This research note is reserved content for AIR research clients only. Please login below and click on requested service to access content. Sign in to your AIR research account. Please ensure that the research note or forecast document that are you are trying to access is included in your current Read more…
The results are in, and as expected. The COVID crisis will be felt until the early 2030s and both Airbus and Boeing are at a critical juncture of their history.
The questions are now relatively simple: what market environment is to be expected in the next decade? What will be the impact on the competitive environment and finally what strategic direction should the industry adopt to adapt and grow in a scorched commercial market landscape.
Boeing’s peak valuation stood once at $250B,
Our briefing is available below for all AIR research customers without restrictions.
Our revised outlook is available. Three scenarios have been considered for this updated forecast. We are generally positive about the long term industry resiliency. Our concerns that may lead to a more severe regional crisis have now clearly migrated into the geopolitical & societal consequences of this major crisis.
Let us be clear – the disruption and shock to the global system are massive, but there will be a day after, and it is how this day is carefully and resolutely managed that will define the shape of recovery, our societies, and international relations for the next fifty years. Therefore, it must be done right and this day after is possibly as, if not more, important as the management of the current sanitary crisis. History is full of examples of crisis exit mismanagement that led to even worse outcomes.
On a scale of 1 to 10, the title of this short note may lead to reasonable confusion in the mind of the AIR research customer and probably deserves a 9 for not making any sense whatsoever. It is no accident however. No, the recent PNAA conference has not permanently damaged the mind of this analyst (it was a close call), but one of the panels that we contributed to triggered additional thinking that perhaps is worth of this exercise in extrapolation.
Our panel was titled “the swinging pendulum: trade and protectionism.” Although we continue to disagree with co-panelist Richard Aboulafia (not the first time, not the last time) on the current issues affecting the Chinese economy, we wholeheartedly agreed with Ron Epstein’s comments “You see two spheres of technology and two areas of economic development; so you have a major trading partner who is also a security
This report is part of the Forecast Series available to our research customers until May. This new format will provide you with unique market data customization capabilities.
This can be viewed in full screen by clicking on the bottom right corner double arrow.
Part two of this report will look at suppliers and systems. Commercial markets forecast will be updated this month and in April.
Our forecast dashboard has been updated with the addition of the Airbus outlook to 2033. Access to all AIR Power BI dashboards is available to all research customers until May.
The current situation in the People’s Republic has further emphasized the complexities associated with the global aerospace supply chain and the exposure of global airlines to an event of this magnitude in the world’s fastest growing market.
Our media colleagues have been discussing the current Coronavirus-19 situation on their website. We are using some of their material to provide additional perspective on the Chinese supply chain, the PLAAF contribution and the possible implications for aerospace supply chain.
The past weeks have been a source of significant concern about the Boeing company. While we have been surprised, to a degree, at the delays towards a resolution of the MAX crisis, it is the noise surrounding the crisis that has increasingly become the key restraints to a satisfactory exit.
Grandstanding, inept media coverage, and political hijacking of this crisis have deteriorated to such an extend that we are at times unable to provide a clear path to resolution of this situation as so many known unknowns might still eventually come to pollute the situation in the first half
We ended 2019 on a distinctly cautionary note. Now we begin 2020 with a single purpose for AIR research customers, to paraphrase Nate Silver’s 2012 work, to help separate the “The Signal from the Noise” to , simply said, provide a flightplan like outlook for the year(s) ahead.
This note will be delivered in a unique format as well, we will include an audio to provide appropriate background info for our forecast and recommendations. Ernie Arvai, the AIGroup president joined me to provide multiple views. The accompanying audio can be played here
This is how 2019 will be remembered by the team at AIR. Our research notes recurring themes for 2019 centered around themes such as crisis (MAX), disruption (supply and production), evolution (China) and uncertainties (Trade). In this note, we will focus on the first two themes. Needless to say, these themes are not wholly positive and they may even take a more negative turn in 2020. The coming new year will be a year of correction for some, disruption for the supply chain, growth for others and continuing crisis at Boeing.
Chicago, February 2029
In its annual call with investors to discuss 2028 results, Boeing CEO Travis Sullivan (or Marc Allen, or replace with your personal favorite) highlighted significant enterprise level accomplishments and decisions for the year.
Full production rate achieved for the Boeing 797 (formerly known as NMA) with production output of 12/month reached in the last quarter of the year. The aircraft backlog now stands at 1,108. Deliveries of 124 aircraft were delivered in 2028 out of the Huntsville FAL
Successful initiation of production for the Boeing 708 (FSA). A total of 36 aircraft were delivered out of the Charleston facility with the second FAL in Sao Jose Dos Campos slated to become operational in 2030.
The attached presentation will provide an overview of our revised 2019-2030 business aviation outlook. This material was presented during NBAA last week.
This presentation is only accessible by our Notes and Forecast customers.
Let’s go into reactive mode here. This has indeed been much of the story for 2019 when it comes to the Boeing company. With the 737MAX not anywhere near a return to flight by Q4, the ramification of the crisis is affecting the entire enterprise product strategy forward.
It perhaps is necessary to recap how we view a prolonging (we suggested this would carry on well into 2020 back in early June) of the grounding at this stage:
NMA – No change of course aside from the delays associated with the engine development. The NMA is well underway internally and there are no signs that…
No, Dennis Muilenburg does not need to go for his role in the MAX crisis, it would be an oversimplification. The question that can be legitimately asked however is if he is the best person to lead the Boeing company out of that crisis. As a CEO, his performance has been impressive, and he has led the company to new financial and transformational heights.
However, the perception has changed considerably and what needs to be done at Boeing next perhaps necessitates a new approach. It is up to the Boeing board to decide on the appropriate course in that regard. The changes presented, in particular with the new Aerospace Safety Committee and the Product and Services Safety organization, should be enough to…
We make a point to attend materials events regularly enough to keep a close eye on this increasingly critical (and exposed) piece of the aerospace supply chain. For those seeking additional insights about the health of the aerospace supply chain, we highly recommend the survey conducted by
The attached presentation will provide an overview of the Boeing production outlook and enterprise issues of importance as of late September. This material was presented during a call organized by Desjardins on 2 october.
We have certainly not been shy with the number of AIR notes (1,2,3,4) addressing the multiple trade disputes over the past three years. The news that the WTO has reached a decision on granting the United States the right to impose between $6 to $9 Billion in tariffs on a wide range of EU exports worth $25 Billion, is adding to our tally of trade related analysis. The end is…
This note looks at the expected production of commercial aircraft(>100seats) and their known or expected material choices (Fuselage/Wings).
