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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 June for both manufacturers and their role in the narrow and wide body markets.

Overview for June

Airbus and Boeing together hauled in 333 gross orders in June compared to 322 orders in the same month last year. Looking at the division of the orders in June, we’d mark Boeing as the winner as it logged 233 orders versus 100 for Airbus. In terms of value, Boeing received $14.3B worth of orders versus $9.6B for Airbus.

In June, Boeing booked 233 gross orders, 32 wide body jets and 201 single aisle aircraft:

  • Boeing Capital Corporation ordered 75 Boeing 737 MAX aircraft.
  • An unidentified customer ordered 75 Boeing 737 MAX aircraft, this likely is an order from Jet Airways.
  • A Business Jet customer ordered 1 BBJ MAX.
  • Two unidentified customers ordered 20 and 30 Boeing 737 MAX aircraft respectively.
  • FedEx (NYSE:FDX) ordered 11 Boeing 767-300Fs and 9 Boeing 777Fs.
  • An unidentified customer ordered 2 Boeing 767-300Fs.
  • An unidentified customer ordered 10 Boeing 777Fs.

The full report on Boeing’s orders and deliveries in June can be read here.

In June, Airbus booked 100 gross orders, 47 wide body jets and 53 single aisle aircraft:

  • An undisclosed customer ordered 20 Airbus A320neo aircraft.
  • Aegean Airlines ordered 20 Airbus A320neo aircraft and 10 Airbus A321neo aircraft.
  • Lufthansa (OTCQX:DLAKF) ordered 3 Airbus A320ceo aircraft after having already ordered 3 in the previous month.
  • International Airlines Group ordered 2 Airbus A330-200 aircraft.
  • An undisclosed customer ordered 10 Airbus A330-900neo aircraft.
  • An earlier commitment from Turkish Airlines for 25 Airbus A350-900 aircraft has been finalized.
  • An unidentified customer ordered 10 Airbus A350-900 aircraft.

The full report on Airbus’s orders and deliveries in June can be read here.

June was quite a good month for Boeing and Airbus marking the first month were both jet makers logged 100 or more orders. Boeing saw strong order inflow for its single aisle and cargo products, while Airbus saw strong order inflow for the Airbus A350. and Airbus A330neo.

Overview Year-to-date

Figure 1: Infographic June 2018

Airbus received 55 cancellations in the first 6 months, leaving the jet maker with 206 net orders. Boeing received 609 orders and 149 cancellations in the first 6 months of 2018, bringing its net orders to 460. Looking at the net orders, Boeing has 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. In June many orders have been announced by both jet makers and it will be highly interesting to see whether these jet makers have many new orders to announce during the air show or whether it will be a show filled customer reveals.

In the first 6 months of the year Airbus booked more gross orders compared to last year when it booked it 249 gross orders, netting 203 orders compared to 206 this year. Boeing saw its orders inflow improve in the first 6 months as well; gross orders increased from 438 to 609, while cancellations increased from 57 to 149 marking a strong net improvement.

Conclusion

Boeing and Airbus both will be very happy with the order inflow in the first 6 months. Neither jet maker really faces imminent difficulties if its new aircraft program suffers from a soft year, since risk has already been mitigated previously. The single aisle programs are in good shape when looking at the backlog where continued order inflow plays an important role in making decisions for future hikes in production rates while order inflow for the wide body jets will help keep production at sustainable levels with the possibility of higher production rates as replacement cycles boost the required delivery profiles in the coming years.

Boeing has a strong lead, but both jet makers can turn the battle around in just one month as Airbus showed last year. We’d expect to be able to see some clear headings after the Farnborough Airshow that will take place this month. 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.