TOULOUSE--Airbus SE raised its forecast for industry-wide plane deliveries for the coming 20 years on Friday, despite signs of a slowdown in orders, particularly for lucrative long-haul planes.
Continue Reading Below
The European plane maker expects manufacturers to deliver 34,899 large commercial planes through 2036. That's 1,829 more planes than it forecast in 2016 for the 20-year period. The deliveries have a value of $5.3 trillion at list price.
But there are signs of market softening. Airbus has booked only 73 net orders in the first five months of 2017 compared to 162 deals inked for the comparable period a year earlier.
Demand for widebodies has fallen in particular. Airbus ha booked 30 net deals for its A330 and A350 widebody jetliners this year, 46% fewer than at this point in 2016.
Fabrice Bregier, Airbus COO and president of Airbus Commercial Aircraft, said Friday that the company expects plane deliveries to outpace new order bookings in 2017 for the first time in years. Airbus began the year with modest expectations for new orders.
Airlines such as American Airlines Group Inc. and Delta Air Lines Inc. are among the carriers in recent weeks to announce deferrals of some big plane orders.
Mr. Bregier acknowledged the widebody market was shifting, but said it wasn't softening. Instead, he told reporters Friday that the market was having trouble digesting both the older long-haul plane models in production for years and the newer designs coming off Airbus and Boeing production lines.
A headwind for the widebody market could be emerging, though, from the Middle East--a key market for planes such as the Airbus A350 and Boeing 787 Dreamliner.
The isolation of Qatar by several other Mideast countries is "a development that is troubling for our industry," Airbus CEO Tom Enders said Thursday. "We sincerely hope this disruption does not develop into a long-term conflict."
But Mr. Enders rejected the idea Airbus was too reliant on rapidly growing airlines in Turkey, the U.A.E. and Qatar, whose home markets are under political and economic pressure.
"We are far from overexposed to this area," he said, noting that only about 13% of Airbus's backlog was linked to orders from the region.
Airbus's own outlook is a little more muted than a year ago. It cut its forecast traffic growth rate to 4.4% a year through 2036. Last year, it projected 4.5% growth in the two decades to 2035.
"We are being a little conservative," Airbus chief plane salesman John Leahy said Friday.
Airbus officials stressed traffic would still be higher at the end of the period because of strong growth in the near-term.
Mr. Bregier said that even with fewer new deals this year, the backlog of more than 6,700 planes ordered and yet to be built underpinned the plane maker's plan to boost output on it most popular models, the A320 single-aisle jet and A350 long-haul plane. Airbus currently builds about 50 A320 planes a month and plans to produce 60 planes a month by mid-2019.
Airbus's market outlook sees single-aisle types like its A320 or Boeing 737 representing 73% of the deliveries through 2036.
Airbus trimmed slightly its outlook for the market size for its A380 superjumbo, which has struggled to secure deals. Airbus is cutting output of the double-decker to one plane a month from 2018, and Mr. Bregier said this might need to be reduced further.
To help reinvigorate appetite for the plane, Airbus plans to pack more seats into it and is considering smaller updates to it to lower fuel burn.
-Write to Robert Wall at email@example.com
(END) Dow Jones Newswires
June 09, 2017 07:05 ET (11:05 GMT)