Monday, March 5, 2018

Three Horse Engine Race For The 797

The closer the 797 becomes a reality the closer an engine maker(s) emerge. The three top contenders will be a GE sponsored product (CFN), P&W redo from the A320-NEO world and finally Rolls Royce picking up where it left off with the 787 program competition. Boeing will not go the single-engine type route it did with its 737. The 797 airplane stance will allow any configured engine a maker could think of at this time. However, the matter could become a three-engine choice for customers.

CFN exclusively makes the 737 oval shaped engine because the low slung 737 wings only allows for a wedged in CFN from yonder days from the early 737 design screens. Other engine makers would not try for a Boeing 737 engine acceptance as it would cost them too much for an attempt at having no certain outcome. Boeing has now positioned itself to accept all attempts for an engine mounting just so its airplane buying customers are happy with superior engine performance. Boeing expects an initial order book of 2,000-4,000 797's and will bear the brunt of developing new airplane risks along the way.

The 787 program dug a 31 billion money pit as it trialed and error its way during the 2011-2015 787 time period. It will deliver a 787-10 this month with Singapore Airlines. Boeing may never or will probably retire the money pit by the 1400th model ordered. It now has an order book of 1,294 787's ordered which is short of the 1,400 unit block Boeing requires for extinguishing its deferred cost account. That account stands at or about 25 billion at this time. The deferred cost set aside allows Boeing a profit margin for each 787 delivered and thus reducing the deferred cost balance when delivering one 787. It thinks by unit 1,400 delivered. its 25 billion costs will evaporate. It will probably have to go farther in units delivered when it aspires for a zero balance.

The 797 is a big risk based on experience with the 787 program. However, Boeing became profit-addicted with its prior programs since the 737 through the 777. The 797 show a promise of profit and the high ground over its competitor. Airbus will answer Boeing's 797 attempts by various means such as its A-330 NEO or A321 NEO rendition. But history suggests those who are second to market never seem to capture the market high ground. Boeing can and will adjust later its 797 model according to how the market reacts. Otherwise, keeping the Boeing boot on the Airbus neck.

Back to engines and the 797. Its a big risk for the big three engine makers mentioned above. The question asked is how lucrative would a 4,000 engine market be split among the big three. The answer comes down to a big two answer where a European engine maker and a Western engine maker become the engine suppliers. Gear drove vs classic turbofan and so forth. The engines are the problem, not the 797 concepts. The latter is already finished. Boeing is waiting for big engine makers stepping forward with a reliable proposal for saving fuel for its Boeing's customers.