As the old song states, “Liar, Liar, pants on fire, your nose is longer than a telephone wire.”  The advertising war between Airbus and Boeing has kicked up a notch, with Airbus showing an Boeing aircraft with a Pinocchio nose and asking why its competitor is stretching the truth in its newest ad.  In the ad, Airbus claims that Boeing is utilizing misleading performance comparisons with the 737 against A320 and with the 747-8i against A380.


It has always been true that each manufacturer advertises its products in the most favorable light, and its competitor in the worst possible light.  In this blog, we’ve taken each manufacturer to task for various claims, and have published independent economic analyses that show the aircraft to be quite close in economic performance.  An example of that is here.   Airbus has, in the past, exaggerated the performance of its A330-300 against the 787-9.   But recently, Boeing has begun to quote performance numbers that we, and other industry analysts, have been quite skeptical of and have raised our eyebrows.  These numbers, particularly for existing aircraft that airlines, those who really know, tell us have quite similar operating costs and tell a different story. Airbus does have a point here.  Boeing is claiming that the current 737NG has an 8% fuel burn advantage over the A320ceo, and that a similar advantage will exist for Max against neo.  We agree with Airbus that those claims are extremely exaggerated.

The problem has always been apples and oranges in economic comparisons by the OEMs.  The range chosen for comparative economic analysis by each manufacturer for public consumption will be the range that optimizes performance for their airplane.  Typically, each manufacturer claimed about a 2% advantage, and the net results were about even.  But Boeing is now claiming a larger advantage for its current, and future aircraft than it has in the past.  Unfortunately, the current case with the A320 and 737NG series is that airlines are reporting operating costs that are fairly equal, and our independent analyses show the aircraft to be remarkably close, with Boeing in the lead over shorter hauls and Airbus leading for longer-haul operations.

So how does Boeing claim an 8% advantage, when the aircraft operators and independent analysts say differently?   Boeing’s credibility on economic issues has begun to slide in the industry, but the attack by Airbus appears to indicate that Boeing’s marketing hype may be having an impact.  These claims are made not for airlines or leasing companies, who perform their own detailed economic analysis, but for the unsophisticated journalists and Wall Street analysts who don’t have the capability or time for independent analysis.  Will that help Boeing’s stock price, or market image?  Is Airbus concerned that less sophisticated airlines might be taken in by Boeing’s claims of an 8% advantage for current their narrow-body aircraft, and similar claims for the Max against neo, which are even more troubling since neither aircraft has yet completed design, and are relying on new engines that in the case of the PW GTF are just entering testing and the CFM Leap has not yet been built.  While each manufacturer can claim performance improvements to their own aircraft with some credibility, based on their engineering analyses, accurate competitive comparisons are more difficult.

In our view, Boeing’s claims of an 8% advantage for Max over neo also appear to be ridiculous, and Boeing has been publicly challenged at conferences by industry experts.   The challenges to “prove it” have been ignored by Boeing, who simply state that they “stand by their numbers” and refuse to disclose how, likely because they can’t.

Cutting through the hype, the bottom line is keeping customers from switching, and Boeing has lost a couple of key narrow body customers to Airbus in recent years, and needs to stop the bleeding.  The shared order at American was a huge win for Airbus, and while Boeing also gained orders, the battleground that once tilted in their favor is now neutral.  In recent years, Airbus A320 family has outsold the 737NG, and neo has about 1,500 orders to about 1,000 for Max.  If the Boeing was really 8% better, Airbus wouldn’t be outselling it.

Similarly, the A380 continues to sell well, while the 747-8i has not been well received in the industry.  Among current production very large jets, Airbus has an 86% market share, and a much larger backlog.  We recently completed an independent economic analysis of very large airplanes, and examined in detail the Boeing claims of economic superiority for 747-8i over A380. We found it to be an apples to oranges comparison, particularly with respect to seat pitch and the number of seats.  Boeing utilized higher density seating in its analysis, rather than similar seating plans from airlines operating the aircraft.  Our independent analysis adjusted the number of seats by utilizing the same seat pitch, which yielded different results.  We show an aircraft-mile advantage, as would be expected for the smaller 747-8i, but a seat-mile cost advantage for the larger A380, which has significantly more capacity.  That is a far cry from the double digit advantage Boeing projects.

The Bottom Line:

This is much ado about nothing, as airline customers will do their own homework.  We would find it hard to believe that Boeing would present exaggerated numbers to sophisticated customers, who would then in turn ask for performance guarantees and penalties for not meeting those projections.  But PR battles and market image are important, and Boeing is trying to win over journalists and investors, if not customers, with their claims.   While Airbus has point, the market has already spoken by giving them the lead in each of the categories in which Boeing is attacking, and that lead is likely to continue.

Apparently, it has gotten to the point that Airbus has had enough, and will counter-attack.  It will be interesting to see how Boeing reacts as the nastiness factor in this battle has just increased by an order of magnitude.


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