Re: 777 mtow

Date:         24 May 99 01:52:10 
From:         James Matthew Weber <jmweber@goodnet.com>
References:   1
Next article
View raw article
  or MIME structure

At 02:49 AM 5/12/99 +0000, you wrote:
>Can somebody tell me the new revised maximum MTOW for the
>777 that Boeing is thinking of to compete with the A340 500/600?

There two products that seem to be on the table. The 777-300X, which
will probably end up at about 700,000 pounds IF it ever gets built.
Engines are kind of a problem for it, as it will need a 120,000 pound
thrust, and the only engine capable of growth to that level is the GE90.
At the moment GE doesn't seem very interested.

There is another aircraft that is a sort of 4 engine 777, and all
information on that is based upon 'leaks' that have occurred over the
past 4-5 weeks, so what is out there is mostly speculation. That
aircraft is reported to be about 1,050,000 pounds MGTOW in the basic
version, and around 1,100,000 pounds in the extended range version. It
would presumably be powered by 4 engines in the 7580,000 pound class,
which already exist, and were used on the 777-200 (non-ER variant). This
would provide an obvious  R&D cost advantage over the A3XX, which at
least based upon current information, will need a 72,000-75,000 class
engine(which does not exist).

I suspect as much as anything else, this is Boeing retaliating for the
A3XX. Boeing has had to compete against a 'vapor ware' aircraft for some
time, however, now the A3XX will have to compete with an equally real
aircraft that promises even lower operating costs than the A3XX. My
person belief is that neither will actually be built.  The R&D Costs on
the A3XX coupled with  a treaty with the USA on launch aid makes A3XX a
very painful exercise for Airbus. The Boeing design will be slightly
less so because Boeing expects to cannibalize a lot of 777 and 747
engineering to produce the beast.

The bind is A3XX is probably going to end up costing something on the
order of 10-15 billion USD to develop, and I doubt the market will
exceed a few hundred (you usually sell more, Boeing has sold lots of
747's, but there have been 4 versions, and each has required a
substantial capital investment to create) during the period you need to
recover the R&D costs.

The current market puts an upper limit on the value of A3XX (and the
Boeing competitor) at about 200 million USD. By the time you have
recovered the R&D costs, and paid interest on the money (and Airbus now
must raise 67% of the money privately), the 10-15 billion USD will be
more like 20 billion USD, so that puts an R&D component in the cost of
80 million USD per copy. That doesn't leave much to actually build the
aircraft with, or for margin....IF by reusing technology Boeing can save
a few billion USD on the R&D costs, the effect can be substantial. If
you forecast a market of 250 aircraft, each billion you take out of R&D
is about 2 billion USD in total cost, so at the end of the day. each
billion you can reduce the R&D costs by should reduce the cost of the
aircraft about 8 million USD. Even with a several billion R&D cost
advantage, it isn't clear to me that the Boeing product will be
appreciably more economically viable than A3XX.

The Europeans could abrogate the treaty, however that would almost
certainly set off a trade war the likes of which have not been seen for
a very long time.

James Matthew Weber  1 602 315 6520   Fax 1 602 638 1316