Paris Show Orders from Around the Globe Stretch Backlogs
As predicted, most airliner makers went home from last week’s Paris Air Show with yet longer backlogs of orders. Factoring in all the provisional sales (those covered by options, letters of intent or a memorandum of understanding), manufacturers announced something like $170 billion in new aircraft and engine business at Le Bourget. Recent experience has shown that the air transport sector has followed through on a large proportion of these provisional sales, promising at least half a dozen more years of strong income levels in civil aerospace but also mounting challenges for the strained supply chain.
Quite apart from the sheer volume of orders placed at the show, the geographical base of the airline customers involved was impressive. In recent years aggressive new carriers from the emerging air transport markets of Asia and the Middle East have dominated the airshow circuit with their buying power. But this year’s show brought significant volumes of new fleet expansion and replacement from carriers in what have been troubled markets, the U.S. and Europe. For example, United Airlines ordered 10 A350-1000s and upgraded 25 -900 options to firm purchases of the larger -1000 in a $4.4 billion contract. U.S. low-cost carrier Spirit Airlines ordered 20 A321neos and changed options for A320neos into A321s at a total cost of almost $2.6 billion. Boeing also benefited, with Ryanair, arguably Europe’s most profitable carrier, inking a $15.6 billion deal for up to 175 of its 737-800 narrowbodies. After apparently falling out with Airbus a few years ago, Ryanair founder Michael O’Leary tried to make Boeing work harder for his business by suggesting that he might become the first foreign customer for China’s Comac C919. Evidently, he got deterred by that program’s continued delays and looked west once more to Seattle.
Regional aircraft makers also had a busy week at Le Bourget. ATR reported its most prosperous Paris Air Show ever, with contracts valued at more than $4.1 billion. The latest deal came on June 20, when Air Lease placed a $120 million order for five ATR 72-600s. One day earlier leasing group HGI Aircraft signed a $482 million contract for 20 ATR 72-600s that will go to Brazilian carrier Passaredo Linhas Aereas. This followed an earlier $2.1 billion deal with Nordic Aviation Capital, which is to take 91 of its twin turboprops. Embraer topped this with deals valued at up to $18.75 billion, but much of these related to early launch commitments for the new E2 versions of its E-Jet line of regional jets. Bombardier logged orders for three CRJ1000s and four Q400s with Nigeria’s Arik Air, as well as three more Q400s to Horizon Air, in contracts valued at just under $400 million.