Looking To Replace Older, Less Efficient Aircraft With Newer Airbus, Boeing Models

The recent surge in commercial jetliner orders, particularly for the Airbus A320neo at the Paris Air Show, may be just the tip of the iceberg as U.S. airlines reportedly are prepping major fleet upgrades. Fuel economy would appear to be at the root of the plans to transition out of older airplanes.

A320neo Computer Rendering

And Boeing may come up on the short end of the stick. Reuters reports that American Airlines, which currently flies an all Boeing primary fleet, is considering an order for as many as 250 narrow-body airplanes split between the U.S. planemaker and its principal rival Airbus. Other deals reported to be in the works are a 200 airplane order from Delta, and Southwest is also said to be looking at "refleeting."  Of the major hub-and-spoke carriers, only US Airways says it does not have some kind of fleet upgrade plans on the drawing board. That major carriers are eyeing new airplanes is really not surprising, according to AVITAS VP Adam Pilarski. "Eventually, they have to do it," he told the news service.

American is still flying nearly 250 older MD-80s, along with about half that many older model 737s. And while Airbus is scooping up orders for its re-engined A320neo, Boeing is still dithering over whether to re-power the 737 or replace it completely. Analysts say that could put the U.S. company at a competitive disadvantage.

B737NG Production Line

Analyst Michael Boyd said that Airbus basically ate Boeing's lunch as it announced major order after major order for A320 neos at Paris, ending with a total of over $50 billion in commitments for the plane. And consultant Bob Mann of RW Mann & Co. told Reuters that airlines, even U.S. carriers, may not have the patience to wait while Boeing looks at the re-engine vs new airplane options for the workhorse 737.

Still, Pilarski said that neither company was ever going to win all the orders. He said neither planemaker could produce that many aircraft in the time frame in which airlines will demand them. Boeing's Jim Albaugh said at the Paris Air Show that the company hopes to have a final decision about what comes after the current 737 by the end of the year.

FMI: www.boeing.com. www.airbus.com