DALLAS — Slowed-down deliveries and supply chain woes will permeate Boeing and Airbus' presence at next week's 2024 Farnborough Airshow.
As the former needs to resume production of two important commercial programs by year's end and the latter sees issues with its factories and supply systems, the American plane maker and its European rival are finding it difficult to keep up with the high demand for aircraft from their customers.
The competitive edge between these two titans are at stake with wider implications for the commercial aviation industry. So, what's eating the American aerospace giant and the European multinational aerospace corporation prior to FIA2024?
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Boeing
Boeing started 2024 with a positive increase in sales of commercial planes yearly and a spike in deliveries. However, once the Federal Aviation Administration (FAA) directed its magnifying glass at Boeing after the door plug blowout accident on Alaska Airlines (AS) Flight 1282 on January 5, things took a sharp turn.
The FAA reported in March following its audit that it had found "Non-compliance issues in Boeing's manufacturing process control, parts handling and storage, and product control." As a result, the FAA would increase in-person inspections at manufacturing facilities and prohibited Boeing from producing more MAX aircraft.
Due to the fact that airlines pay the majority of a plane's cost at the time of delivery, Boeing's commercial arm, which brings almost half of its revenue, is suffering from delivery delays caused by its production limits.
Boeing also reduced its 787 production earlier this year to give suppliers time to catch up, a company representative informed reporters during a June visit to the company's expansive 777 wide body plant in Everett, Washington State, for which it got an earful from the FAA.
Last but not least, certification of the Boeing 737-7 and -10 has been delayed to 2025 after the company selected a design to modify the internal structure of the 737 MAX engine inlet earlier this year.
According to Yahoo Finance, Boeing is "burning through more than US$1 billion in cash a month as it has dozens of new planes sitting outside factories in need of parts."
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Airbus
Airbus's supply chain problems as of June 2024 have slowed down the delivery of new aircraft and made it more difficult for the company to achieve its production and financial targets for 2024.
There is a lack of engines, structural parts, and cabin interiors at Airbus, which could face penalties for any delays thereof, according to it CEO, Guillaume Faury.
A320neo Pratt & Whitney turbine engine produced with defective parts and supply shortages influenced by CFM’s weary stance on ramping up deliveries have also played a part in airbus shortcomings. Airbus has also had problems with Chinese fake titanium documents.
The manufacturer had to ultimately lower its 2024 forecast for jet deliveries from 800 to approximately 770. Additionally, the company has postponed by a year its intention to raise monthly A320 production rates to 75 units; as a result, it won't reach that goal until 2027.
Alas, Airbus has downgraded its financial targets for 2024, including its operating profit and cash generation.
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Titans of the Sky at FIA
Boeing wants to show a "tailored presence" at the FIA2024 as the American manufacturer looks to prioritize safety, quality, and achieving client obligations, while also emphasizing next-generation technologies and capabilities.
Airbus wants to consolidate its position as a leader in the passenger aircraft segment at FIA2024. At least in terms of aircraft displayed, the European manufacturer will be the company to showcase the largest variety of planes to the public and potential customers.
We'll see how Boeing's delayed supply of parts, regardless of the end-of-year catch-up promise, and Airbus' downgraded 2024 delivery forecast, from 800 to 770, will influence confidence at the industry's most important airshow next week.
Our take: We're confident Boeing will get 777-9 and 787-9 commitments and Airbus its fare share of A320neo and A321XLR orders, as the duopoly won't see any competition coming from CCP-backed plane maker COMAC in the foreseeable future.
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FIA2024 Live Coverage
The 2024 Farnborough Airshow takes place July 22-26, so stay tuned to Airways for our live coverage of FIA2024 from the Farnborough International Exhibition & Conference Centre in the UK.
Be sure to follow us for live updates on all our social media channels #FIA2024.