Each Has A Production Backlog Of About Seven Years

After a flurry of orders from around the world, both Boeing and Airbus are looking at the prospect of declining jet sales which could have an adverse effect on their bottom lines.

The sales … some of them record-breaking … came as airlines took advantage of attractive interest rates to work on replacing their fleets with more fuel-efficient airplanes, but now, the orders may taper off if interest rates rise or fuel prices dip.

Reuters reports that analysts point out that slower sales and a declining order backlog would mean less work for the tens of thousands of people employed by the planemakers. Airbus is set to open its first U.S. final assembly plant next year to be able to more efficiently deliver airplanes to U.S. customers.

Still, both planemakers predict that the number of jets plying the skies will double over the next 20 years. Neither sees a particular slowdown in orders or production, and they do not say the market is oversaturated. Some analysts, however, say that Airbus and Boeing, and some airlines, are being overly optimistic about their forecasts, and that airlines in particular are over-predicting the demand for air travel. They say some of the massive orders for airliners announced in the past couple of years are based on incorrect assumptions.

Demand for airliners and production are on the agenda at an Aerospace and Defense Summit taking place this week in Washington, D.C.

FMI: www.reuters.com/summit/AerospaceandDefense11