Manufacturers Experiencing A 'Huge' Order Backlog

The Global Commercial Aircraft market continues to be on a roll in one of its longest aviation super-cycles driven by strong tailwinds with strong demand drivers for air traffic growth, supply-side factors in form of introduction of re-engined aircraft offering enhanced operating economics and favorable macroeconomic factors boosting air travel across most key parts of the world.

According to a new report from ResearchandMarkets ... The "Global Commercial Aircraft Market - 2019-2038 - Market Dynamics, Competitive Landscape, OEM Strategies & Plans, Trends & Growth Opportunities, Market Outlook - Airbus, Boeing, Bombardier, Embraer, ATR" ... the same has created a huge order backlog for the industry which is likely to translate into significant top-line growth potential for the entire aviation industry value chain over the next decade. Next-generation aviation turbofan engines, featuring a high bypass ratio and extensive usage of technological innovations have just entered service over the recent years, are proving their mettle in grueling, active duty service and are likely to form a major chunk of new deliveries over the medium term given the composition of the order backlog across aircraft OEMs.

The grounding of the global Boeing 737 MAX aircraft family fleet, however, remains the top concern for Boeing as well as the suppliers and the airline groups having exposure to the 737 MAX program with the global fleet likely to be airborne and resume service only from November 2019 which has disrupted schedules and has impacted numbers across the board. Some mainstream carriers with strong exposure to the 737 MAX program have already incurred charges worth millions since the grounding of the fleet in March 2019 along with significant disruptions to service and flight schedules.

This year, however, is turning out to be another good year for commercial aviation with reference to the order intake wave which has showed no significant signs of abating at the Paris Air Show 2019 with both Boeing & Airbus booking decent orders from airline customers with the latest A320XLR from Airbus being the showstopper and posing further questions for Boeing to answer with Boeing required to take a well-calculated call on its NMA decision on priority while grappling with & sorting out the 737 MAX crisis.

However, the slowing down of the world economic growth from the ongoing trade wars remains a key concern for the airline groups with likely impact on cargo business & passenger traffic. The profitability forecasts for the airlines for 2019, too, has been revised downward in June 2019 indicating pressures on profitability from slowing demand & rising input costs.

(Source: Research and Markets news release)

FMI: www.researchandmarkets.com/r/unkst9