Premium – Updating MoM

The news that Boeing is getting closer to actually saying something about the NMA, or 7M7, is an opportune moment to see how that market is evolving. This is an update to a story we had looked earlier this year. The basis of this story is the following chart. Airbus Since 2000 Airbus has made remarkable progress. Its fleet size has grown by 349%. The Airbus fleet has grown consistently younger. Implying many new deliveries to customers. Airbus has seen market share move from 16.1% to 47.2%. Note the growing space between the dots (each dot is a year); Airbus' deliveries are accelerating in this segment. Airbus has focused its attention here primarily on the A321, though the A330-800 could fall into this segment in future. Boeing Boeing's market share went from 74.8% in 2000 to 52.0% in 2Q17. Note the Boeing fleet has hovered between about 1,500 and 1,700. In nearly 20 years Boeing has seen hardly any growth (6.6%). There is very little space movement between the dots, indicating few deliveries in the segment. The Boeing fleet is older than the Airbus fleet. Boeing has had several models in the period in the segment and keeps trying to innovate most recently with the MAX10. But these offerings have not caught on - the 757 once owned the category. The updated and stretched 737s have not managed to maintain Boeing's hold. Conclusions Boeing has to move forward with something other than the 737. The MAX10 is a stopgap. The MAX10 is more likely going to kill off the MAX9 more than hurt A321 sales. The 7M7, or what everyone believes to be the 797, can't come fast enough. Boeing cannot stay competitive in the segment with current models. Despite the stress another new program will bring to bear, Boeing might be expected to accelerate its NMA.

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