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Aviation History
2003
2003 - 0085.PDF
NEWS ANALYSIS ORDERS AND DELIVERIES MAX KINGSLEY-JONES / LONDON Airbus beats Boeing for hollow win Gloomy forecast for 2003 puts cloud over European manufacturer's victory over US rival in last year's order race JET AIRLINER ORDERS, DELIVERIES AND BACKLOG - 2002 •[ Airbus A300 A310 A318 A319 A320 A321 A330 A340 A380 Total Value (bn) Boeing 717 737 747 757 767 777 MD-11 Total Value (bn) Deliveries 9 0 0 85 116 35 42 16 0 303 $18.5" 20 223 27 29 35 47 0 381 $27.4"* TOTAL 684 Total value (bn)* $45.9 2002 Orders 0 0 0 148 78 9 24 31 10 300 $24.3 32 162 17 0 8 32 0 251 $20.7* 551 $45.0 Net Cancelled Orders Backlog 0 0 27 105 -96 9 12 10 0 67 $5.9* 16 43 0 0 10 6 0 75 $5.4* 142 $11.3 0 0 -27 43 174 0 12 21 10 233 $18.4 16 119 17 0 -2 26 0 176 $15.3* 409 $33.7 66 5 87 245 591 159 168 89 95 1,505 $134.6* 40 798 52 28 39 195 0 1,152 $100.2* 2,657 $234.8 2001 Net Deliveries Orders 11 0 0 89 119 49 35 22 0 325 $20.5 49 299 31 45 40 61 2 527 $35.1 852 $55.6 61 0 -47 -7 117 37 41 -13 85 274 $37.3 6 188 16 44 51 30 0 335 $24.5* 609 $61.8 NOTES "Values = Where other figures are unavailable, Flight International estimates have been calculated from manufacturer data/list prices. "Airbus reports 2002 deliveries worth €19.5 bn. '"Boeing 2002 delivery value based on list prices, adjusted downwards by 20% to reflect 2001 's discount level. Cancellations may be negative where an order has been converted from one aircraft to another, but no new order has taken place. Airbus defeated Boeing in last year's commercial aircraft order battle, but is drawing little comfort from its victory, warning that the bleak trading conditions endured over the past 12 months look set to deteriorate further in 2003. The two companies' combined gross order intake tumbled 22% from 710 to 551 aircraft in 2002, worth an estimated $45 billion (using average 2002 list prices for Boeing's share of the total). The year-on-year fall in orders was the second in a row after 2001's figures were adversely affected by the US terrorist attacks, and came despite two massive injections provided by European low-cost carriers Easyjet and Ryanair. These two deals alone accounted for 40% of 2002's total in volume terms. The two manufacturers' com bined net orders dropped by a third to 409 aircraft - the lowest since 1994 - as a result of over 140 cancellations. These cancellations reduced the order value to around $34 billion, down 45% on 2001. Airbus's 300 gross orders put it in pole position with a 54% share, which increases to 57% after can cellations. Airbus also beat Boeing in order value terms for the second year running, with its orders worth $24.5 billion against its rival's $20.7 billion (as estimated by Flight International). Detailed analysis of the geo graphical breakdown is not possi ble due to the large number of undisclosed customers in Boeing's orderbook, but business in Europe was the strongest in 2002 (see table), primarily due to low-cost carriers' orders. Orders from leasing companies, which had averaged 20-30% of the total in the boom years, were well down in 2002. Airbus acknowledges that the sales situation last year was better than it had feared 12 months ago, when it predicted the industry would achieve around 350-400 orders, but Airbus president Noel Forgeard warns that 2003 "will be an extremely difficult year...the sit uation in the industry is con trasted, but globally bad". He says that US airlines are in crisis and in the rest of the world "the situation is frail...there is no reason to believe the situation will improve significantly in 2003". Forgeard says he and Airbus executive vice-president customer affairs John Leahy agree the indus try will generate a similar level of orders in 2003 as it did last year, but without the massive contribu- Airbus Boeing Total Europe 158 108 266 North America 31 44 75 Asia 29 29 58 Africa 38 9 47 Middle East 14 0 14 Australasia 7 4 11 Latin America 0 6 6 Lessors 20 6 26 Undisclosed 3 45 48 Total 300 251 551 tion of 220 orders from the low- cost carriers: "That is to say around 170-180 orders each for Airbus and Boeing. This would mean that we would eat about 100 aircraft out of our backlog, but this is peanuts." Forgeard adds that Airbus has out line agreements for almost 30 air craft that will be firmed up soon. Boeing has so far declined to comment on its prospects for 2003, saying "we are sticking solely with our deliveries forecast because they drive revenue...orders are less and less useful as a measurement of market leadership". As forecast a year ago, total deliv eries fell 20% to 684 aircraft, thanks mainly to massive production cuts by Boeing in Seattle. It was still the number one producer last year, but Boeing's output fell 28% to 381 air craft. The US manufacturer has yet to reveal the value of its deliveries last year, but Flight International esti mates they were worth $27.4bn at 2002 list prices, with a 20% dis count. This was the level to which Flight International calculated Boeing's 2001 deliveries were reduced, based on stated revenue. In 2001, Airbus had put the brakes on its planned output growth to over 400 aircraft annu ally, with production pegged back from 325 aircraft in 2001 to 303 last year. Airbus says its 2002 deliv eries produced a turnover of €19.5 billion, which Flight International calculates equates to an average 20% discount based on list prices. Output fell by just 7%, enabling Airbus to gain more ground on its rival by share of overall deliveries, leading to accusations from Seattle that Airbus is damaging the whole industry by overproducing. Based on current forecasts, the combined output is due to fall at least 15% further this year to no more than 580 aircraft, when Airbus should take a historic lead over Boeing by retaining its 2002 build rate of 300 aircraft against its rival's planned 275-285. However, Forgeard warns its 300 aircraft tar get could drop to "280 or 290" depending on what happens in the coming months. "We have still organised ourselves to deliver 300 aircraft," he says. "We will recon firm this target in April or May". With Airbus set this year to achieve its holy grail - 50% of the world's large aircraft production - Europe will produce more airliners than the USA for the first time in modern history. The Airbus president says that "international tensions cloud the picture" and warns that if a war with Iraq is not concluded quickly, or the indecision drags on, then the industry could be seriously damaged. Leahy does not expect 2003 deliveries to dip much below 280 units even if the crisis deepens. The combined year-end order backlog fell by 10% for the second year running, to 2,657 aircraft worth about $235 billion. In mar ket share, Airbus has gained three percentage points on its rival, mov ing from 54% to 57% in the year. www.flightinternational.com FLIGHT INTERNATIONAL 21-27 JANUARY 2003 IS
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