Companies throughout the aerospace supply chain are struggling to overcome parts shortages and workforce challenges to produce the commercial aircraft the market wants. The demand is strong: global passenger traffic is projected to surpass 10 billion passengers in 2025, according to electronic payments company ACI World. That figure is up 6% from 2024 and up more than 16% from 2019.
Aircraft leasing company Avolon predicts the global airline industry will reach $1 trillion in revenue for the first time during 2025. According to its analysis, the main driver behind this growth is the Asia-Pacific region, which will be adding more capacity than all other regions of the world combined.
At the same time, the aircraft manufacturing industry strains to supply airlines and leasing companies with modern, fuel-efficient jetliners. Avolon expects aircraft deliveries to be ramped up by 20% in 2025. However, Airbus and Boeing order books will remain full for years to come. Avolon predicts this year may even see new delivery slots for narrowbody aircraft stretching from the 2030s into the 2040s. With production rates lower than anticipated, the backlog that was expected to last a decade may now last 14 years if current production rates don’t increase.
As a result of new aircraft scarcity, carriers are forced to extend the lifespan of their current fleets, increasing demand for maintenance, repair, and overhaul (MRO) and services. Increased MRO demand creates a shortage of used serviceable parts and engines.
Long term, predictions remain consistent with estimates from recent years. Boeing’s 2024 Commercial Market Outlook (CMO) predicts strong air travel demand will drive demand for nearly 44,000 new airplanes from 2024 to 2043. The global commercial fleet is projected to grow 3.2% annually. Single-aisle airplanes are expected to make up 71% of the 2043 fleet. Boeing forecasts the support and services market to be worth $4.4 trillion in the same 20-year period.
Airbus’ 2024 Global Market Forecast for the same timespan is for 42,430 jets, with 80% being narrowbody. Annual growth will be approximately 3.6% from 2027 onward. Airbus’ Global Services Forecast puts the commercial aircraft services market at $290 billion in 2043, up from $150 billion in 2024.
Supply chain issues encompass many shortages, with workforce needs a persistent pain point. Attracting and retaining a quality workforce was cited by more than two-thirds of the respondents in a National Association of Manufacturers (NAM) mid-2024 survey. While artificial intelligence (AI) and digital technologies offer recruitment solutions, traditional approaches are gaining momentum. Deloitte analysis shows the number of apprentices in advanced manufacturing occupations increased to 59,500 in fiscal year 2023, nearly 3x that of fiscal year 2021. https://avolon.aero;https://www.deloitte.com; https://nam.org
Left to right: Airbus A350-1000, A321XLR, A330-900, and A220-300. CREDIT: AIRBUS SAS
AIRBUS delivered 766 commercial aircraft to 86 customers globally in 2024 – up 4% from 2023, but shy of its 770 target, revised down from 800. Delivery milestones included the first A321XLR to Spanish airline Iberia, and A330neo and A350 deliveries to several customers. Sixty percent of single-aisle deliveries were the A321neo. The commercial aircraft business had a 2024 year-end backlog of 8,658 aircraft – up from 2023’s 8,598.
Airbus CEO of commercial aircraft Christian Scherer says, “2024 confirmed sustained demand for new aircraft. We won key customer decisions and saw phenomenal momentum for our widebody orderbook, complementing our leading position in the single-aisle market.” Of the 878 gross new orders (826 net), a quarter are widebodies: 82 A330s and 142 A350s.
Scheer adds, “Given the complex and fast-changing environment we continue to operate in, we consider 2024 a good year.”
Airbus produced an average of 44 A320s per month last year, according to Forecast Int’l, and it’s working with its supply chain to increase A320 production to 75 aircraft per month by 2027 – a year later than planned. Airbus pushed back the target as its suppliers – especially engine manufacturers – can’t keep up with demand. https://www.airbus.com; https://www.forecastinternational.com
Airbus commercial aircraft deliveries 2024 vs. 2023
Program
2024
2023
A220 family
75
68
A320 family
602
571
A330 family
32
32
A350 family
57
64
Total
766
735
The largest model in the 737 MAX family, the 737-10. CREDIT: BOEING
BOEING’s 2024 deliveries were reduced by a nearly two-month strike by the International Association of Machinists and Aerospace Workers (IAM) in the Pacific Northwest and ongoing scrutiny of its 737 MAX safety and quality program in the wake of a mid-exit door (MED) plug blowing out of the left side of a 737-9 while in flight last January. Boeing management is focusing on four areas in its safety and quality plan: investing in workforce training, simplifying plans and processes, eliminating defects, and elevating its safety and quality culture. The plan also sets forth measures to continuously monitor and manage the health of its production system. Progress highlights:
Added hundreds of hours of new curriculum to training programs, including quality proficiency
Instituted new random quality audits of documented removals in high frequency areas to ensure compliance to process
Reduced defects in 737 fuselage assembly at subcontractor Spirit AeroSystems by increasing inspection points at build locations
Implemented a new work in process (WIP) procedure in 737 and 787 final assembly to track and secure parts for manufacturing work not yet completed
Addressed more than 70% of action items in commercial airplanes production based on employee feedback
Implemented criteria across airframe final assembly to manage traveled work, mitigate risk
The company has developed detailed plans and deliverables for each recommendation from the FAA’s Expert Review Panel, convened per the Aircraft Certification, Safety, and Accountability Act (ACSAA) of 2020. This includes safety and quality training to more than 160,000 employees focused on their role in identifying and reporting potential product hazards; improving the Speak Up reporting channel to increase transparency, strengthen confidentiality, and create a better user experience for those who report; and creating the new position of human factors functional chief engineer. These and more actions are detailed on the Boeing Strengthening Safety & Quality webpage.
The company reports 569 gross orders for 2024 with 6,245 total unfilled orders and an Accounting Standards Codification (ASC) 606-adjusted 5,595 aircraft backlog. The order book was boosted notably in December by Pegasus Airlines’ order for 100 737-10s with options for 100 more.
Citing supply chain delays as the reason for scaling back production earlier in 2024, Boeing plans to produce 737 MAX aircraft at a rate of 38 per month by May 2025. That’s the limit the FAA now allows, but observers say Boeing may not be able to reach that rate until 2026. The 787 build rate is targeted at five per month, again constrained by the supply chain. The 777 program is currently delivering three aircraft per month with a company goal of four 777s per month by 2026. https://www.boeing.com
Boeing commercial aircraft deliveries 2024 vs. 2023
Program
2024
2023
737
265
396
747
-
1
767
18
32
777
14
26
787
51
73
Total
348
528
An F-35B Lightning II aircraft, flown by a test pilot from Air Test and Evaluation Squadron (VX) 23, prepares to land aboard Japan’s JS Kaga off the California coast. CREDIT U.S. CMDR. DARIN RUSSELL
EMBRAER delivered 206 aircraft in 2024 – a number 14% higher than the 181 recorded in 2023. With 31 deliveries in the last three months of the year, the commercial aviation division reached 73 new aircraft for 2024 (inside guidance of 72 to 80), up 14% from 2023. The company’s executive aviation unit made 130 deliveries in the year (the midpoint of the original guidance), up 13% year-over-year. In the third quarter of 2024, Embraer’s backlog reached $22.7 billion, a 25% increase year-on-year and a nine-year high. https://embraer.com
LOCKHEED MARTIN delivered 110 F-35 Lightning II joint strike fighter aircraft to the United States and its allies in 2024, topping the 75 to 110 CEO Jim Taiclet indicated in a summer earnings call and up from 97 delivered in 2023. Deliveries were paused that year for an electronic warfare software upgrade and Technology Refresh 3. https://www.lockheedmartin.com
THE GLOBAL SPACE ECONOMY presents an opportunity worth $1.8 trillion by 2035, up from $630 billion in 2023, according to a report by the World Economic Forum and McKinsey & Co. The figure counts satellites, launchers, services, and applications for which space technology helps companies across industries generate revenues (Uber, for example). Expected annual growth rate is 2x the projected rate of gross domestic product (GDP) growth during the next decade.
Growth drivers for the space economy include the need for greater connectivity via satellites, higher demand for positioning and navigation services on mobile phones, and increased demand for insights powered by artificial intelligence (AI) and machine learning (ML).
Embraer E195-E2 Tech Eagle. PHOTO: EMBRAER
A mid-2024 Space Foundation report stated the global space economy totaled $570 billion in 2023, 7.4% higher than 2022’s $531 billion. Commercial space products and services accounted for $321.4 billion, commercial infrastructure and support industries $123.8 billion, U.S. government space budgets $74 billion, and non-U.S. government space budgets $51.2 billion. This growth is consistent with the industry’s five-year compound annual growth rate (CAGR) of 7.3% and is nearly 2x the size of the space economy a decade ago. https://www.mckinsey.com; https://www.spacefoundation.org; https://www.weforum.org
About the author: Eric Brothers is editor of GIE Media’s Manufacturing Group. He can be reached at 216.393.2228 or EBrothers@gie.net.
