Air­bus wide-body or­ders over­take Boe­ing

Financial Mirror (Cyprus) - - FRONT PAGE - By Paul Au­sick

Air­craft maker Air­bus Group an­nounced that it has taken net new or­ders for 1,007 pas­sen­ger air­planes to the end of Novem­ber. That to­tal is well above the 568 net new or­ders writ­ten by Boe­ing Co. up to De­cem­ber 2. The really un­happy news for Boe­ing is that new or­ders for the Air­bus A330, A350 and A380 have pushed the Euro­pean maker’s to­tal for net new wide-body or­ders to 127, com­pared with 113 net new wide-body or­ders for Boe­ing’s 747, 777 and 787.

Air­bus also holds a wide lead in the mar­ket for nar­row-body planes. The A320 fam­ily of sin­gle-aisle pas­sen­ger planes has re­ceived net new or­ders for 876 planes in the first 11 months of the year, com­pared with a net to­tal of 389 new or­ders for Boe­ing’s 737 fam­ily. For the year, Air­bus’s share of the nar­row-body mar­ket is nearly 70%.

While this com­par­i­son favours Air­bus, Boe­ing is the easy win­ner when it comes to de­liv­er­ies. The com­pany has de­liv­ered 705 new com­mer­cial air­craft so far in 2015 and should eas­ily de­liver more than its stated yearly tar­get of around 755 planes. Air­bus has strug­gled with de­liv­er­ies in 2015 and has shipped out just 556 new planes. In or­der to meet its tar­get of 630 de­liv­er­ies, Air­bus needs to roll out 74 new planes in De­cem­ber. That’s pos­si­ble, but it won’t be easy. Air­bus had shipped just ten of the 15 A350s it had tar­geted for de­liv­er­ies this year by the end of Novem­ber. It still expects to meet its tar­get, hav­ing de­liv­ered one new A350 last week, with the other four on sched­ule for de­liv­ery by the end of this month. The Christ­mas hol­i­days, how­ever, could slow pro­duc­tion. Air­bus did de­liver four new A350s in Oc­to­ber, so there is prece­dent.

An­other is­sue for Boe­ing is slow sales of its cur­rent 777 wide-body, for which the com­pany has taken or­ders for just 38 so far in 2015. Boe­ing’s tar­get for the year was 40 to 60 new or­ders for the plane, and it still hopes to sign a deal with United Air­lines for ten of the 777-300ERs by the end of De­cem­ber, ac­cord­ing to a re­port from Lee­ham News. The new 777X has logged 20 net new or­ders so far this year.

On Mon­day, Boe­ing Cap­i­tal Corp. (BCC) re­leased its mar­ket out­look for air­craft fi­nance in 2016. The re­cent reau­tho­ri­sa­tion of the U.S. Ex­port-Im­port Bank has lifted the out­look to its best level since 2009. Boe­ing es­ti­mates that the to­tal global mar­ket for new air­craft will reach $127 bln in 2016, up from $122 bln this year, and that 36% of the fund­ing for those planes will come from the cap­i­tal mar­kets. By 2020, BCC projects to­tal new de­liv­er­ies will reach $172 bln.

Leas­ing com­pa­nies are ex­pected to take about half the cap­i­tal mar­ket’s fund­ing in 2016 and the Ex-Im Bank’s fund­ing sup­port “is pro­jected to be lim­ited in scale.” The ExIm Bank’s to­tal fi­nanc­ing as­sis­tance to Boe­ing in 2016 is forecast at 9%.

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