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Meeting demand of Vision 2030 is far from plane sailing

Airbus and Boeing's order books are already filled to the brim

Gulf airlines plane orders backlog Riyadh Air
Plane makers Boeing and Airbus have order backlogs due to the growth of airlines – and the launch of new ones such as Riyadh Air

As we know, there are some extremely ambitious targets for passenger growth in Saudi Arabia over the next decade.

And while the kingdom’s new airport terminals are under development and airlines are launching their branding and liveries, it seems that one fundamental question is being forgotten: where are the planes coming from for all this growth? 

The aviation industry’s post-pandemic bounceback has resulted in a swathe of new orders in the first half of this year.

In February Air India put in for 470 aircraft. In March a combination of Saudia and Riyadh Air placed a large wide-bodied order. Last month Ryanair asked for 150 single-aisle planes.

That giant order book is likely to be swelled by an impending 500 single-aisle Airbus request from Indigo, India’s largest low-cost airline. 

This week Riyadh Air also indicated that it is close to placing an order for 150 single-aisle planes. 

Even before this year both major manufacturers, Airbus and Boeing, were in the fortunate position of having full books which will keep them employed well into 2030 and beyond.

At the end of 2022 Airbus had a backlog of 6,373 single-aisle and 619 wide-bodied aircraft to deliver.

Current production rates for Airbus single-aisle aircraft are 43 per month – giving the company 12 years of orders already placed.

Airbus hopes to increase production to 65 planes a month by 2024 but, even then, that’s eight years of guaranteed cash.

And that is before the Indigo order is placed and the resolution of a dispute with Qatar Airways means that another 73 A320s is to be added. 

As the table below shows, the five largest outstanding single-aisle aircraft orders for both Airbus and Boeing highlight the scale of the challenge for any new airline seeking to secure planes quickly and jump the queue. 

1Indigo – 482United Airlines – 408
2Air Asia – 362Southwest Airlines – 369
3Wizzair – 288Ryanair – 258
4Frontier – 218Lion Air – 229
5Air India – 210VietJet – 200
Source: Airbus & Boeing Order Books

All the airlines listed are in growth mode and are unlikely to contemplate delays to their planned delivery dates, especially as a percentage will be for fleet replacement purposes and improved carbon emission credentials.

Those numbers already look daunting.

But once delays in aircraft deliveries are factored in – a common occurrence nowadays – then taking delivery of shiny new planes is likely to be problematic for any airline which has not already secured its place in the production queue.

All of which suggests that aligning aircraft orders with the growth ambitions of the Saudi airlines will be challenging, to say the least.

Available aircraft are not the only hurdle in reaching the ambitious targets for Vision 2030.

The whole aviation industry is suffering from shortages of qualified and experienced manpower.

A recent report by business consultancy Oliver Wyman forecast an industry-wide shortage of almost 80,000 pilots by 2032. This includes a shortfall of 18,000 across the Middle East – 22 percent of the total.

While the packages on offer in Saudi Arabia will be among the most attractive on the market, finding that labour will still be a constant challenge.

Riyadh Air claims it has already received expressions of interest from 336,000 potential employees including 48,000 pilots. Quite how well qualified those candidates may be is not clear.

Of course, not all of the aircraft required for Saudi Vision 2030 need to be delivered overnight. And any airline which accepts such volumes of planes needs to undertake careful planning. Deliveries must be phased over a number of years.

But the hard facts are that reaching 300 million passengers by 2030 seems increasingly difficult.

While both Airbus and Boeing would undoubtedly love to secure more large orders, the physical delivery of those aircraft on time – and to the needs of Vision 2030 – will be very, very hard.

John Grant is partner at UK consultancy Midas Aviation

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