Analysis: BA loss may spur Boeing to offer mini-jumbo in weeks

Wed Apr 24, 2013 6:45am EDT
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By Tim Hepher and Praveen Menon

PARIS/DUBAI (Reuters) - Boeing (BA.N: Quote) looks ready to start offering its long-awaited next-generation mini-jumbo in weeks after pondering for months how to prevent a key part of the big-jet market slipping to rival Airbus EAD.PA.

Industry sources, analysts and potential buyers say Boeing's idea of revamping its long-serving 777 was rapidly gathering momentum even before British Airways (ICAG.L: Quote) signed a $6 billion order for 18 of Airbus's new A350-1000 jets on Monday.

Airbus's victorious climax to a three-year courtship cracks Boeing's virtually complete hold on BA's long-haul fleet and makes it almost certain the U.S. group will show its hand by formally offering a revamped "777X" very soon, the sources said.

Boeing's response would mark the end of a "phoney war" between transatlantic rivals and set up a direct clash for a segment of the market projected to involve 2,000 twin-engined mini-jumbo jets worth $500 billion at list prices over 20 years.

It provides a glimpse of fierce competition that continued behind the scenes - pulling in top Boeing executives - even as the grounding of its 787 Dreamliner over battery concerns captured global headlines and drew public support from Airbus.

"I think there is pressure on Boeing to move by the (June 17-21) Paris air show," said Adam Pilarski, former chief economist at Douglas Aircraft, which is now part of Boeing.

For years, Boeing governed a "sweet spot" in the jet market between 300 and 400 seats after pioneering two engines rather than four for long routes. Its 777 is an industry best-seller.

Now, its dominance is being challenged by the A350-1000, a larger cousin to Europe's answer to the carbon-composite 787, forcing Boeing to come up with changes such as folding wingtips to increase wingspan while fitting at the same airport gates.   Continued...

The Boeing logo is seen on a Boeing 787 Dreamliner airplane in Long Beach, California March 14, 2012. REUTERS/Lucy Nicholson