Global aviation is returning to pre-pandemic levels and airlines are ordering record numbers of airliners to meet travel demand and freshen fleets with more fuel-efficient and greener aircraft.
According to Boeing, the commercial aircraft market is expected to reach $3.9 trillion through 2032. Airbus and Boeing still foresee more than 40,000 new commercial jets needed throughout the next 20 years.
Global credit ratings business Morningstar DBRS forecasts global travel to remain healthy in 2024, underpinned by the Asia-Pacific region’s continuing recovery with most other regions already surpassing 2019 passenger levels.
The Global Business Travel Association now expects spending on business travel to recover to pre-coronavirus levels in 2024 instead of 2026.
The International Air Transport Association (IATA) expects 2024 revenue passenger kilometers (RPKs) to reach 105% of 2019 levels. However, the caveat is potential escalation in geopolitical tensions could adversely affect global air travel and/or fuel prices.
The experts note the robust aircraft demand comes as original equipment manufacturer (OEM) production and supply chain issues constrain new aircraft deliveries.
In the broader economy, the often-predicted recession of 2023 didn’t materialize, but orders of manufacturing technology, measured by the U.S. Manufacturing Technology Orders Report published by AMT – The Association For Manufacturing Technology, consistently fell short of orders placed in 2022. The notable exception: aerospace manufacturers increased November 2023 orders, peaking 60% above the monthly average compared to the rest of 2023.
Inflation declined as the year ended and is nearing the Federal Reserve’s 2% year-over-year (YoY) target, boosting stock market optimism that interest rates will begin to come down in Q1 2024, notes commercial real estate business platform Bisnow.
The National Defense Authorization Act (NDAA) for Fiscal Year 2024 signed into law in December includes a record $886 billion in annual military spending. Yet the abundance of orders remains a production challenge for aerospace manufacturers. Eliza Hetrick, labor market research analyst at talent recruiting and contract services provider Actalent, says many companies are reporting a shortage of workers including engineers and data analysts, hampering growth and productivity. https://www.actalentservices.com; https://www.amtonline.org; https://www.bisnow.com; https://dbrs.morningstar.com; https://www.whitehouse.gov
AIRBUS delivered 735 commercial aircraft in 2023 – an 11% increase compared to 2022 – to 87 customers, mainly in Europe (34%), Asia-Pacific (32%), and the Americas (25%). The company reported a record 2,094 net new orders, including 1,835 A320 family single-aisle and 300 A350 family widebody aircraft. By comparison, 2022’s net orders totaled 820. The company’s 2023 year-end backlog stands at 8,598 aircraft.
“2023 was a landmark year for Airbus’ commercial aircraft business with exceptional sales and deliveries on the upper end of our target,” Airbus CEO Guillaume Faury noted early this year. “A number of factors came together to help us achieve our goals, including the increased flexibility and capability of our global industrial system, as well as the strong demand from airlines to refresh their fleets with our most modern and fuel-efficient aircraft.”
“We originally anticipated aviation to recover sometime in the 2023-2025 timeframe, but what we saw in 2023 was, alongside the single-aisle market, widebody return much sooner than expected, and with vigor,” added Christian Scherer, Airbus’ newly appointed CEO of commercial aircraft. “Travel is back and there’s serious momentum!”
Airbus previously issued guidance stating it plans to increase A350 production from five to six jets per month in 2024, while maintaining A320 production at 45 aircraft per month.
Airbus A220, A321neo, A330neo, and A350-1000 in flight. CREDIT: AIRBUS SAS
BOEING reports 1,314 commercial orders for 2023 after cancellations and conversions, including 883 for the 737 family, 30 for the 767, 100 for the 777, and 301 for the 787. The company delivered 528 airplanes in 2023. At year-end, Boeing reports an accounting standard ASC 606-adjusted 5,626 airplane backlog from a gross total of 6,216 unfulfilled orders. Almost 77% are 737s.
Boeing seemingly had recovered from its pre-pandemic 737 MAX difficulties until a mid-fuselage door plug popped off a Boeing 737 MAX 9 in flight in early January. Thankfully, no lives were lost, but the Federal Aviation Administration (FAA) initially grounded 171 MAX 9 aircraft for inspections. A round of lawsuits have been filed against Boeing and its fuselage supplier Spirit AeroSystems, and at least one MAX 9 operator (Alaska Airlines) is demanding its own inspection team on the manufacturer’s assembly line.
Boeing President and CEO Dave Calhoun spoke to employees on the importance of safety, accountability, and transparency to ensure the event can never happen again: “We’re going to have to demonstrate by our actions and our willingness to work directly and transparently with [airline customers] to make sure they understand every plane Boeing has its name on that’s in the sky is safe, and we’ll see our way through to that.”
Boeing management named retired U.S. Navy Admiral Kirkland H. Donald as special advisor to help assess the company’s quality management system for commercial airplanes, including quality programs and practices in Boeing manufacturing facilities and its oversight of commercial supplier quality.
Actions Boeing is taking to bolster quality assurance and controls in 737 production include:
Additional inspections throughout the build process at Boeing and Spirit AeroSystems.
Additional sessions for teams to refocus on the fundamentals of the quality management system (QMS), take expanded training programs, and recommit to improving quality and compliance.
Deploying a team to work alongside Spirit AeroSystems to complement existing teammates and inspect more than 50 other points in Spirit’s build process.
Opening its factories to 737 operators for additional oversight inspections; Spirit will do the same.
Have an outside party review the QMS and suggest further improvements.
These actions are separate from the FAA’s investigation and the agency’s plan to increase oversight of 737-9 production. No statement yet on the potential impact to Boeing’s intention to increase output of 737s from 31 to 38 per month this year. https://www.boeing.com
Boeing 737 MAX 9 seen during a flight test. CREDIT: PAUL WEATHERMAN
EMBRAER increased regional jetliner deliveries 33% through Q3 2023, to 105 versus 79 aircraft in 2022. At the end of Q3 2023, firm order backlog stood at $17.8 billion, the highest level in any one year. Its services reached $2.8 billion, the highest backlog volume ever recorded in that business unit.
Embraer E195-E2 in Tech Eagle livery. PHOTO: EMBRAER
All business units had higher revenues and volumes YoY and year to date (YTD), with the main highlight being commercial aviation representing growth of 68% YoY and 52% YTD. Through Q3 2023, Commercial Aviation delivered 18 Embraer 175 and 21 Embraer 195-E2 regional jets and Executive Jets delivered 44 Phenom light jets and 22 Praetor mid-size jets. In August, the Phenom 300E became the most-flown business jet in the United States, according to the FAA. https://embraer.com
LOCKHEED MARTIN delivered only 97 F-35 Lightning II stealth fighter aircraft in 2023 compared to 141 the year before, according to a press report. The company’s long-term objective is to produce 156 F-35s per year, but a Block 4 electronic warfare software upgrade and Technology Refresh 3 are delaying foreign military sales deliveries according to several sources, including the U.S. Government Accountability Office. https://www.gao.gov; https://www.lockheedmartin.com
U.S. Air Force Maj. Kristin “BEO” Wolfe, F-35A Lightning II Demonstration Team pilot and commander, flies during the Dubai Airshow. CREDIT U.S. AIR FORCE/STAFF SGT. KAITLYN ERGISH
About the author: Eric Brothers is editor of Aerospace Manufacturing and Design. He can be reached at ebrothers@gie.net.
