All’s fair in love, war and global airliner sales. As Boeing presses for an investigation into alleged CSeries price-dumping – TIM ROBINSON asks are Chicago and Toulouse aiming to murder the right heir apparent?

Some 40 years ago, the then civil airliner giants of Boeing, McDonnell Douglas and Lockheed laughed at the idea of a European ‘Airbus’ widebody ever competing with them. While Concorde had demonstrated Europe’s technical excellence in a niche supersonic airliner, the American dominance of the rest of the airliner market was taken as read.

Today, however, it is a different story with the big airline duopoly consisting of Airbus and Boeing – bitter rivals but both keen to see off new entrants on their turf, such as Embraer and Bombardier. 

An Airbus exec, for example, once quipped of “strangling the CSeries at birth” with the upgraded A320neo while more recently, a report on Boeing’s trade complaint against Bombardier’s CSeries highlighted the Boeing view: ‘never again’ – referring to how the company had underestimated the danger from its European upstart. A new US President, determined to project American jobs, thus makes a fertile environment to push complaints that previously might only have caused grumbling on the sidelines of air shows.

Yet two things, perhaps, might strike an external observer as slightly peculiar in opening a new front in the WTO against the CSeries. The first is that the current CSeries (CS100 + CS300) is aimed at the smaller single-aisle market segment (103-133 seat) that both Airbus (A318) and Boeing  (737-600NG) have almost essentially abandoned themselves. The best selling A321neo for example can be configured with 235 seats, while the recently launched MAX 10 can seat 230.  The trend for airlines to upgauge and demand larger narrowbodies strongly suggests that Bombardier’s struggling CSeries poses no immediate direct threat to Chicago or Toulouse.   

The right target?

Is this the competitor that Airbus and Boeing should really be worried about?

Second, if one accepts that argument of ‘never again’ that by not killing the child now, eventually it will usurp and claim the throne - mysteriously there is a larger and bigger threat to Airbus and Boeing looming, that both seem remarkably reticent to complain about – that of China. Unlike the CSeries, the COMAC C919 with 156-168 seats overlaps Airbus and Boeing’s bestselling models.

 It, through COMAC, a state-owned manufacturer, might also potentially run afoul of state subsidy or launch aid rules, and while list prices are different than what is paid for, would anyone be surprised if some or many of the 586 ordered so far included significant deep discounts or some Chinese customers had a very limited choice in which single-aisle airliner they could buy? True, its orders have overwhelmingly been to domestic airlines or Chinese leasing companies, rather than in Airbus or Boeing’s backyard, but China’s growing international leverage and muscle suggests that the C919 may go head-to-head with western airliners at some point.

Beijing, for its part, has been crystal clear that it sees aerospace as strategic necessity and both Airbus and Boeing recognise that China will get there, given time. Yet, so far, there has been no effort to strangle the young heir in the crib. Conversely, it could be argued that Airbus and Boeing have actually been assisting the development of a giant civil aerospace rival with a A320 FAL and 737 completion centres the latest in transfers of skills, technology and knowledge that may one day come back to haunt them. The why of this is simple. As the economic powerhouse that is driving the fast-growing Asia-Pacific aviation market – both Airbus and Boeing realise that angering China could cost them huge amounts of airliner sales.      

It therefore is ironic that action has been started against a rival airliner that is unlikely to match the powerhouse of European and US aerospace commercial industry – yet the real long-term threat to the civil airliner duopoly is, if not underestimated, quietly ignored for now…. 

Tim Robinson
18 July 2017