The Boeing board has given the green light to offer airlines the proposed new 777X widebody jet, which means key decisions on where to build its wings and assemble it could be just months away.
“We’ve made great progress in our development work and we are beginning to discuss additional technical, pricing and schedule details with customers regarding 777X,” said Boeing spokeswoman Karen Crabtree.
The jet will be a bigger version of the current 777, a significant revamp that will feature new engines and a carbon-fiber composite plastic wing.
According to a senior Boeing engineer, the company has proposed the longest wingspan it has ever built, with folding wingtips so that the jet will fit into airport gates. Industry reports put the proposed wing’s length at 233 feet.
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The go-ahead came at last weekend’s board meeting in Chicago, before the company’s annual meeting Monday.
Decisions ahead on this jet program are of huge significance to the Puget Sound region.
In a quarterly earnings teleconference last week, Boeing CEO Jim McNerney said the company is “in the middle of the assessment now, where to assemble it and where to build the major components.”
The current all-metal version of the 777 is built in Everett. For that reason most industry observers believe it’s very likely the 777X will be assembled there.
To build it elsewhere, “they’d have to move the entire production infrastructure and the cost would be just out of sight,” said the senior engineer, who asked for anonymity since he is not authorized to speak publicly.
“Boeing Commercial Airplanes would never recommend that,” he added. “777 is half of our cash cow at the moment, and the (profit) margins on each plane need to be preserved.”
As for duplicating all the tooling somewhere else, so the current 777 would continue to be built here while the 777X went elsewhere, that would cost at least $1 billion, he said.
“I can’t see from a Chicago point of view that it makes any economic sense,” the engineer added.
However, it is an open question where the composite wing will be built.
One factor favoring Washington state is that the immense size of the wing may make it difficult to transport long distances.
But last week, McNerney insisted on leaving all options open.
“Obviously Everett is doing one heck of a job right now building the current 777 model, and so it would obviously be an attractive place to consider for the assembly for the next 777 model,” McNerney said. “The composite wing, we have to think through, as in the case of assembly, where we do that.”
On Wednesday, Gov. Jay Inslee said in a statement the state is developing a comprehensive aerospace strategy
with the “paramount goal … to win the 777X for Washington.”
“We will roll out details of this plan soon,” Inslee said. “I hope the Legislature will … prioritize investments that support our efforts so that we can clearly demonstrate to Boeing that there is no reason to consider any place other than Washington to build the 777X.”
The step Boeing has now taken in the jet’s development phase, known as authority to offer, was widely anticipated from the latest board meeting.
It means Boeing’s salespeople can go ahead and negotiate tentative deals.
“It’s clearly the next step in the marketplace,” said Crabtree.
Boeing is targeting the 777X for entry into service for the end of this decade, she said.
A formal launch of the program, which means a Boeing commitment to production, will follow if deals with airlines are pinned down to the satisfaction of Boeing’s board.
The timing “depends on the market response” and will need board approval, said Crabtree.
By the time of launch, Boeing may have decided where to build the plane.
In the past, Boeing has launched jets only a few months after management received authority to offer.
McNerney said last week only that the launch would likely come “before the end of the year.”
Aviation consulting firm AirInsight, in a note last week, said Boeing is offering customers three different versions of the new jet.
First up will be the 777-9X, seating 406 passengers, entering service in 2019. This jet is a big step up in size from the flagship 777-300ER, which seats 365 passengers.
The second version will be smaller, the 350-seat 777-8X.
And there will also be a longer-range version of that one, the 777-8XL.
That long-range model may be aimed at Emirates, the flag carrier of Dubai in the United Arab Emirates, which is the largest operator of the 777 and a key prospective customer for the new jet.
This year, Boeing put the 777X back on a fast development track, after a marked slowdown in movement last year.
That may be because the rival Airbus A350-1000 has been gaining orders.
Last month, British Airways ordered 18 of the Airbus jets, though Willie Walsh, who heads the International Airline Group that includes the British airline, said he is still open to ordering the 777X.
Singapore Airlines is another customer known to be interested in the 777X.
Dominic Gates: 206-464-2963 or email@example.com