Both Companies Report Weak Numbers As Expected Following Wild December Surge
by J. Kasper Oestergaard, European Correspondent, Forecast International.
Boeing and Airbus delivered 44 and 27 commercial jets in January 2018, respectively, compared to 44 and 25 deliveries during the same month last year. Following the traditional December deliveries surge, weak delivery figures were expected last month. In 2017, Boeing delivered 763 jets (748 in 2016), in line with company expectations, while Airbus surpassed its delivery target of 700 jets by handing over 718 aircraft during 2017 (688 in 2016).
In January 2018, Boeing delivered 31 737s (of which six were 737 MAXs), well below the current monthly rate of 47 jets. The company also delivered one 747-8, one 767, three 777s, and eight 787s. Boeing raised its 737 production rate to 47 per month in Q3 2017 from 42 previously, and plans to increase it further to 52 during 2018. Boeing plans a further increase to 57 737s per month during 2019.
During January Airbus delivered 21 A320s (15 CEO / 6 NEO), two A330s, and four A350s. For most of 2017, Airbus struggled with late deliveries of PW1100G PurePower Geared Turbofan (GTF) engines from Pratt & Whitney for the A320neo family of aircraft, but was able to finish the year on a high note. On February 9, new GTF woes emerged when several airlines reported instances of in-flight shutdowns and aborted takeoffs, affecting 43 engines in total. Pratt & Whitney said it was evaluating another 55 engines. For now, Airbus has decided to stop accepting further deliveries of PW1100G engines. While seemingly limited to relatively few engines, this issue does not come at a good time for Airbus, which is currently ramping up its A320neo production.
Refer to the following for more details on the GTF issue: Pratt & Whitney’s GTF Woes Continue as Regulator Warns of Potential In-Flight Dual-Engine Shutdown
A total of 181 A320neo family aircraft were delivered in 2017 vs. Airbus’ forecast of 200, up from 68 during 2016. Airbus expected to deliver 80 A350s in 2017 and delivered 78. The company plans to deliver up to 120 A350s in 2018, when the production rate hits 10 per month. Airbus is considering a further increase to 13 A350s per month in 2019. The ramp-up of A350 XWB deliveries combined with a higher A320 production rate of 46 per month (commenced Q2 2016) means that the company is narrowing Boeing’s deliveries lead and could surpass its top rival by 2019 or 2020. By mid-2019, Airbus expects to deliver 60 A320 jets per month. Outgoing Chief Operating Officer Fabrice Bregier even indicated in December 2017 that there is enough demand for Airbus to be producing as many as 70 A320 jets per month. The company has internally been debating rates beyond 60 for some time now.
In January, Boeing logged 28 gross orders (minus 17 cancellations => net of 11). Boeing’s December bookings included an order for 13 737 MAX jets placed by an unidentified customer as well as two orders for a total 10 P-8A Poseidon maritime patrol aircraft (seven for the U.S. Navy and three for the U.K.). In 2017, Boeing landed an impressive 912 net new orders (1,031 gross orders), compared to 668 net new orders in 2016. However, this was not enough to take back the order’s crown from Airbus, as the European rival reported an unprecedented year-end order intake.
Airbus’ January bookings were slim and included an order for 15 A320neos for China Aircraft Leasing Group (CALC) and an order for five A320ceos for Spirit Airlines (20 gross orders minus five cancellations => net of 15). Just as Boeing looked set to win the orders race in 2017, Airbus finished the year on a very high note and reported a full-year intake of 1,109 net new orders and 1,229 gross orders. This compares to 731 net new orders in 2016. Airbus has retained an order lead over Boeing every year since 2012.
Airbus’ order backlog as of January 31, 2018 stands at 7,253 jets (of which 6,135, or 85%, are A320ceo/neo family narrowbodies), ahead of Boeing’s 5,831 (of which 4,648, or 80%, are 737 NG/MAX narrowbody jets). The number of Airbus aircraft to be built and delivered represents a 10-year backlog at the 2017 production level. In comparison, Boeing’s backlog would “only” last 7.6 years. Airbus booked 1,109 net new orders in 2017, resulting in a book-to-bill ratio of 1.54. Boeing booked 912 net new orders in 2017, for a book-to-bill ratio of 1.20.
2018 Forecast
Forecast International’s Platinum Forecast System® is a breakthrough in forecasting technology. Platinum provides 15-year production forecasts along with 10 years of historical data. The author has used the Platinum Forecast System to retrieve the latest delivery forecasts. For 2018, Forecast International’s analysts expect Boeing and Airbus to deliver 797 and 793 large commercial jets, respectively. These figures exclude militarized variants of commercial platforms such as Boeing’s P-8 Poseidon, KC-46 tanker and C-40 Clipper and Airbus’ A330 MRTT tanker.
On January 31, Boeing reported that it expects to deliver 810-815 commercial aircraft during 2018 (including militarized variants of commercial jets). On February 15, Airbus announced that it expects to deliver around 800 commercial jets this year (including militarized variants of commercial jets), but at the same time emphasized that it depends on engine manufacturers meeting commitments.
Please feel free to use this content with Forecast International and analyst attributions, along with a link to the article. Contact Ray Peterson at +1 (203) 426-0800 or via email at ray.peterson@forecast1.com for additional analysis.
The Forecast International Civil Aircraft service covers all facets of the fixed-wing commercial and private aviation industry. It includes more than 70 detailed reports, complete with production forecasts on individual civil aircraft families. Four Market Segment Analyses provide in-depth examination of the markets for Large Commercial Jet Transports, Regional Aircraft, Business Jets, and General Aviation/Utility Aircraft. Included in the reports are production forecasts, a Forecast Rationale detailing the basis for the forecast, the aircraft’s price range and technical specifications, a program history, and recent developments.
References:
http://www.boeing.com/commercial/#/orders-deliveries
http://www.airbus.com/company/market/orders-deliveries/
http://boeing.mediaroom.com/2018-01-31-Boeing-Reports-Record-2017-Results-and-Provides-2018-Guidance
http://www.forecastinternational.com/platinum.cfm
A military history enthusiast, Richard began at Forecast International as editor of the World Weapons Weekly newsletter. As the Internet grew in importance as a research tool, he helped design the company's Forecast Intelligence Center and currently coordinates the EMarket Alert newsletters for clients. Richard also manages social media efforts, including two new blogs: Defense & Security Monitor, covering defense systems and international issues, and Flight Plan, which focuses on commercial aviation and space systems. For over 30 years, Richard has authored the Defense & Aerospace Companies, Volume I (North America) and Volume II (International) services. The two books provide detailed data on major aerospace and defense contractors. He also edits the International Contractors service, a database that tracks all the contractors involved in the programs covered in the FI library. More recently he was appointed Manager, Information Services Group (ISG), a new unit that encompasses developing outbound content for both Forecast International and Military Periscope.
