A day after he gave Airbus its launch order for the A330neo as the Farnborough Air Show opened, Steve Udvar-Hazy was given his usual welcome to the Boeing chalet.
Chief executive of Air Lease Corp. (ALC), Hazy has a reputation in the industry as the foremost judge of the aviation market. He was at Boeing on Tuesday to announce a big order for the U.S. jetmaker: six 777-300ERs and 20 single aisle 737 MAXs, which based on blue book values from consulting firm Avitas is worth around $2 billion after standard discounts.
While there, he had high praise for the 787-9 Dreamliner, a star of the flying display at Farnborough.
He also took the opportunity at at a press conference to offer Boeing public advice on selling the 787 in competition with that new Airbus A330neo.
Boeing executives, confident in their airplane, seemed content to wait and see just how big a threat the Airbus jet will prove.
Hazy said that both he and his longtime right-hand man, John Plueger, ALC’s president, are pilots and that a couple of weeks ago Boeing allowed them to fly a 787-9 out of Seattle.
“We did all the maneuvers,” Hazy said. “Low speed. High speed. Steep turns. It’s a magnificent airplane.”
Those who witnessed it fly on the opening day of the Air Show would agree. It has the same graceful wing curve in flight as its smaller sibling the 787-8, but its size and its quietness as it soars past make it majestic.
Most impressive in the display was the touch-and-go maneuver the Boeing test pilot did, coming in low and fast, resting the wheels on the tarmac as if landing, then powering up again. The plane shot into the sky at the steepest of angles.
ALC has orders already for 15 of the 787-9s and also for 30 of the even bigger 787-10 that’s coming in 2018.
He said that Boeing should be able to sell the Dreamliner at peak production rates of 160 to 180 airplanes a year for at least 15 years, assuming a stable global economy, which would mean deliveries could exceed 2,500 aircraft.
For comparison, the 1,500th 747, a widebody jet that’s been sold for more than four decades, was just delivered to Lufthansa at the end of June.
Hazy said that for long range routes the 787-9 is obviously superior to the A330neo and will be preferred by ultra long haul carriers.
He said the two jets will also compete head-to-head in medium long haul markets such as transAtlantic, from Europe to the Middle East and intra Asia. For those routes, airlines will not need the full range capability of the 787-9, and Hazy suggested that Boeing sell the planes in those markets certified to lower maximum weights and with less engine thrust at a cheaper price.
This change to the airplane’s specification would essentially be only on paper, so that the airline wouldn’t have regulatory approval to operate the plane to its full capability.
Boeing Commercial Airplanes chief Ray Conner said this is something that has been done for years in selling airplanes.
An airline taking this option saves not only by getting a bigger than usual discount, but also by paying lower landing fees at airports, which are based on weight, and by saving on engine maintenance because the engines would not be run so hard.
John Wojick, Boeing’s head of jet sales, said that right now there is huge demand for the full capability of the 787-9, with airlines seeking to use its range to open up new markets.
Before Wojick starts offering any big discounts on 787s, clearly he’ll wait and see just how competitive the Airbus jet turns out to be.
“We’ll see how the market shakes out,” said Conner.