for them to gain the market share they were hoping for in this segment.

Some will say “but this is financially risky for Boeing to jump the gun on what product is the right solution”. Well, it’s financially risky for United to keep waiting around to the point that their 757s become way too unreliable and unsafe to operate transatlantic any more (and they’re already stretching their lifespan to the absolute max). United acted in their best business interests, just like how customers act in their interests to pick the best and most convenient flights they can afford from the airlines.

This is entirely in Boeing’s line of responsibility. They have no one to blame except themselves for “losing” a customer to Airbus. A customer that is, no less, a historically affiliated enterprise of their own company.

Frank

I think the problem with the 787-8 and the A330-800 is that they are not optimised models for the MoM segment. Shrinks never seem to work as well as stretches, probably having to do with the extra weight that is inherently designed into the model. The question then becomes – can airlines do without a true 767 replacement (and the costs associated with the design of a clean sheet that an OEM needs to recoup)?

Given the issues Boeing faces;
1) 737 Max – and the financial burden
2) 777X – delays and lost orders
3) 787 – $20 billion in sunk costs

It becomes a question of whether Boeing can afford to invest what is surely to be at least another $15-20 billion to bring the 797 to market and is there enough of a segment there to recoup that investment? As Trent noted below – are Boeing better served by investing in a clean sheet 737 replacement for the future, which surely has a larger market potential?

Trond Eie

Boeing must wake up before it,s to late.

Moaz Abid

I think United made the right call to order Airbus. Here’s why:
Boeing 737-Max: Pickle fork cracks, MCAS
Boeing 747- Not popular or efficient and grown out
Boeing 757- No production
Boeing 767- Only cargo version avaliable
Boeing 777- A good plane but aged and old
Boeing 777x- Delayed- Engine problems, ripped fuselage
Boeing 787- Trent 1000 issues
Boeing NMA- Unknown if made or not
I hope Boeing snaps out of it as airbus is winning huge orders and boeing is left in dust. Because at this rate they are left behind in subject of Next Gen Tech and reliability

Peter Mpande

The writer sounds like a Boeing salesperson? Why is United’s A321XlR order “coming at a bad time for Boeing when, clearly, Boeing doesn’t have a competing or similar product which would be available to United in 2024? And why do you seem to insist that Boeing should build the NMA / 797 if they don’t see a sound business case for the kind of capital investment that it would take to develop a clean sheet design, especially with the potentially ruinous compensation which may arise from claims against the 737 MAX? United wants a !being 757 replacement now, for 2024, why would a serious business be waiting around for a manufacturer to make up their mind whether to build the product or not, which product would not be available for some 10 years or so and the customer wants that product in 4 year’s time? Your article is puzzling

Steve Swenerton

With so many problems bringing the 787 to market, Boeing lost its focus on shorter range aircraft. Clearly the decision to stay with the 737 design forever was a crucial mistake, as has been proven with the Max debacle. Boeing just does not seem to be able to plan well into the future as Air Bus has, the A380 being an exception. The 757 and 767 have been great workhorses which have lived longer than most of us expected, which validates their great designs. But after the 777 came out many years ago, the 787 is all they have done since, while spending crucial time and resources trying to patch together ways to give 737 more life. Boeing has to be able to do what Air Bus does so well, which is to have several projects going simultaneously, making significant progress on each, not putting all their resources into single projects. Boeing is a great company, but they have got to get their long term strategic planning act together!

Rod Abid

Boeing’s problems started when they stopped listening to their engineers after they moved the HQ to Chicago. Money first, safety second.

Greg Heli

United is done with Boeing 797. 321XLR with possible common type A330Neo covers it all today not wait until Boeing’s tomorrow. Does Boeing have a narrow body flyby wire NB?? Why not? It’s 2020…

Meto

MAybe if they relive the 757 to make X they will change her mind