Last summer, Boeing announced its decision to build the 737 MAX as a response to the refresh of the A320 family that Airbus made with its New Engine Option program. Once again, the industry's two largest airplane makers are engaged in a high-stakes struggle for narrowbody sales. Only this time, they face challenges from the Bombardier CSeries, the Comac C919 and the Irkut MS-21.

Europe's safety agency says inspections will assess how severely a new set of wing cracks are affecting the Airbus superjumbos.

The worldwide demand for special-mission aircraft for everything from drug interdiction to medevac is leading to a corresponding need for visual enhancement systems. The increase in drug-trafficking activity in many parts of the world has stimulated growth in the market for smaller special-purpose aircraft engaged in surveillance and targeting of illegal activity. To help meet this demand, nearly all manufacturers of regional/commuter business jets and corporate turboprops now offer variants that can serve in multiple roles.

“We're going to shrink to win.” Scott Donnelly, the chairman, president and CEO of Textron, is referring to his strategy of cutting the company's cost structure while simultaneously investing in new products and chasing new business. The question is whether he will ultimately be forced to execute that strategy on a larger scale. Textron, a 32,000-employee conglomerate and parent company of Cessna, Bell Helicopter, Textron Systems and Lycoming, has come under varying degrees of shareholder pressure for more than three years to sell off underperforming operations.

Combat Aircraft: Growing demand for stealth technology gives Lockheed Martin's F-35 a dominant position in the global fighter market, even if the U.S. cuts the number it buys. And where the F-35 leads, new trainers will follow. See pp. 49 and 54. Commercial Transports: They face new challengers this time around, but Airbus and Boeing rake in orders in a high-stakes struggle for the narrowbody market. Their airline customers warn of higher costs and lower profits in 2012. See pp. 76, 80, 86 and 88.

Boeing's 737 MAX announcement this past summer has set the stage for a titanic struggle over the narrowbody airliner market. The 737 MAX series is the company's answer to the new Airbus A320NEO family, launched in late 2010. Making things even more interesting is the appearance of other new narrowbodies such as the Bombardier CSeries, Comac C919 and Irkut MS-21.

Significant defense orders, strong government subsidies and growing demand for domestically produced commercial aircraft have provided optimism regarding the Russian aircraft industry.

An item in Washington Outlook in the Jan. 16 edition (p. 17) mischaracterized the position of the U.S. Chamber of Commerce on a union matter in the FAA reauthorization bill. The House version of the bill calls for reverting to the rules for how airline and railroad employees form unions that had been in existence for 75 years until the National Mediation Board changed them in 2010. The chamber supports the House bill's provision to reverse the recent rule change.