Competition between Airbus and Boeing

Competition between Airbus and Boeing

Competition between Airbus and Boeing is a result of both companies' domination of the large jet airliner market since the 1990s, a consequence of mergers within the global aerospace industry over the years. Airbus began as a consortium from Europe, whereas the American Boeing took over its former arch-rival, McDonnell Douglas, in 1997. Other manufacturers, such as Lockheed Martin and Convair in the United States and Dornier and Fokker in Europe, have pulled out of the civil aviation market after economic problems and dropping sales figures. The collapse of the Eastern Bloc and its trade organisation Comecon in the 1990s has put the former Soviet aircraft industry in a disadvantaged position, although Antonov, Ilyushin, Sukhoi, Tupolev and Yakovlev still develop new aircraft and have a small market share. This has left Boeing and Airbus in a near-duopoly in the global market for large commercial jets comprising narrow-body aircraft, wide-body aircraft and jumbo jets. However, Embraer has gained market share with their narrow-body aircraft in the Embraer E-jets series. There is also a similar competition in regional jet manufacturing between Bombardier Aerospace and Embraer.

In the last 10 years (2001–2010), Airbus has received 6,506 orders while delivering 4,009, Boeing won 5,869 orders while delivering 3,921. Airbus had higher deliveries since 2003. Competition is intense; each company regularly accuses the other of receiving unfair state aid from their respective governments.


Competition by product

Range overlap

Though both manufacturers have a broad product range varying from single-aisle to wide-body, they do not always compete head-to-head. As listed below they respond with slightly different models.

Airlines benefit from this competition as they get an array of diversified products ranging from 100-500 seats, than if both companies offered identical aircraft.

Passengers/range km (statute miles) for all models

A chart comparing the passenger capacity (two-class typical) and range (maximum in nautical miles) of in-production, future, and out-of-production Airbus and Boeing aircraftc since 2000.
2,645 to 3,185 km (2400 sm) 5,600 to 5,900 km (3500 sm) 6,800 to 7,700 km (4500 sm) 9,000 to 10,200 km (5900 sm) 10,500 to 11,300 km (6800 sm) 12,250 to 12,500 km (7700 sm) 13,300 to 13,900 km (8500 sm) 14,200 to 14,800 km (9000 sm) 14,900 to 15,200 km (9300 sm) 15,400 to 16,000 km (9800 sm) 16,700 to 17,400 km (10500 sm)
100-139 (717-200) A318-100 737-600
140-156 737-700 A319-100 737-700ER
148-189 737-800 A320-200
177-255 A321-200 737-900 (757-200) (A310-200) (A310-300) 767-300ER 767-200ER 787-8
243-375 (757-300) 767-400ER 747SP
253-300 (A300) (A300-600) A330-200 A340-200 A350-800 787-9
295-440 777-200 A330-300 A340-300 777-200ER A350-900 777-200LR
313-366 A340-500 A340-500HGW A350-900R
358-550 747-100SR 747-300SR 747-100 777-300 747-200 777-300ER A350-1000
380-419 A340-600 A340-600HGW
410-568 747-400 747-400ER
<467 747-8
525-853 A380

Airbus A320 vs Boeing 737

Airbus A330 vs Boeing 767 & 777

Airbus A350 vs Boeing 787 & 777

Empty weight EW:

  1. ^ Proposed manufacturer's weight empty including expected overweight.
  2. ^ a b Final operating empty weight
  3. ^ a b Proposed operating empty weight not including expected overweight

Airbus A380 vs Boeing 747

Cross-section comparison of Airbus A380 versus Boeing 747-400

The wide-body Boeing 747-8, the latest modification of Boeing's largest airliner, is notably in direct competition on long-haul routes with the A380, a full-length double-deck aircraft now in service. For airlines seeking very large passenger airliners, the two have been pitched as competitors on various occasions. Following another delay to the A380 programme in October 2006, FedEx and the United Parcel Service canceled their orders for the A380-800 freighter. Some A380 launch customers deferred delivery or considered switching to the 747-8 and 777F aircraft.[18][19]

Boeing's advertising claims the 747-8I to have over 10% lighter per seat and 11% less fuel consumption per passenger with a trip-cost reduction of 21% and a seat-mile cost reduction of more than 6% compared to the A380. The 747-8F's empty weight is expected to be 80 tonnes (88 tons) lighter and 24% lower fuel burnt per ton with 21% lower trip costs and 23% lower ton-mile costs than the A380F.[20] In order to counter the perceived strength of the 747-8I, from 2012 Airbus will offer, as an option, improved maximum take-off weight allowing for a better payload/range performance. The precise size of the increase in maximum take-off weight is still unknown. British Airways and Emirates will be the first customers to take this offer.[21] As of April 2009 no airline has canceled an order for the passenger version of the A380. Boeing currently has only two commercial airline orders for the 747-8I: Lufthansa (20) and Korean Air Lines (5).[22]

EADS A330 MRTT - Northrop Grumman KC-45A vs Boeing KC-767

Data are preliminary and partially copied from A330-200 and 767-200ER.

The announcement in March 2008 that Boeing had lost a US$40 billion refuelling aircraft contract to Northrop Grumman and Airbus for the EADS/Northrop Grumman KC-45 with the United States Air Force drew angry protests in the United States Congress.[24] Upon review of Boeing's protest, the Government Accountability Office ruled in favor of Boeing and ordered the USAF to recompete the contract. Later, the entire call for aircraft was rescheduled, then canceled, with a new call decided upon in March 2010.

Boeing later won the contest, with a lower price, on February 24, 2011.[25] The price was so low some in the media believe Boeing would take a loss on the deal; they also speculated that the company could perhaps break even with maintenance and spare parts contracts.[26] In July 2011, it was revealed that projected development costs rose $1.4bn and will exceed the $4.9bn contract cap by $300m. The first $1bn increase from the award price to the cap Government would be responsible for $600m under a 60/40 Government/Boeing split and with the additional $300m ceiling breach wholly Boeing would be responsible for $700m of the additional cost.[27][28][29][clarification needed]

Competition by outsourcing

Because many of the world’s airlines are wholly or partially government owned, aircraft procurement decisions are often taken according to political and commercial criteria. Boeing and Airbus seek to exploit this by subcontracting production of aircraft components or assemblies to manufacturers in countries of strategic importance in order to gain a competitive advantage.

For example, Boeing has offered longstanding relationships with Japanese suppliers including Mitsubishi Heavy Industries and Kawasaki Heavy Industries by which these companies have had increasing involvement on successive Boeing jet programs, a process which has helped Boeing achieve almost total dominance of the Japanese market for commercial jets. Outsourcing was extended on the 787 to the extent that Boeing’s own involvement was reduced to little more than project management, design, assembly and test operation, outsourcing most of the actual manufacturing all around the world. Boeing has since stated that it "outsourced too much" and that future airplane projects will depend far more on Boeing's own engineering and production personnel.[30]

Partly because of its origins as a consortium of European companies, Airbus has had fewer opportunities to outsource significant parts of its production beyond its own European plants. However, in 2009 Airbus has opened an assembly plant in Tianjin, China for production of its A320 series airliners.[31]

Competition through use of technology

Airbus sought to compete with the well-established Boeing in the 1970s through its introduction of advanced technology. For example, the A300 made the most extensive use of composite materials yet seen in an aircraft of that era, and by automating the flight engineer's functions, was the first large commercial jet to have a two-man flight crew. In the 1980s Airbus was the first to introduce digital Fly-by-wire controls into an airliner (the A320).

Since then Airbus has established itself as a viable competitor to Boeing, both companies use advanced technology to seek performance advantages in their products. For example, the Boeing 787 Dreamliner will be the first large airliner to use composites for most of its construction.

Competition through provision of engine choices

The competitive strength in the market of any airliner is considerably influenced by the choice(s) of engine available. In general, airlines prefer to have a choice of at least two engines from the major manufacturers General Electric, Rolls-Royce and Pratt & Whitney. However engine manufacturers prefer to be single source, and often succeed in striking commercial deals with Boeing and Airbus to achieve their objective. Several notable aircraft have only provided a single engine offering: the Boeing 737-300 series onwards (CFM56), the Airbus A340-500 & 600 (Rolls-Royce Trent 500), the Airbus A350 (Rolls-Royce Trent XWB - so far) the Boeing 747-8 (GEnx-2B67), and the Boeing 777-300ER/200LR/F (General Electric GE90).[32]

Effect of currency on competition

Boeing's production costs are mostly in United States dollars, while Airbus' production costs are mostly in euros. When the dollar appreciates against the euro the cost of producing a Boeing aircraft rises relative to the cost of producing an Airbus aircraft, and conversely when the dollar falls relative to the euro it is an advantage for Boeing. There are also possible currency risks and benefits involved in the way aircraft are sold. Boeing typically prices its aircraft only in dollars, while Airbus, although pricing most aircraft sales in dollars, has been known to be more flexible and has priced some aircraft sales in Asia and the Middle East in multiple currencies. Depending on currency fluctuations between the acceptance of the order and the delivery of the aircraft this can result in an extra profit or extra expense - assuming Airbus has not purchased insurance against such fluctuations.[33]

Orders and deliveries

2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
European Union Airbus 1231 574 271 777 1341 790 1055 370 284 300 375 520 476 556 460 326 106 125 38 136 101 404 421
United States Boeing 495 530 142 662 1413 1044 1002 272 239 251 314 588 355 606 543 708 441 125 236 266 273 533 716
Sources 2011: Airbus net orders until October 31 <>
Boeing net orders until November 16 <>
2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
European Union Airbus 418 510 498 483 453 434 378 320 305 303 325 311 294 229 182 126 124 123 138 157 163 95 105
United States Boeing 387 462 481 375 441 398 290 285 281 381 527 491 620 563 375 271 256 312 409 572 606 527 402
Sources 2011: Airbus deliveries until October 31 <>
Boeing deliveries until October 31 <>

Orders and deliveries, by product

Civil airplanes 2010 Deliveries 2010 Orders 2010 Backlog Historical Deliveries ending Dec 2010
European Union Airbus United States Boeing European Union Airbus United States Boeing European Union Airbus United States Boeing European Union Airbus United States Boeing
single aisle 1010 707
single aisle 1831 727
single aisle 401 A320 376 737 416 A320 486 737 2418 A320 2186 737 4728 A320 6637 737
single aisle 1049 757
widebody 12 767 3 767 50 767 561 A300
255 A310
994 767
widebody 87 A330
4 A340
74 777 47 A330
1 A340
46 777 354 A330
4 A340
253 777 750 A330
350 A340
910 777
widebody 0 A350 0 787 78 A350 -4 787 583 A350 847 787 0 A350 0 787
widebody 18 A380 0 747 32 A380 -1 747 193 A380 107 747 41 A380 1418 747
Total 510 462 574 530 3552 3443 6685 13849
Boeing (1957) and Airbus (1972) until 31st December, 2010

Sources : Wikipedia pages and Analysis: Airbus’s late push sees off Boeing - again

Effect of competition on product plans

The A320 has been selected by 222 operators (Dec. 2008), among these several low-cost operators, gaining ground against the previously well established 737 in this sector; many full-service airlines also have selected it as a replacement for 727s and aging 737s, such as United Airlines and Lufthansa; and after 40 years the A380 now challenges the Boeing 747s dominance of the very large aircraft market. The Boeing 747-8 is a stretched and updated version of the venerable 747-400 and will offer greater capacity, fuel efficiency and longer range. Frequent delays to the Airbus A380 program caused several customers to consider cancelling their orders in favour of the refreshed 747-8,[34] although none have done so and some have even placed repeat orders for the A380. However, all A380F orders have been canceled. To date, Boeing has secured orders for 78 747-8F and 28 747-8I with first deliveries originally scheduled for 2010 and 2011 respectively now, after certification the 747-8F, revised to 2011 and 2012 as the 747-8I is still (as of August 2011) being test-flown, while Airbus has orders for 234 A380s, the first of which entered service in 2007 and has delivered a total of 53 to customers (as of July 2011).

Several Boeing projects were pursued and then canceled, like the Sonic Cruiser, launched in 2001. Boeing is now focused on the Boeing 787 Dreamliner as a platform of total fleet rejuvenation, which uses technology from the Sonic Cruiser concept. Despite having been delayed by more than three years, the 787 is still the fastest selling wide-body airliner in history. The 787's rapid sales success and pressure from potential customers forced Airbus to revise the design of its competing A350.

Boeing first ruled out producing a re-engined version of its 737 to compete with the A320neo launch in 2016 saying it did not believe airlines would be willing to pay 10% more for only a few percentage gained in fuel efficiency, instead airlines would be looking towards the next major redesign and a 30% fuel saving. The company is facing airline pressure to offer a direct re-engined competitor including from Southwest Airlines who use the 737 for their entire fleet (680 in service or on order) saying they were not prepared to wait 20 years or more for a new 737 model and threatening to convert to Airbus. Industry sources believe that a re-engine of the 737 would be considerably more expensive for Boeing than it was for Airbus A320 due to the 737's design but decided to do so during the summer of 2011.[35]

There are 5,417 (April 30, 2009) Airbus aircraft in service, with Airbus managing to win over 50 per cent of aircraft orders in recent years. Airbus products are outnumbered by in-service Boeings.


Both aircraft manufacturers have good safety records on recently manufactured aircraft. By convention, both companies tend to avoid safety comparisons when selling their aircraft to airlines. Most aircraft dominating the companies' aircraft sales, such as the Boeing 737-NG and Airbus A320 families (as well as both companies' wide-body offerings) have good safety records as well. Older model aircraft such as the Boeing 727, the original Boeing 737s and 747s, Airbus A300 and Airbus A310, which were respectively first flown during the 1960s, 1970s, and 1980s, have had higher rates of fatal accidents.[36]


The Boeing 787 Dreamliner (above) will compete with the Airbus A330 and the Airbus A350 on the medium to long range market.


Boeing has continually protested over launch aid in the form of credits to Airbus, while Airbus has argued that Boeing receives illegal subsidies through military and research contracts and tax breaks.[37]

In July 2004 Harry Stonecipher (then-Boeing CEO) accused Airbus of abusing a 1992 bilateral EU-US agreement providing for disciplines for large civil aircraft support from governments. Airbus is given reimbursable launch investment (RLI, called "launch aid" by the US) from European governments with the money being paid back with interest, plus indefinite royalties if the aircraft is a commercial success.[38] Airbus contends that this system is fully compliant with the 1992 agreement and WTO rules. The agreement allows up to 33 per cent of the programme cost to be met through government loans which are to be fully repaid within 17 years with interest and royalties. These loans are held at a minimum interest rate equal to the cost of government borrowing plus 0.25%, which would be below market rates available to Airbus without government support.[39] Airbus claims that since the signing of the EU-U.S. agreement in 1992, it has repaid European governments more than U.S.$6.7 billion and that this is 40% more than it has received.

Airbus argues that the pork barrel military contracts awarded to Boeing (the second largest U.S. defense contractor) are in effect a form of subsidy (see the Boeing KC-767 vs EADS (Airbus) KC-45 military contracting controversy). The significant U.S. government support of technology development via NASA also provides significant support to Boeing, as does the large tax breaks offered to Boeing which some claim are in violation of the 1992 agreement and WTO rules. In its recent products such as the 787, Boeing has also been offered substantial support from local and state governments.[40] However, Airbus' parent, EADS, itself is a military contractor, and is paid to develop and build projects such as the Airbus A400M transport and various other military aircraft.[41]

In January 2005, the European Union and United States trade representatives, Peter Mandelson and Robert Zoellick (since replaced by Rob Portman, and then Susan Schwab, and the present office holder, Ron Kirk) respectively, agreed to talks aimed at resolving the increasing tensions. These talks were not successful with the dispute becoming more acrimonious rather than approaching a settlement.

In September 2009, the New York Times and Wall Street Journal reported that the World Trade Organization would likely rule against Airbus on most, but not all, of Boeing's complaints; the practical effect of this ruling would likely be blunted by the large number of international partners engaged by both plane makers. as well as the expected delay of several years of appeals. For example, 35% of the Boeing 787 Dreamliner is manufactured in Japan. Thus, some experts are advocating a negotiated settlement.[42] In addition, the heavy government subsidies offered to automobile manufacturers in the United States have changed the political environment; the subsidies offered to Chrysler and General Motors dwarf the amounts involved in the Airbus-Boeing dispute.[43]

World Trade Organization litigation

"We remain united in our determination that this dispute shall not affect our cooperation on wider bilateral and multilateral trade issues. We have worked together well so far, and intend to continue to do so."

Joint EU-US statement[44]

On 31 May 2005 the United States filed a case against the European Union for providing allegedly illegal subsidies to Airbus. Twenty-four hours later the European Union filed a complaint against the United States protesting support for Boeing.[45]

Increased tensions, due to the support for the Airbus A380, escalated toward a potential trade war as the launch of the Airbus A350 neared. Airbus would prefer the A350 programme to be launched with the help of state loans covering a third of the development costs although it has stated it will launch without these loans if required. The A350 will compete with Boeing's most successful project in recent years, the 787 Dreamliner. EU trade officials questioned the nature of the funding provided by NASA, the Department of Defense, and in particular the form of R&D contracts that benefit Boeing; as well as funding from US states such as the State of Washington, Kansas, and Illinois, for the development and launch of Boeing aircraft, in particular the 787.[46] An interim report of the WTO investigation into the claims made by both sides was made in September 2009.[47]

In March 2010, the WTO ruled that European governments unfairly financed Airbus.[48] In September 2010, a preliminary report of the WTO found unfair Boeing payments broke WTO rules and should be withdrawn.[49] In two separate findings issued in May 2011, the WTO found, firstly, that the US defense budget and NASA research grants could not be used as vehicles to subsidise the civilian aerospace industry and that Boeing must repay $5.3 billion of illegal subsidies.[50] Secondly, the WTO Appellate Body partly overturned an earlier ruling that European Governments launch aid constituted unfair subsidy, agreeing with the point of principle that the support was not aimed at boosting exports and some forms of public-private partnership could continue. Part of the $18bn in low interest loans received would have to be repaid eventually; however, there was no immediate need for it to be repaid and the exact value to be repaid would be set at a future date.[51] Both parties claimed victory in what is the world's largest trade dispute.[52][53][54]

See also


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  21. ^ "British Airways and Emirates will be first for new longer-range A380". Retrieved 2011-05-21. 
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  23. ^ Northrop Grumman Integrated Systems - KC-45 Tanker[dead link]
  24. ^ "Air tanker deal provokes US row, BBC, 1 March 2008". BBC News. 2008-03-01. Retrieved 2011-05-21. 
  25. ^ "The USAF’s KC-X Aerial Tanker RFP: Canceled". Defense Industry Daily. 13 March 2011. 
  26. ^
  27. ^
  28. ^
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  30. ^ Gates, Dominic (March 1, 2010). "Albaugh: Boeing's 'first preference' is to build planes in Puget Sound region". The Seattle Times. Retrieved 2010-06-16. 
  31. ^ "Airbus' China gamble". Flight International. October 28, 2008. Retrieved 2008-11-15. 
  32. ^ Thomas, Geoffrey (April 4, 2008). "Engines the thrust of the Boeing-Airbus battle". The Australian.,25197,23479281-23349,00.html. Retrieved 2008-11-08. 
  33. ^ Strong Euro Weighs on Airbus, Suppliers, Wall Street Journal, October 30, 2009, p.B3
  34. ^ Robertson, David (October 4, 2006). "Airbus will lose €4.8bn because of A380 delays". London: The Times Business News.,,9077-2387999,00.html. 
  35. ^ Associated, The (2011-01-20). "Southwest waiting to hear Boeing's plan for 737". BusinessWeek. Retrieved 2011-05-21. 
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  38. ^ Oconnell, Dominic; Porter, Andrew (2005-05-29). "Trade war threatened over £379m subsidy for Airbus". The Times (London).,,2095-1631948,00.html. Retrieved Insert accessdate here. 
  39. ^ "Q&A: Boeing and Airbus". BBC News. 2004-10-07. Retrieved Insert accessdate here. 
  40. ^ "See you in court". The Economist. 23 March 2005. 
  41. ^ "EADS Military Air Systems Website, retrieved September 3, 2009". 2011-05-13. Retrieved 2011-05-21. 
  42. ^ Clark, Nicola (2009-09-03). "W.T.O. to Weigh In on E.U. Subsidies for Airbus, New York Times, September 3, 2009, retrieved September 3, 2009". Europe;United States: Retrieved 2011-05-21. 
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  44. ^ "EU, US face off at WTO in aircraft spat". Defense Aerospace. 31 May 2005. 
  45. ^ "Flare-up in EU-US air trade row". BBC News. 31 May 2005. Retrieved 2010-01-02. 
  46. ^ Milmo, Dan (14 August 2009). "US accuse Britain of stoking trade row with £340m Airbus loan". London: The Guardian. 
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  49. ^ "EU claims victory in WTO case versus Boeing". Paris: Reuters. 15 September 2010. 
  50. ^ Freedman, Jennifer M.. "WTO Says U.S. Gave at Least $5.3 Billion Illegal Aid to Boeing". Bloomberg. Retrieved 2011-05-21. 
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Further reading

  • Newhouse, John (2007), Boeng versus Airbus, USA: Vintage Books, ISBN 978-1-4000-7872-1 

External links

Wikimedia Foundation. 2010.

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