Boeing to Airbus: Game On


By the time the brand-new Airbus ( EAD ) A350-900 XWB (Extra Wide Body) aircraft was up in the air Wednesday for its second test flight during the 50th anniversary Paris Air Show at Le Bourget , The Boeing Company ( BA ) had already announced its answer to this supposed emerging threat: the 787-10, which is the third member of Boeing's fuel-efficient family of Dreamliners.

It's no surprise that instead of running scared , Boeing accepted the latest challenge in yet another leg of the race with its all-time rival. "As we say in America, game on now," Jim McNerney, Boeing CEO, said in an interview with Bloomberg Television . He also said that Boeing is ahead of the competition in terms of technology.

A350-900 XWB , a new carrier in Airbus's wide-body family, is an attempt to hit the sweet spot of fuel-efficient jets that serve medium- to long-haul operations; it competes with both Boeing 777 and 787 planes. Depending on the modification, A350s are capable of flying 270 to 350 passengers (in typical 3-class seating) 8,100-8,500 nautical miles (nm).

This craft will compete mainly with Boeing's 777-200ER (301 passengers, 7,725 nm), the upcoming Dreamliner 787-9 (250-290 passengers, 8,000-8,500 nm range), and the freshest addition to the family, the 787-10. The 787-10s will be capable of getting 300-330 passengers to destinations within 7,000 nm. Boeing introduced the biggest Dreamliner to date on Tuesday, with initial airline commitments of 102 planes.

"The 787-10 is 25% more efficient than airplanes of its size today and more than 10% better than anything being offered by the competition for the future," said Ray Conner, CEO of Boeing Commercial Airplanes.

However, Boeing does not expect to deliver its first 787-10 until 2018 and will not deliver its first 787-9 jet until early 2014. If A350 flight tests go as planned, the first A350-900 will be delivered to the launch customer, Qatar Airways, in late 2014.

Just tweaking the Dreamliners might not be enough for Boeing to stay ahead of the competition, however. The company's CEO touted the launch of the refurbished 777 ("777X") line-up by the end of 2013. He said that the company is now in talks with airlines to finalize their orders.

Boeing has a solid lead in terms of demand thus far. Even if 777s are not taken into account, the company boasts around 990 orders of Dreamliner family planes, compared to more than 660 orders and options on A350s.

(See also: The Plane That Airbus Was Reluctant to Build Could Have the Boeing Company Running Scared .)

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Stocks

Referenced Stocks: BA , EAD



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