Boeing Backing Smaller Planes; Airbus Living Large

While both Boeing and Airbus will move to produce a new single-aisle airplane sometime between 2012 and 2015, today the world’s two leading aircraft manufacturers have chosen to adopt differing competitive strategies, according to Thomas Pickering, senior vice president for international relations at Boeing.

Boeing has decided to produce the 787, a middle-of-the-market, 200 to 300 seat airplane, while Airbus is working on the A-380, which has 555 to 873 seats, Pickering told alumni and friends of the GSB at the International Roundtable at Gleacher January 19.

Boeing made its decision because the marketplace went from being highly regulated to liberalized and competitive. In this climate, “The first principle is the passengers,” Pickering said, and they prefer, “nonstop, point-to-point service flights with more frequencies, not increased size and capacity.” In addition, new technology is leading the market into smaller planes that can go further.

For example, Boeing’s new twin-engine 777-200LR jetliner can fly with a full passenger load nonstop from London to Sydney. “This is approaching the ultimate airplane in range,” Pickering said “It can fly about 12,000 miles–half the circumference of the earth.”

In addition to working on new airplanes, Boeing has expanded from being a commercial aircraft manufacturer to a more balanced aerospace company. “We had been product-focused and engineering-oriented. Now we’re more business-oriented,” Pickering said. Boeing has design bureaus in cities such as Moscow and Madrid, suppliers in 100 countries, foreign subsidiaries and joint ventures, customers in 145 countries, and field representatives and parts and distribution centers around the world.

Boeing’s new approach also means going head-to head-with Airbus. “It’s an interesting competition,” Pickering said.

—Carmen Marti