- The Paris Air Show returns on Monday after a four-year hiatus during the pandemic.
- Aviation analytics firm expects around 2,100 aircraft orders during the show.
- Meanwhile, Boeing and Airbus are racing to ramp up production to meet strong demand.
An employee works at the Airbus A350 assembly site in Colomiers, near Toulouse, southwest France, on December 9, 2022.
Valentine Chapuis | AFP | Good pictures
A lot has changed in the four years since the aviation industry’s biggest air show has been held in person.
The Covid-19 pandemic has devastated travel demand, the airline industry has shed thousands of veteran workers and the rollercoaster appetite for new jets has wreaked havoc on new aircraft production rates.
After all, the Paris Air Show — a trade event that gives companies a chance to showcase new technology, commercial and military aircraft and strike deals — returns Monday amid a surge in air travel demand, with airlines starved for jets to feed it. . The question is whether Boeing, Airbus and their numerous suppliers can catch up.
“It’s creating pressure on order books — it’s creating upward momentum in used aircraft lease rates and forcing airlines to compromise,” said Andy Cronin, CEO of aircraft-leasing company Avolon.
Aviation analytics firm IBA estimated last week that orders for around 2,100 aircraft will be placed during the show as airlines replace older aircraft and prepare for future growth in air travel.
In the past year, Boeing has booked large orders or preliminary contracts from customers including United Airlines, Saudia and new Saudi carrier Riyadh Air. Air India’s biggest order earlier this year included Boeing and Airbus jets.
The chairman of Turkish Airlines told reporters last month that the carrier plans to order 600 planes, both wide-body and narrow-body. The order would be the biggest ever for an airline, though it’s unclear if it will come together during the show.
IBA’s chief economist, Stuart Hatcher, wrote in a June 15 forecast that Delta Airlines, Malaysia Airlines and Air France-KLM were likely buyers, but the timing was still uncertain. Air Baltic can also expect to expand its Airbus A220 fleet, he said.
“Given the political environment it may be premature to call any Chinese expansion, but I would not be surprised to see top-up orders coming in,” Hatcher wrote.
A major challenge for manufacturers today is to increase production. Slots for narrow-body jets such as Boeing 737s and Airbus A320s have been sold for years. Now that long-haul travel is making a comeback, expect some airlines to expand their larger, longer-haul jets as well.
But customers around the world have been forced to wait longer than expected for the new planes as Boeing, Airbus and a web of suppliers around the world scramble to ramp up output. It has low flight capacity, keeping airfares high.
Qantas CEO Alan Joyce told CNBC last week that he expects supply chain issues to last until 2025.
Boeing and Airbus are scrambling to raise production rates in the coming years to meet that demand.
Production delays have pushed up leasing fees for new and older planes as airlines look for other opportunities to increase fleets.
New Boeing 737 Max 8 planes were leased for about $350,000 a month in July, up from $305,000 in January 2020 as the pandemic began, IBA estimated. New Airbus 320s sell for $355,000, up from $325,000 at the time. Older versions are closer to pre-pandemic levels.
“People love their jets,” said Richard Aboulafia, managing director of Aerodynamic Advisory.
