The order battle between Boeing and Airbus is one way for the companies to flex their muscles, next to marketing their respective products as the best solution with the highest fuel efficiency and passenger comfort. Even though the orders (in terms of value) are in no way a reflection of financial performance, it’s important to have a look at the order inflow. That’s because the order tallies give a nice impression of which manufacturer has the best mix of discount, comfort, slot availability and efficiency and it gives an idea of the overall health of the aircraft market and appetite for new aircraft. In this report, AeroAnalysis will look at the order inflow during April for both manufacturers and their role in the narrow and wide body markets.
Overview for April
Airbus and Boeing together hauled in 146 gross orders in April compared to 119 orders in the same month last year. Looking at the division of the orders in April, we’d mark Boeing as the winner as it logged 78 orders versus 68 for Airbus. In terms of value, Boeing received $7.8B worth of orders versus $3.4B for Airbus.
In April, Boeing booked 78 gross orders, 48 wide body jets and 30 single aisle aircraft:
- American Airlines ordered 25 Boeing 787-9 aircraft.
- Boeing Capital ordered 22 Boeing 787-8 aircraft to be leased to American Airlines.
- UTAir Aviation ordered 30 Boeing 737 MAX aircraft, though we believe this is a conversion from the Boeing 737NG to Boeing 737 MAX.
- Uzbekistan Airways ordered 1 Boeing 787-8, the order offsets the Royal Jordanian cancellation for the very same airframe.
The full report on Boeing’s orders and deliveries in April can be read here.
In April, Airbus booked 68 gross orders, 1 wide body jets and 67 single aisle aircraft:
- Druk Air ordered 1 Airbus A320neo.
- An undisclosed customer ordered 3 Airbus A320ceo aircraft.
- Scandinavian Airlines ordered 35 Airbus A320neo aircraft and 1 Airbus A330-300.
- Allegiant Air ordered 1 Airbus A320ceo aircraft.
- An undisclosed customer ordered 5 Airbus A319ceo jets and 22 Airbus A319neo jets.
The full report on Airbus’s orders and deliveries in April can be read here.
April, at first sight, seems to have been a good month for Boeing as an important order from American Airlines was logged and it seemingly booked more orders than Airbus. It needs to be pointed out however that the 78 orders include one aircraft not taken up by a customer being accepted by another, 30 conversions and 22 aircraft that Boeing bought itself.
For Airbus, we continue seeing challenges to accumulate wide body orders as they come in flocks instead of a more continuous stream but this is partly caused by the Airbus A350 going through the first cycle of filling orders and the Airbus A330neo has yet to enter commercial service.
Airbus received 50 cancellations in the first 4 months, leaving the jet maker with 86 net orders. Boeing received 333 orders and 65 cancellations in the first 3 months of 2018, bringing its net orders to 268. Looking at the net orders, Boeing is having a strong lead over Airbus but this of course doesn’t say a lot since a few big orders can completely change the game as we saw last year. It will be very interesting to see how many orders both jet makers materialize until and during the Farnborough Airshow later this year.
In the first 4 months of the year Airbus booked more gross orders compared to last year when it booked it 117 gross orders, but following cancellations from key customers such as American Airlines and Hawaiian Airlines the jet maker netted 92 orders. Boeing saw its orders inflow improve in the 4 months; gross orders increased from 173 to 268, while cancellations increased from 18 to 50 marking a strong net improvement.
Boeing and Airbus both will be happy with the order inflow in the first 4 months. Airbus has been dealt some blows as it lost American Airlines and Hawaiian Airlines as customers for its new wide body jet, but overall things are good. Neither jet maker does really face difficulties if its new aircraft program would suffer from a soft year, since risk has already been mitigated previously.
After 4 months, we can see that Boeing is having a strong lead, but. Both jet makers can turn the battle around in just one month as Airbus portrayed last year. We’d expect to be able to see some clear headings after the Farnborough Airshow that will take place in July. What is interesting is that Boeing is expecting moderated order inflow, which is a rather vague term while Airbus expects to maintain a book-to-bill of 1. This is not necessarily an indication that Boeing expects to book less orders since it produces more aircraft than Airbus, but it seems that Boeing is more cautious about their ability to accumulate orders in 2018. From what we’re seeing so far we’d expect a better year in terms of order inflow as well as commercial aircraft deliveries.
What holds for both manufacturers is that they are oversold on their single aisle programs and there is the possibility to hike production rates beyond levels currently announced, though the supply chain and especially the supply chain of the propulsion systems should be stress tested thoroughly and this might delay a rate hike somewhat. Overall, we remain positive on the commercial aircraft market and ability for both jet makers to benefit from this growing market.