Jetmakers kick off air show with rich sales

PLANEMAKERS racked up more than US$20 billion of deals on the opening day of the Farnborough Airshow yesterday, suggesting demand for new passenger jets remains in good health despite worries over trade tensions and Brexit.

The deal-making came as host Britain tried to convince a sceptical aerospace industry about its plans to leave the European Union, saying supply chains would continue to run smoothly and pledging money for a new fighter jet program.

European jetmaker Airbus and US rival Boeing have been enjoying an almost decadelong boom thanks to rising emerging markets growth and a need among Western airlines to upgrade their fleets, and order books are bulging.

Higher oil prices, rising interest rates, global trade tensions and uncertainty over Brexit have all raised concerns that demand may slow.

But business was brisk on the first day of the July 16-22 air show, though analysts will be watching closely to see how many of the deals are new, and how many involve adjusting earlier business or switching models — something not always easy to spot at first.

Even before the first displays had taken to the skies over a sun-baked southern England, Boeing said delivery firm DHL, part of Deutsche Post DHL Group, had placed a US$4.7 billion order for 14 777 freighters, and purchase rights for seven additional freighters.

It followed that up with a US$3.5 billion deal for 30 of its hot-selling single-aisle 30 737 MAX 8 aircraft with US aircraft leasing firm Jackson Square Aviation, while Qatar Airways finalized an order for five 777 freighters.

Meanwhile, Airbus announced a memorandum of understanding for Taiwan startup StarLux Airlines to buy 17 of its A350 widebody planes worth around US$6 billion at list prices, and another MoU with an unidentified leasing firm for 80 A320neo single-aisle jets worth about US$8.8 billion.

The Farnborough Airshow is the industry’s biggest event this year. It alternates with the Paris Airshow and collectively they account for over a quarter of industry order intake each year.