The delivery of the first Airbus (EADSY, Financial) A350 XWB to Qatar Airways marks the beginning of a dramatic shift in the dynamics of the wide-body jet market. Analysts and industry experts are considering this to be an extremely crucial milestone in the never-ending battle between American aero major Boeing (BA, Financial) and its European peer. Airbus has been counting on the built-from-scratch jet to gain significant traction in the wide-body commercial aviation space, an area dominated by Boeing. Chicago based Boeing has moved ahead in the race with its 787 Dreamliner, but now Airbus’ answer to Boeing’s clean-slate model is here. How will the two jets fair against each other? What this means for Boeing? Here’s a lowdown.
Source: Airbus
The faceoff
Boeing delivered the first Dreamliner in 2011 after a series of issues resulted in a delay of 4 years. Since then the model has bagged more than 1,000 orders, of which 200 plus jets have already been delivered. On witnessing the success of the 787 and encountering questions whether the A330 will be able to compete with Boeing’s latest or not, Airbus decided to work on a jet that could take on the 787 head to head.
The European aero major started working on the A350 and later after several design changes, it rolled out the A350 XWB model, where XWB stands for extra-wide body. When airlines across the globe heard of a newer jet that could challenge the 787, they were quick to place orders. According to Airbus, it has bagged more than 750 orders for the jet from 41 customers spread across the world.
Airbus A350 XWB claims to offer 25% additional fuel efficiency which according to Qatar CEO Akbar Al Baker would help the airline bring down its operating costs significantly. Fuel accounts for almost a third of the total operating cost and thus spending millions on a new jet makes sense since that would provide years of operational efficiency. Even on the back of dropping oil prices the deal seems logical, since, first of all, no one expects oil prices to stay this low all through, and, second, oil will continue to be a significant cost item no matter how much the price drops and thus lower fuel expenses will always be desirable.
What’s attractive about the A350 is that it offers technology that’s even newer than that found in the 787. While both jets are built-from-scratch models, A350 includes the latest advancements that tool place since 2011.
What this means for Boeing
The delivery of the first A350 has brought the top two jet makers Boeing and Airbus at par since both the companies now have their carbon-composite jets on the runway. Until this delivery, the 787 Dreamliner was the only jet built mostly out of carbon composite material. This has led many analysts to believe that the monopoly or authority which Boeing was enjoying so far will come to an end. Boeing has seen its share of difficulties with the Dreamliner – issues related to batter fires, wing cracks, etc.
So now airlines are waiting to test out Airbus’ latest to see if it can deliver a better experience and impressive dispatch reliability. So far the A350 has had a smooth run in development and flight tests, and now if the jet lives up to the expectations of the airlines and passengers, in all probability it will score better. So, what does this mean for Boeing? Well, it needs to work on making the Dreamliner even better in terms of dispatch reliability and proactively resolve whatever issues that crop up. This is one battle that Boeing can’t afford to lose.
