Orders from airlines indicate a resurgence in travel after the pandemic

In the first five month of this year, airlines placed orders for more than 1,200 new aircraft. This shows the resurgence of demand in the industry. Passenger traffic is continuing to recover in the aftermath of the pandemic.

According to IBA’s research, the figures were boosted by three notable deals. These included Air India’s announcement in February that it would purchase 470 single aisle and long distance widebody aircraft from Airbus, Boeing, and HTML2_ Airbus HTML2_. The total orders up to the end May, including options, were 1,198.

The huge order haul shows how quickly demand for airlines has returned to pre-pandemic level. The International Air Transport Association (IATA), an industry group, announced this week that domestic travel has regained its pre-pandemic level and that overall passenger traffic in April grew by 46 percent year-on-year, led by carriers from the Asia-Pacific region.

Industry-wide Capacity Constraints have been driving up demand for aircraft, pushing out delivery slots towards the end. Airbus and Boeing have struggled to meet delivery targets due to a shortage in components.

“Airlines rush to regain capacity, returning stored aircraft and ordering new ones. “They are all eager to be at the head of the line for deliveries,” William McClintock said, IBA’s manager of market research.

IBA data shows that net orders in 2022, after cancellations are taken into account, were 1,592. This is almost twice the number of orders in 2019 (812), the year prior to the Covid pandemic, which brought the air travel industry to a virtual standstill.

Net orders for single-aisle aircraft were 1,436. This includes Airbus best-selling A320 jet family. The net orders for widebody aircraft used on international long-haul routes totaled 156. This is a small increase from the 148 orders in 2019.

McClintock said that the wide-body recovery “looks sustainable.” Before the pandemic began, orders were not being filled and delivery rates were higher than expected.

Executives warn that the industry’s supply and demand balance will remain off for some time.

Boeing’s chief executive, David Calhoun warned that the progress in fixing supply chain issues had been “frustratingly slowly” on Friday.

Calhoun, speaking at the Bernstein Conference in New York, said: “We have to be very smart about managing supply against this demand spike. It is quite large.” On the other hand, the supply chain is frustratingly slow to release the constraints.

Calhoun, while acknowledging that Boeing has made improvements to its supply chain in certain areas, said that the US group as well as Airbus will still struggle to meet the customer’s demand five years hence.

Guillaume Faury (CEO of Airbus) said last month the crisis in the supply chain that is affecting the industry may last until next year.

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