With many of their announcements lining up on the first day, it initially appeared that lessors would generate more order commitments than airlines at the Paris air show, particularly for the 737 Max 10. But large deals involving SpiceJet, Lion Air and United Airlines started to tip the scale.
Ultimately, there emerged a roughly 50:50 split between lessors' commitments and airlines'. That is not wildly out of kilter with the proportion of commercial passenger jets currently managed by lessors, which Flight Fleets Analyzer puts at 43.1%; however, it does contrast with the picture at last year's Farnborough air show, where lessors accounted for less than a fifth of orders and options disclosed over the event's first three days.
This year at Le Bourget, commitments for the newly launched Max 10 totalled 361 (including 214 conversions). Airlines accounted for 261 and lessors 100, giving a percentage split of 72:28. Hence, there looks to be some capacity for sale-and-leaseback opportunities on the 10.
United Airlines, which converted 100 Max jets to 10s, will most likely finance its equipment in the capital markets, SpiceJet and Lion probably wanted to snag good prices and early delivery slots. These could provide good sale-and-leaseback opportunities for lessors not wanting to place speculative orders.
In committing to Boeing jets, lessors predominantly backed the Max 8 and 10, calling into question what might happen with the 9. Lessors committed to 164 Max 8s plus 50 options, and those 100 Max 10s, but there was not a single Max 9 deal.
Notably absent from Max 10 commitments were endorsements from Air Lease and Avolon.
Air Lease placed an order for five Max 7s with no word on the 10, while Avolon said they would look at the stretched Max seriously in the future.
For Airbus, the picture was slightly different. Of the 277 A320neo-family commitments (including 15 conversions), lessors accounted for 177 and airlines 100.
The European manufacturer had amassed total A320neo-family orders of 5,053 jets at 31 May, Airbus figures show. Of these, 1,022 were from lessors.
On its own, the A321neo – against which the Max 10 will compete – had 1,416 orders, including 279 from lessors.
Lessors' 20% share of the A320neo family's orders makes sense when you consider the level of airlines' orders for the European re-engined narrowbodies over the past few years – a trend that could not continue in perpetuity, and which gives lessors opportunities for sale-and-leasebacks.
Overall, lessors gave Airbus a steady endorsement at Le Bourget, and their exuberance for the Max 10 got Boeing's new variant off to a good start. Lessors are likely to have ordered at decent prices to ensure earlier slots for airlines still deciding whether the type has a place in their fleet.
However, airlines' lack of enthusiasm at Paris for the Max 9 might leave investors concerned about the variant's residual values as Boeing expands the family to compete with the already successful A321neo.
Generally, the level of firm orders at Paris was modest – they accounted for just 350 of the 1,000-plus commitments. And, early on in the show, there were signs that such an outcome might be welcome to some in the industry.
"This year we need to see a throttling-back of overall orders," Air Lease chief executive John Plueger told FlightGlobal on 19 June. "We can't have a book-to-bill ratio more than one – I don't think that's healthy."
Even in the aircraft manufacturing sector, that argument had a high-profile supporter. On 20 June, Airbus chief operating officer for customers John Leahy told FlightGlobal: "In previous years we were selling book-to-bill way over one. You can't just continue that – it just doesn't make any sense."
Leahy added: "This year the book-to-bill will be less than one, and we're chewing down the backlog."
Source: Cirium Dashboard