New Boeing jet unlikely but depends on MAX return: Safran CEO

October 30, 2020

By Tim Hepher

PARIS (Reuters) – Boeing <BA.N> is unlikely to launch a new plane in the near future but its options will depend in part on how successfully its grounded 737 MAX regains its position in the market, the head of one of its engine suppliers said on Friday.

The MAX is expected to win safety approval within weeks following a 19-month grounding in the wake of two crashes, Safran <SAF.PA> Chief Executive Philippe Petitcolin said.

“We are doing everything with Boeing to put the MAX back in service in the best possible conditions,” he told reporters.

Boeing, suppliers and leasing companies – all of whom invested heavily in the MAX – have pushed back against the idea of replacing it despite mounting cancellations.

But Boeing is expected to try to capture eye-catching orders to recover some of the share lost to Airbus <AIR.PA>, especially the increasingly dominant A321neo.

If airlines stop buying the MAX or fail to reabsorb it into their fleets, there has been speculation Boeing could obliquely begin the process of replacing it by first developing a replacement for the out-of-production 757.

This is a slightly larger single-aisle jet occupying a spot in the market overlapping with the MAX and A321neo family.

It is therefore seen as a possible starting point for a design that could eventually pivot to a full MAX replacement.

Petitcolin said the 737 MAX was likely to stay in service until 2035, implying development of a successor would not start until 2027 with pre-marketing starting in 2025.

If the MAX failed to reassert itself in the market, Boeing could theoretically be tempted to bring that forward to 2022-23.

“The success or otherwise of the return to service of the MAX could – I am speaking hypothetically – influence Boeing’s decision whether to launch a plane earlier,” he said.

A new model is “in the realm of possibilities even if today it is not the solution or option that we consider the most probable,” Petitcolin told reporters.

Boeing, which has repeatedly said it is focusing solely on the MAX, was not immediately available for comment.

Reuters first reported in April that Boeing had been studying a possible 757 replacement to thwart the A321neo, though plans for this and a potential revamped 767 cargo jet had been placed on a back-burner during the crisis.

Fresh reports pushed up Boeing shares earlier this week. Senior industry sources said Boeing would not launch a new jet soon, though some analysts have urged it to do so.

Boeing is meanwhile studying refinements of larger MAX variants including the MAX 9, they said. The Air Current reported this week that Boeing was looking at updating the MAX 10.

(Reporting by Tim Hepher; Editing by Susan Fenton)