Airbus and Boeing secure deals as Qatar Airways considers wide-body aircraft options

Airbus and Boeing Secure Major Deals Amid Qatar Airways’ Potential Wide-Body Jet Order

Increased Orders Despite Supply Chain Challenges

At the Farnborough Airshow on Tuesday, the aviation industry saw a remarkable uptick in aircraft orders, even as supply chain disruptions and delivery delays continue to affect jetmakers. Airbus and Boeing emerged as key players, securing several significant deals that reflect both ongoing demand and the complexities faced by the industry.

Airbus announced new agreements with Japan Airlines and Virgin Atlantic, while Boeing obtained a major order from Macquarie Airfinance. Qatar Airways also hinted at a potential “sizeable” order for wide-body jets, which is anticipated to be finalized towards the end of this year or early 2025.

This year’s Farnborough Airshow was expected to feature limited deal-making, as Airbus and Boeing are currently sold out for several years of production. Both manufacturers have been grappling with difficulties in scaling up output amid persistent supply chain challenges. These delays have constrained airlines’ ability to fully leverage the rebound in travel following the pandemic, which some industry observers believe may be starting to taper off.

Ongoing Supply Chain Challenges and Delivery Delays

The impact of COVID-19 on the supply chain continues to resonate throughout the aviation industry. Virgin Atlantic’s CEO, Shai Weiss, expressed surprise at the prolonged effects of the pandemic, which have led to significant delivery delays. In response, Virgin Atlantic placed an order for seven Airbus A330-900s, valued at approximately $807 million based on estimated delivery prices from Cirium Ascend. Weiss stressed the urgency for engine suppliers and manufacturers to address these delays and get back on track.

Boeing, in particular, has faced additional scrutiny and regulatory challenges. The company had to scale back its production after a serious incident involving a nearly new 737 MAX 9 in January, which drew legal and regulatory attention.

Significant Orders and Extended Aircraft Service Lives

Japan Airlines has made a substantial commitment by finalizing an order for 20 Airbus A350-900 and 11 A321neo jets, with deliveries slated to begin in 2028. This deal, estimated to be worth just over $3 billion, represents a reduction from a previously announced order of 21 A350s. The adjustment came after Japan Airlines needed a replacement for a jet lost in a collision with a Coast Guard aircraft earlier this year.

Macquarie Airfinance also made headlines by placing an order for 20 Boeing 737 MAX-8 planes, set to be delivered between 2029 and 2030. The total value of this deal exceeds $1 billion, according to estimates from Cirium Ascend.

Qatar Airways’ CEO, Badr Al-Meer, revealed plans to make a significant new order for wide-body jets by the end of this year or early 2025. Additionally, Al-Meer announced that the airline would extend the service life of its Airbus A380 jets. These aircraft will undergo upgrades, including the installation of new wifi systems, to enhance passenger experience.

Extended Aircraft Usage and Maintenance Delays

As jetmakers struggle with backlogs and delivery delays, airlines are increasingly focusing on extending the service life of their existing aircraft. Consultancy Bain recently reported that airlines are experiencing their longest-ever wait times for engine maintenance, adding to their operational costs.

British Airways CEO, Sean Doyle, highlighted the importance of being vigilant about new aircraft deliveries. Despite the challenges, he noted that the airline’s planes are largely arriving according to the timelines required.

The Farnborough Airshow has underscored both the ongoing demand for aircraft and the significant hurdles facing the aviation industry. The latest deals reflect a robust appetite for new jets, while the sector continues to navigate the complexities of supply chain disruptions and production delays.