Brimming order books at Farnborough put industry in giddy mood

Last week’s Farnborough Air Show has come and gone, leaving those of us who were there wrestling with a mixed set of feelings in its aftermath.

Alternating every other year with the Paris Air Show, Farnborough is a weather-vane of international aerospace industry performance – a time when you can sense, simply by experiencing the buzz around the exhibition halls and corporate chalets, just how the industry is faring, even before the headline statistics start to roll in.

This year’s show, switched to its new July date from September, couldn’t have had a better start, with speculation surrounding the go/no-go launch of the Airbus A3XX super-jumbo at fever-pitch.

The guessing-game ended on the first day with a launch order for the A3XX from Middle Eastern airline Emirates, which signed a $1.5bn agreement for five passenger and two freighter variants. Other commitments from Air France and US leasing firm ILFC quickly followed.

Boeing struck back with announcements that it had amassed orders for 114 airliners worth around $12bn. But Airbus held the high ground with news that it had sold more aircraft than its US rival – worth around $20bn – over the same period.

Then there were the regionals. Embraer, Fairchild Dornier, Bombardier and BAE Avro, which dominate the regional airliners sector, reported booming activity in this exponentially expanding segment of the market.

The news was confirmation of something the industry already knew: passengers want the same level of comfort and speed from the aircraft that delivers them to their final port-of-call as they get in a trans-continental airliner.

Regional jets are increasingly fulfilling that promise, taking over from where turboprops left off, and the sales are the living proof of it. The dollar-value of the market, spanning the 15-19 seat to the 80-99 seat segments, looks like being worth anything up to $200bn over the next 20 years.

By the second morning of Farnborough, it was clear that something remarkable was occurring. While some people had been reporting that the aerospace industry was at the top of the cycle and slipping backwards, the orders were saying otherwise.

A dollar-value tally of business announced at the show, amended daily outside the site offices of the Society of British Aerospace Companies, was ringing up like a Las Vegas gaming machine. By the end of the week, it would stand at $52 billion – $25 billion more than at Farnborough 1998.

With talk of so many billions floating around the show, it was easy to become inured to it. When seven European defence ministers turned up to confirm that 225 Airbus A400M military transports would be ordered by their respective governments – total value around $18 billion – it scarcely raised an eyebrow.

Everywhere you looked, from the aircraft-makers to the engine manufacturers and the equipment suppliers, the money was pouring in.

It took the Concorde crash outside Paris on Tuesday to break the bubble and bring everyone back to reality of the harshest kind.

While the deals continued, there was a palpably different mood about the show from the second half of the week onwards. The aerospace community, even in the e-business era, is a close-knit one and the loss of an aviation icon against the backdrop of an overwhelming human tragedy, reined it in hard.

For all the billions, technology can break down. And the Paris crash was a reminder that it can do so with the most catastrophic results.

When it comes to converting last week’s dollars into hardware, if a few more of them are siphoned into safety than otherwise would have gone into the bottom line, then perhaps, at the very least, perhaps some good can result from such a terrible tragedy.

Nick Cook is aviation editor of Jane’s Defence Weekly and industry editor of Interavia Business and Technology

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