By Joe Brock and Tim Heffer
FARNBOROUGH, England (Reuters) – Aviation leaders gather for a high-profile summit outside London on Monday as the industry struggles to cope with supply chain disruptions, aircraft delays and failed plans to cut carbon emissions.
The Farnborough Airshow, which runs from July 22-26, a gathering of senior executives from airlines, aircraft manufacturers and arms manufacturers, has been a festival of orders for passenger jets from Boeing and Airbus.
Several delegates said the show was not expected to produce a surge in orders as Airbus struggles to hit production targets and Boeing maintains a quiet stance amid a safety crisis sparked by a 737 Max door panel that flew in January.
Some deals are coming through, delegates said. Virgin Atlantic is close to placing an additional order for Airbus A330neo jets, and Saudi low-cost carrier Flynas is preparing to order up to 30 of the wide-body jets, industry sources said.
Japan Airlines is expected to confirm its initial orders for the planes, Boeing is seeing interest in leasing its 737 Max jets, and Turkish Airlines is in talks to buy Boeing planes, industry sources said. Both companies declined to comment.
Industry chiefs will also be looking for any further signs of weakening demand for air travel services after profit warnings from airlines. Ryanair, a leading low-cost carrier, is due to announce its quarterly results on Monday.
With dealmaking limited, attention is likely to focus on how to remove bottlenecks in the supply chain and speed up aircraft deliveries to frustrated airlines.
The aviation industry has been hit hard by the pandemic, which has seen air travel collapse before recovering sharply. This has prompted many companies to rush to address labor and parts shortages.
The situation was exacerbated by the escalating crisis at Boeing, which was forced to slow production of its best-selling 737 Max aircraft after a door explosion.
Boeing Commercial Airplanes President Stephanie Pope said at a news conference on Sunday that production of the 737 Max is improving and that the company is undergoing a “transformational change” in safety and corporate culture.
Airbus Chief Executive Guillaume Faury told reporters on Sunday that the planemaker is making progress in increasing production of luxury passenger jets.
political problems
Aerospace and defense companies, which rely heavily on government-funded programs, are closely assessing a turbulent political period in Western democracies, with a new Labour government in Britain, a fragmented parliament in France and elections in the United States in November.
“We are already in a world that is changing all the time… very volatile, unpredictable and very challenging for industries,” Faury told reporters on Sunday.
Fury’s comments turned out to be prophetic. About an hour later, US President Joe Biden announced that he was ending his re-election bid and endorsing Vice President Kamala Harris to replace him.
This week’s air show will feature sessions and workshops on sustainability, as airline giants and airlines seek to underscore their commitment to cutting carbon emissions, even as they plan to significantly expand global air travel.
On the defence side, attention will focus on Ukraine, potential delays to the future US F-22 fighter replacement, known as NGAD, and the new UK Labour government’s defence review.
British Prime Minister Keir Starmer is expected to attend the air show on Monday, and defence executives will be looking for any signs of how Labour’s review might impact their programmes.