The first day of the Farnborough Airshow has turned out to be quite kind to the world’s two makers of large (more than 100 seats) airplanes. Boeing Co. (NYSE: BA) announced new deals early in the morning valued at nearly $7.5 billion and has added more since. Airbus Group also has announced new orders. and there remains potential for more.
Both makers also released new 20-year aircraft market outlooks today that were roughly in line, but diverged in some interesting ways. The biggest difference shows up in the difference between the two companies’ expectations for the size of the market for very large aircraft.
Boeing, which has cut production for its 747 jumbo jet and has no plans to build another 4-engine plane, sees a market size of 530 through 2035 for the planes. Airbus, which just began posting a profit on its superjumbo A380, sees a market for nearly 3 times as many, 1,430.
Another major difference between the two rivals is their estimates of the 20-year market for single-aisle planes like the 737 and the A320. Boeing estimates a market size of 28,140 narrow-body planes compared with an Airbus estimate of 23,530, a difference of about 20%.
Boeing’s estimate for the total dual-aisle, wide-body market is 9,100 compared with an Airbus estimate for 8,060, a difference of about 13%.
As for Monday’s deals, here’s a list of Boeing’s announcements:
- Letter of intent from China-based Donghai Airlines to purchase 25 of Boeing’s 737 MAX 8 aircraft and 5 Boeing 787-9 Dreamliners. At current list prices the deal is worth $4 billion.
- A memorandum of understanding from Xiamen Airlines to purchase up to 30 Boeing 737 MAX 200 aircraft in a deal valued at $3.39 billion.
- An order for 10 737-800s valued at $960 million from Standard Chartered Bank’s aircraft financing arm was made for an unidentified customer already included on Boeing’s order book.
Airbus has announced several deals as well
- Air Lease Corp. (NYSE: AL) has placed a firm order for 3 A350-900s and one A321 valued at more than $1 billion at list prices.
- Virgin Atlantic “is purchasing” 8 A350-1000s with delivery scheduled to beginning in 2019. At current list prices the order is worth $2.8 billion. The airline also plans to lease 4 more aircraft and has an option on a fifth.
- Air Côte d’Ivoire placed a firm order for one A320neo valued at $106 million at current list prices.
- Vietnam’s Jetstar Pacific Airlines has signed a memorandum of agreement to purchase 10 current version A320s in a deal worth $970 million.
The number of firm orders is definitely low-key: Boeing has exactly zero and Airbus chalks up just five. There is talk that Airbus has large orders in the works with both Malaysia’s Air Asia and India’s GoAi, the first for 100 A321neos and the second for 70 A320neos.
Because the airplane makers like to kick off the big shows with big orders, this could have been the big day for Farnborough. Not like the old days of 2013 and 2014.
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