1. Airbus will respond.
2. They will sell many hundreds more A321's - including the A321neoLRalphabet soup - into the face of the 797 launch.
3. Boeing may have a winner, but they aren't going to have it without a serious fight.
1. Of course they will. But the longer they take to respond with something in between the A321XLR and A338, the longer Boeing has to establish a hold on the segment.
2. Of course they will. I don't think Boeing or anyone else expects that Airbus won't sell plenty of aircraft at the bottom of the MoM segment. But as long as it's based on the A321, the bottom of the segment is always where it's going to be, and without a clean sheet redesign at best it will merely be competitive at the bottom, whereas right now they're the only option.
3. Of course they will. Airbus will have lots of scope to aggressively compete on price with the A321XLR.
I guess my point is that I don’t think B will get a couple thousand units down the road before Airbus responds in multiple ways. They are really set from the A321 down and the A359 up - throw in an enhanced A321 as well as an A322 by the time the 797 first flies, and possibly a launch of an A360 covering the A321-789 range around 797 EIS and it only gets more challenging for Boeing. However, I think we’re probably basically in the same ballpark.
So Airbus will respond by making two new wings and gear setups and a whole new fuselage during the time period it takes Boeing to do one wing and fuselage? Seems ambitious to me.
I also think people undervalue that Airbus is talking NEO on the A350 already. Does that help you move up into the 777X range? Sure, maybe it does. But the program also has a bad recent sales record. You picked up 30 orders from EK but lost 42-62 from Etihad and 10 from Air Asia X that seem unlikely as well as 16 dead orders from Iran on the books as well. And people can moan and groan all they want but I am not sure United will take its 45 frames either. So that order book to me doesn’t look that great and the order momentum is not where you would want it.
This year is critical as they need to pickup order intake pace. If the 787 scores big again in Korea and Germany, and Airbus may well know where it sits on those already, then a NEO is less of an offensive move than it is a defensive one. Moreover I think a NEO there simply creates an engine that lets the 787 eat the lunch of the A350 in the meat of the market.
If I am Airbus I don’t feel particular good about any product I have other than the A320neo family. The 797 threatens to take the premium rate and some steam from the top of that family and probably destroys the A330neo entirely. The best optimized products to move around lots of people in Asia will either be a 797 if you don’t need cargo or a 787-10 if you do. Airbus can try to wedge something into that gap but if the NMA gap is tight that one will be much much tighter.
Airbus in my mind has made 3 major mistakes on its program positioning.
1. The A350 is too big and capable compared to the 787 and won’t age as well as TSFC drops on engines unless you rework the frame or stretch it to the point airlines may fear filling it.
2. The A350 wasn’t big enough to kill the 777 entierly and this has left some portion of the large twin market to that frame.
3. The A330neo was an abject mistake when they didn’t rework the wing and bring down the weights. It’s too mixed up in the A350/787 battle and it shouldn’t have been. Airbus got lazy because it worked on the A320neo and made a costly mistake.
NMA will drop in to take a large share of the A330 regional replacements that comprised a ton of its late in life orders during the 787 spin up drama. It will also create some new market space for itself. The 787-10 will gobble up most of the rest of the regional widebody orders. Airbus effectively will have two options once NMA drops. Going head to head with NMA or the 787 and simply beating them on technical merits or trying to find a market gap to put something in. I just don’t see a substantial gap. You going to find a ton of orders for a frame with a higher CASM than NMA and that hauls less cargo than a 787-10?