Airline traffic is picking up, and some scrappy carriers are moving into new markets where they see opportunity amid the financial devastation -- which should eventually translate into new airplane orders for the jetmaking giants, U.S.-based Boeing Co. and European rival Airbus Industrie, experts say.
"On the assumption that the U.S. recovery is real, we're clearly past the low point," said Peter Hilton, a Hong Kong-based aerospace analyst for investment bank Credit Suisse First Boston. "Now, the airlines might be thinking about the extent to which they should unwind some of the job cuts they made last year, and horror, shudder, when they should revive some of the (airplane) orders they put on hold. Some might even be looking to expand."
The senior vice president of sales at Boeing Commercial Airplanes, Larry Dickenson, said this crisis seems to be less severe than the one the airlines and plane makers found themselves thrown into by the Persian Gulf crisis in 1990.
The airlines limped into that one with too many jets in their fleets, but in recent years they have purchased more wisely and are set to weather this downturn more quickly, Dickenson said in an interview.
"If you look at each month, it has gotten better and better -- it's slowly coming back," Dickenson said.
He added a cautionary note: "I don't think we're ready to declare victory and say it's over, but it's a lot more positive than I thought."
Others remain far more negative, although defense contractors may be in the best shape right now, with the war on terrorism putting more emphasis on military hardware purchases.
The chief operating officer at jet engine maker Rolls-Royce PLC, John Cheffins, said Rolls-Royce is sticking by its prediction that deliveries would drop by 30 percent this year -- which prompted the British company to announce in October it would slash 5,000 full-time jobs.
Cheffins said he sees "remarkable" similarities between the Persian Gulf crisis and the post-Sept. 11 troubles and said: "It's clear that this time around the impact was greater in the initial months."
Facing eventual competition from a huge Airbus plane, Boeing said Tuesday it plans to offer a new version of its 747 jumbo jets -- dubbed the 747-400XQLR as it is being developed -- that will better meet stringent European noise rules and be able to fly far enough to make new trans-Pacific routes possible.
Boeing's 747s are the largest passenger airplanes flying, capable of carrying more than 400 people, but archrival Airbus Industrie of Europe plans to launch an even bigger jet, the A380, which can carry more than 500 people, in 2006.
Airbus officials declined to comment, saying any news would come Wednesday during a news conference with company president Noel Forgeard.
The new Boeing 747s would be able to fly 9,190 miles, compared to 8,830 miles for the current 747-400ER jets, Boeing said. That, for example, would enable airlines to fly nonstop from New York to Bangkok, whereas the older 747s can go only as far as New York-Hong Kong.
The Singapore air show is Asia's biggest, though it ranks third globally behind the shows held alternating years in Paris and outside London.
http://accesswdun.com/article/2002/2/198250