SEATTLE Boeing Co (BA.N) heads to the year's biggest air show under a new leader looking to make a hit with its latest single-aisle aircraft and undermine Airbus' leadership of the global $100-billion-a-year airliner market.
The world's No. 2 aircraft maker, which put top salesman Ray Conner in charge of its commercial plane unit only last week, will also face international customers' questions on how it plans to replace its successful but aging 777 mini-jumbo and increase production across the board.
"There's going to be lots of eyes looking toward Boeing 737 MAX orders and a lot of attention focused on production rates and the overall worldwide demand equation," said John Plueger, chief operating officer of Air Lease Corp (AL.N), one of the aviation industry's leading aircraft buyers.
Boeing is scrambling to catch up to Airbus in orders for single-aisle aircraft - the workhorse for many airlines - with its revamped, re-engined 737 MAX unveiled last year in response to the EADS EAD.PA subsidiary's reworked A320neo.
Boeing has 451 firm orders for the MAX since launching it last August, but wants 1,000 sales by the end of this year as it tries to close the gap with Airbus, which has already booked more than 1,400 firm A320neo orders.
Boeing could make progress at the Farnborough International Airshow next week, where airlines and leasing companies like to grab publicity with big orders.
A Boeing spokesman said this week that the company did not save up orders to announce at airshows. For example, on Thursday Virgin Australia Holdings Ltd (VAH.AX) said it had ordered 23 737 MAX planes in a deal worth $2.19 billion at list prices.
Air Lease Corp, run by leasing pioneer Steven Udvar-Hazy, is one of the most likely MAX buyers at Farnborough, having firmed up an order for the A320neo a month ago.
The Los Angeles-based company says it has had discussions about the MAX, but would not say anything about an announcement.
"Ask Boeing," Udvar-Hazy wrote in an email to Reuters.
Boeing is counting on Udvar-Hazy, along with American Airlines and other big buyers, to help it regain the historical 50/50 split with Airbus in the single-aisle aircraft market, which tilted in the European company's favor last year on the back of strong A320neo orders.
"I would definitely expect that (50/50 split) to continue," said Beverly Wyse, general manager of the 737 program, in a briefing at Boeing's Renton plant near Seattle last month. "We have thousands more proposals out. I think you can expect over the next few months to see several of those orders come home."
Beyond the 737, Boeing needs to reinforce its presence in the smaller, but equally valuable, market for widebody, long-haul airliners, where it traditionally has led the market.
Its massively successful 777 - its second-biggest aircraft behind the 747 jumbo - is due for a replacement, but Boeing is taking its time.
"The dream scenario for Boeing at Farnborough is to firm up a couple of hundred 737 MAX orders and then move onto the offensive with widebodies," said analyst Richard Aboulafia of aerospace research firm Teal Group.
"The 777 tube (airframe) is an absolute winner," he said, "so the more they can do with it in terms of acquiring new engines and new materials, the better off they are."
Unless Conner decides to take Boeing in a radically new direction, the company is unlikely to make any quick decisions on the new 777 - dubbed 777X by the industry - as it weighs the views of its customers.
Boeing held a two-day "summit" of key 777 customers, including Air Lease and Emirates Airlines EMIRA.UL, in Seattle two weeks ago to find out what they want to see in the new aircraft. People with knowledge of the discussions say Boeing gave no indications of how it was leaning, or when it would make a decision.
"If we are ready to take it to the board at the end of the year, we will take it," said Nicole Piasecki, head of business development for Boeing's commercial plane unit, in a pre-Farnborough briefing.
Piasecki acknowledged that Airbus' final specifications on the slow-selling A350-1000, the largest of its mid-size aircraft, would affect Boeing's own plans to bring in the new 777 by the end of the decade.
"We are interested to know what it (the A350-1000) is because we're going to be better than whatever it is," she said. "We have time to move, we have a few years to move if we have to."
Boeing must also make a decision on the specifications of the next variant of its popular, carbon-fiber 787 widebody - known as the 787-10 - which will be a stretched version of its 787-9 model, carrying around 300 passengers, but with a shorter range.
"If I were them, I would do 787-10 first - go straight after Airbus' greatest strength, which is the (300-seat) A350-900," said Aboulafia.
Boeing plans to fly a 787 in the displays at Farnborough, giving many their first up-close look at its latest jet.
BIG RAMP UP
Boeing either just has increased or is in the process of ramping up production of all its major aircraft to meet surging demand for the newest, most fuel-efficient models. Despite short-term economic uncertainty, the company expects the commercial market to grow steadily over the next 20 years.
At its 737 plant in Renton, there is a hum of construction as the company builds the infrastructure to hit its aggressive targets.
Boeing now produces 35 737s a month, having just ratcheted up from 31.5 a month this year. It plans to go to 38 a month in April 2013 and 42 about a year after that. It is even now considering what it would have to do to go still higher.
That puts Boeing slightly behind Airbus, which is planning to produce 42 A320s a month by the end of this year, but has no plans yet to go further.
Boeing's plan is to build the 737 MAX along the same lines as the existing 737 NG. The first MAX is scheduled to fly in 2016 and enter service in 2017.
North of Seattle, in Everett, Boeing is ramping up production of its 777 to 8.3 a month, starting in October, from seven now. For the 787, it is looking to almost triple production to 10 a month by the end of next year, up from 3.5 now, including 787s coming from its new plant in South Carolina.
Boeing has just increased production of its largest aircraft, the new 747-8 jumbo, to hit two a month by the spring. Demand for that passenger version of the aircraft has not taken off yet, with only three airlines in the order book, but Boeing is hoping to change that at Farnborough.
"We're in active sales campaigns," Elizabeth Lund, general manager of the 747 program, said recently. "I would like to announce some orders this summer, but I don't know if it will be before or after Farnborough."
Turkish Airlines could be a buyer at Farnborough, industry watchers said, as it weighs up the aircraft against Airbus' A380.
Orders for any of Boeing's models would mark a strong debut for Conner. He was in charge of commercial plane sales before getting the top spot last week, a move that surprised the market. Invitations had already been sent for Farnborough meetings with his predecessor, Jim Albaugh.
"Conner's got a very good reputation, but he has to do this all of a sudden," said Aboulafia.
(Editing by Andre Grenon and Lisa Von Ahn)