Wednesday, May 29, 2024

Airbus & Boeing: No Longer Is The Cupboard Bare

By Bikram Vohra

Bikram Vohra, Consulting Editor, IADB

Any regular aviation writer worth his ink will acknowledge that the Airbus versus Boeing dramatics at every air exhibition is a bit of a stage show. Yet, both their major media conferences are the spice of the five-day event every time. Whether Farnborough, Le Bourget, Singapore or Dubai, the script is much the same. The media plays along, and the crowded conferences are awaited because the shrill accusations and the sharp and caustic comments generate a slanging match that makes for great copy. It is a colourful relief from otherwise relatively dreary press releases shoved into cubbyholes.

Between 2007 and 2018, this verbal pugilism became increasingly vitriolic and occasionally bordered on the uncomfortable as both the big boys accused each other of being bankrolled and engaging in unfair practices. The Covid pandemic hit hard and thereby created a certain sobriety. Since then, there has been a drop in the often manufactured ‘for the occasion’ hostility. That said, the residual bantering continues, but the sting has gone as both Boeing and Airbus become aware of the reality bite. In an odd fashion, they need each other to make the fulcrum of not just balance but also market stability. One company by itself could not feed the market.

The losses in the 2019 to 2021 timespan were massive. The crisis dropped Boeing from a $12 billion profit to a $2 billion loss.   Airbus weathered the crisis a little better but lost $1.7 billion by mid-2021. For four years running from 2018, Airbus won on deliveries, and the general impression was that the United States manufacturer had been dethroned, especially as it retreated from the scene following the fallout from the 737max crashes to Ethiopian and Lion Air. In 2020 Airbus strengthened its lead by delivering 663 aircraft, compared to Boeing’s 480 planes. In 2021, Boeing and Airbus delivered 340 and 611 aircraft.

In light of the Airbus streak of wins, the 2023 first quarter sale of Boeing aircraft at 130 aircraft as opposed to Airbus at 127 becomes a significant reason for a whoop of triumph. Long time since it came close, let alone take the lead. Now, three ahead may not be much, especially since one of the planes is a P8 Poseidon and one a 767 freighter, neither of which constitute the usual battlefields of the 737 family versus the A320 and the widebody segments options. But a lead, however slender, is a lead and does give the impression that the competitive edge is being honed. In fact, Boeing managed to transfer seven Dreamliners in this period, although the 737max at 52 made up a major part of the deliveries.

Airbus was just a little behind and kicked in with a surge for the A350. Airbus’ aircraft deliveries fell by 11% to 127 compared to 142 deliveries in the same period in 2022. It blamed global supply chain disruptions for the slack, but with March doubling the output for February, it looks on track to close in the 2023 promise of 720 deliveries in the year with a far better showing in Q2.   Over the year, Boeing now targets an average rate of between 33 and 38 737s per month or 400-450 for the year. It plans to increase output to 47 jets per month by the end of 2023.

According to a news service report, Airbus delivered 11 widebody jets, including five A350s, in the first quarter of 2023, 10 small A220 jets and 106 of its best-selling A320neo-family aircraft. And while Casey hasn’t struck out for either of them, and another pandemic being unthinkable, the area of concern is the change that could happen in the demand for the aircraft type. The average seat capacity was pegged at a low of 141, with the A320 and 737 families being favourites and the E150/E170 also gaining popularity. On the top end, the A350 and the Dreamliner share the honours. The big losers are the 777, the A330/340, and we all know the sad story of the A380.

Carriers have become very sensitive to fuel costs, efficiency, and environmental carbon footprints, and with power plant manufacturers responding to the new priorities, the odds favour single-aisle planes that can do the reasonable long haul of six to eight hours because they tick all the bottom line boxes. It is just cheaper to fly smaller planes. Therefore, in the new thinking, many of the orders may change not slightly but dramatically. Safer and cleaner power plants and the advent of sustainable alternate fuels will also impact the sort of fleet mix, and the four-engine long-haul twin-aisle monopoly could well be broken by smaller single-aisle new-gen aircraft that are as comfortable and less expensive to fly. In the transformation period, fuel-efficient aircraft will be the key as smaller aircraft and more frequency dictate the next five years. 

To quote the International Civil Aviation Organisation (ICAO): Engines and aircraft will become lighter, quieter and more efficient. Emerging technologies are reshaping with robotics, artificial intelligence (AI, the Internet of Things (IoT), unmanned aircraft systems (UAS) and the push for hybrid and electric airplanes. The four-engine era is passe. Commercial narrow bodies have improved to a great degree with the A320neo and the 737 Next Generation, and 737 MAX aircraft are now the main choice.

Boeing introduced the 777X, which is supposedly 10% more fuel efficient than the Airbus A350. It is also the largest twinjet boasting new technologies, advanced wingtips and a massive wing-based power plant on each side. Airbus’ latest development of the A321XLR likewise also underscores efficiency and a low carbon footprint. Such aircraft have improved range and can comfortably go transatlantic and move into the preserve of routes typically served by widebody aircraft. For now, the slanging match can resume, as both the plane makers know they are riding the wave and, whatever the size, they are ready for it. And when they hold their respective press conferences at le Bourget next month, the media will be there…waiting for snarky sound bites. 

Bikram Vohra is the Consulting Editor of Indian Aerospace & Defence

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