An Airbus A321 flies at the Farnborough International Airshow in Farnborough, Britain, July 22, 2024.
Toby Melville | Reuters
FARNBOROUGH, England — The massive aircraft orders that have run into the hundreds in recent years were nowhere to be seen at this year’s biggest air show. Instead, attention focused on the struggles of Boeing and Airbus to ramp up their aircraft production while battling the effects of the pandemic, which has left production sputtering.
Many issues, including training new workers, will take years to resolve, analysts say, leading to lingering headaches for airlines, suppliers and manufacturers themselves, as well as a shortage of new, more fuel-efficient planes.
“It’s perfectly legitimate for suppliers and airlines to say that we’ve failed them in terms of on-time performance and predictability,” Ihssane Mounir, Boeing’s senior vice president of global supply chain and manufacturing, said during a panel discussion at the Farnborough Airshow near London last week. “So obviously people are starting to plan for themselves and make their own assumptions.”
The roadmap for the next few months of production will be revealed this week, when Airbus reports quarterly results on Tuesday, followed by Boeing on Wednesday. Wall Street analysts expect Boeing to post another loss in the second quarter and possibly the next. Airbus has cut its delivery targets for the year.
At the show that ended Friday, Boeing booked 96 orders and commitments, including sales already made and confirmed, while Airbus booked 266, a far cry from the 826 orders booked at the Paris Air Show a year ago, according to a tally by consultancy Ishka. Paris and Farnborough alternate hosting the show each year.
One of the highlights was Air Korea’s order for 50 Boeing wide-body jets, including the 777X, which Boeing is working to get certified by regulators. The airline also has orders for Airbus A350-1000s. With both manufacturers grappling with production problems, Air Korea CEO Walter Cho joked at the order signing with Boeing: “Whoever gets there first will be our flagship, no matter when it gets there on time.”
The drop in orders during the show is due to both manufacturers having largely sold out narrow-body jets like the Boeing 737 Max and Airbus A321neo for much of this decade, if not longer. Boeing has a global order book of nearly 5,500 planes, while Airbus has more than 8,000 on order. Many airlines, from United Airlines to Air India, have also stocked up on new plane orders as travel has resumed during the pandemic.
Boeing’s presence at the air show was notably modest, with none of its commercial planes being flown as the manufacturer focused on its safety crisis and manufacturing problems. Arlington, Virginia-based Boeing is trying to ramp up production of its Max planes to about 38 a month, and investors will be looking this week for clues about when those goals might be met.
Airbus presented its new narrow-body, extra-long-range aircraft, the Airbus A321XLR, which was certified by European regulators just days before the show began.
Airshow visitors typically get a glimpse of fleets that will fly for decades, but most of the industry this year has focused on production over the coming months.
Shortages of parts, from landing gear to engine components like high-pressure blades to increasingly complex cabin interiors, such as those with premium seats, are also common. That has slowed production, depriving airlines of more fuel-efficient planes and angering some executives.
Ihssane Mounir, Senior Vice President of Commercial Sales and Marketing at The Boeing Company with Peter Anderson, Chief Commercial Officer at AerCap, attend the press conference at the Farnborough International Airshow in Farnborough, Britain, July 19, 2022.
Matthew Childs | Reuters
Airbus is taking a more hands-on approach “than ever before,” deploying more than 200 supply chain engineers to suppliers, said Christian Scherer, chief executive of the European manufacturer’s commercial aircraft division.
“What we don’t want to see again in the future, whether we’re in a recovery or a downturn in this industry, is a situation where the supply chain doesn’t believe what we’re telling them,” Scherer told reporters ahead of the show.
Airbus said last month it would cut its aircraft delivery target for the year and slow a planned production increase, citing “persistent specific supply chain issues, mainly in engines, aerostructures and cabin equipment.”
Boeing, meanwhile, in addition to supply chain problems, is trying to emerge from a safety crisis stemming from a door stopper failure in January and a series of manufacturing defects that have slowed production.
The loss of skilled workers, laid off or taking early retirement during the Covid-19-related drop in air traffic, has hampered the production of new aircraft. Manufacturers must now train new workers, which is a major challenge.
“I think this is going to be a problem that’s going to be there in three to five years,” said Kevin Michaels of AeroDynamic Advisory, a consulting firm that specializes in the industry. “Wages need to be raised to make the industry more attractive” to workers.
Boeing’s Mounir acknowledged that low wages are a problem further down the supply chain and said Boeing itself should invest in training them.
“There’s no doubt about it,” he said. “I don’t expect these smaller suppliers, who are essential to the ecosystem, to be able to shoulder that burden. We have to do it ourselves at a higher level, again, leveraging our balance sheet. It will pay off.”
It takes more time to train workers like “bakers, butchers, people working in a very different industry” who are new to aerospace, said Delphine Bazaud, head of industrial supply chain and digital operations at Airbus.
Michaels of AeroDynamic Advisory predicts that in the case of the United States, more aerospace work will eventually move overseas, “to places where the labor is available.”