New Design for MD-12 Jetliner by McDonnell : Aerospace: The expanded plane would carry 511 passengers and cost the company about $5 billion to develop.

McDonnell Douglas unveiled a newly designed four-engine, double-decker MD-12 jetliner Thursday, a plane that would carry 511 passengers and cost the firm about $5 billion to develop.

Robert Hood, president of the firm’s Long Beach-based Douglas Aircraft unit, said the new aircraft--priced at about $130 million each--would enable the firm to “leapfrog” its competitors, Boeing and Airbus Industrie, which have plans to develop such jets but have not yet begun offering them to airline customers.

McDonnell officials said they hope to win an unspecified number of orders by the fourth quarter of this year, enabling them to launch development of the aircraft and make deliveries by 1997. The aircraft would be produced in a plant to be built in one of nine cities outside California.

The firm originally had intended the MD-12 to be a smaller, three-engine derivative of its MD-11, but turned to the new configuration after its sales efforts apparently proved unsuccessful.

Hood termed the new MD-12, the first entirely new commercial aircraft from Douglas since the early 1970s, as “a revolutionary new airplane that will carry the public into the 21st Century.”

The MD-12 effort began early last year and was the original basis for McDonnell’s proposed linkup with Taiwan Aerospace Corp., a deal that has been delayed and now may face another six months of negotiation, according to officials in Taiwan.

An evaluation of the commercial operation of McDonnell, conducted for Taiwanese investors by the accounting firm Deloitte & Touche, found that Douglas Aircraft was worth less than the amount indicated in the preliminary accord between McDonnell and Taiwan Aerospace. The government-backed company agreed last November to pay $2 billion for a 40% stake in the commercial operation.

The accounting firm also projected that the MD-12’s market share will be about 25% to 30%, compared to McDonnell’s prediction of 40%. The difference is attributable to assumptions about the future growth of the airliner market, McDonnell Executive Vice President John Wolf said Thursday.

As for other statements by Taiwan Aerospace officials that the $2-billion price tag on the deal is too high, McDonnell officials said they regarded the comments as “posturing” for upcoming negotiations.

John Hayhurst, Boeing vice president for large airplane development, countered Hood’s assertion that McDonnell would leapfrog its competitors.

“I don’t think anybody has been leapfrogged by a press announcement that one manufacturer is studying a possible new airplane,” Hayhurst said in an interview Thursday.

Boeing is examining three different large aircraft of its own, ranging from a 480-passenger derivative of the 747 to an all-new 750-passenger aircraft. But the Seattle-based firm has not yet narrowed down its options or offered to sell the planes to airlines. Hayhurst said the airline market is not yet ready for such a plane.

Walter Orlowski, McDonnell vice president for the MD-12 program, said the aircraft would operate at a cost 12% below the 747. An extended range version of the MD-12, carrying 430 passengers at distances of more than 8,000 miles, would have a 1% cost advantage.

Meanwhile, Taiwan Aerospace has begun trying to round up private sector partners for its proposed investment, but may need up to six months before completing the deal, a Taiwan legislator said Thursday.

“If everything goes smoothly, everything may be done within three months. But frankly I think it may be more like six months,” said Tsay Fun-dow, an independent member of the legislature. “The (legislature) would have to approve any investment that involved the Taiwan government.”

A six-month delay in the deal would mean that its closing would coincide with the proposed launching date for the MD-12. Analysts have long speculated that the Taiwan deal would not go forward without a commitment to actually develop the MD-12.

The differing projections for the MD-12’s market share are considered a serious issue, Tsay said.

“It may be that the key element for the success of the deal is how many new orders McDonnell Douglas can get for the MD-12,” he said.

Times staff writer Ralph Vartabedian reported from Los Angeles. Special correspondent Bruce Einhorn reported from Taipei, Taiwan.