Ed. Note: Mike Bair is vice president of Advanced 737 Product Development for Boeing Commercial Airplanes and is responsible for planning the future of Boeing's single-aisle airplane.

Mike Bair Vice President of Advanced 737 Product Development

On several occasions this year, I've joined our Boeing Capital team in their efforts to help the financial community understand where our product strategy is heading, particularly as it applies to a 737 replacement.

As some of you've may have heard me describe, Boeing has been evaluating two potential options for the next single-aisle airplane: to improve on the 737 with new, more fuel-efficient engines that could enter service mid-decade, or a new small airplane with a planned entry into service in 2019.

As you now know, Boeing has launched the new engine variant: the 737 MAX. Arriving at that decision required balancing a complex range of factors. In addition to daily discussions with a wide array of customers, we made a thorough assessment of options, including timing and production system readiness.

Teams had been pursuing the two options, and we had made significant progress on both. However, it became clear that customers needed more certainty on our direction sooner – they are ready to move on fleet planning decisions. While we knew we would have the technology for a new airplane, we did not see a clear path to address the risks associated with maturing a production system that could quickly ramp up by the end of the decade.

The 737 MAX is the best choice for our customers and for Boeing. This direction not only delivers that certainty customers were asking for, but it also ensures that Boeing will continue to have the most capable and fuel efficient airplane in this market segment.

With the technology we're going to invest in that airplane, it will live on for 15, 20 years. Adding new engines to the 737 will also provide 10-12 percent greater fuel efficiency to our customers in the near term. Compared to our competitors, it will provide a 7% advantage in operating costs per seat. This is the best, most cost-effective solution for our customers and for Boeing.

Along with being the most fuel efficient in its class, the 737 MAX will have the lowest operating cost, while also meeting customer needs for range, payload, standardization, reliability and fleet compatibility. It extends the incredible franchise of the 737 program well into the next decade.

Since the start of our journey to design the new 787, the financiers have been an active part of our dialogue around where our products should head, so you can continue to expect to hear more from us as the 737 MAX progresses. And as always, we appreciate your feedback.