Boeing debates overhaul on its 737In a decision that's sure to reverberate through its supply chain, Boeing Co. is currently debating whether to offer a new engine for its 737, or wait to focus on developing a brand new jet instead, according to Jim Albaugh, the head of Boeing's commercial jet unit.

Many airlines have pressed Boeing in recent months to come out with upgrades to the 737, one of the most ubiquitous aircrafts in the world. Boeing, however, has been loath to upgrade its engines as the company weighs the cost benefit of such a restructuring to its planes versus its planned redesign of airplane in the next few years.

"We have had a very difficult time making a compelling business case for why we should re-engine," Albaugh affirmed in an interview. "At the same time, we continue to study the subject and we'll announce our decision sometime in the middle of the year."

However, Airbus SAS, Boeing's biggest global competitor, just announced that it signed a deal valued at $15 billion to supply the Indian low-fare carrier IndiGo Airlines with 180 of its A320 jets, which compete with the 787. That deal puts pressure on Boeing to make a decision as to whether it will upgrade the engines on its planes or simply wait to develop an entirely new jet.
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