Karim Sahib | AFP | Getty Images
DUBAI, United Arab Emirates – The last Dubai International Airshow held in November 2019 seems like a new era.
Just months before the Covid-19 pandemic turned travel upside down, the biennial high-traffic aviation event marked an industry that looks very different today.
But almost two years after the travel and air travel industry practically stalled, the market is starting to grow again.
Dubai Air Show 2021 kicks off Sunday 14 November. What to expect:
Rebuilding the tourism industry?
Travel gear is improving thanks to the ongoing successful rollout of vaccination campaigns and the relaxation of government Covid restrictions.
“Executives are cautiously optimistic about the future,” wrote aviation analysts at consulting firm Accenture in a note ahead of the show.
The company predicts 13% year-on-year growth in the commercial aerospace industry in 2022 globally, although this year it will still be 4% below the 2019 level.
Dubai’s flagship carrier Emirates Airline – the Middle East’s largest airline and largest aircraft buyer – has partially recovered its position, cutting its previous losses on an 86% six-month revenue growth for fiscal 2021-2022.
However, concerns about potential new Covid variants, inflation and rising energy prices leave significant uncertainty for the industry. The Dubai show is bound to have a lot of discussion about the industry’s recovery, as well as how aviation has become safer and more hygienic in the wake of the pandemic.
Due in part to this uncertainty, and also due to the fact that there are fewer air shows in Dubai than in Paris or Farnborough, analysts do not expect to see many large orders this year. This is also because orderbooks for Gulf carriers “tend to be more grassroots focused,” said Sheila Kahyaoglu, aerospace and defense analyst at Jefferies. “So I think with the slower international traffic, I just don’t think this will be a catalyst for more orders.”
The disruption of the global supply chain has impacted many industries, and the aerospace industry is no exception.
In the aviation field, supply chain shortages mainly affect the defense space, Kahyaoglu said. “In communications systems, ships, semiconductor parts – wherever they hit the rest of the world.”
In the business jet segment, the impact is less, as fewer private jets are produced per year than other types of aircraft, but this still “creates a slight shortage of parts, so original equipment manufacturers.” [original equipment manufacturers] should be aware of their material purchases, ”Kahyaoglu said.
More than half of aerospace executives – 55% – “expressed lower confidence in the timeliness and quality of their supply chain over the next six months,” according to Accenture.
Only one segment of air travel exceeded the level of 2019, and that is cargo.
People may have stopped traveling for a long time, but e-commerce and the movement of goods continued to grow. Before the pandemic, a significant amount of cargo was transported in the belly of passenger aircraft. But after those planes went offline due to increased travel restrictions, says Richard Abulafia, vice president of analysis at Teal Group, “all of a sudden people said, ‘Hey, we need special cargo planes because this cargo isn’t available “. “
“You will see Airbus talk about the cargo version of the A350 XWB airliner, and maybe even launch it,” he told CNBC.
“And you can see the same with Boeing with the 777X cargo version, the latest 777 that has compound wings and the like. It will be really interesting to watch because the Persian Gulf is a pretty big cargo market.”
Indeed, in Emirates Airline’s last half-year profit, cargo operations have been robust, increasing 39% and bringing the business to 90% of the volume it had in 2019.
On the defense front, attention will remain focused on whether the sale to the UAE of the Lockheed Martin F-35 II Joint Strike fighter, written on the last day of the Trump administration, will be sold. The gigantic $ 23 billion sale, consisting mostly of 50 F-35 jets and no fewer than 18 armed drones, is reportedly still under discussion between Washington and Abu Dhabi.
Previously, U.S. export laws and regulations prevented it from selling lethal drones or F-35s to any of its Arab allies. But the changes made by the Trump administration made it possible, meaning that if completed, it would be the first sale of F-35s and American combat drones to any Arab country.
There is also “a general trend towards continued modernization of the fleet of fighters, mostly upgraded fourth-generation platforms,” said Justin Bronk, Fellow of Air Force and Technology at the Royal United Services Institute in London.
The fourth generation broadly refers to fighters in service from the 1980s to the present, with multi-role functions and more advanced technologies than their predecessors, such as infrared search and tracking capabilities and digital avionics.