Boeing’s Next New Airplane Could Cost $50 Billion, Says CEO David Calhoun

Boeing CEO David Calhoun has set the aerospace community abuzz with his recent statement that the next new airplane from Boeing could carry a staggering development cost of $50 billion. This announcement comes at a critical juncture as Calhoun, who is set to retire by the end of this year, highlighted that the decision to proceed with the new aircraft would fall to his successor.

The anticipated cost is unprecedented in the aviation industry, where single-aisle airplane programs typically range between $10 billion and $12 billion, and widebody aircraft costs are estimated between $15 billion and $20 billion, excluding overruns. For context, Boeing’s own 787 Dreamliner, which was fraught with financial and production challenges, ultimately accrued costs close to $50 billion due to extensive delays and compensations, though Boeing has never officially confirmed this figure.

This potential $50 billion investment underscores the massive financial stakes involved in developing new aircraft in today’s market, where technological and regulatory demands continue to escalate. The last all-new, widely used single-aisle jetliner introduced was Bombardier’s C Series, now known as the Airbus A220, which had a development cost of about $6 billion before Airbus acquired the program.

The announcement comes amid significant leadership changes at Boeing. Alongside Calhoun’s planned retirement, Boeing Commercial Airplanes CEO Stan Deal has stepped down, replaced by Stephanie Pope, who previously served as CEO of Boeing Global Services. These shifts in Boeing’s top management come at a time when the company is navigating recovery from past production setbacks and reshaping its strategy for future competition and innovation.

Boeing’s last venture into an all-new single-aisle airplane was the 757, introduced back in 1982, while Airbus’s latest was the A320 launched in 1984. With Calhoun’s revelation, the industry is now keenly watching how Boeing will approach the development of its next major project under new leadership, especially considering the formidable financial implications and the competitive landscape defined by rivals like Airbus and emerging players such as China’s C919 and Russia’s uncertain MC-21 program.

This development marks a pivotal moment for Boeing as it weighs the risks and rewards of launching an ambitious new aircraft project that could significantly influence the company’s position in the global aviation market.

Sources: AirGuide Business airguide.info, bing.com, leehamnews.com