A model of a Boeing 777 airliner is displayed at the Dubai Airshow yesterday. The announcement of the Jet order created some momentum at the Dubai show, which on its first day on Sunday saw only a single order for two Boeing 777 freighters from Etihad Airways. That contrasts with the $179bn in combined transactions for the US company and rival Airbus Group at the 2013 show.
Dubai aerospace expo struggling to match 2013 order bonanza; airliner manufacturers already boast record backlogs
Bloomberg
Dubai/New Delhi
Boeing Co announced an order for 75 of its 737 single-aisle airliners with a list price of about $8bn from Jet Airways India Ltd, ending a sales drought at the biennial Dubai Airshow.
The order, which was already on Boeing’s books with the buyer listed as undisclosed, is comprised entirely of re-engined Max8 variants, Mumbai-based Jet said at a press conference with Boeing at the Dubai expo yesterday.
The announcement created some momentum at the Dubai show, which on its first day on Sunday saw only a single order for two Boeing 777 freighters from Etihad Airways. That contrasts with the $179bn in combined transactions for the US company and rival Airbus Group at the 2013 show.
Jet Airways is adding aircraft as competition steps up in the fast-expanding Indian air travel market, where it’s seeking to take on no-frills carriers like SpiceJet Ltd and market leader IndiGo. The carrier has said it might not make money until 2017, after failing to post a full-year profit since 2008, according to data compiled by Bloomberg.
Jet sold a 24% stake to Etihad Airways in 2013, the first Indian carrier to tie up with a foreign airline after the government relaxed rules. The deal revealed in Dubai saw it convert 25 orders for current-generation 737s to the Max version. The 50 other aircraft were already for the re-engined type.
“Some aircraft will go, be phased out, and new ones will come,” founder Naresh Goyal said at the press conference. “Over a period we will have all Max.”
Planemakers and airlines signalled that they expect relatively few further deals at this week’s expo as the industry pauses to digest a record haul of new planes. The show also lacks a new, buzz-building offering like Boeing’s upgraded 777X that was introduced with an order rush two years ago.
“The bar was raised in 2013,” said Tim Clark, president of Dubai-based Emirates, the world’s biggest long-haul carrier, which snapped up 50 Airbus A380 superjumbos two years ago. “There was serious money spent.”
As it stands, Boeing’s backlog of planes goes out eight years into the future, while Airbus’s stretches out for a decade.
Some airlines have also raised the spectre of an oversupply of planes.
Airbus’s sales chief, John Leahy, said the general trend of business is what needs to be watched, rather than whether one air-show crop matches a previous one.
“The important thing is that orders cycle as they do, some years are very strong others years aren’t quite as strong,” he said. “As long as you have a book to build of positive one, things are going in the right direction.” Airbus itself has already won 900 orders this year, outpacing the 635 planes it expects to deliver, he said.
At Boeing, orders as of November 4 were only 498, though John Wojick, sales chief of the airliner division, said he was confident the planemaker will bring the figure up in coming weeks. The company projects 755 deliveries this year.
