Boeing may well be forced to re-engine its iconic B737, according to a projection by New New York-based market research firm, Bernstein Research. In a recent report, the firm says that options for making incremental improvements and reducing the price are no longer viable.
According to the firm's analysis, Boeing cannot make a compelling case for an all-new aircraft as such technology does not yet exist. Waiting four or years or more for such technology to possibly emerge is also a risky call.
''We do not believe that Boeing can confidently project technology breaks that will enable it to deliver a compelling all-new aircraft that justifies the investment,'' the report stated.
The report states that Boeing's belief that it has enough time to arrive at a decision is also mistaken. ''We do not believe this is the case, despite the long backlog for the 737. Airlines want answers. And if Boeing were to re-engine, it should act soon.''
The Bernstein report says with Airbus moving ahead with the A320neo, Boeing's hand has been forced.
''Boeing has stressed its bias toward doing an all-new aircraft for delivery in 2019-20 for the last six months, but we still believe that Boeing will ultimately re-engine the 737,'' the report states.
The report says that to gain the maximum customer base and returns, the re-engined model will need to make an entry-into-service by 2014/15 and not later in the decade, when an all-new type would make more sense.