Paris Show expectations

By John McHale
PARIS AIR SHOW REPORT BLOG: 17 June 2011. Expectations for the Paris Air Show next week are positive as the market returns from its doldrums of the last couple years.  The mood at the Paris Air Show two years ago was bit gloomy as the Air France crash over the Atlantic was still fresh and the small number of airplane order announcements at the show didn't help improve the mood much.

I think this year is going to be much different. There is already quite a bit of buzz among readers of our Avionics Intelligence e-newsletter regarding the 787 Dreamliner from Boeing. I think we're going to hear about new customers and orders for the aircraft especially as the launch operator for the aircraft -- All Nippon Airways (ANA) – completed pilot training and validation of the aircraft. Expect more good news regarding the 787.
Yes it  might be the most overhyped aircraft of all time, but many electronics and avionics components and system level suppliers have say that once the orders for this start coming in over the next year, their business will go through the roof. Barring any more natural disasters or recessions I think they're right.
In 2009 a sales manager from Airbus told me the best way to gauge whether or not Farnborough or Paris were good shows is to follow the airplane order announcements. If they're in the hundreds or thousands, it's a "damn good show," if they're for amounts like 16 or 25 or even 42, then it will be gloomy like 2009. I think -- based on this theory -- 2011 will be a damn good show . Passenger traffic is up according to IATA and expected to continue climbing, encouraging operators to buy more aircraft.
You will also see many new products from avionics suppliers that are NextGen or SESAR compatible. NextGen is the U.S. Federal Aviation Administration's (FAA's) Next Generation air Transportation System. The European version is SESAR or Single European Sky ATM Research. Both programs are starting to implement programs that will require new technology be added to aircraft such as Automatic Dependent Surveillance-Broadcast (ADS-B).
For business and general aviation, the phrase uttered the most will be "it could be worse." Despite the turn around on the commercial aircraft side, general and business aviation is still hurting and I don’t expect it to suddenly get better next week.
On the defense side unmanned aerial vehicles (UAVs) and electro-optics are hot with unmanned aerial vehicle (UAV) payloads driving much of the electro-optics procurement. Companies such as FLIR, DRS, Raytheon, and others that supply electro-optics such as infrared cameras and video systems for UAV payloads are not feeling the effects of the recession and should have an outstanding show in Paris next week.
Despite these positive developments there will still be some griping next week from U.S. defense companies about the U.S. import/export controls such as the International Traffic in Arms Regulation (ITAR) and how it is hurting their ability to do business overseas -- and they're right it is.
Last year at the Farnborough Air Show Northrop Grumman's president predicted that the ITAR will end up killing U.S. UAV business internationally as U.S. companies prevented from doing business by the State Department will see foreign companies winning UAV contracts around the world even if the U.S. has better technology.
I don't see this changing any time soon despite the Obama Administration's promise to reform the export compliance system. The government is still hiring more enforcement personnel, which means more violations will be uncovered, and more companies fined -- sometimes for just clerical errors on their paperwork.
Those are jsut a few predictions, check back with me in a week to see ifI got them right. During that time I will have coverage of ITAR, the 787, UAVs, and electro-optics daily next week from the show. Check out our Paris Air Show Report page for the latest every day. Let’s hope my forecast is right and there are tons of airplane orders next week.
See you in Paris.

 


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