News Backgrounder
Asia’s Le Bourget order blitz
The region’s carriers stole the limelight at the Paris Air Show, but their big orders fueled fears of continuing over-capacity in their home markets.
July 1st 2015
Asia’s Garuda Indonesia grabbed the headlines on the opening day of this year’s Paris Air show with a stunning $20 billion order for 60 Boeing and Airbus jets. As the days rolled on, Asia-Pacific airlines continued to boost the order books of the big planemakers, a change from the recent past when Gulf carriers dwarfed their rivals with their fleet orders at Paris. Read More »
Korean Air (KAL) signed for 50 B737 MAX-8 (30 firm, 20 options) and two B777-300Ers. The South Korean flag carrier also ordered up to 50 A321neos (30 firm, 20 options) . KAL signed a Memorandum of Understanding (MoU) with Pratt & Whitney for its PurePower PW1100G engines to power the A321neos.
In addition, Airbus said it had signed an MoU with an un-named “Asia-based airline” for 60 A320neo family aircraft.
Asian airlines committed to 318 jets, nearing half the orders made at the bi-ennial June show. While delivery of these aircraft will be spread over many years, the orders once again raised flags about over-capacity at Asia-Pacific fleets. Profitability in the region has already softened as a result of over-capacity.
In 2014, capacity growth was slightly ahead of demand and there have been repeated warnings from analysts that carriers will need to carefully manage their growth to avoid worsening the situation.
The final tally was: Airbus announced customers for 421 aircraft at list prices of US$57 billion. Boeing won orders and commitments for 331 aircraft valued at US$50.2 billion. Of the $50.2 billion of business signed by Boeing, 145 aircraft, worth $18.6 billion, were firm orders, with the balance either commitments or orders already in the order book from unidentified airlines. Airbus said it had firm orders for 124 aircraft, worth $16.3 billion, and commitments for 297 aircraft at $40.7 billion.
Garuda’s order for 30 B787-9s and as many as 30 B737 MAX 8s (in addition to 50 B737 MAX 8s it ordered last October) signals a regional and long-haul international expansion drive at the airline.
“The agreement is part of Garuda Indonesia’s revitalization program,” said Arif Wibowo, the airline’s chief executive, who added the deal is to “support the airline’s plan to expand its network globally”.
Deliveries of the B737s will between 2022 and 2025 and the B787s from 2022 to 2024. The A350 XWB will enable non-stop flights from Jakarta or Bali to Europe.
Korean’s commitment for up to 50 A321neos makes it a new customer for the single-aisle plane, although it operates A330s and A380s. Korean Air Group chairman, Cho Yang Ho, said it was chosen “after an extensive technical evaluation”.
Regional jet manufacturers such as Embraer and Bombardier announced no new customers at the show, but China’s emerging regional jet maker, the Commercial Aircraft Corporation of China (COMAC), received an order for seven shorter-range regional ARJ21-700s and seven C919s from PuRen Germany Gmbh, an investor owned by the China PR Group.
|
Asia-Pacific airline orders also included: Leasing companies were the other big customers at Paris. Major orders were: |
