GE Aviation’s RISE Meets Some Industry Skepticism
Ever since CFM International—the joint venture between GE Aviation and Safran—presented the details of its RISE program in June, the industry has been wondering what the project is actually about. Is the Revolutionary Innovation for Sustainable Engines a concept for an all-new engine or a technology program for the next 15 years, elements of which can be applied to potential upgrades of the Leap engine? Perhaps both? Or is RISE an attempt to take over Boeing’s product strategy?
- Mixed industry reaction to RISE project
- Lack of aircraft applications limits early options
Reactions by analysts and insiders have been mixed. Some say the two OEMs simply have some catching up to do in certain technologies and have found a nice umbrella for their efforts. But the challenges are not limited to technology: One of the main issues for early adoption of RISE is the strategic question of where to use it.
When it comes to reducing aviation’s environmental footprint, new engines are key. Engine OEMs are therefore the most important players in the transformation of the business. Yet developing an engine typically takes several years longer than developing a new airframe. In an unusual set of circumstances, neither Airbus nor Boeing appears to have an all-new aircraft program on the drawing board. Even the prospects of the two companies launching derivatives of existing families different enough to justify a new powerplant are unclear at this stage. The A320neo and 737 MAX experiences—all the difficulties of the first years—are not necessarily making future reengining programs a more attractive proposition.
“Airbus has a 65% market share right now,” a senior aircraft OEM executive says. “That is not sustainable [for Boeing]. Boeing [does] need to build a new single-aisle aircraft or a 757 replacement, but it is becoming increasingly clear that they cannot afford to do that right now.” Airbus will not act until Boeing has played its cards.
“There is an element of the tail wagging the dog,” says Kevin Michaels, managing director of the AeroDynamic Advisory. He believes that GE is attempting “to drive the product strategy of Boeing” by simply putting out the story that it will have a revolutionary engine in place by 2035. Another industry source says, however, that “RISE is not necessary to deter a new Boeing product [to enter service before the end of the decade] because right now there isn’t one.” Boeing seems to believe that it does not need one.
Some insiders agree. Bernstein Research analyst Doug Harned thinks that although incremental advances in materials can happen, “even on the Leap” engine, they are “not enough to launch a new aircraft.” Nonetheless, he believes that the MAX will be a “perfectly competitive aircraft for the future.” Harned thinks that Boeing is satisfied with split narrowbody fleets such as that of United Airlines: Its MAX fleet operates transcontinental services and shorter distances, whereas its A321XLR aircraft fly across the Atlantic or into Latin America.
One big hurdle for Boeing in the potential launch of a new aircraft, and a reason for engine OEMs to find an application, is the potential cannibalization of the MAX market by the new product, Harned says.
Agency Partners analyst Sash Tusa disagrees. “Boeing cannot afford to wait until 2035 [to introduce a new aircraft],” he says. “Boeing has not seen a narrowbody market share that low before. It has put a lot of weight in getting into the China market [with the 737 and the 787], but it is looking less and less likely that this will play out. The U.S. market is not big enough to sustain Boeing.”
“GE and Safran don’t believe they can run the Leap core technology for as long as the CFM-56,” Tusa says. The RISE program “suggests that GE and Safran have not been investing enough over the first few years [of Leap],” he adds. “They are now playing catch-up.”
There is also a fair degree of skepticism about RISE in the industry. “The core of it is the normal stuff that anyone would put into any new engine,” one observer says. “It’s a technology program to develop an unducted fan and a gearbox.” He says that engine OEMs have two customers: the aircraft manufacturer and the airline. As much as airlines are aiming at lower fuel burn and sustainable flying, they also want reliability. For the latter point, RISE is a high-risk bet, the executive argues.
Action from Pratt is “the biggest threat for GE,” Tusa says,because of potential further iterations of the geared turbofan (GTF). “Pratt is in the driver’s seat. They did a reasonable job in fixing the GTF, which is clearly the best engine on the A321neo. And Pratt has been working on performance improvement packages for years. All the stuff that GE did on the Leap, they will do now on the GTF.”
Tusa believes that in small increments, performance improvement packages (PIP) can lead to a fuel-burn improvement of up to 7% in the coming years. If Boeing sticks to the MAX, “all they can do is backfeed anything from RISE to improve the Leap.” A new aircraft could provide opportunities for more significant improvements because it could potentially allow CFM to introduce a bigger fan diameter, he argues.
Michaels, of AeroDynamic Advisory, believes there has to be another step between now and a future engine based on the RISE technologies. “We have one more generation of conventional gas turbines ahead of us,” he says. “You cannot take all these [RISE] bets at once. GE has to avoid doing all or nothing.”
Michaels credits Rolls-Royce for having “doubled down on alternative technologies,” since it does not have an engine for any of the current narrowbodies. The company also benefits from a cleverly constructed network of associated universities for research. Its biggest challenge besides finding enough money for a real engine development program, however, may be ensuring that customers have enough confidence to buy a Rolls-Royce product, given its precarious financial position, Michaels says.