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Boeing wins SIA order but Airbus retains upper hand

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A Scoot B787-9 Dreamliner. Pic/Sim Kok Chwee

Singapore Airlines’ (SIA) decision to order 20 Boeing 777-9s and 19 B787-10s (read here) has many market observers concluding the US aircraft manufacturer has overtaken its European rival in the widebody market.

That is too simplistic a view, in our opinion. For a start, SIA is a very canny and savvy customer to allow one planemaker to dominate its fleet requirements. Secondly, the airline never places an order for any aircraft type unless it strengthens the company’s future.

Therefore, this latest acquisition of the B777-9s is not a setback for Airbus and its newest widebody, the A350XWB. SIA has always split its fleet between Airbus and Boeing, not always equally (history has shown a predominance of Boeing aircraft a decade or so ago) but dividing it in a way that it is the airline, and not the aircraft makers, that calls the shots.

Indeed, such is SIA’s reputation for being a tough but important client that what it buys sets the benchmark for other carriers; aircraft manufacturers are known to have bent over backwards to do whatever possible to have SIA as its launch customer, if not just a customer.

Why the B777-9s and 787-10s then?

The B787-10 Dreamliners are to be used by Scoot, SIA’s low-cost, long-haul subsidiary. Scoot currently operates 12 Dreamliners. The Dreamliner is favoured by low-cost, long-haul carriers such as Norwegian and Jetstar for its efficiency and range.

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Close up of a Scoot B787-9 nose. Pic/Sim Kok Chwee

As for the B777-9, let’s not forget it isn’t even built yet. These are due for delivery only in the airline’s 2021/22 financial year. That’s almost five years down the road. And here’s what Goh Choon Phong, SIA’s CEO, had to say: We are continuing to invest in the future of the SIA Group… further growing the Singapore hub…” (Read the full release here).

The arrival of the B777-9 (typically with 406 seats) in the next decade indicates one thing though: that SIA wants to squeeze in more passengers and this aircraft, unlike the A350XWB, allows for it – Boeing will make it such that an airline can configure seats 10-across, or 3-4-3, in economy class.

SIA’s current fleet of B777s is now configured in a 3-3-3 layout, meaning more space for passengers.

Thus, while the order is a significant one for Boeing, it doesn’t change SIA’s future strategy of employing its fleet of A350XWBs as it flagship workhorses – all 67 of them, including the seven A350ULRs (Ultra Long Haul) – that will start flying direct from Singapore to New York and Los Angeles from 2018.

Meanwhile, the importance and relevance of the A350XWB was confirmed and reinforced no less by SIA’s Goh himself, at the arrival of the first plane in March 2016, when he called it a “game changer”. Goh added: “The addition of the A350-900 exemplifies Singapore Airlines’ longstanding commitment to operate a young and modern fleet.”

What will Airbus do in response to SIA’s Boeing order? Probably nothing for now. The A350XWB variants allow for seating arrangements of between 280 and 366 (for the A350-1000).

The European manufacturer still holds the title of maker of the world’s largest capacity aircraft with its A380, which can seat 525 in a typical 3-class configuration or 850 in an all-economy layout.

Airbus is caught between a rock and a hard place: if it decides to compete with Boeing head-on by stretching further the A350XWB, it could threaten the existence of the A380. Ironically, if anything, SIA’s choice of the B777-9 might hasten the end of the A380 programme…

But it is the A350XWB that will ensure Airbus leads in the widebody segment in years to come, if SIA’s commitment to the programme is anything to go by.

Located in the heart of Singapore at the Seletar Aerospace Park is the Airbus Asia Training Centre (AATC), a joint venture – 55% Airbus, 45% SIA – facility that showcases state-of-the-art technology and (when fully operational), eight full flight simulators (including three A350XWB simulators).

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Benefits of the Airbus-SIA AATC JV. Pic/Shukor Yusof

It is manned by many highly trained instructors seconded from Airbus and SIA, and can offer courses to over 10,000 trainees annually.

The AATC was launched in April 2016. It is an extremely impressive setup and in less than a year of operations has attracted 28 airlines worldwide to send their cockpit crew to be trained there. It is also Airbus’ largest flight crew training centre in the world.

The alliance between Airbus and SIA – as manifested in the AATC, and the investment involved (USD100 million) by both parties – is clear evidence of the airline’s belief in the A350XWB and its popularity for the next 20 years at least.

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An A350XWB simulator at the AATC in Singapore. Pic/Shukor Yusof

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