Airbus, Boeing See Strong Narrowbody Demand Despite Disruptions

Almost two years after the onset of the novel coronavirus pandemic, which is the biggest shock experienced by aircraft manufacturing in recent history, Airbus and Boeing are still in crisis mode to varying degrees. Building production rates back up has proven more complicated than expected for a variety of reasons. Making decisions even on near-term product development appears to be on the back burner for the time being, except at Embraer. And the coming year is likely to be full of more operational challenges that will absorb the attention of management.

• Airbus and Boeing plan to rebuild narrowbody production
• Boeing 787 quality issue resolution will drag on well into 2022
• Airbus A321XLR flight-testing and A350F development work to kick off

Boeing: Quantity and Quality

As 2020 drew to a close, Boeing eagerly anticipated seeing its two most important commercial programs, the 737 and 787, getting back on track in 2021. The 737 MAX family was grounded in the wake of two fatal accidents, and deliveries had stopped in March 2019. Quality problems had halted 787 deliveries in the fall of 2020. 

A year later, Boeing is largely in the same spot. The 737 MAX is flying again, but the company’s goal of wiping out a stored backlog of about 460 aircraft by 2023 is out of reach. A production-line change forced Boeing to pause deliveries for a few weeks in the spring of 2021, and orderbook shuffling means already-built aircraft are changing hands, forcing the manufacturer to reconfigure them. The cascading issues resulted in handover of as few as six airplanes per month from Boeing’s stored inventory in late 2021—far below the target of 19-20 needed to clear the backlog by 2023.

New production is faring better. Boeing’s 737 program production rate was up to 19 per month in October and on track to hit 31 per month in early 2022, according to Boeing executives. The rate of 31 was picked to match demand with supply chain capabilities, Boeing CEO David Calhoun said in October. How much higher the rate will go, and when it might increase, will be dictated more by supplier capacity than market demand.

“As we go through the second half of the year and forward, I think that will be an assessment of the supply chain, not an assessment of demand, that gets us to whatever number we get to,” Calhoun said. “I think we’re going to be in a supply-constrained world, probably from [the] second half [of 2022] through all of 2023 with respect to narrowbodies.”

Boeing’s planned 737 MAX rate ramp-up will come alongside additions to the family. The 737-7 is on track for certification and first deliveries in 2022, while the 737-10 is slated to follow in 2023. 

The -10 incorporates several changes ordered by regulators as part of modifications mandated following two fatal accidents, one in 2018 and one 2019, that together killed 346 people and grounded the fleet. The most significant is an enhanced angle-of-attack (AOA) system, championed by the European Union Aviation Safety Agency (EASA), that adds redundancy to the original, two-AOA system (AW&ST Nov. 22-Dec. 5, p. 16). Faulty AOA data factored prominently in both accidents, prompting Boeing to redesign the MAX flight control software. EASA pushed to have the new system developed and phased in as part of Boeing’s return-to-service plan (AW&ST Feb. 22-March 7, p. 24).

With the 737 MAX program steadily gaining altitude, the 787 has assumed the spotlight as Boeing’s most troubled commercial program. Barring a major change as the year comes to a close, Boeing will end 2021 with just 14 787 deliveries—a figure that reflected an average month’s worth of customer handovers before the pandemic and production problems created intense headwinds.

While the airplane remains popular among customers—the 81% of 787s in regular service in October 2020 was the highest percentage among all widebodies and trailed only the A320neo and A220, Aviation Week Fleet Discovery data show—Boeing is struggling to address a spate of quality issues. They range from unfilled gaps between structural parts to potentially contaminated composite material. The issues likely will require attention on in-service aircraft, but that work may end up being phased into schedule maintenance checks. 

The larger headaches come before delivery. In order to avoid ripping each one apart to check for every known defect, Boeing is working to develop effective techniques for identifying if an airframe has issues. As of late November, Boeing had not convinced the FAA that its methods were sufficient, and 787 production had slowed to less than two per month, down from an already reduced rate of five per month established in early 2021 (AW&ST July 26-Aug. 8, p. 22). The travails have left Boeing with more than 100 787s waiting for delivery and little certainty when the backlog will begin to decline.

“The exact timing of deliveries and future production rates will depend upon inspections and rework, ongoing customer and supplier conversations, production stability and our activities with the FAA,” Calhoun said.

In the coming year, Boeing will continue to transition its 777 program from current-generation models to the 777X, starting with the 777-9 (AW&ST Oct. 11-24, p. 22). The company is shifting production of the 777X from the low-rate initial production (LRIP) line at Everett, Washington, to the main line, which began producing the first few non-LRIP 777-9s or 777F freighters in the middle of 2021. Demand for large twin-engine freighters prompted Boeing to add extra positions on the line. The uptick means the combined output of the 777F/777X line has stabilized at around two per month—most of them freighters.

Meanwhile, the 767 line continues at three aircraft per month—all freighters or military tankers. As of Oct. 31, Boeing had 47 767-300Fs in its backlog—about twice the number of 777-8s believed to be on order. Boeing’s official orderbook does not break out variants within aircraft families.

The airframer remains confident that the extended 777-9 certification campaign likely will be completed just under two years from now—putting it on track for first deliveries in the last quarter of 2023. Production of additional 777-9s will therefore begin to increase in late 2022 as Boeing works to build up its delivery inventory and perform rework on the initial batch of 777-9 airframes already produced.

The future of the shorter 777-8, development of which was pushed back in 2019, now looks to be increasingly tied to that of the 777XF, the freighter version. Boeing is on the cusp of officially launching the cargo model and, according to industry sources, aims to reduce production cost and complexity by extending the size of the 777-8 and configuring the 777XF around the same fuselage length.

The 777-8 is currently defined with a shortened 229-ft. fuselage, compared with the 242-ft. 777-9, and a maximum takeoff weight (MTOW) of up to 788,000 lb. However, the 777XF probably will be offered with an MTOW target of around 805,000 lb., compared with 766,800 lb. for the current 777-200LR-based 777F model.

The 777XF is Boeing’s heir apparent to the 747-8F, production of which will end in late 2022—bringing down the curtain on a 53-year run and marking the end of the longest continuous jet transport assembly line. In close second place is the long-running 767 line, which continues at three aircraft per month—all freighters or military tankers.

Airbus: The Large and the Small

A key strategic decision Airbus made in 2021 was to get into the freighter business in earnest. At the November Dubai Airshow, the manufacturer received its first orders for the A350F from Air Lease Corp. (ALC) and CMA CGM Air Cargo. Aside from the A321XLR, the A350F is Airbus’ only near-term development program that will gain momentum in 2022 in preparation for entry into service in 2025.

The A350F, based on the A350-1000, will have a forward fuselage shortened by five frames and a large cargo door in the rear to make ground handling easier. The aircraft will have a 109-ton maximum payload and 4,700-nm range. It is being designed to accommodate 30 pallets or 30 AM-base containers on the main deck and 12 pallets or 40 LD-3 containers on the lower deck.

The decision to launch the freighter was obvious and long overdue, given that Boeing has enjoyed a monopoly in the space and with the cargo market far outperforming the passenger business in growth rates and margins. It is also a good way to keep Airbus engineers busy in the absence of many concrete near-term projects.

Work on the first A321XLR is even more advanced, with the first aircraft now in final assembly. The long-range version of the A321neo, able to fly missions of up to 4,700 nm, is expected to make its first flight next year and then enter a flight-test program ahead of its entry into service in 2023.

The A321neo is gaining more momentum as Airbus’ most important model. At the recent Dubai Airshow, Indigo Partners alone ordered 255 additional aircraft, and ALC bought an extra 75. The two orders underscored its importance: The A321neo has surpassed the A320neo as the most in-demand Airbus single-aisle, with more than 4,000 firm commitments. The A320neo has 3,800. The A321neo makes up 57% of the undelivered A320neo family backlog, a share that is likely to rise.

One big question going into 2022 is whether others will follow the lead of ALC and Indigo Partners and secure more production slots early. Their orders do not include any near-term deliveries—they are mostly for deliveries starting in 2025. Airbus certainly will try to persuade airlines and lessors that now is the time to buy further out, too, particularly since production in 2022 and 2023 is already sold out, and airlines that need additional lift in the short term essentially have to revert to lessor portfolios.

Another big unknown in the Airbus production planning is the future of orders from China. The backlog of undelivered aircraft from previous deals is fast diminishing, and Airbus CEO Guillaume Faury had hoped for a follow-up purchase that would ensure enough supply for Chinese airlines even in 2021. That has not happened, leaving Airbus looking toward a possible agreement in 2022. It is not clear whether China will be back in the market that soon, however. There is plenty of capacity available, and regional lockdowns are forcing airlines to ground aircraft frequently. The more or less complete halt of international flying also means that many widebody aircraft are available for use on domestic routes.

Airbus is factoring into its slot allocation the likely level of orders from China, but as pressure builds from clients in other regions that are ready to commit to purchases, these allocations are bound to be released in the not-too-distant future.

The A321neo boom has consequences for Airbus’ industrial setup, too. The Tianjin final assembly line will be enabled to build A321neos, and a dedicated A321neo facility is planned to be created in the former A380 hangar in Toulouse.

Airbus’ largest aircraft program came to a close in December, with Emirates scheduled to take delivery of the last A380 off the production line at the end of December or in January.

Ramping down is otherwise not one of Airbus’ problems. Many considered too ambitious the plans to raise production rates that Faury announced at the end of May 2021. Airbus stuck to them nonetheless, even though it experienced substantial issues with late cabin parts in September and October. In both months, the OEM fell short of its targets to raise output to around 44 from 40 aircraft per month by year-end. And it delivered just 30 and 32 A320neo-family aircraft in September and October, respectively. Faury says the OEM is “on top of it” and that the bottlenecks will be an issue of the past soon.

Airbus is still committed to raising single-aisle production to 65 aircraft per month by the middle of 2023, and much of that needs to be achieved during the course of 2022. Output of the A220, A330neo and A350 are also increasing: The A220 is slated to go to six from five aircraft per month in early 2022, the A330neo to three from two at the end of the year and the A350 to six from five in early 2023.

Embraer: New Props

Embraer is the only manufacturer of large commercial aircraft that is considering launching an all-new conventional aircraft in the near term. The company is talking to all three major engine manufacturers about a powerplant for a new large turboprop planned to enter service in 2027 or 2028, provided the OEM can stick to its schedule of firmly launching the aircraft before the end of 2022.

The turboprop would be offered in versions seating around 70 and 90 passengers. Embraer is pitching the smaller aircraft as a replacement for 50-seat jets in the U.S. market, putting forward the much better economics of a turboprop and the bigger cabin based on the E-Jet fuselage. In a three-class layout—including domestic first class, premium economy and regular coach—the cabin would have space for around 50 passengers.

The turboprop is planned to have rear-mounted engines and a propulsion system that can be adapted to future alternative sources such as sustainable aviation fuel or even hydrogen. Moving the engines aft also should reduce cabin noise and improve passenger appeal. The aircraft likely would be used typically on short sectors of around 250 nm, but it would be able to fly up to 800 nm.