If ever there was an aviation message in a bottle, then perhaps Farnborough Air Show 2024 is it. Or to be more precise – multiple messages in a bottle.
Overall, the dynamics and the focuses evident at this year’s event neatly reflected some of the key underlying factors currently influencing the commercial aviation industry.
Let’s unpack some of the key findings and highlights from this year’s four day event.
Farnborough Air Show: Overall Dynamic
A broad standout at this year’s Farnborough event has been the generally lower level of new firm aircraft orders. Several market factors arguably come into play here, which we discuss below.
The general focus by manufacturers has been centred on developing existing product and nurturing customer experience as opposed to proactively seeking new orders.
This is seen the presentation of premium passenger cabin product, which seeks to capitalise on the current market demand for high-end air travel.
Sustainability and investment in green initiatives has also been a central theme, in keeping with industry emissions reduction goals and targets.
Existing Order Backlogs
Paris Air Show 2023 was something of a windfall event for new aircraft orders. It saw records set for overall firm orders which ran to over 1,100.
It also saw the largest historic order by a carrier, set by India’s low-cost giant IndiGo with its bulk A320neo family order.
With their proverbial bellies full from Paris, both Boeing and Airbus are presently running with large order backlogs.
According to an estimate by Bloomberg intelligence, the backlog of key single aisle variants for both manufacturers now stretches to 10 years at current production rates.
Delivery Delays and the Fallout Effect
On top of the large order backlogs, manufacturing and production issues have dogged the industry in the post Covid recovery era
This has ultimately led to widespread delays on delivery schedules, causing a growing sense of frustration with end users. As pent-up air travel demand continues, so the need for new aircraft deliveries grows more critical.
This week a further airline, flydubai added its criticism of Boeing for delivery delays which were crippling its fleet growth program.
This delay has a flow on effect through the airline’s operations, affecting its financial bottom line and ultimately, its paying passengers.
Several airlines have already been forced into alternatives including wet leasing to get around scheduled delivery delays.
The fallout effect of sustained and widespread delay problems is potential brand damage for the aircraft manufacturer.
Boeing: The ‘Softly Softly’ Approach
Boeing entered this year’s event with a stated passive stance on cultivating new orders. Ahead of the air show opening, Chief Operating Officer Stephanie Pope signaled Boeing’s focus on production and delivery.
Still reeling from issues with its 737 MAX and 787 production lines, Boeing is understandably investing in getting its house in order and back on an even keel.
That being said, the US manufacturer saw appreciable gains for its new 777X line, and widebody 787 variants.
The Asian market was notably represented here, with widebody orders flowing from Japan Airlines and Korean Air.
Airbus
Whilst Airbus did not enter the airshow in quite the same subdued manner as Boeing did, it was similarly carrying a healthy backlog from Paris 2023.
Airbus dominated the play overall with a final large order falling to the European manufacturer on Day 4, with an order from Saudi carrier flynas. The airline signed an MOU for 75 A320neo family aircraft and 15 widebody A330-900 aircraft.
Airbus had picked up a mixed single-aisle A320neo and widebody A350-900 order from Japan Airlines on Day 2.
Another notable MOU for Airbus was for two of its new A321XLR (Extended Long Range) variants from the carrier Drukair.
Virgin Atlantic brought in the other widebody purchase, with a firm order for 7 A330-900 aircraft.
Another order that isn’t in the table above is the last-minute purchase made by the Abra Group, which is a major investor in Avianca & GOL, for five A350-900 aircraft.
Embraer: Playing the Long Game
Interestingly no new commercial aircraft orders were announced by the regional aircraft manufacturer at this year’s event.
Embraer’s strategy with its commercial division appeared to be focused heavily on developing the longer-term market positioning of its E-Jet stable of aircraft.
The manufacturer released its plans for wide-ranging upgrades and performance improvements for its commercial jet product range.
The upgrade packages announced applied to its E195-E2, E190-E2, and E175 variants. These planned upgrades included fuel burn and range improvements, avionics and cabin upgrades.
Market Outlook 2024 released by Embraer during Farnborough airshow estimates 10,500 orders for new jets and turboprops through to 2043.
A snapshot of Embraer at the year’s Farnborough show appears to capture the Profit Hunter fine tuning its weapons to reap a long-term harvest.
Arjan Meijer, Embraer’s President & CEO of Commercial Aviation, said, “A mix fleet of sub-150-seat jets and larger narrowbodies will be the successful fleet strategy for the next 20 years.”
So for now, the Brazilian regional aircraft manufacturers strategy appears to be positioning for a longer game spanning the next two decades.
Embraer’s Market Outlook also contains an analysis of the cargo aircraft market. It cites new opportunities for small-narrowbody freighters resulting from the projected growth in online commerce.
To this end the manufacturer also fielded its E190F passenger to freighter conversion, which looks to be something of a potential game change for the cargo market.
Once again it strategically positions Embraer to capitalise on a gap in the existing global cargo market.
ATR
Rounding off the main manufacturers, regional aircraft manufacturer ATR similarly maintained a focus on product support.
ATR firmed a new MRO capability to support the Africa and Middle East market. As part of Ethiopian Airlines Group, Ethiopian MRO’s maintenance capabilities will support ATR operators in the region.
ATR will also explore collaborative ways to train new ATR pilots with the Ethiopian pilot academy.
On the new order front, ATR acquired one new order from the Farnborough Air Show. It signed a firm order for four ATR 72-600 aircraft with Pacific carrier Air Tahiti.
The airline currently operates a fleet of 11 aircraft, comprising nine ATR 72-600 and two ATR 42-600.
Sustainability
Sustainability initiatives remained a key focus for the major manufacturers, with several announcements during the Farnborough Air Show. Airbus is investing in LanzaJet, a leading sustainable fuels technology company and producer.
This agreement in line with its ambition to act as a catalyst for the global development of sustainable aviation fuels (SAF).
Airbus also announced a new partnership with aircraft lessor, Avolon, to study the potential of hydrogen-powered aircraft. This marks the very first collaboration of the ZEROe Project with an operating lessor.
For its part, Boeing announced a new partnership with Clear Sky, an investment company dedicated to aviation sustainability. The pair are joining forces to accelerate sustainability solutions for aviation.
As an initial project, the companies will help in testing and advancing Firefly Green Fuels’ cutting-edge technology. The aim is to increase sustainable aviation fuel (SAF) production in the UK.
The Focus on Premium Cabin Product
As global aviation continues to move through the post-pandemic rebound era, the industry has seen a shift in customer sentiments towards high-end leisure air travel demand.
Evidenced by recent monthly performance reports, major airlines are consistently seeing financial gains from their First Class and Premium class sales.
The shift in focus towards high-end cabin product has been particularly evident at Farnborough FIA2024 this year.
Manufacturers and major airlines will likely increasingly focus on product development and the cultivating of improved customer experience to meet this market demand.
Summary
As another Farnborough Air Show draws to a close, we have witnessed a further interesting dynamic unfold over the past four days.
Challenges for the industry and the major manufacturers continue to hold sway, and the coming months will certainly make for interesting times!
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