Ten years ago, the boss of Qatar Airways, who took his first new A350 jet last week, warned Airbus it was flying off course.
Boeing was knocking on his door with a “super-efficient” jet boasting 30 per cent fuel savings thanks to a carbon-composite design.
In Toulouse, some Airbus engineers, riding high after overtaking Boeing and suspecting a short-lived marketing stunt, laughed off the future 787 with a "tail like a dolphin".
The Qatar Airways chief, Akbar Al Baker, urged Airbus to take the 787 seriously and said its draft response, a quick fix to its A330 with new General Electric engines, was inadequate.
As Qatar Airways planned for rapid regional and long-haul growth, Mr Al Baker recalls, “there was a requirement for an aircraft that has capacity that is optimal on two fronts: customer comfort and technologically forward-thinking”.
That clamour for both cabin comfort and better economics eventually forced Airbus into a fundamental shift in strategy.
But after Mr Al Baker’s warning, it took another two years of sales setbacks and doubts at the highest management level before Airbus agreed to build the A350XWB (extra-wide body).
The fluctuating, decade-long journey from half-hearted tinkering to an all-new family of jets highlights a chess game still being played out as Airbus and Boeing battle each other in the widebody market, valued at US$1.9 trillion over 20 years.
Next month, the A350 will start competing with the 787 in the skies, having garnered 778 orders against 1,055 for the 787.
To build the carbon-plastic jets, plane makers have tested themselves to the limit. Yet they have carefully avoided a direct confrontation, searching for pockets of empty space in the twinjet market by unveiling variants that rarely have precisely the same capacity as their competitor’s.
Some analysts say that may help support their profit margins.
“I think they are now pretty well matched,” said Steven Udvar-Hazy, who as the chief executive of the lessor ILFC at the time was the world’s biggest buyer of commercial jets and would prove to be an important influence on the A350’s development.
A decade ago, air travel was changing. Planes with two engines were able to fly further, and proving more efficient than big jets with four engines. Boeing’s twin-engine 777 was beating Airbus’s four-engine A340 in the market for big planes, and Airbus’s huge four-engine A380, the biggest airliner ever, had yet to enter service.
Airbus was strong in the market for small widebody jets, doing well with its twin-engine A330. But fast-growing airlines such as Qatar and Emirates were demanding more comfortable cabins with space to install new lie-flat beds.
That might have suggested a new fuselage, a decision plane makers rarely make more than once every couple of decades.
But Airbus was behind in new materials technology, focused on finishing the A380 and hoarding resources to improve its most profitable cash cow, the A320 small jet, in case Boeing refreshed its 737 model.
When Boeing launched the medium-sized 787 to compete with the A330, Airbus responded defensively. Its answer, the A350, was basically an A330 with carbon wings and new engines, rather than a new plane.
Soon, Airbus customers in Boeing’s backyard, such as Northwest Airlines and Air Canada, were writing cheques for 787s. Airbus found itself straining to compete with both flagship Boeings.
In December 2005, pressure reached boiling point with two big Boeing wins. Qantas chose the 787; Cathay Pacific picked the 777.
The Airbus chief executive, Gustav Humbert, called in his 43-year-old strategy chief, Olivier Andries and gave him a delicate task.
“I asked him to take the best guys and set up a long-range policy team,” said Mr Humbert, who is now retired.
Mr Humbert urged Mr Andries to consider whether Airbus could capture 50 per cent of the big-jet market, up from 35-40 per cent, by straddling the largest 787 and smallest 777: about 300 seats. Monitored by a cadre of retired “wise men”, the team of 10 drew up confidential scenarios from makeovers to bold new jets.
In March 2006, Mr Udvar-Hazy, who now runs Air Lease, piled on pressure by urging Airbus to drop its cautious A350.
“We looked at the economics and concluded it was not a contender in a meaningful way. So I felt it would get a silver medal and didn’t deserve to get built,” Mr Udvar-Hazy said.
In Toulouse, it was proving hard to make the business cases stick, but one proposal labelled “1d” looked promising. It had the all-important wider fuselage. It would cost about €11 billion to build rather than the €4bn budgeted for the original A350, while setting Airbus up for 20 years with projected sales of 2,000 planes instead of 800. But Airbus was still a step behind Boeing’s 787 – the tube would be in metal rather than carbon.
Meanwhile, an internal crisis at Airbus was casting a shadow over the proposals.
Delays to the A380 hit share prices in June 2006 and forced Mr Humbert to resign.
His replacement, the aerospace outsider Christian Streiff, took top Airbus managers to a converted French abbey to reflect. Over dinner, according to a person familiar with the event, he asked them to raise their hands if they thought Airbus should build the very plane they had publicised weeks earlier. Only a handful did.
Nevertheless, the engineers pressed on. Soon they came up with a cost-effective way to make an all-carbon body assembled from panels, which they felt would be cheaper to build than the single giant piece in the Boeing 787.
In December, 2006, the reversal was complete: the board approved the new, all-composite body A350XWB.
And yesterday, a decade after Mr Al Akbar’s initial prodding, Airbus finally was handing over its first A350 to Qatar Airways at a ceremony in Toulouse.
* Reuters