david nielson chief engineer, airport strategy boeing commercial airplanes march 1, 2006 david...
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David NielsonChief Engineer, Airport StrategyBoeing Commercial AirplanesMarch 1, 2006
David NielsonChief Engineer, Airport StrategyBoeing Commercial AirplanesMarch 1, 2006
Market & Product Overview
Agenda
2005 Current Market Outlook
• Market Evolution
• 20-Year Forecast
• Contrasting Views
Product Strategy
• Twin-Aisle
• Single-Aisle
Aviation Is Moving From Being Highly Regulated
To A More Liberalized And Competitive Marketplace
Passengers Drive Airline Strategies
Since 1995, All Air Travel Growth Has Been Met By Frequency Growth And New Nonstops
0.9
1.0
1.1
1.2
1.3
1.4
1.5
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Index 1995=1.00World
Frequency Growth
Nonstop Markets
Average Airplane Size
Air Travel Growth
August OAG
In 1990, Only A Few Cities Had Direct ServiceBetween China And Japan
August 1990 OAGAugust 1990 OAG
59 Weekly Frequencies8 City Pairs
OsakaFukuoka
Nagasaki
Beijing
Tokyo
Shanghai
Dalian
By 2004, The Number Of China To Japan City Pairs Served Increased Five Times
Moscow
Lisbon
Harbin
Changchun
Guangzhou
Qingdao
Shanghai
Xiamen
Wuhan
Beijing
TianjinDalian
Shenyang
HiroshimaOkayama
NagasakiFukuoka
TokyoNagoya
Niigata
Osaka
Sapporo
Sendai
Toyama
Kagoshima
Okinawa
Fukushima
Fuzhou
Hangzhou
Nanjing
Yantai
OitaMatsuyama
Xian
Hong Kong
Jinan
Chongqing
Handan
August 2004 OAGAugust 2004 OAG
463 Weekly Frequencies45 City Pairs
20-Year Forecast: Strong Long-Term Growth
Forecast growth annual rate 4.8% (2005-2024)
Historical
10
8
6
4
2
01970 1980 1990 2000 2010 2020
Long-Term Growth2005 - 2024
GDP = 2.9% Passenger = 4.8%
Cargo = 6.2%
RPKs (trillions)
Future
0 500 1,000 1,500 2,000
Middle East - Asia-Pacific
Africa - Europe
Europe - Latin America
Latin America
North America - Latin America
China
Transpacific
Europe - Asia-Pacific
North Atlantic
Europe
Asia-Pacific*
North America
RPKs, billions
3.5
5.1
3.4
4.6
5.4
6.0
8.8
5.1
7.2
4.9
5.0
6.1
* Except Within China
Air Travel Growth Varies By Region
2004 traffic2004 trafficAdded traffic
2005-2024Added traffic
2005-2024Annual
growth %
World Average Growth: 4.8%
ASKs (billions)
Regional Market Evolution Shapes Fleet Requirements
Asia-Europe
Trans-Pacific
NorthAtlantic
EuropeAsia-Pacific
NorthAmerica
Regional jetsSingle-aisleTwin-aisle747 and larger
0
10,000
20,000
30,000
40,000Units
18,500Growth
Airplanes
18,500Growth
Airplanes
7,200Replacements
7,200Replacements
9,600Retained Fleet
9,600Retained Fleet
16,77816,778
35,300
25,700
2004 2024
Long Term Demand For New Airplanes Remains Strong
11%
23%
66%
Boeing And Airbus Have Contrasting Views On The Fleet Mix Required
25%
72%
3%
21,080 airplanes2005 CMO
16,601 airplanes2004 GMF
Single-aisleTwin-aisle747 and larger
BoeingBoeing AirbusAirbus
New passenger airplane deliveries, excluding regional jets
Airbus Is Predicting A Significant Trend Shift In Airplane Size
140
160
180
220
240
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025
Airbus: +20% Size Increase
Historic Air Travel Growth: 5.8% Forecasted Air Travel Growth: ~5%
Recent History Forecast
Boeing: ~+2% Size Increase
NOTE: Excludes regional jets
• Highly regulated
• Few airplane choices
• More competition
• Many airplane choices
Bygone Era
19751970
• Increasing liberalization
• More airplane choices
200
2% Size Growth Over Last 10 Years
Average Seats Per Airplane
Congestion Is Not Driving Large Airplane Use Up
0%
10%
20%
30%
40%
50%
60%
70%
80%
747 Share of Departures
NRT
HKG
HND
JFK
LHR
CDG
FRA
LAX
Narita
Hong Kong
Haneda
New York City - JFKLondon Heathrow
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
August OAG
Very Large Airplanes Will Not Reduce Airport Congestion – London Heathrow Airport
Daily departures
Seat size category
• OAG August 2004
• All scheduled passenger service
83% of the airplane departures are below 300 seats
68% of the airplane departures are below 200 seats
Passengers prefermore nonstops and frequency choices
London Heathrow
Nonstop Service Continues To Bypass Mega-Hubs, Not Consolidate
London-Heathrow
Air Canada Emirates
American Continental
London-Heathrow
New York (JFK)
London-Heathrow London-Heathrow
New York (EWR)
DelhiToronto Dubai
Manchester GenevaChicago
It Costs Less To Carry Passengers Point-To-Point
ChicagoChicago GenevaGeneva
Nonstop flightsresult in…
• Lower costs
• Increased revenue
• Better utilization
• Less environmental impact
• More convenience for passenger Seat Mile Cost
A320 / A380 Base
787-8 7% Lower
777-300ER 10% Lower
LondonLondon
Does The Forecast For 1,648 A380-Size Airplanes Pass The “Reasonableness Test”?
Top Fifteen 747
Operators
Japan Airlines 72
British Airways 58
Northwest Airlines 48
Korean Air 44
United Airlines 38
Air France 37
Qantas 36
Cathay Pacific 34
Singapore Airlines 32
Lufthansa 31
China Airlines 29
ANA/Nippon Cargo 27
Malaysia Airlines 25
KLM 25
Saudi Arabian 22
Average Fleet 37
1. The top fifteen 747 operators average 37 airplanes
a. They would all have to take 110 A380-size
airplanes each
b. Top 25 would have to take 66 each
2. 629 747-400’s have been delivered over the last
16 years – an average of 39 per year; Airbus is
forecasting 1,648 A380-size airplanes to be
delivered over a 18 year period (2006-2023) or
an average of more than 91 airplanes per year
2005 Current Market Outlook Summary
• Boeing and Airbus agree passenger traffic growth will average about 5 percent per year over next 20 years
• Boeing and Airbus differ as to how airlines will accommodate this future growth
– Boeing believes the current trend of more frequencies and nonstop flights will accommodate growth
– Airbus is projecting a significant shift in this trend to larger airplanes
• Boeing forecasts airlines will need about 25,700 new airplanes valued at $2.1 trillion
Agenda
2005 Current Market Outlook
• Market Evolution
• 20-Year Forecast
• Contrasting Views
Product Strategy
• Twin-Aisle
• Single-Aisle
0
50
100
150
200
250
300
350
400
450
500
550
500 1500 2500 3500 4500 5500 6500 7500 8500 9500
Range, nmi
Sea
ts
737-900ER1
Tank
737-900
737-600737-700
737-800767-200ER
787-3
787-8
777-200LR*
787-9
747-8
Efficiency In All Markets
797-ZC-0057 1-19-6-CF
In ServiceLaunched
767-300ER
767-400ER
777-300
777-200
777-200ER
747-400/-400ER
777-300ER*
* w/ Restricted Loadability
2Tanks
Two class
Three class
787-3290-330 passengers (two-class)
3,000 nmi / 5,500 km
The 787 Is a Complete, Flexible, Efficient Family
797-CO-0218 1-19-6-CF
787-8210-250 passengers (three-class)
8,000 nmi / 14,800 km
787-9250-290 passengers (three-class)
8,600 nmi / 15,700 km
186.1 ft 186.1 ft
206.1 ft
197.3 ft
197.3 ft170 ft
Improving the Flying Experience
797-IN-0063 1-12-6-CF
Better lightingBetter lighting
Large passenger
windows
Large passenger
windows
Lower cabin altitude
Lower cabin altitude
14” (35cm) wider 14” (35cm) wider
Wider seats and aisles
Wider seats and aisles
Large overhead
bins
Large overhead
bins
Better economy seating optionsBetter economy seating options
More head room
More head room
Smoother ride
Smoother ride
HigherhumidityHigher
humidity
Better air qualityBetter air quality
787 Significantly Quieter For The Community
4001041404
Source MS Mappoint, (c) Microsoft, Inc.
Feet
Meters
0 5000
0 1500
-10000
-5000
0
5000
10000
-10000-500005000100001500020000
-10000
-5000
0
5000
10000
-10000-500005000100001500020000
-10000
-5000
0
5000
10000
-10000-500005000100001500020000
-10000
-5000
0
5000
10000
-10000-500005000100001500020000
A340-300A330-200
787- 8767-300
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
787 Ramp Operation
The traditional pneumatic system (used for air conditioning, engine start, and anti-ice today) has been eliminated. Replaced on 787 by an electrical system to
Improve reliability Reduce weight and operating costs
APU can run all systems while on the ground If the APU is not used (or inoperative)
Two 90KVA ground electrical connectors are needed Existing PC air units can be used Engines are started using ground electrical power.
Two connectors are adequate with load shedding. Anti-ice is powered electrically
797-WD-0305 1-12-6-CF
2005
Development Schedule On Track
2002
787-8First
Flight
787-8 Enters Service
AirplaneAnnouncement
Firm Configuration
Program Launch
AuthorityTo Offer
2003 2004 2006 2007 2008 2009 2010
787-3Enters
Service
787-9EntersService
777-200LR WorldlinerGoing The Distance
It’s All About Passenger Convenience And Schedule Reliability
0.0 0.1 0.2 0.3 0.4 0.5
A340
777 Family
0 5 10 15 20
A340
777 Family
Air turnback and diversionsAir turnback and diversions
Scheduled delays and interruptionsScheduled delays and interruptions
777 has half as many scheduled delays
777 has half as many turnbacks and diversions
½ the delays½ the delays
½ the turnbacks½ the turnbacks
Data based on the manufacturer published interruption rates for the 12 months ending December 2004
777s Have Better Fuel EfficiencyThan The Competition
Fuel per seat, lb
0
100
200
300
400
500
600
700
777-200ER A340-300 777-200LR A340-500 777-300ER A340-600
+24%+23%
+13%•Lower Fuel Costs
•Lower Emissions
777 Freighter
797-CO-0220 1-17-6-CF
General Arrangement
84 ft 11 in
209 ft 1 in
61 ft 1 in
36 ft
212 ft 7 in
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
747-8 Freighter
797-CO-0221 1-18-6-CF
General Arrangement
97 ft 4 in
250 ft 2 in
63 ft 6 in
36 ft 1 in
224 ft 7 in
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
737-900ER Value Changes Comparedto the 737-900
797-CO-0219 1-12-6-CF
Flat aft bulkhead (enables new larger aft galley)
Stronger fuselage, wing box, center section, landing gear, wheels & tires (enables increased weight)
737-900 737-900ER
MTOW, lb (kg)174,200(79,010)
187,700(85,140)
MLW, lb (kg)147,300(66,810)
157,300(71,350)
MZFW, lb (kg)140,300(63,630)
149,300(67,720)
Short field performance enhancements (enables more payload, decreased runway lengths & more derate)
Optional aux fuel tanks (1 or 2 tanks increase range)
Standard type 2 exit doors (optional activation increases exit limit from 189 to 215)
EGT redline limit increase on 27K thrust engines (increases engine on wing life & reduces direct engine maintenance costs)
Product Strategy Summary
• Boeing product strategy is focused on meeting passenger desires and airline requirements
– Single-aisle: 4 sizes at 20% increments with ~3,000nmi range
– Twin-aisle: 5 sizes at 20% increments with ~8,000nmi or more range
• Boeing has a long history of delivering airplanes with superior design and efficiency
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
Airport Preparation
Wing span increases require changes to gate width.
Increasing range results in increased pavement loading.
Ramp congestion and environmental concerns require more fixed services at the gate.
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
Wing Span is Increasing for All Sizes of Aircraft
737-200
737NG
737 withwinglet
93 ft/28.4m
225 ft/68.6m
213 ft/64.9m
747-200
747-400
747-8
196 ft/59.7m
767-300
787 197 ft/60.0m
156.1 ft/47.6m
112.6 ft/34.3m
117.4 ft/35.8m
Single-aisle
Small wide body
Large wide body
197 ft/60m
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
Trends in Pavement Loading
Trend in ACN Flexible Pavement – Code B Subgrade
20
40
60
90
1950 1960 1970 1980 1990 2000 2010 2020
Aircraft Classification Number (ACN)
70
80
Year of Entry into Service
30
50
Concorde
DC8-63/73L1011-1
747
DC10/MD-11
A300
767-200
A310777 (A market)
767-300ERA340
A330777-300
747X
Long-Range 777
A340-600A340-500
707
767-400ER
BOEING PROPRIETARY COPYRIGHT © 2005 THE BOEING COMPANY
Servicing Needs
Airports are limiting APU operations to reduce noise and emissions. Electrical and conditioned air is then required at each gate.
To reduce ramp traffic, fuel and potable water are needed at the gate.
Wireless transmission of maintenance information desired for operational efficiency.
Additional boarding bridges are used to service the cabin interior and reduce turn time.
Thank You!
For more information, visit our CMO website:http://www.boeing.com/commercial/cmo/index.shtml