Stan Deal, Boeing Commercial Airplanes President and CEO.
Boeing Commercial Airplanes President and CEO Stan Deal sat down with Aviation Week's Jens Flottau, Executive Editor, Commercial Aviation, ahead of the Paris Air Show to talk about the current commercial aircraft market, the prospects for a new generation Boeing aircraft and his view on the competition.
AW: There has been a lot of talk around the next generation of aircraft of late. You seem to be focusing on the transonic truss-braced wing—or TTBW—architecture. In a nutshell what are its advantages?
Deal: TTBW is the potential direction. The configuration has been borne out of a lot of R&D work in the wind-tunnel and it is promising a double-digit aerodynamic efficiency gain. The next step is to see whether all the predictive work out of the wind-tunnel correlates to real life. That is what the NASA contract is about. And if it does then it is a very viable technology suite for the future.
Another issue is understanding autonomous certification, not that we would make the next airplane autonomous, but we would probably have an autonomy built-in capability in the next airplane. So there is a host of capabilities that we are working on. Anything that we take to market has got to be in that 20-30% operating benefit to unlock all the capex that you have to reinvest. That’s an exciting wing, an exciting configuration. The high wing unlocks a couple of capabilities, too, it gives you more variability around the engines.
What size of aircraft is realistic in that configuration?
The product, I think, is pretty scalable. It probably does not go up to the ultra-widebody size because you are dealing with a very, very long wingspan. We think about that architecture as in the single-aisle to middle-of-the-market range. As you approach the middle to large widebodies you have to think about other configurations. But we want to make sure people understand there is still a lot of research and development to unlock that value. Right now the existing product strategy from narrowbodies to widebodies is working well. We are unlocking market share across the board.
What are the engine options that you are considering?
It is about airframe capability first and foremost, from an aerodynamic efficiency. Then propulsion will be the next trade. Obviously, we are looking at RISE and conventional technology—how far can you push a Pratt engine? A GE engine? Of course Rolls-Royce is working on a new technology suite as well. The high wing opens up more potential if you get to an ultra-high bypass ratio or open rotor. That’s a nice feature of this product.
Boeing has a conservative company culture. Is it fair to say you could lean more toward a conventional engine rather than open rotor?
We are going to be agnostic, we are not going to put all of our eggs in one basket. [CFM] have staked the claim on RISE, they have got R&D improvement plans on their conventional technology engines around the Leap. I assume they are going to run both paths because there is still a lot of uncertainty around how much real net benefit an open rotor has. For us, it is going to be about the integration effects, how much ultimate specific fuel consumption you yield once you integrate into the airframe and how you solve the safety concerns around the large rotor relative to fan blade out. Then there is noise: how do you acoustically assure that you are continuing down the path of less and less community noise which the current engine technology has done a nice job of. That is one trade dimension we really watch because community noise has just become this bug push in Europe and the U.S.
Any new aircraft would have to match the performance characteristics of current narrowbodies, right?
Yeah, I don't see at this juncture the above-100-seat segment fragmenting to a short-range and long-range kind of product. When you think 100 seats to say 250, I think you need a family of airplanes. It is going to have a built-in capability that would cover the average stage length, which is classically 1,200 km (648 nm) all the way up to 4,000-5,000 km. I just think that's the most capex-efficient solution.
For the next aircraft you plan to put in more autonomy. What specifically are you thinking about?
It’s too early to say specifically. I think you have to look at every phase of flight and the pilot or the human machine interface. And then you have to look at the accident track record and say what phases of flight have risk? And how can you eliminate some of that risk from the human-machine interface? That's how we're approaching the problem. And to a degree airplanes have autonomy to date: autoland, autopilot and cruise. The question becomes, how much further can you take it? And move from what's a very safe environment to even a safer environment. We're looking at each phase of flight to answer that question.
And you have will have to make the call when you launch the aircraft?
Potentially. The one thing we want to make sure is the architecture of the flight deck and the avionics. Enable it, whether it's at day one, or in the future, so that we don't have to fundamentally rearchitect the flight deck because of evolving regulatory and/or technology enablement. So another reason why you see a big part of Boeing's investment around kind of the heart of the airplane is to support that thesis that day one you filled an airplane with a very stable interface with a lot of flexibility for the future in the flight deck and the avionics architecture to be able to usher in as much capability around autonomy is the world will regulate.
Are you looking at single-pilot ops from day one or...?
No, but not to say it wouldn't happen. Yet to be answered.
From today’s point of view, if you bring an aircraft to market in 2035 will it have two pilots?
Most likely.
Is there any pressure by airlines on you to speed up development of a new aircraft?
No. Not at all. I haven't had a customer over the past two years saying that he is worried. And that he is not going to buy because he thinks we have the wrong product strategy.
But a lot of people argue that Boeing does not have that much time, given where you stood with the MAX in competition with Airbus.
When you are out of the market for two years, there are really no sales and in fact you are cancelling airplanes, it is natural criticism to be levied out there. But the MAX has been restored, the order base has picked up dramatically. Every family member of the MAX is selling, there is this criticism that the -10 would never do well. Look at the orders for the MAX 10 over the past two years, it's been an incredible unlocking of the market. We are going to continue to be paranoid. But we're quite content with the product strategy as it sits today against Airbus, both on the narrowbody and the widebody.
Could you go sooner with a new product and a more conventional engine?
I think the best way to characterize it is the technology tracks each have discovery points along the way. If I think about engines, clearly more time is needed for the open rotor, less time needed for conventional. The trade becomes how much total specific fuel burn you can unlock. The production system is another piece of how you get to scalable rate very fast with the technologies which you chose to embed in the airplane. So, you know, right now, I think we view that horizon is about the 2035 timeframe.
Given how long certification is taking and how new this is, you would probably have to launch way before 2030?
Yeah, there'll be a setback off that. Obviously, anything we do moving forward relative to that range of airplanes, you know, it's going to be under the new [certification] rules. So we'll have to consume every one of those requirements of FAA and EASA.
What market share threshold for the MAX is acceptable for you? If it gets too low, you won’t get good supplier deals and have to accept airline discounts at the same time.
The good news is we are not in this position and the other good news is it looks like we're in growth mode. But look, there's no absolute threshold we've set. My job is to continue to run the business. If we are under Airbus I’m not going to panic relative to the share question. That's not what we run the business around as a market share number and right now, we're in a very good position. Our supplier base isn't worried about Boeing and market share. They're focused on how they ramp up to meet demand. And we'll just keep selling.
Are you concerned about the A220 Stretch?
No. It is a separate family airplane. I think, for airlines, that puts a big dilemma on them. We've got the MAX 7 that competes well, the MAX 8 that competes well. I'm not worried about it. In fact, I think Airbus probably has a dilemma. Do they cannibalize the product line if they do it? We are in a value maximizing position for the airlines, which is step one, and then having a family that can compete across that range is economically efficient for Boeing. And I think Airbus is going to face some economic inefficiencies with two families and particularly the heritage of where the A220 started—probably not at the optimal cost position.
This is the first Paris Air Show in four years. What are your expectations?
We are going to showcase our products. We will have the MAX 10 there, we are going to have the beautiful 777-9, with those great folding wings. And then the show is the show. It's meet with suppliers, meet with customers, I anticipate there'll be some order activity. We've already made some big splashes. Ryanair was one of them. If some of the customer deals land and they coincide with the show, we will announce them. We're not going to incentivize for an airshow announcement. So there'll be a few announcements.
