Key Points:
- Boeing and Airbus face significant production challenges due to workforce shortages and supply chain issues.
- The Farnborough Airshow saw fewer orders than in previous years, with Boeing securing 96 and Airbus 266.
- The pandemic led to a loss of skilled workers. Shortages of parts and complex cabin interiors are slowing down production.
- Both manufacturers are enhancing supply chain management and investing in workforce training to address these issues.
The Farnborough Airshow, one of the industry’s biggest events, concluded without the massive airplane orders that have characterized past years. Instead, the focus was on the significant production challenges faced by Boeing and Airbus as they grapple with the pandemic’s lingering effects on their supply chains and workforce.
Both manufacturers are struggling to ramp up airplane production. Boeing’s Senior Vice President of Global Supply Chain and Fabrication, Ihssane Mounir, acknowledged during a panel at the airshow that they have fallen short in meeting commitments to airlines and suppliers. Training new workers and resolving supply chain issues are expected to take years, leading to a new, more fuel-efficient plane shortage.
The airshow saw modest orders. Boeing secured 96 orders and commitments, including previously made sales, while Airbus garnered 266 orders. This starkly contrasts the 826 orders at last year’s Paris Air Show. Notably, Air Korea ordered up to 50 Boeing wide-body planes and has Airbus A350-1000 jets on order, with their CEO humorously commenting that whichever company delivers first will become their flagship.
The subdued order numbers reflect a broader trend. For much of this decade, both manufacturers have sold out of narrow-body jets like the Boeing 737 Max and Airbus A321neo. Boeing has a backlog of nearly 5,500 planes, while Airbus has over 8,000 on order. Despite the airshow’s lower-than-expected order volume, the demand for new aircraft remains strong as travel rebounds post-pandemic.
Production remains a critical issue. Boeing, focusing on safety and manufacturing problems, did not bring any commercial aircraft for flight demonstrations. The company aims to increase production of its Max planes to 38 per month, and investors eagerly await updates on this target. Airbus showcased its new A321XLR, which was certified by European regulators just before the show, but it, too, faces production slowdowns due to parts shortages.
Both companies are addressing these issues by enhancing their supply chain management. Airbus has deployed over 200 supply chain engineers to work directly with suppliers. Christian Scherer, CEO of Airbus’s commercial airplane business, emphasized the importance of transparency with suppliers to avoid future disruptions.
Supply chain disruptions include shortages of landing gear, engine components, and complex cabin interiors, all hampered production. Additionally, both manufacturers are facing a workforce shortage. Many skilled workers left the industry during the pandemic, necessitating extensive training for new hires and further delaying production.
Kevin Michaels of AeroDynamic Advisory highlighted the need for higher wages to return workers to the industry. Boeing’s Mounir echoed this sentiment, noting that the company must invest in training to support the supply chain. Airbus’s Delphine Bazaud pointed out the challenge of training workers from unrelated fields like baking and butchery.
The industry is at a crossroads, balancing immediate production needs with long-term solutions to workforce and supply chain challenges. As the U.S. potentially shifts more aerospace work abroad to where labor is more available, Boeing and Airbus must navigate these complexities to meet global demand.