Wall Street Times

Airlines set to make massive order as Paris Air Show returns

Image Commercially Licensed from: DepositPhotos

Airline — When the pandemic arrived in early 2020, many major industries took a massive hit.

Lockdowns prompted many businesses to either make a temporary halt or close up shop, while orders to remain at home were strictly observed.

Travel and tourism suffered heavily as a result of the mandates, prompting big players to part ways with employees and slowing down production.

However, the past two years have seen the protocols loosen up, allowing people to make up for the lost time.

As of late, the aviation industry has been flourishing as people make their way to airlines and take the long-awaited vacation they’ve craved for years.

The upcoming Paris Air Show is set to carry the momentum and give people a showcase of what airlines have to offer.

Read also: Boeing’s revenue report shares 737 Max plans

The Paris Air Show

The Paris Air Show is a prestigious international event showcasing the latest advancements in aerospace and aviation.

Held biennially, the show brings together industry leaders, manufacturers, and aviation enthusiasts from around the world.

The exhibition features a wide array of cutting-edge aircraft, including commercial jets, military planes, helicopters, and unmanned aerial vehicles.

During the event, major aerospace companies unveil their latest technological innovations, such as fuel-efficient engines, advanced avionics, and groundbreaking materials.

Attendees have the opportunity to witness captivating aerial displays, where skilled pilots demonstrate the impressive capabilities of various aircraft.

The show also serves as a platform for networking and business negotiations, facilitating partnerships and sales agreements among industry professionals.

The Paris Air Show serves as a significant industry milestone, highlighting the progress and future prospects of aviation.

It attracts global attention and fosters collaboration among key players, ultimately driving advancements in aerospace technology and shaping the future of flight.

Demand resurgence

Earlier this year, major airlines revealed that travel demand received a major boost, giving carriers reason to be optimistic. 

However, it also faces the obstacle of increased fuel prices, which could lead to more expensive tickets.

Delta Air Lines witnessed bookings going beyond 2019 numbers, using the year before pandemic as a milestone to estimate their recovery.

Meanwhile, American Airlines also had its share of improvements in the first quarter, with revenue 37% higher than a year earlier.

Supplier stress

While the demand has largely been positive, airlines are in a conundrum as aircraft supply has tightened.

In 2022, Boeing’s 737 Max rental rose significantly.

As a result, several aircraft leasing firms have taken advantage of the price increase, but some suppliers are still struggling.

“That’s creating more pressure on the order books,” said Andy Cronin, CEO of Avalon, another aircraft-leasing firm.

“It’s creating upward momentum on used aircraft lease rates and forcing airlines to make compromises.”

Last week, aviation analytics firm IBA estimated there could be an astounding order of 2,100 planes for the Paris Air Show.

Airlines are said to be looking to replace older crafts in preparation for the future growth in air travel.

In 2022, Boeing logged large orders from customers.

Meanwhile, 2023 has seen Air India make a massive order, including Boeing and Airbus Jets.

In May, Turkish Airlines said they plan to order over 600 aircraft, ranging from narrow-body and wide-body planes.

It is set to be the largest order for an airline, but it remains to be seen if it would happen for the show.

Stuart Hatcher of IBA wrote that Delta Air Lines, Air France-KLM, and Malaysia Airlines could be potential buyers, but the timing is yet to be confirmed.

“It might still be too early to call any Chinese expansion yet given the political climate,” wrote Hatcher.

“But I wouldn’t be surprised to see top-up orders coming through.”

Manufacturing challenge

With large orders in place, most manufacturers are faced with the problem of increasing production.

Narrow-body jets have mostly been sold out for years, but with the air travel in demand, some airlines could expand with larger, long-range crafts.

However, customers worldwide would have to wait longer for more jets to arrive as Boeing and several suppliers are working to ramp up output, limiting airline capacity and pushing airfares higher.

Production delays are also driving up rates to lease new and older crafts, prompting airlines to seek other opportunities to increase flights.

“People just want their jets,” said AeroDynamic Advisory’s Richard Aboulafia.