End of year flurry sees European company triumph on orders. However, widebodies give Boeing advantage on value
Last week’s cliffhanger in Paris had the suspense of a Hitchcock thriller, as the world waited to see if the Europeans had managed to do what folks in Seattle probably thought was impossible.
As we all now know, Airbus has emphatically proved to its rival that “anything you can do we can do better”, outselling Boeing again and setting a new orders record as well. But it was not all good news for the European airframer, as its reliance on narrowbody sales made Boeing the clear victor in terms of order value thanks to a strong performance by its widebodies.
While many were surprised by Airbus’s order victory, only the foolhardy would have based a full-year order extrapolation on Airbus’s 11-month tally, given that the manufacturer makes a habit of booking over a third of its annual firm orders in the last month of the year, with 2005 no exception. Airbus added 424 orders in December to give it a year-end tally of 1,111 (1,055 net of cancellations), beating its rival for the fifth successive year. Only time will tell whether Airbus was forced to “clear out the cupboard” last year, leaving itself exposed for this year’s order race.
But given Airbus’s resounding success in 2005 – it shipped 30% more aircraft and secured 8% more orders than its rival – the atmosphere at the annual press briefing in Paris seemed muted. Perhaps this was a reflection of the less flamboyant, more formal style of new German chief executive Gustav Humbert compared to his impish French predecessor Noel Forgeard. Or perhaps the executive team was expecting a grilling over the inferior sales performance of its widebody products against their Boeing equivalents.
With the A320 family securing 912 net orders against 569 for the Boeing 737, it accounted for 86% of Airbus’s total orders. The airframer accumulated 173 widebody orders (excluding the 30 net cancellations for the A300-600F), compared with 422 for its rival’s twin-aisle offerings.
Flight International estimates that this strong performance of higher value widebodies gave the US airframer a 57% share of the overall order value (based on 2005 list prices), with its 1,002 net orders worth $109 billion against $84 billion for its rival.
The main weakling in the Airbus widebody armoury is the four-engined A340-500/600, sales of which barely scraped into double-digits during a year when the rival 777 family gained a record 154 orders. Airbus is known to be studying an upgrade for the A340-500/600 family, but despite an onslaught of questions about what it was going to do, Humbert would not be drawn on plans beyond saying “there’s no reason to panic” and “nothing is imminent”. He frustratingly declared that when the A330/A340 was dominating the market, “I never heard you asking Boeing ‘what are you going to do with the 777?’”.
The A350 orderbook reached 172 aircraft by year-end (including 87 firm orders), which Airbus chief operating officer customers John Leahy acknowledged was short of the “200-aircraft goal” that he had repeatedly stated last year. Although the A350’s firm backlog of 87 aircraft is less than a third that of the 787’s, Leahy emphasised that the Airbus twinjet was well ahead of where the 787 had been at that stage of the programme’s development.
The 2,140 firm orders secured by the two manufacturers, worth over $200 billion, has created a new high-water mark for airliner orders, beating the 16-year-old record of 1,631 set in 1989. That year Boeing and McDonnell Douglas (then separate) secured 1,107 orders between them, which Airbus has conveniently beaten by a whisker with its 1,111 orders.
Airbus has abandoned its tradition of giving an order forecast for the coming year, adopting a wait-and-see policy like its rival. Leahy – who admits he would have struggled to forecast 2005’s record orders a year ago – would say only: “Can we both have a record for another year in a row? I don’t know.”
With the manufacturers’ backlog having grown by over 50% during 2005 to 3,990 aircraft, output is heading towards pre-9/11 levels in 2006 with over 800 shipments forecast. Total output should still be well short of the 914 aircraft delivery peak in 1999.
Boeing, which has clawed back some order backlog market share, but still trails its rival, is expected to deliver a little fewer than 400 aircraft. Airbus will only say that its will ship more than 400, with further guidance expected at next month’s Asian Aerospace show.
MAX KINGSLEY-JONES / PARIS