Airbus outsells Boeing as focus shifts from buying to building

Airbus SE came in ahead of Boeing Co. at this week’s Paris Air Show in the closely watched contest for airplane orders thanks to a massive haul from India that highlights Asia’s growing importance to aircraft demand. 

North American and European carriers sat largely on the sidelines while Airbus raked in a record-setting deal for 500 narrowbody jets from low-cost carrier Indigo, the biggest airline in the world’s most populous country. 

While that was the only major show stopper, the two planemakers also split a 470-jet purchase by Air India that had already been announced in February and was now firmed up in Paris. The nation’s former flag carrier, being revamped under new owners, also added 70 Boeing options — setting up the deal to potentially reclaim mantle of the world’s biggest aircraft order. 

Overall though, dealmaking remained muted. Airbus picked up an agreement with leasing company Avolon Holdings for 20 A330neo aircraft and an accord with Saudi low-cost carrier Flynas for 30 A320 aircraft. Boeing secured a win with North African carrier Air Algerie for eight 737 Max models, alongside another accord with Avolon for the same bestselling jet. 

But with so many commitments already on their books, attention focused on how Airbus and Boeing will get the planes built. Aviation executives and investors attending the show spent much of their time discussing how the manufacturers will overcome shortages of parts and labor that have slowed a post-pandemic ramp-up in production, as well as the repair work needed to keep existing fleets in the air. 

“The focus of air shows is shifting away from large orders, especially as both Airbus and Boeing have large backlogs that they have still to deliver,” said Andy Cronin, the Avolon chief executive officer. “We do believe in the demand story. There have been some significant orders in markets where we see real growth opportunities, whether that’s in the Middle East, or whether thats in India.” 

Even as the event at Le Bourget on the outskirts of Paris wound down, reminders of the supply-chain crunch were on display. Boeing’s biggest supplier, Spirit AeroSystems Holdings Inc., suspended production on Thursday after workers voted to strike. Airbus will meanwhile accelerate work on a second production line at its factory in Tianjin as it races to ramp up output.

Customers outside of India made some modest additions to their order books. Besides Flynas, Avolon and Air Algerie, Luxembourg’s Luxair bought four 737 Max-7 models; and Philippine Airlines ordered nine Airbus A350 widebodies. 

Saudia Arabia’s push to build the kingdom into a tourism magnet and hub for global travel was also in focus. Startup Riyadh Air showed off its new purple livery on a Boeing 787 Dreamliner parked at the show, though the airline remains several years away from actual operations as it only begins to build its fleet. While it chose GE engines for widebodies from Boeing, the aircraft purchase itself wasn’t definitively sealed at the event.

Other airlines also remain in talks for widebody orders, Bloomberg has reported, including Air France-KLM, Delta Air Lines Inc., Air Canada and Turkish Airlines. That risks creating a supply squeeze in a few years similar to the one in narrowbodies, Airbus Sales Chief Christian Scherer cautioned at Le Bourget.

Boeing is sold out for several years on its most popular planes, and Airbus doesn’t have narrowbody aircraft available before 2029 at the earliest. IndiGo will only start taking delivery from 2030. With such a deep backlogs, chasing orders at shows like Paris, Dubai or Farnborough near London has become less of a priority.

“Airlines are clearly trying to secure their place in the queue with orders,” said Rob Morris, global head of consultancy at Ascend by Cirium. “But the key question is how do planemakers ramp up production to meet all this demand? It’s almost as if now the party’s over and manufacturers have to wake up and get to work.”