FARNBOROUGH – At the Farnborough Air Show, AviationSource got to sit down with Darren Hulst, Boeing’s Vice President of Commercial Marketing.

In this interview, we went through the entire spectrum of Boeing’s commercial aircraft portfolio, as well as talking about some of the external threats to the manufacturer, such as Airbus as well as the ongoing Ukraine Crisis.

Within this as well, there was some focus on the 737 MAX and how its sales momentum has been elevated during the air show.

Without further ado, let’s get into it.

The Interview

JF: Darren, thank you for taking the time to speak to AviationSource. We will start things off with the 737 MAX. It’s been quite a great week for the program in terms of orders. Is this as a result of the increased confidence amongst consumers following the re-entry of the MAX 8 and MAX 9 into commercial service?

DH: I think it’s a combination of things. First, where the market is in terms of recovery, how the MAX is performing in service, and I think it’s the value proposition that airlines are seeing in the market as well in terms of efficiency, versatility of the fleet from the 7 all the way up to the 10 in terms of that family value proposition. Going forward, I think this is the time for them to make those commitments to establish their replacement and growth needs in the near future.

JF: There has been a lot of talk about the congressional approval needed for the MAX 10. How is Boeing feeling about the situation at the moment? Do you feel that you’ll be able to get certification by year-end or is it something that will head into 2023?

DH: I don’t have a timeline to provide to you. What we can say is that this is a priority of ours and we’re closely working with the FAA on the path towards certification. The 737 MAX 10 is an important part of the completion of the MAX family. As you have seen with Delta’s order this week, I think this highlights the value of that airplane in the market in terms of both our customer’s needs, but also the efficiency and sustainability that it helps bring to the industry as well.

JF: As a hypothetical, if the MAX 10 doesn’t get congressional approval, what would be the next steps for Boeing?

DH: I don’t even think it’s a hypothetical. It’s something we are thinking about. It’s an important part of our family and we’re working closely with the FAA to achieve the goals and the milestones because we think that the commonality and the flight deck experience across the family, enhancement to safety, but also exactly what our customers value in that family of aircraft.

JF: Do you think there will ever be a MAX freighter?

DH: I will say this. Freighters have proven their value strategically in the market, especially over the last two and a half to three years. The 737-800 BCF has had incredible success, securing more than 250 total commitments in the program so far. We announced an additional line of production in Gatwick to sustain and support the demand that we’re seeing in the marketplace. So that’s fundamentally a key area for us in the conversion space. I would say long term that like how the Next-Generation aircraft replace the classics in terms of the platform for converted freighters, I think you’d see the same thing over the life cycle of the 737 MAX. I don’t think we are looking right now at a production version of the freighter, just because of how everything fits into the air cargo environment at the moment.

JF: With that in mind, do you feel the MAX 10 is going to be a competitor against Airbus’ A321XLR?

DH: I’ll answer that question in two ways. In terms of the A321 family, the 737 MAX 10 is absolutely a competitor. Our aircraft is more efficient on every single flight, it has more capability in terms of range than the A321neo. So it’s got what the market needs at the top end with lower cost specifically versus the XLR. I think my view is that it’s a niche market (The A321XLR). Airbus is obviously marketing that level of additional performance, but it has a specific corner of the market where that actually fits above it. You need a wide body like the 787 for long-haul travel, and even with the MAX, there are some transatlantic routes with it already. So the versatility of that product I think comes into question in terms of where you could deploy it and actually generate value. I think longer term we’re always looking at where a product fit could exist in our future opportunities, especially with future development of our future families.

JF: Yesterday (July 19), there was the announcement from VietJet, firming up an order for 200 MAX aircraft. That’s quite the significant order. With that in mind, how popular has the aircraft been in the Asia region?

DH: It’s very popular. I will say that when you look at the industry in Asia-Pacific, low-cost carriers (LCCs) have really been an engine for growth in that market. There’s a tremendous amount of replacement demand that we’re approaching as we go through the next few decades. So going forward, the MAX 8 200 Gamechanger, plus the MAX 10 provides a great platform for LCCs to continue their growth path. And that’s kind of what you saw with VietJet’s commitment. Also in terms of the pacing of the recovery in other areas like North America and Western Europe, these markets have accelerated at a faster rate because of reduced restrictions. I think as we go into the next few years, you’re going to see that same demand and trajectory as Asia due to the emerging nature of fast growing economies. So that’s where the market growth has been. And now as the market recovers, that’s where it is going.

JF: The order with AerCap & Azerbaijan Airlines this week for 787s is also good news for the program as well. Do you still feel that wide bodies are still going to sell well given the current economic climate, especially with airlines wanting cheaper, more fuel efficient aircraft. Are these orders a stabilization of the need for widebody aircraft?

DH: I don’t think there’s any question about the demand for widebodies. Like what we talked about in terms of geographical recovery, short-haul has recovered faster because that’s where the demand is. But for long-haul, this recovery is coming too. We’ve seen it this summer where transatlantic travel has returned and is going crazy. So as we see more of that long haul recovery, I think that’s going to follow into that confidence around placing more wide body orders. And to your point, it’s not about any wide body. It’s got to be the right one. And the ones that have the most versatility without that risk in terms of cost. I think that’s where the 787 fits in really well. Even before the airshow, Lufthansa’s newest 787 order shows there’s definitely some momentum in that space as airlines go. Fuel prices are a key focus area for us and we need an efficient twin-engine aircraft that can cover our networks well.

JF: With the issues surrounding 787 re-certification, is Boeing worried about customers potentially switching over to Airbus with the A350 or does Boeing have a level of confidence that this is all going to get ironed out and keep customers on side?

DH: Obviously it’s a priority for us and we’re working closely with the FAA on this. I think we have achieved a lot of the milestones needed to return the aircraft to the production line for deliveries. As far as the customer angle of this is concerned, I think they’re looking at this as a long-term asset. That’s the view that they take when they make a purchase decision. I think that’s what we’re kind of seeing from customers, and when the airplane returns to deliveries, that’s just going to be more momentum in terms of the market. As we’ve gone through the pandemic, the 787 has been the most used wide body, so it’s clearly generating value whilst in service.

JF: Moving onto the 777X. There’s also delays on this program as well. What sort of update does the company have regarding this?

DH: We don’t have any new updates as this time, but 2025 is when we aim to begin deliveries of the 777-9X and we are continuing to move through the flight test program. We have completed over 2,000 test flight hours at the moment. You see how the airplane performs, it’s been flying at Farnborough this week. I think looking at the bigger picture, if we talk about that market demand, it’s good timing mid-decade for the aircraft to really make strides because that’s when the bulk of larger widebody replacements start to hit the market. You know, whether it’s the 777-300s or perhaps more importantly for efficiency, the A380s and 747s that can kind of be replaced with what we call jumbo capacity with twin-engine economics.

JF: Obviously GE Aviation is the engine supplier for the 777X with the GE9X. Why did Boeing choose to continue this relationship and was it based off the successes of the GEnx engine on the 787s?

DH: Obviously, there are multiple factors that go into launching a business case and a new aircraft. If you look at the capability, the performance at the very highest levels of thrust was on the GE90, which powers the standard 777-300ER and on the freighters. When you combine that with the technology push, their ability to put these platforms together to provide game changing efficiency is a key element of how you bring the whole airplane’s value proposition.

JF: There has been a lot of focus for freighters with the 777-8X. Does Boeing envisage further passenger variant orders for this side of the program?

We obviously launched the freighter version and since the cargo market is where it is, I think a lot of airlines are looking at how do we achieve that efficiency. And this is to replace our large freighters that are currently flying today with the capability of the 777-8X. So activity wise, I think we’re seeing more of that on the 777X passenger versions. The -9X is the one we have been focused on delivering and certifying, especially because it offers additional range compared to the -8X. We also do not offer the freighter on the -9X. I just think it’s a relatively kind of smaller part of the overall 777X family, the -8X is.

JF: Coming back to the MAX for a minute, with the accidents we had with Lion Air Flight 610 and Ethiopian Airlines Flight 302, what additional support has Boeing given to these customers since the crashes?

DH: Ethiopian and Lion Air are just like all the other MAX customers in terms of the additional training that was part of the MAX’s return to service, the software updates etc. Just like any customer that we have, we work closely with them. And I think in some cases, our partnerships have strengthened with them. As you go forward from this, it’s important to emphasise that the focus on safety is paramount for us and all our customers. I’ll just mention also that we made an announcement with Ethiopian pertinent to maintenance and operations services, so you can see in real time that we continue to work on things and do business.

JF: Moving onto the Ukraine Crisis, how has Boeing coped with issues surrounding the supply chain and things like that?

DH: Just like other manufacturing companies, we’ve had various supply chain kinks here and there that we’re managing through. But these are not specifically related to Ukraine. But it is a tough thing to work through nevertheless.

JF: Continuing on that theme, the Russian Government have laid out significant plans to nationalize aircraft as well as placing a lot of investment into Russian manufacturers to build their own aircraft. With that in mind, does Boeing feel like they’d still be able to penetrate the market post-Ukraine Crisis?

DH: There’s a lot of uncertainty there. We haven’t included the Russian market in our commercial market outlook because of the sanctions that have been imposed on the country at the moment. It’s just not an addressable market for us. Either way, we update our outlook yearly based on the realities of the market.

JF: As a final question, is there anything you would like to say to our readers?

DH: That’s a good question. We could talk for a long time. I guess what I would say is the last two years have taught us how important aviation is to the economy, to people connecting, and moving forward. Whether it’s the current product line that we have, whether it’s our innovations that we’re developing for the future of aviation, we’re just as passionate now as we ever have been in terms of the market. It’s so important to our future.

JF: Darren, thanks very much for taking the time to speak to me and AviationSource

Overall…

This week at Farnborough has shown that Boeing is most definitely on the mend. Through the enhanced customer confidence in the MAX, to further endorsements on the 787, as well as having a clear roadmap for the 777X, it’s going to be interesting to see what the next few years will hold for the manufacturer.

The next priorities for Boeing will be to ensure certification of the 787 Dreamliner, 737 MAX 10 and subsequently the 777X. But with the confidence the American planemaker is emitting, they seem happy enough to get the job done.