Virgin Atlantic's A350-1000
Virgin Atlantic’s A350-1000

There is, as usual, very little difference between total demand estimates underlying the Airbus and Boeing rolling 20 year market forecasts released at the Farnborough Airshow yesterday.

But they show some signs of gradually pulling further apart, with Boeing being slightly more optimistic about average annual rates of passenger traffic growth over that period, putting it at 4.8 percent against 4.5 percent as estimated for Airbus.

The actual numbers predicted for new airliners and freighters are much wider apart, and not just because Airbus with a total of 33,060 aircraft only starts counting for jets with 100 seats or more, while Boeing includes 2380 regional jets of 90 seats or less in its total of 39,620 new builds.

It’s the same story as before. Boeing sees the world as moving to smaller aircraft overall, even referring to its 777-X family, the largest twin engine jets yet being marketed as ‘medium sized’ wide bodies.

Airbus sees the trend going in the opposite direction, but only up to a point, and would lose its claim to offer the highest capacity airliner if as its critics keep urging, it were to retire the A380 in the next decade.

The sharpest divergence in the forecasts made by the big two jet makers concerns the dimensions of the single aisle jets they are proposing to make (although by 2035, both the A320 NEO and 737 MAX lines might well be history.)

Airbus, in line with its very successful A321 NEO, sees that market as strongly upwardly mobile, while Boeing continues to refer to the not so competitive 737 MAX 9 as being somehow smaller in capacity to the 737 MAX 200, which is the MAX 8 without proper toilets.

As such, these documents from both sides of the contest are creatures not just of very sound economic forecasting but an interpretive ‘showcasing’ of their respective stronger points, as of the middle of 2016.

A reasonable person might struggle to identify a single airline in the world that cares what is going to be the situation in say 2025, never mind 2035. The investor and management attention span is a lot shorter than that of the economic experts engaged by Airbus and Boeing to peer into the future.

As recent reporting about Boeing’s constant ‘plans’ for a Middle of the Market or MoM jet suggests, the airline are strongly interested in a new technology jet that would seem to be sized more around the current 737 MAX family parameters than a true 757 replacement or alternative to the Airbus A321 NEO.

This must be something of a pain in the neck for both makers, as it is very difficult to see how either could choose from the airlines anything but unanimous claimed preferences for such an airliner, and risk so much capital on a product with a surprisingly small level of demand.

(In aggregate, the numbers look great for an MoM, but when broken down, the airline preferences are fragmented, and the technology may not be available to deliver on the hype this side of 2025.)

Farnborough awash with water rather than big orders

The UK airshow has been flooded out, and so far, announcements could be described ‘measured’ rather than grandiose.

Boeing says it will add two rows of seats to its 737 MAX 7 model, which until now has like the comparable A319 NEO, struggled to be a third choice in the respective new technology single aisle lines.

Given the possible interest of Virgin Australia in more 737-700s that could make it a contender for some of its future MAX orders as it simplifies its fleet.

Among the wide body airline orders announced so far, Virgin Atlantic will take 12 Airbus A350-100s and ARKIA Israeli Airlines will operate four A330-900 NEOs alongside its earlier order for four A321 NEOs.

Low cost carrier Jetstar Pacific, 30 percent owned by Qantas and run by Vietnam Airlines, has ordered 10 current model A320s.

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