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- Boeing dismissed rumors of a 737 replacement, but analysts say a new narrowbody is inevitable.A next-generation plane hinges on securing an engine that is efficient enough to power it.A new plane isn't expected for at least a decade, and Boeing still has a trio of jets to certify.
Boeing hasn't engineered a clean-sheet commercial airplane since its cash cow 787 Dreamliner launched in 2004. The planemaker has instead opted for upgrades to already-built planes, as it was cheaper and less complicated.
However, a September report from The Wall Street Journal said that Boeing was actively developing an all-new plane to replace its 737, a jet that has evolved through four generational modifications since its debut in 1967 and has largely exhausted its upgrade viability.
Boeing's 737 narrowbody is the workhorse of short and mid-range flying and can carry up to 220 passengers, depending on the model of in-service aircraft.
At the International Society of Transport Aircraft Trading conference in Prague on Monday, Boeing leadership downplayed the rumors of a newly designed plane appearing soon.
"We are never not looking at new technology, but we are also not close to launching a new airplane," Boeing's vice president for commercial marketing, Darren Hulst, said at the event, Reuters reported.
Still, industry analysts told Business Insider that Boeing's long-term competitiveness hinges on developing a new narrowbody and securing a next-generation engine to power it.
However, it still faces a few near-term hurdles, including certifying its trio of unfinished airplanes and rebuilding investor confidence through improved production, quality, and cash flow.
A clean-sheet Boeing plane likely won't fly for at least a decade
Richard Aboulafia, the managing director of the aviation consulting firm AeroDynamic Advisory, told BI that Boeing would have a lot to gain by touting a new design, even if its launch would likely not happen until the mid-2030s.
"If I were them, I would talk about it," he said, saying the ideal scenario would be to officially announce a new plane in the next three years. "The fact that they have a CEO who is not denying there's anything is a huge step forward."
He added that Boeing CEO Kelly Ortberg, who took over in August 2024, has "brought great changes" to the company that can hopefully lead to a new aircraft. He said it's unlikely Boeing would have reached that point under the old leadership: "The previous CEO was strangling the company."
Ortberg has spent the past year addressing cultural and quality gaps on the assembly line, which has been well-received by investors and customers.
Edward Jones analyst Jeff Windau said Ortberg's leadership has contributed to the firm's upgrade of Boeing to a "buy" rating in early October, saying the company has improved operationally and that Ortberg's messaging emphasizes the need for Boeing to focus on quality — even if it takes more time.
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Boeing stock is up nearly 23% year-to-date as of Friday. The company has focused on ramping up its Max output this year to 42 a month after regulators forced it to cap production at 38 following the Alaska door plug blowout.
Windau added that the upgrade did not consider the rumors of a new plane, but he said it would be a good idea for Boeing to focus on future technology and start talking about it once the company more fully recovers from its Max crisis.
"I think once you start getting back to the Boeing pre-Max issues, that's when things start to make sense," he said. "But it's going to take an awful long time for them to get that clean sheet developed and the cost right."
Both Windau and Aboulafia said that there are always discussions about a next-generation plane, even if nothing has been officially launched. It takes years of development work, from initial design concepts and computer modeling to flight tests and certification.
Aboulafia said Boeing's competitor, Airbus, needs to be ready to respond when the inevitable happens.
"If they wanted to get aggressive, they have options; they could launch a stretch of the A220, or re-wing and re-engine the A321neo to make the A322neo," Aboulafia said. "But for a clean sheet, that would only be in response to Boeing."
And Airbus isn't its only competition — startups like US-based Natilus are chasing single-aisle market share, as global demand for narrowbodies is expected to be in the tens of thousands over the next few decades.
A new jet hinges on the development of a new engine
Aboulafia said the engine on any new Boeing aircraft is the "missing variable" as manufacturers test and develop new technologies to meet fuel efficiency targets.
The WSJ report said Ortberg visited engine manufacturer Rolls-Royce in England earlier this year and heard a "pitch" for a new powerplant. It's unclear which engine, but Rolls-Royce is developing a smaller version of its UltraFan technology to power future narrowbodies.
Rolls-Royce did not offer a comment.
That would break from Boeing's long partnership with CFM International — a joint venture between GE Aerospace and Safran — whose engines have powered every 737 generation since 1981. CFM is developing a new "open-rotor" engine where the fan blades are exposed rather than encased in a typical shell.
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Aboulafia said it's possible that Boeing is considering Rolls-Royce because it may not want an open-rotor for its next plane, or the technology may take too long to develop.
CFM's new engine will likely not be available until the mid to late 2030s because of remaining technical challenges like noise and certification.
"Engine technologies will be critical to meeting the 15-20% rule-of-thumb fuel efficiency improvements to launch NGSA," Jefferies analyst Sheila Kahyaoglu said in a September note to investors. NGSA stands for next-generation single-aisle.
Boeing still has 3 planes it needs to certify
The planemaker's latest in-progress jets — including the 737 Max 7 and 10 variants and the 777X — have yet to come to fruition amid heightened scrutiny of safety and certification following Boeing's Max crisis.
Kahyaoglu said completing these would be "precursors to a new plane."
The constant delays and quality control problems have left customers, investors, and passengers alike questioning Boeing's ability to engineer and deliver aircraft. Still, Boeing has secured hundreds of orders from global airlines that are seemingly willing to wait.
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Windau said Boeing should focus on the programs it has already started, and continue improving production, quality, and cash flow, before going full throttle on a new jet.
A Boeing spokesperson told BI that the company is focused on certifying its 777X and Max models and delivering its more than 6,000-strong backlog of jets.
"At the same time, as we have done over the decades, our team evaluates the market, advances key technologies, and improves our financial performance, so that we will be ready when the time is right to move forward with a new product," they added.
