jetmakers hunt for new growth as order binge fizzles out
Plane giants are preparing to squeeze the last drop out of a once raging torrent of airplane orders without the razzmatazz of recent years, as the aerospace industry heads to a belt-tightening Paris Airshow looking for new sources of revenue.
The June 19-25 gathering takes place against the backdrop of surprisingly strong airline traffic driven by economic growth, but a steep drop in the appetite for new planes following robust demand for the latest fuelefficient models in recent years.
Instead, many firms will talk up efforts to extract new revenues out of powerful data-crunching services, while the first Paris display of a US stealth jet in decades, the F-35, points to a defence recovery at the world’s largest air show.
The meeting also comes amid tensions in the Gulf over a transport and economic boycott of Qatar that is fuelling questions over the resilience of a major source of demand.
Dominating an otherwise thin slate of commercial orders will be a new version of Boeing’s most-sold airliner, the 737.
The 190-to-230-seat Boeing 737 MAX 10, designed to narrow a gap against European rival Airbus, will be launched on Monday with over 100 orders, two people familiar with the plans said.
Analysts said one unknown quantity is how many of the MAX 10 orders may merely be replacing previous orders for other variants as Boeing rejigs its medium-haul portfolio.
Low-cost giants Lion Air of Indonesia and Ireland’s Ryanair have confirmed Reuters reports of interest in the new jet, though talks with Ryanair could take longer to complete.
CDB Aviation, the aircraft leasing arm of China Development Bank, is in talks to place orders with both Boeing and Airbus and could complete at least one of the deals by the show.
It may buy 40-50 Boeings, including about 5 MAX 10s, and a similar number of Airbus jets, two sources said.
Boeing is seen anxious to win backing of major operators for the new catch-up model and has also talked to United Airlines.
“I think you’ll see some activity on this in Paris and that will start the process of seeing how airlines react to it,” said Peter Barrett, chief executive of SMBC Aviation Capital.
Seeking to leapfrog Airbus after a mixed few years for the MAX series, Boeing will also give more details on a larger new mid-market jet employing a novel fuselage designed to try to capture projected growth in demand for 220-270 seaters. (RTRS)