Boeing Leaning Away from 737 Re-engining

 - August 31, 2010, 10:09 AM

Chances that Boeing will fit new engines on the existing 737 appear slimmer now than at any time since the company began talking publicly about the prospect, judging by the comments of Boeing CFO James Bell today at the Morgan Stanley Industrials Unplugged Conference in New York. According to Bell, potential customers haven't shown much interest in a re-engined 737, and Boeing remains unconvinced that the performance improvements promised by the various engine makers will prove sufficient to warrant such a step. 

"Right now it looks like the engines can get 10- to 15-percent more efficient, but it's not flow-through efficiency," said Bell. "When you add the weight associated with the change in the design of the airplane and you add the cost, it looks more like a single-digit improvement, which we don't believe is something that our customers are interested in." Still, Bell wouldn't completely discount the prospect of a re-engining, particularly if fuel prices rise well above today's relatively low cost by the time the company decides on plans for the future of the 737. 

Still planning to choose among the options of re-engining, introducing an all-new airplane or essentially maintaining the status quo by the end of this year, Boeing has yet to finish its studies, said Bell. "On the new airplane, we obviously are looking at what are the technological improvements that we need to have in order to [achieve] flow-through improvement of 10- to 15 percent," he added. "At this point we don't know exactly what that is. We do know part of it would be the engine. The other part would have to be improved aerodynamics of the aircraft itself, and it's easier to scale up [composite material] than scale it down, but we're still working at it…But I can tell you right now our customers have not shown a real interest in a re-engining."