For those who attended the Paris Air Show, it will be remembered for the lousy weather—it poured rain each of the first three days, when attendance by industry professionals is heaviest—a train strike on day two that created the sort of dreaded work-day commute only the French know how to serve up to locals and visitors alike—and a record number of orders for commercial aircraft. That includes the 730 new aircraft deals Airbus raked in valued at more than $73 billion. It was a testament going into the bi-annual technology and marketing extravaganza of the strength of the pent-up demand for more efficient aircraft.
Such sales activity is the stuff of big headlines in the trade and business press, lots of photo ops, and visions of the commercial aircraft manufacturers and their supply chains having all the work they can handle for years to come. Here’s the back-story: it may well be more work than they can handle.
Officially, OEM executives insisted they would be prepared to manage higher production rates to meet demanding delivery schedules. With only a few notable exceptions, so did major subsystem suppliers of engines, avionics, pumps, landing gear assemblies and the like.
As much as many industry professionals (and aviation/aerospace journalists) dread the grind of 15-18-hour days that are routine at the Paris Air Show, and Farnborough too, the great thing about the events is that draw virtually all of the major decision makers, outside consultants to the contractors, major investors and industry analysts. All of them provide an invaluable reality check. By filtering through these other groups information released through official company channels, journalists are able to separate fact from, well, fiction, or at least wishful thinking.
The upshot is that there is more than just isolated skepticism that OEMs will be able to manage the production ramp-up as smoothly as they would have you believe. In fairness to them, and their major suppliers, they have been conducting supplier-by-supplier assessments to determine their readiness level. There is no such thing as an unimportant tier of suppliers; all are interdependent to the point that shortages of raw materials at the lowest rung of the ladder eventually can disrupt workflow at the OEM level.
And keep in mind that airframe manufacturers for all markets — that includes civil, commercial, business and military — purchase components from the same suppliers. Think back to what happened not too long ago when fasteners were in short supply.
There is no question that airframe manufacturers and second-tier subsystem producers are mindful of the risks in taking so many orders in such a short period to meet market demand. It’s not a bad problem to have, assuming you can meet commitments to customers, and it’s a sight better than the alternative of having a dearth of orders.
Only time will tell whether the supply chain will choke on the fat order books they have built. Let’s hope the skeptics — including me — turn out to be wrong, because if they prove to be right, everybody loses.