At the year's biggest air show, Boeing and Airbus orders were muted. Supply chain worries were not

FARNBOROUGH, England — Massive airplane orders, hundreds deep in recent years, were absent from this year’s biggest air show. The focus instead was on struggles at Boeing and Airbus to ramp up airplane production while battling a hangover from the pandemic that was marked by seesawing output.

Many of the issues, particularly training new workers, will take years to fix, analysts say, meaning lingering headaches for airlines, suppliers and the manufacturers themselves — and a shortage of new, more fuel-efficient planes.

“It’s a fair sentiment on the part of the supply base and the airlines to say that we failed our commitments to them in terms of being timely, in terms of predictability,” said Ihssane Mounir, Boeing’s senior vice president of global supply chain and fabrication, during a panel at the Farnborough Airshow outside of London last week. “So obviously, people start doing their own planning and their own second-guessing.”

A roadmap of the next few months of production will come this week, when Airbus reports quarterly results on Tuesday, followed by Boeing on Wednesday. Wall Street analysts expect Boeing will post another loss for the second quarter and possibly the next. Airbus has cut its delivery targets for the year.

At the show, which concluded Friday, Boeing racked up 96 orders and commitments, including previously made sales that were firmed up, while Airbus had 266, far shy of the 826 orders during the Paris Air Show a year ago, according to a tally from consulting firm Ishka. Paris and Farnborough alternate hosting the expo each year.

One standout was Air Korea’s order for up to 50 Boeing wide-body planes, including the 777X, which Boeing is working toward getting certified by regulators. The carrier also has Airbus A350-1000 jets on order. As both manufacturers grapple with production strains, Air Korea CEO Walter Cho quipped during the Boeing order signing: “Whichever comes first will become our flagship, whoever’s on time.”

The muted order tally during the show came as both manufacturers are largely sold out of narrow-body jets like the Boeing 737 Max and Airbus A321neo through much of this decade, if not longer. Boeing has an overall backlog of close to 5,500 planes, while Airbus has more than 8,000 on order. Many airlines from United Airlines to Air India have also stocked up on new jet orders as travel rebounded in the pandemic.

Boeing’s presence at the air show was notably modest — it didn’t bring any of its commercial aircraft for flight demonstrations while it focused on its safety crisis and manufacturing issues. Arlington, Virginia-based Boeing is trying to ramp up production of its bread-and-butter Max planes to about 38 a month, and investors will be looking for clues this week on when those targets could be reached.

Airbus showed off its new extra-long-range, narrow-body plane, the Airbus A321XLR, which was certified by European regulators days before the show started.

Visitors to the air show usually get a glimpse of fleets that will fly for decades, but most of the industry this year was focused on output over the next few months.

Parts shortages from landing gear to engine components like high-pressure blades to ever-more-complex cabin interiors, like those with premium seating, are also in short supply. That has slowed down production, depriving airlines of more fuel-efficient planes and angering some executives along the way.

Airbus is taking a more hands-on approach “than we’ve ever done before,” deploying more than 200 supply chain engineers among suppliers, said Christian Scherer, chief executive of the European manufacturer’s commercial airplane business.

“What we don’t want to be seeing again in the future, whether we’re in an uplift or in a slowdown of this industry, is a situation where the supply chain does not believe what we’re telling them,” Scherer told reporters ahead of the show.

Airbus last month said it would cut its airplane delivery target for the year and said it would slow planned production increase, citing “persistent specific supply chain issues mainly in engines, aerostructures and cabin equipment.”

Boeing, meanwhile, in addition to supply chain issues, is trying to dig its way out of a safety crisis stemming from a door plug blowout in January, and a series of manufacturing defects that have slowed output.

A loss of skilled workers who were either let go or opted for early retirement during Covid-19’s plunge in air travel has hampered output of new jets. The manufacturers are now left to train new workers — a major challenge.

“I think it’s a three-to-five year issue,” said Kevin Michaels of AeroDynamic Advisory, an industry consulting firm. “Wages have to be reset to make the industry more attractive” for workers.

Boeing’s Mounir acknowledged that lower wages are a problem further down the supply chain and said that Boeing itself should invest in their training.

“There’s no question about it,” he said. “I don’t expect these smaller suppliers who are essential to the ecosystem to be able to shoulder that burden. We have to do it ourselves at the higher level, again, leveraging our balance sheet. It will pay off.”

It takes more time to train workers like “bakers, butchers, people working in a very different business area” who are new to the aerospace field, said Airbus’s Delphine Bazaud, head of industrial supply chain and digital operations.

Michaels, of AeroDynamic Advisory, predicted that in the case of the U.S., more aerospace work will eventually move abroad, “to places where labor is available.”