Plus ça change, plus c’est la même chose
On the back of two years of record aircraft orders, one would have expected the industry to slow down this year. Yes, the US fleets have been tipped for renewals this year, but before the Paris Air Show, Airbus only recorded Spirit Airlines for 30 Airbus A319s. Boeing recorded 15 737-700s for AirTran Airways and Continental Airlines for ﬁve 787s.
At the Air Show, US Airways selected Airbus for its narrowbody renewal programme. It placed orders for 60 A320-family aircraft – a mix of A319s, A320s and A321s. US Airways also agreed terms with Airbus for 22 A350-800s.
But once again attention turned to the Middle East community. Between Emirates Airlines, Etihad Airways, Jazeera Airways, Qatar Airways and operating lessor ALAFCO, Airbus amassed a total of 152 aircraft. Boeing did not announce any orders with Middle East carriers. However this would leave few announcements for the bi-annual Dubai Air Show this year in November. Unless …
Prior to Paris, Boeing was well ahead of Airbus in terms of orders. The US manufacturer compiled 417 net orders to 31 May compared to 201 for its European rival. However at the show Airbus said it received a total of 425 ﬁrm orders as well as a further 303 commitments for additional aircraft. Airbus’ performance was remarkable, although the European manufacturer confused the aviation community by announcing new orders, conﬁrming or signing other orders.
Boeing’s Paris tally is 125 aircraft orders at the show, among which is a 52 aircraft order for the 787 from ILFC. This year the 787 has amassed 186 orders. Airbus recorded 163 orders for the A350XWB in Paris, plus 25 commitments.
Boeing Commercial Airplanes’ president and CEO Scott Carson attributed this year’s record global performance to ‘demand driven by non-traditional markets’. He said the global aircraft market is in the midst of “an unbelievable cycle” that deﬁes “traditional indicators” and shows no sign of slowing down.
He said that the company’s past success had been driven by markets such as the US, UK, France and Germany but that the current cycle is fuelled largely by emerging markets. Strong demand from the Asia/Paciﬁc region, particularly in China, and in other emerging markets such as India, the Middle East and Eastern Europe, has created a boom that has seen Boeing take orders for more than 1,000 aircraft in each of the last two years and more than 400 so far in 2007.
“Fundamentals remain strong in nearly every region of the world and there’s sustained economic growth in nearly every region. This is a very different cycle,” Carson commented.
More co-operation is the way forward
Interestingly Carson noted that Boeing no longer competes with just Airbus but with Bombardier, Embraer and other potential new entrants such as China, which has stated its intention to build an aircraft to compete with the 737 and A320 by 2020.
At the Paris show, Bombardier Aerospace announced a long-term co-operation agreement with China Aviation Industry Corporation Consortium (AVIC I) that includes participation in the development of the ARJ21-900. Under the agreement Bombardier will invest $100m in the development of AVIC I’s 105-seat ARJ21-900, which is expected to enter service in 2011, and will assist on the joint deﬁnition phase and certiﬁcation process.
In turn, AVIC I will invest $400m into CSeries research and development as well as construction of new facilities and equipment in China to build the aircraft.
AVIC I is currently a Bombardier supplier and produces the fuselage for the Q-400 turboprop. Production of the front and back sections of the Q-400 are also to move from Belfast to China.
Also at the show, Alenia Aeronautica and Xian Aircraft Company (part of AVIC I) signed an agreement to produce a section of the ATR rear fuselage in China. Alenia Aeronautica is teaming up with Xian Aircraft Company to produce section 18 of the ATR aircraft – a rear section of the fuselage – in China. The manufacturing of section 18 in China will start in 2007 and reinforces the ties between ATR and the Chinese aeronautical industry, which started in 1985 with the supply, also by XAC, of the ATR-42 outer wing boxes. Since 1997, another part of the rear fuselage of the ATRs – section 16 – has also been manufactured in China by XAC. Under the new agreement, a signiﬁcant part of the structure of the ATR aircraft (around 15% to 20%) will be directly manufactured in China.
Both announcements are not pure coincidence. ATR and Bombardier have made China one of their priorities. China represents 15% of worldwide demand over the next 20 years. Neither manufacturer has sold aircraft in China for a long time and the key issue is global partnership in order to be successful.
Since 2002 Embraer has invested in China through a joint venture with Harbin Aircraft Industry and Hafei Aviation Industry. Last year it received orders for 50 ERJ-145s and 50 E-190s from Hainan Airlines.
In Paris, Sukhoi Civil Aircraft signed a long-heralded strategic deal with Alenia Aeronautica in which the Italian company will take a 25% stake in Sukhoi. Under the agreement, a joint venture company will be set up in Italy in the summer. It will assist in the development, marketing and sales of the SSJ-100 family in regions such as Europe and the Americas. Although Sukhoi has pitched the aircraft family to Air France-KLM, SAS, SN Brussels, Iberia and Lufthansa, the ﬁrst Western orders come from … Italy.
Through their partnerships, ATR and Bombardier will be looking at ATR-72-500s and CSeries orders in the future. Main target: China.
The battle for the regional jet is intensifying. Japan’s Mitsubishi Heavy Industries, a major partner in the 787 Dreamliner programme, is looking at entering the regional jet market with its proposed 70- to- 96 seat Mitsubishi Regional Jet (MRJ) family. MHI displayed a full-size cabin mock-up with single-aisle four-abreast seating conﬁguration and large overhead bins.
It would be able to challenge Bombardier and Embraer in the segment but it will need a considerable ‘technology breakthrough’. The concept calls for the aircraft to have an all-composite airframe, a ‘premiere’ in the regional jet market. MHI says it plans to use composite materials on a signiﬁcant scale for its aircraft, reducing its weight substantially.
MHI is in talks with possible strategic partners such as Rolls-Royce, General Electric and Pratt & Whitney, and could announce an engine partner this year. It says the MRJ family would offer a 20% reduction in fuel consumption per seat over competitors in the same category, and that it will beat Chapter 4 noise regulations by more than 10 EPNdb. A launch decision is planned for next spring and ﬁrst flight in 2011. If launched, the aircraft will be offered in two versions, the MRJ-70 seating between 70 and 80 passengers and the MRJ-90 seating between 86 and 96 passengers.
Last … another project taking advantage of the UK-US bilateral agreement?
In Paris, Aerion said it hosted meetings with potential OEM partners and launch customers to move into full-scale engineering and prototype development of its supersonic business jet. It projects development costs at $2bn. Aerion is backed up by Texas billionaire Robert Bass, who is bankrolling an effort to build the world’s ﬁrst supersonic private business jet. “With this plane, you can have breakfast in New York, fly to London, stay for four hours, and fly back to New York for dinner,” Bass commented.