Whatever else Boeing may be discussing with potential customers at this year’s International Society of Transport Aircraft Trading (Istat) meeting regarding options for replacing the 757, we now at least know it will not be talking about bringing the original aircraft back to life with new engines.

The 757 replacement question has become an increasingly hot topic, particularly since Airbus upped the ante by launching the long-range A321neo LR variant in mid-January. Until then, Boeing had quietly conducted its ongoing studies through most of 2014, occasionally being more open about them at places such as the Singapore air show, when it acknowledged that serious market evaluations were underway.

Part of that issue has always been trying to figure out not only where and how big the market might be but whether it exists at all. Boeing has pointed out that the apparent gap on the seating chart between the 737-900/MAX 9 and the 787-8 does not necessarily create a cast-iron case for a new program, particularly when the current long-range use of the 757 is distinctly “niche” in nature.

Steven Udvar-Hazy, the highly influential CEO of Air Lease Corp., helped clarify the situation in a roundabout way on Feb. 10 after The Wall Street Journal reported his comments that Boeing could consider upgrading its out-of-production 757 with new engines and interiors. While Udvar-Hazy has helped drive some major design decisions, including most famously Airbus’s redesign of the A350 to an all-new cross section, he could be out of luck when it comes to sparking a Phoenix-like reincarnation of the 757. 

Commenting on speculation about a reengined 757, on Feb. 11 Boeing Commercial Marketing Vice President Randy Tinseth says, “The fact is, there’s absolutely no business case to support that. We’re very happy with our 737 and 787 product lineups. So we’re studying the space in between them. Customer feedback has led us to look at an airplane that is larger than today’s 737 and has greater range than the 757.”

The statement reiterates Boeing’s underlying message that if a market for a 757-sized aircraft does exist, it is for an all-new “middle of the market” (MOM) aircraft rather than a one-for-one successor to the current twinjet fleet. Earlier in 2014, Boeing’s global sales and marketing vice president, John Wojick, told Aviation Week, “One opportunity is an airplane in the 200-300-seat category which maybe doesn’t fly as far as 787 and which is more regional. People liken it to the 757 or something different.” A key market for such an aircraft is likely to be Asia, and operators in this area “will play a significant role in helping us determine what those characteristics might be.”

Echoing the view that Boeing is likely to take a longer-term view of this market niche rather than react to the A321neo LR with a short-to-mid-term reengining effort, Jeffries analyst Howard Rubel says, “There are over 150 757s parked in the desert today, approximately 15% of the fleet. If this plane [is] so hot, why is such a high proportion of the fleet going unused?” He adds that “we see no urgency to fill that market niche, and believe that Boeing has reasonable long-term options. The market may evolve and shift, creating a different need than what is perceived today. We are of the view that Boeing is not about to jump into a new development program.”

Boeing’s long-term new airplane development strategy is therefore focused on developing a New Small Airplane (NSA) 737 successor for the 2030s and beyond, and whether or not to tie this in with codevelopment of a larger MOM aircraft. “We have got things to work out, but there is no question there is the challenge of the transition between single aisle and twin aisle.

“We are working hard to understand how large that market really is because it is not that easy. What technologies do you need for an aircraft with a range of 4,000-5,000 nm, and at economics that make sense? And if it is a small market, how do you deliver at the right cost, and how do you set up a production system to do that?”

Others looking at Boeing’s conundrum from the outside are also puzzled that the company is not, apparently, considering reviving the long-canceled short-to-mid range 787-3 for the MOM market. After all, the aircraft was designed to carry up to 330 passengers as far as 3,500 mi., making it close to the requirement. However, despite the fact that the broader appeal of the 787-3 was limited by being designed specifically for the Japanese market, more deeply rooted cost issues likely make the prospects of reviving the -3 a non-starter. 

The 787 is the most complex, sophisticated commercial aircraft Boeing has ever produced, and it is inevitably costly to manufacture. While Boeing is making strides to drive costs down, it is extremely unlikely to produce a “simplified 787-3” at sufficiently low cost to sell to the MOM sector. 

Although no one knows for sure what the exact passenger capacity and range needs are, all the Boeing planning pundits seem to agree that the 757 replacement market will be extremely cost-sensitive. 

Mike Sinnett, vice president of product development for Boeing Commercial Airplanes, has already acknowledged that one option under study is to develop NSA and MOM in parallel, sharing common cockpits, systems and structures to cut costs. The result could be an “NSA1” aimed at the 737 market and a slightly larger, twin-aisle “NSA2” for the MOM sector. 

The “common core” design approach was successfully used in the 1970s and 1980s to produce the 757/767 and is something “we would have in our mind going forward,” he adds. 

In December, Sinnett stressed to Aviation Week that the 757 replacement study “is a proxy for something that is not a 737 and is not a 757.” The airlines are interested in something that “is more than a 757. They are not looking for a carbon copy,” he said. Studies are therefore focused on designs with more range and capacity to “enter a niche, and to understand if it can be expanded into a third market segment. We are still testing the waters,” Sinnett notes.

Far more immediate matters are therefore likely to dominate Boeing’s agenda at Istat. These will include updates on the 737 MAX, the first of which will enter assembly at Renton, Washington, by year-end, as well as further measures to revive flagging sales of the 747-8, development progress on the 787-10 and new details of the planned upgrade to the current 777F and -200LR/300ER. 

Airbus, in contrast, has already defined its answers for the segment of the market left open by the end of Boeing 757 and Airbus A300/A310 production. The answers are the A321LR—a minimal-change variant of the A321neo in the cabin-flex configuration with rearranged exit doors, and the A330 Regional. Airbus has already secured Udvar-Hazy’s support for the A321LR, and is now promoting the aircraft to airlines following the official launch in January, but the proposed regional version of the A330 has not really taken off.

The aircraft—structurally identical to the long-haul version of the A330, but with de-rated engines and a lower maximum takeoff weight—was targeted in particular at the Chinese domestic market, where there are many high-density routes that are too large for the A321. However, Airbus has not yet identified any sales for the A330 Regional.

That is causing serious concerns in two ways. The manufacturer faces the challenge of smoothing the transition from the current version to the A330neo in the coming years. Airbus is slowing down A330 production from 10 aircraft per month to nine in the fourth quarter of this year, but it still has some open production slots in 2015, and—even more significantly—in the following years, leading many observers to conclude that more cuts are coming. Additional highly welcome short-term sales have not yet materialized.

But more long-term, the transition to the A330neo will potentially make sales of a regional version harder: The additional weight incorporated with the latest engines can be compensated for by lower fuel burn on longer-range routes, but the business case is much harder to make on the shorter-haul sectors that Airbus is targeting.

Airbus does not face the same A330-related production issues in terms of the A320 family, which is essentially sold out through the A320-neo transition unless a very large number of airlines decide to cancel late-production A320ceos because of lower fuel prices and opt instead to wait for the neo.

The next program decision Airbus may have to make is whether to reengine the A380. While that issue is likely to be broadly discussed at Istat, a decision may not be as near as the aircraft’s main customer, Emirates, would like. But Airbus is coming under increasing pressure to clarify its position: The longer the speculation about an A380neo continues, the harder it becomes to sell earlier production slots of the current version to airlines that may be concerned about being stuck with late-build aircraft of an old production standard.