While trends show that airline traffic around the globe roughly doubles every 15 years, the Asia-Pacific region will see a three-fold increase, according to Airbus, thereby supporting its sanguine outlook for its widebody product line in particular. Speaking publicly Tuesday for the first time as the company’s new head of sales, former Rolls-Royce Civil Aerospace president Eric Schulz noted that even though Airbus accounts for just 40 percent of the widebodies in operation in the region, its backlog accounts for 60 percent. In a region expected to generate 46 percent of all widebody demand over the next 20 years, the trends look encouraging for the European manufacturer.
Airbus’s Asia-Pacific market forecast calls for an annual traffic increase of 5.6 percent, generating a demand for 14,450 new aircraft over the next two decades. Expected to account for some 40 percent of the world’s demand for single-aisle equipment, Asia will absorb almost 10,000 airplanes in that category. The sheer numbers will place pressure on manufacturers to keep pace with narrowbody demand especially.
Addressing Airbus’s industrial capacity, Schulz reported that studies aimed at increasing A320 production beyond the planned 60 per month have intensified. He also expressed confidence in the company’s supply chain to accommodate another rate boost.
“We were having the same question when we hit rate 40 and, at the time, we thought the supply chain would never be able to cope. It coped with rate 40, and it coped with rate 45 and then 50,” said Schulz. “I believe the industry has changed dramatically, and I believe that each and every one of our suppliers have plans in place today, which means that they are prepared.”
Of course, Airbus’s concern with production rates of its biggest airplane, the A380, differs dramatically. Planning to lower rates from 12 this year to nine in 2019 to six in 2020, Airbus needs to think about sustaining enough activity to keep the program viable for suppliers.
“That’s why it was so important to finalize our order with Emirates,” said Schulz, referring to an MOU covering a firm order for 20 airplanes and options on another 16 signed with the Middle East carrier last month. “We know that at a rate of six [per year] we are industrially viable. This means that we have the opportunity to keep a final assembly line open, but we also keep our suppliers in situations and volumes [that will allow] them to sustain the activity.”
Schulz added that he had held discussions with “a couple of customers still interested in the A380.”
“The door will continue to be open on some very specific markets where growth will be a big issue because of restricted airspace, restricted airports. And I think we’ll continue to have some opportunities. Now will that be a dozen [per year]? Probably not. But it will probably be sustainable and help us to continue to live with the program, which is delivering value to the customers.”
