Re: A3XX vs B747-600 (was: Airbus lawsuit coming?)

From: (don shifris)
Organization: 1st Solutions Inc.
Date:         23 Aug 96 13:45:01 
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>I don't think there is any doubt that Boeing will launch the B747-500X/
>-600X.  (Supposedly, most airports can handle the B747X without any major
>updates.)  It's most likely that Boeing will officially announce the
>launch during the Farnborough Air Show in September.  I don't think Airbus
>will let Boeing have the monopoly and the A3XX will most likely be built,
>too.  However, Airbus does not seem to have secure all the funding and
>potential partners.  Airbus will be at least three years behind.

The imminent lauch of the -500/-600 747 received considerable play in Aviation
Week recently, along with fiarly detailed specifications. One can only
conclude if the specifications are that detailed, about all that is needed is
a first order. I know of at least one major airline who is already committed
to these aircraft. They expect to be either the first or second announced
order. It is clear, at least to me, that negotiations involving the sale of
these aircraft are quite advanced, even if it is unannounced.

I think you comments regarding airbus and R&D funding are perhaps an
understatement. Under current trade accords, European Governments are no
longer able to provide unlimited funding for Airbus. I believe Airbus is
limited to obtaining about 45% of R&D funding this way, so ultimately the
people who fund Airbus R&D must believe in the commercial benefits of the
products. This was not the case when previous Airbus aircraft were launched.

If Airbus wishes to launch A3XX, it means other aircraft, for which there may
already be  clearly defined markets, probably cannot be launched. Timing is
also key. If A3XX follows 747-500/600 by 3 years, that is a lot of ground to
make up. I don't think it is a big secret that a fair number of MD-11 sales
were because Boeing couldn't guarantee anything approaching reasonable
delivery in the early days of the 747-400 program. If you wanted a long range,
high capacity wide body any time soon, MD-11 was the only game around. In
retrospect a fair number of airlines now apparently have second thoughts about
this aircaft. A sizeable portion of the passenger fleet of MD-11 is going out
of passenger service, and the failure of the aircaft to deliver on fuel
economy appears to be the main reason Delta gave up on Hong Kong. It's no
secret that AA didn't like the performance, and at one point, refused to
accept delivery of the aircraft because of it.

I think there is one other potential problem with A3XX. Engines. New engines
have become very very expensive. So painful that traditionally enemies like
GE/Pratt have been forced to team. I have to wonder how enthusiastic any of
the engine makers would be if A3XX requires an all new engine. Big expense,
quesitonable market, and the engine makers are all private companies, they
don't get Government handouts to fund the R&D.

I think it is also clear the given the state of government in Europe,
enthusiam for very large taxpayer supported project like airbus is wanning.
The French are forcing ratinalization in the Aircraft/Defense sectors simply
because they cannot afford not to any longer.

I think the key issues for Airbus on A3xx aren't technical, they're financial.

my opinions anyway.