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More engines on firm order than at the start of 2016, but fewer aircraft.
(The latest figures we have are to the end of April 2016.)

At the end of April there were fewer aircraft on backlog than at the start of the year, but considerably more single-aisle engines. The aircraft order intake is slightly down on the first four months of last year and there have been fewer new aircraft deliveries. Considering that delivery numbers this year are expected to be at much the same level as last year, this is slightly surprising but probably points to a large increase in the Second Half and particularly towards the end of the year.

Bombardier’s big CSeries order in April was a huge vote of confidence in a program that has gone for a very long period without a single-order. Some in the industry may have been thinking that the CSeries was never going anywhere and that the long-time backlog of 243 would gradually diminish and eventually reduce to nil. What this order did do, of course, was add to the single-aisle aircraft backlog. By the end of the month, Airbus and Boeing both had fewer single-aisles on backlog than at the start of the year. Bombardier, quite unexpectedly, turns out to be the only aircraft manufacturer to currently have a larger backlog than at the start of 2016.

Airbus continues to have the largest single-aisle backlog but has had a larger drop this year than Boeing. If one looks at what has happened since the start of last year, the Airbus single-aisle backlog has grown by far more than Boeing’s. Also, in the widebody segment, the current Airbus backlog is larger than at the start of this year and also larger than at the start of last year. Boeing’s widebody backlog has dropped. The fact that the current widebody aircraft backlog is down on the start of the year is entirely due to the large Boeing drop outstripping the Airbus gain.

Boeing may actually have started to get a little bit anxious about the difference between their widebody backlog and Airbus’. The gap is closing fairly quickly. A year ago, Boeing had 211 more widebody aircraft on backlog than their European competitor. This had reduced to 155 more at the end of last year and the current figure is 90 more. The reason for this is really quite simple; Boeing’s widebody order intake this year is roughly half that of Airbus and the U.S. manufacturer’s widebody delivery total so far is more than twice that of Airbus. The odd thing in this context is that Airbus does not necessarily have to get one large widebody order to have the largest backlog in this segment – sooner or later the higher Boeing delivery figure will reduce the gap to nothing.

One can see where this is going by looking at each company’s widebody order and delivery figures over the last 12 months. In that period, Airbus has taken orders for 201 widebodies and has delivered 140. Boeing, on the other hand, has taken orders for 171 and has delivered 255.

The aircraft order intake has slowed and, in fact, has been slowing for some time. Overall figures show that compared to the first four months of last year, two fewer single-aisles and 15 fewer widebodies have been ordered. Those figures give the impression of a slight decline, particularly in the single-aisle market. However, there are two important points here; the first is that the order intake is very much lower than it has been in the past and the second is that there is a large difference in both the Airbus and Boeing order intakes.

The single-aisle intake so far this year is actually the lowest for the Jan-April period since 2011. The widebody intake is the lowest for the period since 2014. The point is that three years ago, the total Jan-April order intake was 420 aircraft larger.

While the aircraft order intake so far this year is slightly lower in overall terms than in the same period last year, the engine order intake is up. Well, the single-aisle engine order intake is up but the widebody engine order intake is down to the extent that it is half the intake in the first four months of last year. This year there have been orders for 1,056 single-aisle engines and 220 widebody engines. The single-aisle intake is very nearly four times the intake in the same period last year. The widebody intake is 222 engines lower.

The very big change has come from CFM and P&W’s single-aisle engines. CFM has taken orders for 754 engines so far this year, an increase of 546 on last year. P&W has taken orders for 302 single-aisle engines this year, up 246 from this time a year ago. What both companies have benefitted from this year are engine orders for previously ordered single-aisle aircraft.

This has also been a positive impact on their firm order books. CFM now has 264 more engines on firm order than at the start of this year and P&W has 240 more. In the widebody segment, GE’s firm order book is currently four engines lower than at the start of this year; the Engine Alliance has 28 fewer engines on order but Rolls-Royce does have 32 more. Rolls-Royce also has significantly more engines on firm order than at the start of 2015. GE and the Engine Alliance do not.

Aircraft and engine delivery numbers are also down on the same period last year. Airbus and Boeing have both delivered fewer single-aisles and fewer widebodies and, as a result, CFM, GE, P&W and Rolls-Royce have all had fewer deliveries. Only the Engine Alliance has had more deliveries, up 12 on the same period last year.

The industry was probably expecting roughly the same number of aircraft deliveries as in the same period last year since the projection for 2016 is for a very slight gain on the 2015 total. Airbus will deliver slightly more aircraft while Boeing will deliver slightly less and the gain will be helped by first deliveries of the CSeries. However, so far this year Airbus has delivered 15 fewer single-aisles than in the same period last year while Boeing has delivered eight fewer. Airbus has also delivered four fewer widebodies than last year and Boeing has delivered 12 fewer.

What this boils down to is 23 fewer single-aisle deliveries and 16 fewer widebody deliveries, or 19 fewer deliveries by Airbus and 20 fewer by Boeing. In order to reach their delivery targets for this year, both companies will have to have much higher average monthly delivery figures each month for the rest of this year.

Of course, as a result of fewer aircraft deliveries there have also been fewer engine deliveries, or installs. There have been 66 fewer single-aisle engine installs this year than in the first four months of last year and 36 fewer widebody engine installs. The total install figure of 812 engines so far is 102 less than by the end of April last year.

These lower figures do not point to lower 2016 production rates. The expectation is that this year there will be 990 single-aisle aircraft deliveries, four more than in 2015, and 420 widebody aircraft deliveries, nine more than in 2015. This translates into 1,980 single-aisle engine installs, up eight, and 920 widebody engine installs, up 12 on the 2015 total.

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Philip Abbott,
Editor & Publisher.