Sept. 12, 2022, © Leeham News: Widebody aircraft demand cratered during the COVID-19 pandemic. It’s still depressed.
But the chief executive officer of lessor BOC Aviation sees recovery in the works.
“We’re beginning to see quite a big pickup in demand for widebody aircraft,” Robert Martin told LNA in an interview late last month. “Not now but starting next year. What’s prompting that is people are beginning to realize that China will probably open in the fourth quarter this year for international traffic. Just to give you some statistics, if you go back to 2019, China outbound was more than 70 million passengers. Last year was 1.5 million, and so the amount of uplift is quite full.”
Boeing resumed deliveries of the 787 in August, completing about a half-dozen by the end of the month. There were 120 787s in inventory when the Federal Aviation Administration authorized Boeing to resume deliveries. Boeing suspended deliveries in October 2020, when small flaws in production were discovered. (A couple of 787s were delivered in May 2021.) It’s taken this long for Boeing to understand the scope of flaws, design a fix and obtain FAA approval.
Boeing consolidated production of the 787s from two assembly lines, one in Everett (WA) and the other in Charleston (SC), to one. Everett’s production line was closed. During the delivery suspension, production in Charleston was reduced to 0.5 aircraft per month. Boeing plans to ramp this rate up to 5/mo over time. The plant can accommodate a production rate of 12/mo, though returning to this level is unlikely. The Everett line is busy with reworking the inventory aircraft fixing the flaws.
BOC Aviation had 22 787s scheduled for delivery through August last year. Four had been delivered before Boeing suspended deliveries. It canceled three orders during the pause. It took delivery of three of the six 787s delivered last month. Five more are due for delivery by year-end.
“Finally, we’re back,” Martin said.
It probably will take Boeing through 2024 to clear the 787 inventory. Some of this time will accommodate lessors who lost lessees during the delivery pause. These lessors must remarket the airplanes and reconfigure them to new lessee standards. Obtaining new interiors and in-flight entertainment systems could take time.
“I think what you’re going to find is that since a lot of the customers placed their original orders, their requirements have changed. We’re going to find some customers who don’t want as many as they originally ordered. Some will want more as markets open up, both next year. I think we’re going to see a big moving round of that order book, particularly on the ones that were on the ground at the moment,” Martin said.