An Airbus A321 takes off at the Farnborough International Airshow, in Farnborough, England, on July 22, 2024.
Toby Melville Reuters
FARNBOROUGH, England – Massive aircraft orders, hundreds deep in recent years, are absent at this year’s biggest air show. Focus instead on the struggle Boeing and Airbus to increase aircraft production while fighting the hangover from the pandemic marked by seesaw output.
Many of the problems, especially training new workers, will take years to fix, analysts say, meaning headaches for airlines, their suppliers and the manufacturers themselves — and a shortage of new, more fuel-efficient planes.
“It’s a fair sentiment on the part of the supply base and airlines that say we failed to commit to them on time, in terms of predictions,” said Ihssane Mounir, Boeing’s senior vice president for global supply chain and manufacturing. , during a panel at the Farnborough Airshow outside London last week. “So obviously, people are starting to make their own plans and second-guessing.”
A road map of production over the next few months emerged this week. Airbus on Tuesday said its adjusted profit in the last quarter fell 56% from a year earlier, mainly due to costs in its space business. The European jet maker earlier cut its plane delivery target for the year because it did not build planes as quickly as planned.
Boeing reported results before the market opened on Wednesday. Wall Street analysts expect the company to post another loss for the second quarter and possibly beyond.
simple order
At the show, which ended on Friday, Boeing collected 96 orders and commitments, including sales that had been made earlier that were strengthened, while Airbus had 266, far from 826 orders during the Paris Air Show a year ago, according to a tally from consulting firm Ishka. Paris and Farnborough alternate hosting the fair each year.
One of the most prominent is Korean Air’s order of up to 50 widebody Boeing aircraft, including the 777X, which Boeing is working on to be certified by regulators. The carrier also has Airbus A350-1000 jets on order. As both manufacturers struggle with production strains, Korean Air CEO Walter Cho laughed at Boeing’s order signing: “Whoever comes first will be our flagship, whoever is on time.”
The order tally was muted during the show as the two manufacturers largely sold narrow-body jets like the Boeing 737 Max and Airbus A321neo this decade, if not longer. Boeing has an overall backlog of close to 5,500 planes, while Airbus has more than 8,000 on order. Many airlines from United Airlines to Air India has also placed new jet orders as travel increases again amid the pandemic.
Boeing’s presence at the air show is minimal – it does not bring commercial aircraft for flight demonstrations while focusing on security crises and manufacturing problems. Arlington, Virginia-based Boeing is trying to increase production of its bread-and-butter Max plane by about 38 months, and investors will be looking for clues this week when that target can be reached.
Airbus showed its new extra-long-range aircraft, the Airbus A321XLR, which was certified by European regulators a few days before the show began.
Lack of parts
Air show visitors typically see fleets that will fly for decades, but much of the industry this year is focused on output over the next few months.
Lack of parts from landing gear to engine components like high-pressure blades to more complex cabin interiors, like those with premium seats, are also few. That has slowed down production, depriving airlines of more fuel-efficient planes and angering some executives on the road.
Ihssane Mounir, Senior Vice President Commercial Sales & Marketing at The Boeing Company with Peter Anderson, Chief Commercial Officer at AerCap attends a press conference at the Farnborough International Airshow, in Farnborough, Britain, July 19, 2022.
Matthew Boy | Reuters
Airbus is taking a broader approach than it has done before, employing more than 200 supply chain engineers among its suppliers, said Christian Scherer, chief executive of the European maker’s commercial aircraft business.
“What we don’t want to see again in the future, whether we’re going up or down in this industry, is a situation where the supply chain doesn’t believe what they’re told,” Scherer said. reporters before the event.
Airbus last month said it would reduce its aircraft delivery target for the year and said it would increase planned production, citing “ongoing special supply chain issues particularly in engines, aerostructures and cabin equipment.”
Boeing, in addition to supply chain problems, is trying to dig its way out of the safety crisis stemming from the plug door blowout in January, and a series of manufacturing defects that have slowed output.
New workers, low wages are the focus
The loss of skilled workers who were laid off or opted for early retirement during the Covid-19 downturn in air travel has hampered the production of new jets. Manufacturers are now left to train new workers – a major challenge.
“I think it’s a three- to five-year issue,” said Kevin Michaels of AeroDynamic Advisory, an industry consulting firm. “Wages need to be reset to make the industry more attractive” to workers.
Boeing’s Mounir admits that lower wages are a problem in the supply chain and says Boeing itself needs to invest in training.
“There’s no question about it,” he said. “I don’t expect the smaller suppliers that are important to the ecosystem to be able to bear that burden. We have to do it ourselves at a higher level, again, using our balance sheet. It will pay off.”
It takes more time to train workers like “bakers, butchers, people who work in very different business areas” who are new to the aerospace field, said Airbus’ Delphine Bazaud, head of industrial supply chain and digital operations.
Michaels, of AeroDynamic Advisory, predicts that in the US, more aerospace work will move overseas, “to places where the labor is available.”
Correction: This story has been updated to correct the name of the Korean Air airline.