Demand for widebody jets buzzes again as Boeing 787 joins the fray

By Tim Hepher and David Shepardson

PARIS/WASHINGTON (Reuters) – Boeing Co’s 787 Dreamliner has returned to the global market for newly delivered planes at a time when demand for wide-body jetliners is finally coming back to life after a prolonged recession.

The American aircraft manufacturer delivered its first Dreamliner since May 2021 on Wednesday, an important step for the manufacturer after production problems with its wide-body aircraft.

Boeing must now go through careful regulatory checks to get more 787s delivered while reducing a backlog of about 120 planes stored outside its factories.

But analysts say there is growing talk of demand for such jets after years of market glut.

From East Asia to the Gulf, several airlines are renewing their wide-body fleets.

Saudi Arabia is discussing a potentially large order for wide-body jets, three industry sources said, though talks have fluctuated over several years with no deal announced and timing. of a decision may be remote.

But with Riyadh investing in tourism and aviation as part of its Vision 2030 plan to diversify the economy, a person following the case predicted a decision “as soon as possible”, with Boeing 787s and 777Xs potentially among The mixture.

China Airlines, backed by the Taiwanese government, plans to renew a fleet of 22 Airbus A330s as part of a competition between the 787 and the Airbus A330neo.

Malaysia Airlines is set to announce an agreement on Monday for the acquisition of 20 A330neo wide-body aircraft, around half of which would be purchased directly from Airbus.

“I strongly believe that with the full reopening of borders, we will see the same rebound in international travel that we have seen in domestic markets,” said Aengus Kelly, chief executive of AerCap, the largest leasing company in the country, on Thursday. world.

“Given the level of investigation and demand we are seeing for widebody aircraft, it is clear that airlines are also convinced of this.”

International traffic has picked up since the start of the year, although the International Air Transport Association says it still has a long way to go before it recovers to pre-pandemic levels.

“What we’re seeing right now is definitely a recovery taking hold in some international markets,” Ihssane Mounir, Boeing’s senior vice president of commercial sales and marketing, said after the Farnborough Airshow last month.

REBOUND IN DEMAND

“The transatlantic is live and doing well,” Mounir told reporters. “You’re seeing very robust demand between Europe and the US and… between the Middle East and Europe and the US. So people are sticking their heads above water again and… making planes.”

Part of the renewed interest stems from delays caused by the manufacturers themselves as well as increased regulatory scrutiny following the recent Boeing 737 MAX safety crisis.

Boeing’s big, twin-engine 777X has been pushed back to 2025, five years later than originally planned, and the 787 has seen a year-long hiatus in deliveries.

“There is a real rebound in demand for widebody aircraft, but availability is short due to manufacturing and development delays, so it has not yet returned to pre-COVID levels,” said the independent aviation consultant Bertrand Grabowski.

“The 777X is behind schedule and the program has its own issues and 787 availability has been spotty,” he added.

Adding to the pressure, Airbus is facing supply chain issues.

“The jury is out on whether Airbus will manage to meet its delivery target for the A350,” Grabowski added.

Markets keep guessing, and perhaps the biggest part of the demand puzzle is China, industry executives said.

Many had seen the door as being left ajar to a large widebody Boeing order after the last big Chinese order in July, which focused only on smaller narrowbody models, went to Airbus.

In September, US Commerce Secretary Gina Raimondo said the Chinese government was blocking its national airlines from buying “tens of billions of dollars” worth of Boeing planes. China tends to balance out aircraft purchases over time, but it has effectively been out of the market for five years as demand was hampered first by trade tensions and then by the pandemic, analysts said.

Now the potential trade with iconic US companies has been pushed amid the outcry surrounding US House Speaker Nancy Pelosi’s visit to Taiwan as well as Chinese military exercises around the China-claimed self-governing island.

Reduced air traffic as millions of people remain stranded is also a drag on demand, FlightGlobal’s Asia editor Greg Waldron said last week.

(Reporting by Tim Hepher in Paris and David Shepardson in Washington; Editing by Matthew Lewis)