TIM ROBINSON reports from the fourth and final trade day of the 2017 Dubai Air Show and provides analysis. 

Those who thought the last trade day of the air show would quietly peter out in terms of big commercial aviation news had their expectations confounded when not one, but two massive airliner orders were announced by both Airbus and Boeing, each deal setting records. Let's take a look at the biggest headlines.

 

Airbus wins record-breaking deal for 430 aircraft

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Bulk buying gets you a deal. (Airbus)

Having started the week on the back foot, when a heavily-rumoured Emirates A380 order was upstaged at the last minute by a Boeing 787 order, Wednesday saw Airbus return to form, with its master salesman John Leahy delivering the wow factor that he is known for, with an record-breaking $49.5bn deal for a staggering 430 A320 family aircraft for US airline investment fund Indigo Partners. (No relation to Indian low-cost airline IndiGo, which coincidentally held the previous Airbus record for largest ever single order (250) in terms of numbers)).

The deal, a Memorandum of Understanding (MoU) with Indigo Partners is for 273 A320neos and 157 A321neos. Valued at $49.5bn, the order will be divided up among Indigo Partners’ four portfolio low-cost airlines - Frontier Airlines in the US (100 A320neos, 34 A321neos), JetSMART in Chile (56 A320neos, 14 A321neos), Volaris in Mexico (46 A320neos, 34 A321neos) and Wizz Air in Hungary (72 A320neos, 74 A321neos). Newest of these is three-month old JetSMART which is looking to emulate the ultra-low cost model in South America. First deliveries for these airlines from this bulk order will begin in 2021.

Based in Phoenix, Arizona, Indigo Partners is a private equity fund focused on worldwide investments in air transportation, and its founder Bill Franke has pioneered the stripped to the bone ultra-low cost model. Airlines operated by Indigo Partners have had previous orders for 427 A320 family aircraft, making Indigo one of the largest customers by order number in the world for the Airbus single-aisle aircraft family.

The deal crowns a legendary career by outgoing Airbus sales chief, John Leahy, who was set to retire by the end of this year. However, he has been reported to be staying on while Airbus searches for a successor, who may also have the task of selling the CSeries.

 

Boeing stuns with record-breaking 225-aircraft flydubai order

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UAE carrier flydubai has ordered 175 737 MAXs. (Boeing)

While aviation media were still digesting the enormity of the Airbus deal, Boeing had a surprise up its sleeve too, with a 225 737 MAX order from the UAE's low-cost carrier, flydubai. This, which consists of a commitment for 175, purchase rights for 50, is the biggest ever single-aisle order for a Middle East carrier. More than 50 of these 737 MAXs will be of the new 10 variant, which Boeing launched with fanfare at Paris earlier this year – the rest will be split between MAX 8 and 9 variants. The follow-on MAX commitment from flydubai, which now has three MAX 8s in service from an order placed at the 2013 Dubai Air Show takes the total MAX backlog at Boeing to over 4,000 aircraft.

 

Flatpack deployable air power

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Affordable and deployable air power

Military customers struggling to decide between the two heavily-armed converted cropdusters at the show, the Iomax Archangel Block II and L3 AT-802L LongSword, might be won over by the USP of the Iomax Archangel, based on the Thrush agricultural aircraft. The Archangel, proclaims Iomax, is the only COIN aircraft in its class with removable wings, enabling the otherwise extremely slow-speed aircraft to be quickly redeployed elsewhere in a large transport aircraft. A C-17, for example, can take two Archangels in its cargo bay. The Block II variant features a upgraded sensor ball, the L-3 Wescam MX-25, which increases stand-off range.

 

CBD firms up A320neo deal

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The A320neo is a popular choice for lessors (Airbus)

If these order announcements weren’t enough, Dublin-based CDB Aviation Lease Finance announced an order for 90 A320neos. However, this order was not completely new, as it was made up from a previously unannounced order for 45 A320neos made in 2014 and the ‘firming up’ of an MoU for 30 extra A320s made at the Paris Air Show in June.

More last minute deals ...

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The orders keep coming - SCAT is to buy six Boeing 737 MAX 8s (Boeing)

Even after the official trade days of the show ended - new orders keep being announced. The latest announcement was that Kazakhstan-based SCAT Airlines Boeing has ordered six Boeing 737 MAX 8s valued at $674m. The agreement also includes purchase rights for an additional five 737 MAX 8s. SCAT Airlines currently operates a fleet of 737s, 757s and 767s. 

AAR to help support UAE special ops wing

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Chinook from the UAE's Joint Aviation Command.

US MRO, services and support giant AAR is to help support the UAE's Joint Aviation Command, which flies 12 types, including Chinooks, Apaches snd Black Hawks as well as armed AT-802 cropdusters, with a MoU with Global Aerospace Logistics (GAL), a subsidiary of Emirates Defence Industries Company (EDIC) to develop enhanced support services, including performance-based logistics. 

 

No pressure, says Embraer

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Legacy 500 on static.

Embraer announced that it would be ‘enhancing the flight experience’ on its Legacy 450 and Legacy 500 business jets by increasing the cabin pressurisation differential. The current maximum cabin altitude of the aircraft is 6,000ft when flying at 45,000ft. By increasing the pressurisation differential from 9.3 psi to 9.73 psi, the maximum cabin altitude on both aircraft can be reduced to 5,800ft. The aircrafts’ environmental control system also preserves a sea-level cabin altitude while flying under 27,050ft. Deliveries of these Legacy aircraft with the new cabin altitude enhancement will commence in Q1 of 2018.

 

Incubating local aerospace talent

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Rockwell Collins has joined the Entaliq innovation initiative in Saudi Arabia. (Rockwell Collins)

Rockwell Collins has joined an initiative with Airbus, TAQNIA Aeronautics, the Saudi Technology Development and Investment Company, Saudi Arabian Airlines and other Saudi companies to support the Entaliq aviation innovation challenge for students. Organised in conjunction with the King Abdulaziz City for Science and Technology (KACST) in Saudi Arabia, the programme gives students the opportunity to share innovative ideas for the aerospace industry. In 2018 a panel fo judges will select three winners for an incubator programme to help the selected students to industrialise their ideas.

 

UAE orders C295MWs

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UAE Air Force & Air Defence has ordered five Airbus C295s. (Airbus)

Finishing off a week of defence announcements from the UAE MoD, was an order for five Airbus C295MW (military winglet) medium transport aircraft. The aircraft will serve with the UAE Air Force, replacing CN235s currently in operation. Deliveries will begin in Q4 2018.

 

EgyptAir to become newest 787 operator

Rounding off a newsworthy week for EgyptAir, which had made headlines with Bombardier CSeries order, the airline announced two new deals for both Boeing and Airbus aircraft with aircraft lessor AerCap. The first is for six Boeing 787-9s powered by Rolls-Royce Trent 1000 TEN (Thrust, Efficiency and New Technology) engines and the second is for 15 Airbus A320neos powered by CFM Leap-1A engines. Both orders are scheduled for delivery in 2020 and will be supplied from the lessor's existing order book.

 

V-22 reaches 400,000 flying hours

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The V-22 has hit a flying hour milestone.

With a USMC MV-22 example out on static, Bell and Boeing announced that the Osprey fleet had now passed 400,000 flying hours since it entered service in 2007. In service with both the USMC and USAF, upcoming tiltrotor operators include the US Navy and the first international customer, Japan, which had its first Osprey delivered in August.

 

Last-minute shopping for Air Sénégal

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Air Sénégal is the first African airline for the A330neo. (Airbus)

Announced just at pixel was going to press on the fifth day of Dubai – was a MoU for two Airbus A300neos for Air Sénégal. The airline becomes the first African carrier to order the revamped widebody airliner. Rolls-Royce was quick to add its own announcement that the aircraft will be powered by Trent 7000 engines.

 

Business aviation gets boost in Bahrain

Hala Bahrain and MENA Aerospace have signed an agreement to work together at Bahrain International Airport (BIA). Hala Bahrain owns the airport’s new business aviation terminal due to open in January while MENA provides aircraft management, charter and maintenance, repair and overhaul services and owns the airport’s only business and GA aircraft hangar. Under the agreement, MENA will extend its services at the airport to include ground handling for business aircraft owners and operators.

 

RAeS President gives Sir Maurice Flanagan Named lecture

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Sir Stephen Dalton at the UAE Branch.

Wednesday evening also saw RAeS President Sir Stephen Dalton, hosted at the Emirates Flight Training College, give the RAeS UAE Branch Sir Maurice Flanagan Named lecture. The event saw a packed auditorium for the talk, which is named in honour of the founding CEO of Emirates. 

 

Thales to supply Emirates 777X IFE

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Emirates is to install Thales inflight entertainment and connectivity systems onto its new 777Xs. (Thales)

Emirates confirmed its commitment to installing Inmarsat’s GX Aviation inflight broadband for its forthcoming fleet of 150 Boeing 777Xs currently on order. The announcement was made at the show by Inmarsat’s partner company Thales which is to supply the inflight entertainment and connectivity (IFEC) systems onboard the aircraft. The first Emirates’ 777X is due to be delivered in 2020.

 

CTT extend parts contract

Swedish aircraft cabin humidity and moisture control systems specialists, CTT Systems announced a five-year extension to Satair Group’s existing ten-year exclusive global spare parts distribution contract for CTT’s equipment portfolio. Under the contract Satair Group is responsible for spares sales and deliveries to the aftermarket, allowing CTT to concentrate on sales and product deliveries.

 

Final sales tally

Order total (end of Day 4): 701

(Total excludes confirmation of previously announced orders)

 Airbus (455)

25 x A320neo family for Wataniya Airways (LoI)

100 x A320neos and 34 x A321neos for Frontier Airlines (MoU)

56 x A320neos and 14 x A321neos) for JetSMART (MoU) 

46 x A320neos and 34 x A321neos for Volaris (MoU)

72 x A320neos and 74 x A321neos for Wizz Air (MoU)

2 x A330neos for Air Senegal (MoU)

 Airbus Military (5)

5 x C295s for UAE Air Force & Air Defence 

 Boeing (227)

40 x 787-10 for Emirates

5 x 787s for Azerbaijan Airlines

2 x 777F for Ethiopian Airlines

175 x 737 MAXs plus 50 purchase rights for flydubai

5 x 737 MAX 8s for SCAT Airlines 

 Bombardier (12)

12 x CSeries CS300 firm for EgyptAir plus 12 purchase rights. (LoI)

 

Analysis - firm sales or fake news?

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What $49,5bn looks like...

As in previous air shows, despite the mind-boggling figures and the last-minute theatrics, it is wise to retain a certain amount of cool assessment when dealing with commitments and MoUs and the like. Of the nearly 700 orders announced at Dubai, just under 30 are finalised firm orders. The rest represent either commitments, options or purchase rights.

Second, is that the list price is never paid, and the more you order, the bigger the discount. As John Leahy quipped during of the Indigo Partners $49.5bn deal: "regrettably they did not pay the full price". Bulk shopping and pooled orders from multiple airlines – with private equity firms or investors fronting the deal, though difficult to co-ordinate, could become more popular as airlines discover new ways to extract discounts from manufacturers.

Third, the extended waiting times mean that a lot can happen between now and when airlines might take delivery – the airline might re-evaluate its fleet needs, change suppliers or even go bust. Emirates' headline order, for example, for 40 787-10s that kicked the show off, has to be seen in the context of an earlier cancellation for 70 A350s just three years ago.

Nevertheless – these announcements represent a vote of confidence in ongoing demand for global air travel which, despite wars, terrorism, pandemics, and economic downturns, always seem to bounce back as more people around the world are able to fly – especially with the new breed of low-cost carriers that have revolutionised commercial air transport in the US and Europe.

 

A reminder for the White House – aerospace is a global industry 

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We can shop elsewhere, you know... (Emirates

Boeing's coup on the first day, upstaging Airbus with a deal with Emirates may also have an subtle, yet important message to the US President and his supporters, that supporting key aerospace skills and manufacturing jobs in Seattle and across the US, should be taken into consideration when American carriers protest about unfair competition from Gulf airlines. Indeed, its press release drew attention several times to the "tens of thousands" of US jobs supported by this order, in case anyone was unsure of it.

President Donald Trump is obviously highly receptive to any claims of US jobs being lost but this deal will give Emirates much more leverage in making its case that it is helping support jobs in the US by buying Boeing. It is notable too that Boeing's official press release about the flydubai 737 order – an airline which does NOT compete with American, Delta or United has this sentence " the purchase promises to sustain tens of thousands of direct and indirect jobs in Boeing's US factories and network of suppliers" in only the second paragraph. The hint to Washington DC protectionists is that these airlines are solid US customers and that unravelling Open Skies could threaten Boeing's market share in this fast-growing market and push these customers into buying rival aircraft - thus costing highly skilled US manufacturing jobs.

 

Battle of the -35s

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When might the UAE get the green light to buy F-35s? (Lockheed Martin)

Despite a week of UAE MoD orders and announcements, the Russian Knights aerobatics and the jaw-dropping Su-35 flying in the display, Russia was unable this week to clinch a firm order from the UAE AF for the Su-35. Instead, reports suggested that the UAE was still keen to acquire the Lockheed Martin F-35 stealth fighter, with Defense News saying there was a requirement for 24 F-35s or two squadrons. While it will most probably be a question of 'when, not if' the UAE is allowed to buy F-35s, there still remain challenges for export approval, particularly if the UAE is serious about its plan to acquire Russian Su-35s as well.

 

A380 – waving goodbye?

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End of the line now?

In a perfect case of bad timing, the air show also coincided with the first A380 from Singapore being delivered into storage in Tarbes after only ten years in service– a further psychological blow on top of the last-minute breakdown in sales talks with Emirates. News reports suggest that negotiations stalled on Emirates desire for Airbus to make a commitment to keeping the A380 production line going for at least further decade before they signed an order. However, while the collapse of the sale at the final hour destroyed any hope of an announcement at the show, negotiations still continue and it may well be that the sides come together and an agreement is reached in the next few months,

 

Space front and centre

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Full size model of UAE Mars Hope probe at the air show.

With the UAE aiming to conquer the final frontier, spaceflight took on a higher profile at this show, with prime positions for the UAE Space Agency, a full size model of its Hope Mars probe, and Boeing bringing its CST-100 Starliner simulator to the show. Ambitious plans for a city on Mars, a Martian simulation facility and the creation of a UAE astronaut corps means that space will become a bigger and bigger presence at future Dubai air shows.

 

China rising

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The AVIC stand grows every air show.

This Dubai also provided further proof of the rise of China as the next great aerospace and aviation power. An appearance by the PLAAF 1 August display team, a massive AVIC stand that included a full UAV GCS, and three UAVs on show, including a new jet-powered armed UCAV, demonstrated the growing confidence and marketing ambition of China on the global defence scene.

 

Ssh – don't mention the...

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Missing in action? (Volocopter)

While those covering the airshow were bombarded by a barrage of announcements, interviews, briefings, press releases and breaking news alerts, there were, oddly, three areas where there was an uncanny silence.

Qatar - the crisis between the UAE, other Middle Eastern nations at Qatar meant that the air show was missing its usual Qatar Airways static display – along with a chalet and other presence. However, the delicate situation also had knock-on effects. Airbus, for example, choose not to send its Airbus A350-1000 – given that the launch customer is Qatar. Meanwhile a briefing over at Eurofighter saw the organisers steer the Q&A away from active sales campaigns – again with an eye on a recent Qatar announcement that it intended to purchase Typhoons.

Airbus/Bombardier - another quiet zone was the CSeries annoucement – and its potential to shake up the industry. While one reason was that this deal is yet to be confirmed, another might be the intense internal high-level battles going on at Airbus. Those expecting joint press announcements, initial thoughts on product commonality were to be disappointed. Even social media, where normally serious corporations can add a bit of fun, there was no recognition that the Airbus family was getting a new member. In this wedding, both groom and bride seemed to be terrified of being seen in public together ahead of the ceremony.

Aerial taxis – with seemingly a flying car concept being released ever week and a real one, mock-ups and models on display earlier in the year at the Paris Air Show, it was thus curious that an air show held in a city which is leading the way in trialing this transport, they were nowhere to be seen – not even on stands. A puzzling one for flying car fans.

 

Local heroes

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SAFAT 02 helicopter from Sudan.

Another theme at this years Dubai was an upsurge in local manufacturing and production projects in the region. A new light attack aircraft, the Calidus B-250, is to be built in the UAE, while Saudi Arabia showed off two aircraft – a MALE UAV from KACST and the An-132, a joint project between Tariq and Antonov. Other projects are also bubbling under, with the Russia's Rostec raising the possibility of the UAE having its own airliner production line in the form of the UAC MC-21.

 

Summary

In short, despite outside pressures of geopolitics, protectionism and competition, the aviation industry showed that once again it can defy gravity. See you at Dubai in 2019!

Tim Robinson and Bill Read
16 November 2017

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