It’s been a few days since Farnborough hosted the Aerospace Industry, and in that time, Boeing has appointed Kelly Ortberg, a highly respected executive, as its next CEO. This nomination has been widely applauded by industry experts. Let's dive into the key findings from the event and their implications for the AAM INDUSTRY.
NEW AIRCRAFT ORDERS:
There wasn’t much excitement on the new aircraft order front, despite Boeing securing a deal with Korean Airlines for 50 widebody aircrafts, including the 777Xs and 787s. However, this wasn’t a big surprise, given the nearly 10-year wait time for new aircraft. Airbus, once again, claimed the crown for the largest order of the week in terms of volume on the penultimate day of the airshow, announcing an agreement with Saudi carrier flynas for 75 A320neo and 15 A330neo aircraft.
The trend toward stronger widebody aircraft orders continues, indicating that this market is not disappearing. Despite slower growth compared to emerging or point-to-point markets, around 25% of long-haul seats are still on jets that carry 330 seats or more. Boeing released an outlook projecting the global commercial jet fleet to grow from 26,750 aircraft in 2023 to 50,170 by 2043, with 47% being replacements and 53% representing new aircraft orders.
SUPPLY CHAIN DISRUPTIONS:
Supply chain disruptions remain a dominant theme, with some predicting they will last another two years—although, didn’t we hear the same prediction two years ago? At the Le Bourget Airshow in 2025, we might still hear people saying it will take another two years to resolve. During the Farnborough event, McKinsey organized a panel on the supply chain, with various executives weighing in including Boeing`s Senior VP of Supply Chain & Fabrication, Ihssane Mounier.
McKinsey Panel on Supply Chain Turbulence @Farnborough Airshow
In other occasions during the show, Airbus Commercial Aircraft CEO Christian Scherer highlighted that part of the problem lies in suppliers second-guessing Airbus's production targets. “We don’t want the supply chain to disbelieve what we are telling them regarding output milestones,” he said. Boeing Commercial CEO Stephanie Pope emphasized that Boeing now has a “much different engagement model with suppliers,” including weekly CEO-level meetings and deploying “hundreds and hundreds” of staff to supplier factories.
AAM IS GETTING REAL:
AAM companies had a strong presence at the airshow, led by Supernal, which had an exclusive chalet and billboards everywhere, along with aircraft displays from EVE, Joby, Lilium, and Vertical. Just before the show began, Lilium announced a significant order from Saudi Arabia for 50 aircraft, plus 50 options, with prepayments dependent on achieving certification and performance milestones. This, and combined with may be the well needed lifeline up to Certification for the company
A new forecast from Aviation Week’s fleet data team predicts 2,000 commercial deliveries of electric vertical-takeoff-and-landing (eVTOL) vehicles by 2030, double the 1,000 units predicted in last year’s study. By 2040, Aviation Week projects nearly 12,000 eVTOL deliveries worldwide, a 20% increase from the 2023 forecast of 10,000. By 2050, they foresee 33,000 eVTOL deliveries, a 10% increase from the 30,000 predicted last year.
PERSONAL HIGHLIGHT:
A personal highlight was reconnecting with so many familiar faces, making new connections, and witnessing the resilience of this industry, with an emerging new market segment becoming more and more real. The 1-on-1 exchange with JoeBen Bevirt (Founder & CEO of Joby Aviation) at the Roland Berger Sustainability Breakfast was particularly insightful. It provided a deeper understanding of his vision for the market, especially in manufacturing, as Joby is following the blueprint of Elon Musk’s Tesla and SpaceX by being fully vertically integrated.
Taking a seat at the Joby Demonstrator @Farnborough Airshow
PERSONAL LOW-LIGHT:
The commute from London to Farnborough and back was a low point. Come on, guys, you’ve been hosting this show for years—can’t you finally sort out the logistics?
WHAT´S NEXT:
Looking ahead to the Le Bourget Paris Airshow in 2025, Paris Airshow CEO Guillaume Bourdeloux mentioned that the event, scheduled for June 16-22, is selling out chalets like hotcakes. One chalet line is already sold out, and the booking trend mirrors that of 2019. Exhibitors are also requesting more space. SPACE & AAM will have an even stronger presence. In 2023, AAM was featured in a dedicated hall right at the entrance of the airshow. In 2025, however, urban air mobility exhibitors will be treated more conventionally, no longer grouped in a specific zone. Artificial intelligence and quantum computing may also be highlighted innovations. There’s a lot to be excited about and look forward to.
BUT, WHAT DOES ALL THIS IMPLY FOR THE AAM MARKET?
First and foremost, the great news is that AAM IS HERE FOR REAL!
My personal perspective is that it will become a significant market, complementing existing mobility—not just air mobility, but how people move around, particularly in large cities. How big this market will be remains to be seen, and much will depend on the price point for the end customer. The closer we can get to an UBER-X price, the higher the odds for success. It will be crucial to establish and maintain a collaborative spirit among the industry, including governments, city leaders, aviation authorities, private investors, and OEMs & Suppliers.
However, a growing AAM MARKET, with multiple players producing more than 10,000 eVTOL aircraft by 2040, will put even more pressure on the existing aerospace supply chain, especially for Tier 1 Structures Suppliers. Compared to 2-3 years ago, there is already less appetite from these suppliers to get involved with AAM OEMs. There’s less risk tolerance and more selectiveness regarding whom they choose to work with.
On the other hand, the market remains attractive for Tier 1 suppliers for two main reasons: a) most technological advancements are happening in AAM, which is crucial for positioning in the next single-aisle program—still the bread and butter business for this group of suppliers; and b) if you bet on the right horse and we get close to projected production rates, this could potentially double your company’s revenue by 2030 if you secure a significant share of work.
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