Insight: Why We Won’t See All-New Airplane Programs in Near Term

We will not be seeing any “all-new” commercial aircraft designs in the 2020s, with the possible exception of the regional market. The reason is technological change, higher risks, and a low return on investment should new technologies obsolete existing technologies before 2040. Propulsion technology is changing radically, and that change will move its way up from trainers to commercial aircraft. The question is when, and with what impact economically?

The nature of propulsion is changing everywhere. From a major shift from gasoline to electric automobiles to research on hydrogen fuel cell production for airplanes, it is clear that propulsion in the year 2040 will be in a state of transition from “fossil fuels” to electricity. If we look out twenty years, to 2042, how different will aircraft be, and will all-new designs be required?

Today, we’re seeing the small end of the market change. Pipistrel, recently acquired by Textron, has the first certified electric aircraft in operation. Bye Aircraft will also soon have its trainer and other larger 4 and 8-seat models to follow. Eviation’s Alice promises to change the economics of smaller capacity regional flights with its 9-seater, and R&D is ongoing for larger hybrid-electric turboprops at ATR, Embraer, and DeHavilland Canada.

From there, the next step is mainline aircraft. But to successfully accommodate electric propulsion, it is likely that the first major changes to the tube and swept wing design introduced in the 1950s may need to occur with all-new designs. Major benefits from new technology are possible, but also entail major risks with all-new development programs.

The Boeing 787 is an excellent example of technology change. With its carbon fiber construction, the all-new 787 achieved record order levels for a wide-body aircraft before it was certified, indicating the strong interest from airlines in aircraft with better economics and better carbon footprint. When new technology aircraft set sales records, older models tend to fade away. In this case, the delays to the 787 program helped the competing Airbus A330 until their A350 arrived, but that is likely to be an exception rather than the rule.

SAF or Electric Propulsion

The use of synthetic aviation fuel is one way to reduce carbon output but producing SAF, in the quantities required to support the aviation industry, will require major investment. Building a global production capacity and distribution system that can offer SAF at competitive pricing is at least a decade away. The advantage of SAF is that it can be used with existing equipment and provides an alternative mechanism for compliance with environmental regulations and potential taxes using today’s engines. But is that the long-term solution?

Hydrogen-powered aircraft, using fuel cells, represent an all-new alternative to today’s more conventional aircraft. There are significant advantages and disadvantages to new propulsion systems. Advantages include the fact that electric engines typically have just one moving part and maintenance requirements are virtually non-existent over the life of the engine. Disadvantages include the logistics and placement of a hydrogen supply to operate a fuel cell on board an aircraft, and the logistical and distribution requirements for hydrogen.

In the near term, SAF is an easier and more feasible solution. Over the longer-term, electric propulsion is more desirable from an environmental perspective. But here’s the rub. As an aircraft manufacturer, you would expect an all-new aircraft program to be about a 50-year process – about 15 years of production, with another 10 from an improved version, and another 25 years of operating life from the last delivery.

The following table shows the history of major jet aircraft programs, including their derivative models, since the late 1950s. The most successful programs have resulted in multiple models from the same basic design, perhaps best epitomized by the DC-9 and 737 families. Many of the models have had their life-cycles extended through cargo conversions, and older aircraft remain in service today.

Launching an all-new program today entails a substantial risk of future technological and economic obsolescence. A new program launched in 2022 would win certification by 2027, have production through 2042, and with improvements likely through 2052-2057, and operations and spares support to customers through 2077-2082. But with a major technological breakthrough in the 2045-2050 time frame, would a conventional configuration with conventional propulsion be able to remain competitive against new propulsion technology? The answer is likely to be no, creating a substantial change in return-on-investment calculations. The ability to produce improved variants will likely disappear, reducing program revenues. Additionally, 15-20 years of service life could be lost, with a reduction in spares and support revenues.

Economically, this translates simply to the fact that it would be better to rely on a derivative of an existing model in the near term rather than take the financial risk of an all-new program. A new program launched today would be unlikely to have the 50- 60-year lifespan that we’ve seen with the earliest models of the jet age that have now exited service. The risk of seeing a technology change causing a sudden decline in production and their order book is not something OEMs take lightly in their analyses.

Airbus set a goal to demonstrate the feasibility of hydrogen propulsion by 2035. That’s an aggressive goal but indicates the serious potential for a tectonic shift in aircraft design. The resulting earthquakes and tsunamis could create havoc for an all-new program that suddenly faces new competition.