Hello All,
This blog was surprised when Ethiopian Airlines announced an order for eight 777-9s. Ethiopia recently had a sovereign default and has lingering domestic tensions, with a civil war in recent years. Surprisingly, despite the political challenges, the carrier is putting all those orders (A350s, 737 MAX, 787, and 777X).
We do not know whether this order will replace an existing 777X one with another customer.
The carrier currently operates only four large 777-300ERs and already has an order for four A350-1000s. The carrier already operates Airbus A350s and three Boeing families (767, 777, and 787). It commits to operating three new-generation families for the long term with the A350, 787, and 777X.
Part politics …
The order has a political component. An Air Current article highlights the growing links between China and Africa. China made sizable investments in Ethiopia. Seeing itself as a non-aligned country, Ethiopia also places most of its orders with Boeing to “balance” its relationship between the two global superpowers. The 777X order fits into this narrative.
Part high growth ambitions
After decades of civil war and political unrest, Ethiopia’s economy rapidly grew in the previous two decades. The rise of Ethiopian Airlines has been a symptom of the country’s economic ascend, capitalizing on the woes of other flag carriers on the continent (South African Airways and Kenya Airlines).
The 777-9 order is a statement of intent that the country and airline see themselves playing in the big league of global carriers. The 777-9 can accommodate high passenger and freight volumes. Addis Ababa is a suitable geographical position for flights between Africa and East Asia, notably China.
The only other 777-9 customer that wants to join the big league of global carriers is Air India. The other 777-9 customers are established carriers that operate north of 100 twin-aisle passenger aircraft (except for Etihad Airways but its 777X order is not solid).
A (not so surprising) loser
Addis Ababa is about 100m higher than Mexico City, so it is an airport where the over-powered (and exceedingly large wing) 777-8 would have worked well. Ethiopian Airlines passed on the variant, sticking with the A350-1000 and preferring the larger 777-9.
Boeing probably lost its last major sale opportunity for the 777-8. The smallest passenger 777X variant has poor economics compared with the A350-1000. The only two customers are Emirates (35) and Etihad (8). Per Boeing’s 10-K annual filing, the variant is not scheduled to enter service before 2030.
Emirates re-ordered the variant because it could not agree with Rolls Royce on engine durability guarantees and maintenance costs. Since then, Rolls Royce announced a three-year program to double the durability of the Trent-XWB 97. If Rolls-Royce succeeds, Emirates could change its mind and re-order the A350-1000, converting its 777-8 order to the larger 777-9 or Dreamliners. Etihad does not want its eight 777-8s.
This blog believes that the 777-8 passenger variant will never enter service. The recent Boeing woes mean that the American OEM has even fewer resources to spare on a variant that does not sell.
