Quantity of airplane orders at Farnborough air Show is strong indicator of market health

Posted by John McHale


FARNBOROUGH REPORT BLOG, 8 July 2010. While at the Paris Air Show last year a contact at Airbus told me one of the best ways to gauge market health was to track the quantity of airplanes ordered from airframers such as Boeing and Airbus during the Paris and Farnborough air shows.


He noted that during Paris last year orders for Airbus and Boeing jets were typically between 15 and 45 or 50 jets per order, whereas in a strong year they number in the hundreds.


Boeing did not make any significant airplane orders last year, but folks in the industry expect that to change as the Boeing 787 Dreamliner continues to go through testing and company officials say the first delivery will happen toward the end of this year.


At the Berlin Air show last month, Airbus announced firm orders for 32 A380s from Emirates Airline, their largest announcement at the show. Thirty-two is not 100, but it is a positive sign because it means operators are buying airplanes.


I think it is doubtful we will see announcements for airplanes in the hundreds at the Farnborough Air Show. The market has hit bottom and most market forecasts -- such as the International Air Transport Association's (IATA's)  --  see an uptick and commercial aviation globally, a fast ascent in revenue is unlikely.


The recovery will be slow and many airlines and system integrators will hold onto their cash in case this turns out to be a double dip type of recession.




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