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The twinjet Boeing 717 is Boeing Company's smallest
commercial airliner. It entered service in September 1999, making it one
of the newest airliners on the market, and yet one of the oldest - the 717
is a renamed McDonnell Douglas MD-95, which itself was based on the
venerable Douglas DC-9 that first flew in 1965.
The last third of the 20th century had been a difficult one for aircraft
manufacturers. The one-time undisputed market leader Douglas, faced with
declining sales of its DC-8 line and stiff competition from the Boeing 737
for its DC-9, found the task of financing the planned wide-body trijet
DC-10 beyond its means and was forced to merge with military specialist
McDonnell in 1967.
Post merger, McDonnell Douglas (MDC) continued to struggle: the DC-8
production line closed in 1972; by chasing the same market niche, the
DC-10 and the rival Lockheed Tristar both lost money. Only the DC-9
continued to sell well: almost 1000 were built up to 1982, when it was
stretched and renamed the MD-80. Over 1100 MD-80s were delivered through
the 1980s and early 1990s, but the follow-on revision, the MD-90, sold
poorly, with just 117 made.
MDC had seen off stiff competition from Lockheed in the '70s (Lockheed
withdraw from civil aircraft manufacturing after relatively lacklustre
sales of the Tristar), but even with new, fuel-efficient engines and many
changes, the MD-90s in the 150 seat class were unable to compete
successfully with the similarly sized Airbus A320 and 737.
The all-new A320 first flew in 1988 and rapidly became known for its
outstanding operating costs, while Boeing's "Next-Generation" 737s,
although based on a design almost as old as the DC-9, were heavily revised
with new Airbus-style electronic cockpits, new, more efficient engines,
and a complete new wing. The MD-80 and MD-90 had had a host of detail
changes over the years, but could only offer new engines to push its
elderly-looking airframe along.
The MD-95 - the aircraft that would eventually become the 717 - was
announced in 1991, initially as the MD-87-105, a re-shortened version of
the stretched MD-80 family that took it back to about the same size as the
DC-9 Series 30 of the 1960s. It was soon renamed "MD-95" to reflect the
anticipated first delivery date, but in the event MDC could not find an
airline willing to place a firm order to start production against until
that time.
In October 1995, US discount carrier ValuJet signed an order for 50
MD-95s, plus 50 options. Generally, new aircraft have one or more large,
well-established high-prestige airlines as launch customers. Launching
MD-95 production on the basis of a single order from a two-year-old
start-up company with doubtful finances was highly optimistic, and seen as
a reflection of the difficulty MDC was having selling aircraft.
In December 1996 Boeing made a $13 billion takeover offer for McDonnell
Douglas and the merger became official the following year. Boeing was
quick to get rid of the entire MDC commercial product line, save only the
MD-95, which was re-named the Boeing 717, and (for a short while longer)
the freighter version of the MD-11.
Most industry observers expected that the MD-95 would soon be dropped
also. To begin with, Boeing had no more success selling the 717 than
McDonnell Douglas, and even the original order for 50 was no certainty in
the chaotic post-deregulation US airline market - a customer must not only
want an aircraft, it must be able to pay for it. (In the event, ValuJet,
now known as AirTran, would meet with considerable success and is now
operating 70 DC-9 family aircraft, including 53 717s.)
Boeing took a handful of small orders from leasing companies and minor
operators, and a second large order, for 50 717s from TWA, but following
the dramatic slump in airline traffic caused by reaction to the September
11th terrorist attacks in the USA, Boeing announced a review of the type's
future.
After much deliberation, it was decided to proceed. Despite the lack of
orders, Boeing had confidence in the 717s fundamental suitability to the
100-seat market, and in the long-term size of that market. Additionally,
the former Douglas plant at Long Beach was almost idle - besides the 717s,
there was only a handful of C-17s to keep it busy. Perhaps most
importantly of all, dropping the 717 would mean abandoning the 100-seat
market to arch-rival Airbus and their planned A318: from a marketing point
of view, any airline that bought A318s would have a powerful reason to
then buy A320s and A321s instead of 737s to take advantage of common parts
and crewing. Previous to the Airbus A318 and 717 most airlines bought
planes like the British Aerospace BAe-146 to fill the void in the 100 seat
market.
Many airlines that have purchased the 717 have become converts to the
type. It is roomier and faster than the British Aerospace BAe-146, cheaper
to operate, and has achieved an outstanding dispatch reliability of 99.6%.
Maintenance costs are very low: a check C inspection, for example, takes
just three days and is required only once in 4500 flying hours. (For
comparison, the old DC-9, which was always well-regarded by engineering
departments for its fuss-free nature, needed 21 days for a check C.) The
new Rolls Royce BR715 engine design is highly modular: none of the line
replaceable units takes more than an hour to exchange, and about a third
of them can be changed in under 15 minutes. Boeing claims a better than
10% operating cost advantage over the A318.
After 19 worldwide 717 sales in 2000, and just 6 in 2001, Boeing took 32
717 orders in 2002, despite the massive industry downturn.
The 100-seat market was overcrowded until 2001, but several potential
competitors have disappeared. BAe cancelled their Avro RJX (an updated BAe
146 with modern engines); Fairchild Dornier closed their doors, taking the
728/928 project with them, and Bombardier cancelled their new BRJ in
favour of a less ambitious stretched 90-seat CRJ.
The remaining players are Boeing themselves, Airbus with the A318, and
Embraer with the ERJ 195. The existing worldwide fleet is largely made up
of aging twinjets with relatively high operating costs, notably the DC-9,
early model 737s, and the Fokker 100, plus the newer four-engined BAe 146,
which is a prime prospect for refurbishment.
Bowing recently announced that production of the
717 will cease in 2006. Boeing's CEO claimed “the overall market for the
airplane does not support continuing 717 production beyond delivering on
our current commitments”. Boeing also have plans to upgrade their 737
pane design that can fill the 100 to 215 seat market more effectively.
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