Boeing on Monday unveiled a new version of its best-selling 737 aircraft, injecting life into a faltering civil aviation market as French President Emmanuel Macron flew in to open the world’s biggest air show in Paris.
After years of booming orders driven by increased air travel and more fuel-efficient planes, passenger jet manufacturers are bracing for a slowdown in demand while they focus on meeting tight delivery schedules and ambitious production targets.
In a sign of their more modest expectations, some companies have cut back on staffing and catering at this year’s Paris Air Show and made less space available for the media.
However, Boeing generated a burst of activity on the opening day by launching the 737 MAX 10 to plug a gap in its portfolio at the top end of the market for single-aisle jets, following runaway sales of rival Airbus’ A321neo.
The US planemaker said it had more than 240 orders and commitments from at least 10 customers for the new 737, which can carry up to 230 people in a single-class configuration.
“Many airports are running out of capacity and for those airports this is a perfect aircraft,” said Ajay Singh, chairman of low-cost Indian airline SpiceJet, which signed a provisional deal to buy 40 MAX 10s.
However, Airbus immediately hit back with an order for 100 of its A320neo planes from leasing firm GECAS, as well as a deal for 12 A321neos with Air Lease Corp.
Airbus sales chief John Leahy brushed off the latest Boeing challenge, saying much of the interest in the MAX 10 was from existing Boeing customers switching orders from other models.
“We think the 737 MAX 10 is a competitor to the [MAX] 9 and that’s why a lot of people are converting,” he said.
Twenty of SpiceJet’s provisional order for 40 MAX 10s were conversions from an existing order for other 737 models.
GECAS also converted an existing 737 order for 20 planes to the new model and Europe’s largest tour operator TUI Group did likewise for 18 aircraft.
Boeing announced provisional new orders for 90 MAX 10s, including 50 from Indonesia’s Lion Air.
It also won a boost from leasing giant AerCap for its 787 Dreamliner long-range jet, which sits in a category for which demand has been fragile over the past year.
Industry sources said that Airbus would soon announce an order for 10 of its A350-900 wide-body jets from Ethiopian Airways, while it also looked set to clinch a US$5 billion deal with low-cost carrier Viva Air Peru.
Qatar Airways said that it was sticking with plans to increase its fleet and routes, despite a diplomatic rift with four Arab countries that have closed their airspace to the company.
“We have had a lot of cancelations, especially to the four countries that did this illegal blockade, but we have found new markets and this is our growth strategy,” CEO Akbar al Baker said.
While demand for passenger jets may be ebbing, there are signs that interest in military aircraft is picking up after years in the doldrums because of government budget cuts and weak economic growth.
Lockheed Martin is in the final stages of negotiating a US$37 billion-plus deal to sell 440 F-35 jets to a group of 11 nations, including the US, two people familiar with the matter said.
That would be the biggest deal yet for the stealth warplane, which is making its Paris debut this week.
Macron flew into the show aboard an Airbus A400M military transporter in his first official engagement since winning a parliamentary majority in Sunday’s elections.
His arrival was followed by a flypast by the world’s largest passenger plane, the Airbus A380, with France’s aerobatic team.
The ceremony lent high-level support to two ambitious European aerospace projects tarnished by difficulties: the A400M because of chronic cost overruns and delays and the A380 because of weak sales that threaten its future.
Airbus on Sunday said that it was working on an A380 upgrade — dubbed A380plus — with fuel-saving wingtips, confirming plans reported by Reuters in March.
Airbus chief Fabrice Bregier on Monday said that the company was in talks with several potential customers for the upgraded plane.
However, it would only be put into production if it received “a large order,” he said, without elaborating.
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