Page 41 - World Airnews Magazine March 2021

FEATURE FEATURE

PLANNING FOR RECOVERY a need for 4,420 new regional jets through • The International Air Transport • Richard Aboulafia - Vice President of
likely remain subdued this year.
2029: 75% to replace aging aircraft.

Analysis, Teal Group

INDUSTRY WATCHERS Association (IATA) expects passenger This is the worst commercial aviation
market environment since people

By Eric Brothers Accenture’s global aerospace and traffic to rebound but remain about first flew. Jet delivery numbers have

40% below pre-pandemic levels. IATA
defence industry lead John Schmidt doesn’t expect a return to pre-pan- plummeted but seem to be stabilizing.
offers a few resolutions for the aerospace demic trip length levels before 2025, There are four areas of positive news.

and defence industry. potentially driving higher demand for » Defence markets are completely

• Cash management - Companies must narrow-body aircraft. unaffected. This is true for the

focus on their financial strategies. Data • Industry is likely to shift toward trans- all-important U.S. defence budget

and analytics can provide models that forming supply chains via onshoring, and for export markets.
ecovery in commercial aircraft can be updated in near real-time to vertical integration, and increased » Returning Boeing 737 MAX to

Rdemand depends on controlling the explore scenarios and develop insights cyber defences. Original equipment service, and to production, ensures

coronavirus pandemic. Discretionary air trav- that guide optimal actions. manufacturers (OEMs) and suppliers some kind of single-aisle recovery
el drives most transport aircraft needs, and • Supply chain resilience - Have 100% in- should leverage digital tools, including this year. Some of this recovery

until people feel confident in traveling and sight into the availability of critical com- automating internal processes and will be due to deliveries of aircraft

governments allow it, the commercial aero- ponents and parts to manage risk. New streamlining workflows, implementing already built, but considering that

space supply chain must focus on survival. technologies can create a more resilient smart management systems, and using only Airbus delivered single-aisle

Despite federal plans to boost COVID-19 supply chain and provide a foundation data analytics. jets in 2020, we’ll see a respectable

vaccination production, president Joe for next-generation capabilities. SOME INDUSTRY LEADERS recovery this year.

Biden said it will take until late summer to • Future sustainability - The pandemic » The overall economic picture is

treat most Americans, leaving the possibili- is forcing the industry to accelerate • Ethan Karp - CEO and President The surprisingly positive, and COVID-19

ty of some resumption of air travel demand its investment in technology. Be more Manufacturing Advocacy and Growth vaccines appear more effective than

later this year. data-driven, deploy more automation Network (MAGNET) anticipated. This, coupled with the

Domestic air travel will lead the way, as and artificial intelligence (AI), use the Consider what it will take to be China air travel recovery experi-

demonstrated in Asia-Pacific nations and in cloud, or create a collaborative culture competitive in 10 years. Talent isn’t ence, implies a very strong air travel

the US in late 2020. - digital is the answer. getting easier to come by. Getting people recovery starting in the second

Air cargo traffic volumes were down 12% While commercial aerospace faces into good manufacturing careers is a half of this year. We expect a full

through Q3 2020, due to fewer planes flying. challenges in 2021, the defence sector is systemic challenge that will require recovery to the 2019 air traffic peak
by Q4 2022.
systemic investment. Manufacturers
However, Boeing analysts reported yields expected to remain stable and weather know Industry 4.0 is coming, but most
the pandemic’s disruption, according to

were up more than 40% and overall air cargo Deloitte’s 2021 Aerospace and Defence have yet to invest in smart manufacturing » Business jet demand seems to be

industry revenues were up more than 15%. Outlook. Robin Lineberger, Deloitte’s US and automation. Now is the time to make recovering quickly, in line with

business aircraft utilisation. While

Defence and commercial space business and global aerospace & defence leader, those investments. deliveries have dropped signifi-

offer alternative revenue for companies notes the industry is likely to take advan- To come out of COVID-19 stronger, cantly, we expect them to recover
in those sectors. The US department of tage of the pandemic and drop in demand manufacturers must form a technology quickly starting in 2022.

defence and NASA continued to award to transform supply chains, as well as strategy and invest in upskilling their

contracts through 2020 and there are no pursue mergers and acquisitions (M&A) talent. Automation and remote UAVS TO SOAR

immediate signs this activity will be cur- to build scale and capture greater value technology will keep people safe and Teal Group estimates that unmanned aerial

tailed under the new administration. so that long-term growth prospects keep production running through vehicle (UAV) production will increase

AIRBUS remain strong. Some highlights: the pandemic, and they’ll also set from worldwide production of (US) $5.6
manufacturers up for the future. When

Airbus kept to its April 2020 production • Global commercial aircraft deliveries demand returns, we’ll need technology billion annually in 2020 to $14 billion by

2029, totalling (US) $95.5 billion in the next

plan in response to the COVID-19 pandem- are estimated at 900, a decline of 44% to meet it. 10 years. Military UAV research spending
from peak year 2018. New orders will
ic, delivering 566 commercial aircraft last

year, 34% fewer than in 2019. The company resumed in December following the plane’s Boeing plans to move all 787 production

reported 383 new orders, and after 115 ungrounding in November. In a vote of to South Carolina by mid-2021. Combined

cancellations, Airbus’ year-end backlog confidence, Alaska Airlines management 777/777X production rate will decrease

stood at 7,184 aircraft. announced plans to buy 23 more 737-9 to two per month in 2021. No changes in

The long-range single-aisle A321XLR airplanes, bringing the airline’s 737 MAX production rates have been announced for

garnered 37 orders, continuing its upward orders and options to 120 airplanes. the 747 and 767 programmes.

sales trend as wide-body orders shrunk. Cancellations far outnumbered gross EMBRAER
Airbus plans to gradually increase A320 orders for the year (net -454), but as of

family monthly production rates from 40 to November 30, 2020, Boeing’s unadjusted Embraer ended Q3 2020 (the latest figures

43 in Q3 and 45 in Q4 2021 - a slower ramp backlog stood at 5,053 aircraft, of which available) with a firm order backlog of (US)
up from last July’s anticipated 47 aircraft 81% were single-aisle jets. $15.1 billion.

per month. A220 production will increase On the defence ledger, Boeing delivered For the year, the company delivered 16

from 4 to 5 aircraft per month from the end 71 new and remanufactured AH-64 Apache commercial jets and 43 executive jets (33
of Q1 2021 as previously foreseen. and 30 new and renewed CH-47 Chinook light jets and 10 large jets), compared to 54

Widebody production is expected to helicopters, 4 F-15 and 20 F/A-18 fighters, commercial jets and 63 executive jets deliv-

remain at current levels, with monthly 14 767-derived KC-46 tankers, and 15 ered during the first nine months of 2019.

production rates of around five for the 737-derived P-8 maritime patrol aircraft. Boeing terminated its government-ap-

A350 and two for the A330. Airbus officials Forecast International reports Boeing proved joint venture with Embraer early

expect the commercial aircraft market to will increase 737 MAX production to 31 per in the pandemic, leaving the Brazilian

return to pre-COVID levels somewhere month by early 2022, down from 42 per company to re-establish its global market-

between 2023 to 2025. month before production halted in May ing efforts.
2020. Boeing is reducing 787 production In its 2020 Market Outlook, Embraer

BOEING from 14 per month (at the start of 2020) to commercial aviation president and CEO

Boeing’s Q4 2020 results offered a path six per month throughout 2021 while also Arjan Meijer foresees global passenger

to its recovery as 737 MAX deliveries addressing manufacturing quality issues. traffic will return to 2019 levels by 2024 and
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