Airbus trims order book outlook for the Middle East

Pat Batard/Hans Lucas via Reuters Connect

• Prediction cut by 2% for the region
• Expects 1,570 wide-body aircraft
• Global demand on the rise

Airbus has reduced its forecast for demand for wide-body aircraft in the Middle East over the next 20 years.

The European jet maker increased its global forecast for wide-body demand by 9 percent to 8,920 units.

However, it cut its prediction for the Middle East by 2 percent to 1,570 aircraft.

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Despite rising demand globally, there are reports of overcapacity in the region.

Industry-wide, Airbus expects to see deliveries of 42,430 new planes over the next two decades, of which the Middle East will receive 3,740. 

Bob Lange, Airbus’s head of market analysis and forecasts, said Asia’s surging economies, led by India and China, will fuel the rising global demand.

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Dubai’s Emirates is the world’s largest Airbus A380 operator, with about 120 aircraft in service.

Airbus in May signed the largest aviation deal in Saudi history, valued at around $19 billion, with the country’s flag carrier Saudia Group.

The deal is crucial for the kingdom’s 2030 diversification and tourism development plans.

The carrier is due to receive the first aircraft in 2026, with deliveries stretching until 2031.

Saudia Group depends on the aircraft arriving on time to realise its network expansion plans of 145 destinations by 2030. However, Airbus is dealing with supply-chain glitches, forcing it to delay deliveries.

Late deliveries have led to significant compensation and concessions for airlines, according to reports.

Last month, the plane maker trimmed several goals, including the monthly production rate of its A320 model. Airbus launched a cost-saving plan to improve its performance, including freezing headcount at its plane-making subsidiary last week.

Confident

Despite these challenges, Saudia Group said on Tuesday that it was confident that the jets it had ordered would be delivered on schedule.

Airbus invited a Saudia Group delegation to its factory in Hamburg this week to mark the recent plane order and reassure its client on deliveries.

After the tour, Saleh Eid, vice president of fleet management and agreements at Saudia Airlines, said: “We believe that the delivery dates we have got are safe.” 

However, he declined to comment on talks over an eventual follow-up order of wide-body planes.