Are supersonic passenger jets back? not so fast

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American Airlines Group Inc. has agreed to purchase 20 supersonic jets from Boom Supersonic which are designed to carry up to 80 passengers. So when can you buy a ticket to fly at 1.7 times the speed of sound from New York to London and cut your travel time in half? Well, probably never.

While the idea of ​​commercial supersonic flight is appealing, the financial and technological hurdles to replace the legendary Concorde, which ceased flying in 2003, will be incredibly steep. There are reasons why no aircraft manufacturer has built a replacement for this iconic aircraft despite advancements in engineering. The Concorde, which made its first scheduled passenger flights in 1976, was more of a cult hit than a commercial success. That’s why airliners always fly well below the sound barrier, which is about 680 miles per hour at 30,000 feet.

People would definitely like to fly faster and save time. But are they willing to pay a super premium price for it? The answer for the Concorde was no. The economy did not work. The plane was also plagued by noisy engines and a sonic boom that could set off car alarms and rattle items on shelves. And then there was the summer 2000 crash that killed 113 people and spelled the end of the plane.

Boom has lined up some awesome partners and a few airlines have agreed to make purchases. This does not mean that the aircraft will ever be built. Partners, including defense giant Northrop Grumman Corp., are on board for now, but they have no obligation to stick around. There is no real skin in the game.

That goes for American Airlines, United Airlines Holdings Inc. and Japan Airlines Co., all of which added to the order book for Boom’s supersonic jetliner, the Overture, which costs $200 million. But they don’t pay anything close to that now. It’s easy for an airline to drop a small amount of money on the chance that a startup will succeed and kick-start the era of supersonic travel. It is more like a venture capital investment. The American Airlines deposit is non-refundable, Boom said in the statement Tuesday. Nobody discloses the amount, so it is necessarily very small.

If this all sounds a bit familiar, that’s because it is. Remember this headline from a May 2021 Bloomberg News article: “Texas billionaire’s supersonic dream dies as Aerion folds.” The startup’s demise came just when it looked like it was really going to produce its supersonic aircraft, the AS2. The company had hired many experienced executives from the aviation industry, had many orders and, most importantly, had an engine manufacturer. General Electric Co. was trying to develop the perfect motor that was quiet and able to efficiently cruise above and below the speed of sound. Aerion ended up owing GE $32 million for work on the engine, according to a list of assets for sale that was released last year. Development Specialists Inc., which is handling the fire sale of Aerion’s few assets, has set a September 7 deadline for submitting bids.

Aerion had all the right partners, including Boeing Co., and had Flexjet, the second largest private jet operator, as a launch customer. The list of wealthy people willing to sign up for the chance to buy a showboat plane that would smoke all the bangers of their rivals has grown. NetJets, the largest private jet operator owned by none other than Warren Buffett’s Berkshire Hathaway Inc., pledged to buy 20 AS2s in March 2021. Two months later, Aerion collapsed. Robert Bass, the headline Texan billionaire, would no longer support the project as it was about to chart its course to manufacturing. When a final attempt to line up investors – according to rumors from Saudi Arabia – failed, the project collapsed.

Aerion’s experience doesn’t mean that same fate will befall Boom, but the challenges are similar and daunting. Environmental and noise control standards make the challenge of developing an engine for a civilian supersonic aircraft incredibly daunting. Regulations that restrict supersonic travel over land will have to change, but Boom says there are hundreds of airlines over the ocean to drive demand. The startup also claims that it will only use sustainable aviation fuel (SAF), which is expensive and in short supply.

“The economy really matters,” Boom chief executive Blake Scholl said in a phone interview. “What we need to do with Overture is reduce the cost of operations so tickets can be cheap and more people can afford to fly on them. It is absolutely essential.”

Scholl said his Overture plane would be “very profitable” with a $5,000 return ticket from New York to London. That would be a lot to cut the seven-hour flight from JFK to Heathrow in half. For the engine, Boom is in talks with Rolls Royce Plc, which has an engineering design, and other unidentified companies, Scholl said. Safran SA, the Collins unit of Raytheon Technologies Inc., Eaton Corp. and other well-known vendors are paying for their own research for the project, he said.

The project begs the question: if the business opportunity was so strong, why would any of the experienced aircraft manufacturers such as Boeing Co., Airbus SE or Lockheed Martin Corp. wouldn’t he already have such a plane in development? Of course, startups can and should disrupt established industries, but manufacturing such a complex aircraft on budget and on time to lower the price per passenger requires more than entrepreneurial audacity. Passengers probably won’t pay much more than a business class ticket to cut the trip from Los Angeles to Hawaii to about three hours from five.

Additionally, developing a supersonic aircraft is going to be capital intensive, and that cost is increasing as the Fed moves aggressively to stifle inflation. The central bank hammer has many worried that a recession is a real possibility. There probably isn’t much appetite for risk from engine makers whipping the supply chain to meet the existing need to power Boeing and Airbus power plants. GE CEO Larry Culp probably isn’t salivating at the thought of making a big bet on the supersonic as one of his self-driving aerospace company’s first projects.

Scholl has a vision, and I wish him well. Don’t expect to fly faster than the speed of sound for many years, if at all.

More other writers at Bloomberg Opinion:

• Airline chaos makes high fares harder to bear: Brooke Sutherland

• Good luck with your vacation this summer: Andrea Felsted

• Airline chaos provides an opening for travel fraudsters: Alexis Leondis

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Thomas Black is a Bloomberg Opinion columnist covering logistics and manufacturing. Previously, it covered US industrial and transportation companies as well as Mexican industry, economy and government.

More stories like this are available at bloomberg.com/opinion

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