The Industry Today

The First Quarter order intake was the largest for a Q1 since 2014.

It was the First Quarter aircraft order intake that was the largest for a Q1 since 2014. The First Quarter engine order intake was lower than the intake in Q1 last year but it was the second largest Q1 intake in the past five years. The aircraft intake mostly involved single-aisles; Airbus took orders for 243 and Boeing took orders for 134. The widebody intake of 43 aircraft was the lowest for a Q1 since 2017. Airbus took orders for 10 widebodies and Boeing took orders for 33.

The good news is that the First Quarter aircraft order intake was the largest for a Q1 for eight years. There is some bad news involving cancellations and the passenger widebody aircraft backlog and also the widebody engine order book but let’s focus on the good news first; the aircraft order intake. First Quarters are not known for having large order intakes. There again, this industry has had three years of turmoil. First there was the grounding of the 737 MAX in early 2019 (there were no MAX deliveries for the next 20 months). Then there was the pandemic which presented airlines and aircraft manufacturers with an unprecedented crisis. Then Boeing had problems with the 787. There have been no 787 deliveries for the last nine months, and no orders for this flagship program for the last seven months.

                All this turmoil has also impacted the total aircraft order intake. There were orders for 420 aircraft in the First Quarter of this year. In the last three years there have been no less than eight quarters with lower aircraft order intakes. In the same period there have been five quarters with lower engine order intakes than in Q1 of this year.

                So, to have orders for 420 aircraft in the First Quarter is very encouraging for the industry. It shows that demand is returning. Perhaps not particularly quickly, but returning all the same. The downside to all of this is that there have been more cancellations. By the end of March there had been 186 single-aisle aircraft cancellations and 194 widebodies had been cancelled. This left a net single-aisle order intake of 430 aircraft and a net widebody intake of -82. Airbus had a gross order intake of 253 aircraft in the First Quarter. The company’s net figure was 83. Boeing has sold fewer aircraft than their European competitor this year but had a gross intake of 167 at the end of March and, after cancellations, a net figure of 145.

                Airbus has lost 80 single-aisles and 90 widebodies due to cancellations. Boeing has lost 15 737 MAX jets and seven 787s to cancellations. During March, 13 A321neos and 63 A330-900s were cancelled, in addition to three 787-9s. Airbus now has three programs with negative net positions while Boeing has just one. The program with the largest negative net position at the end of the month was the A330-900.

                This is where the bad news comes in. There were orders for six widebody aircraft in March, all 777 freighters. No passenger widebodies were ordered. Ten passenger widebodies and three widebody freighters were delivered during the month. Cancellations took 66 passenger widebodies off the books. The result was that the passenger widebody aircraft backlog dropped by 76 aircraft. It was the largest monthly drop in a long time but to make things a whole lot worse, the passenger widebody backlog at the end of February was already at a low point. By the end of March, it was even lower and stood at 1,514 aircraft. This is 171 aircraft lower than at the end of March last year, a 10% drop, and 289 aircraft lower than at the end of March 2020 which is a drop of 16%. The only bit of good news in the context of widebodies is that, at the end of March, the freighter backlog reached a new high.

                The drop in the number of passenger widebody aircraft has had an effect on the widebody engine order book. That, too, was at an industry low point at the end of February and it is now even lower. The number of single-aisle engines on order at the end of March was exactly the same as at the start of the year. But in March 132 widebody engines were cancelled. There are now 168 fewer widebody engines on order than at the start of this year, 216 fewer than at the end of March last year and 508 fewer than at the end of March 2020. Reaching a new industry low is something that happens regularly to the widebody engine order book. There have been six new lows in the last 12 months.

GE is the only widebody engine company to now have more engines on order than at the start of this year and more on order than at the end of March last year. And GE now has the largest share of the widebody engine order book.