-
Boeing
- Stock Code:
- BA
- Business Type:
- Planemaker
- Date Founded:
- 1916-07-15
- CEO:
- Dave Calhoun
- Headquarters Location:
- Chicago, USA
- Key Product Lines:
- Boeing 737, Boeing 747, Boeing 757, Boeing 767, Boeing 777, Boeing 787
Summary
- The rebound of the aviation industry after COVID-19 has been surprising, with travel demand quickly reaching pre-pandemic levels.
- The increase in demand is good news for manufacturers, airlines, and customers, as it will lead to more ticket options and competition in the market.
- Boeing’s CEO is confident in the future of the industry and sees the entry of competitors like COMAC’s C919 as a positive development that will help meet the growing demand for air travel.
Boeing’s CEO was caught unaware by the rebound of the aviation industry and the rapid increase in travel demand in the post-COVID era.
The rebound of the aviation industry after the COVID-19 pandemic was strong, with demand quickly reaching pre-pandemic levels. In 2023, while we are yet to properly reach pre-pandemic levels internationally, many domestic markets are already surpassing pre-pandemic levels, which is something that most pundits would not have predicted two years ago.
Photo: Thiago B Trevisan | Shutterstock
The increase is good news for manufacturers, airlines, and, most importantly, customers, who will have more ticket options thanks to the competition among airlines, which will further help the market reach new heights.
Bullish Boeing
Boeing’s Chief Executive Officer, Dave Calhoun, is one of the many figureheads in aviation who was caught unaware by the strong rebound of the industry. In an interview with CNBC, Calhoun offered his thoughts on the turnaround.
“Yes, it is resilient. It’s more resilient than I ever would have imagined coming out of Covid — a lot of pent-up demand for just passenger traffic and tourism, and businesses coming back.”
Commenting on the status of orders and proposals for Boeing aircraft, Calhoun said that demand has been the highest he’s ever seen in his career at Boeing.
Boeing, along with most other manufacturers in the aviation industry, is limited by the global supply chain constraints caused by the pandemic. It is yet to reach pre-pandemic levels and is hindering the aviation giant’s ability to produce aircraft at the pace it would like to.
In August, Boeing delivered 35 aircraft, eight less than it managed in July. A problem experienced by Airbus as well.
COMAC and China
The Chinese domestic market has completely recovered to pre-pandemic levels, and there is room for Boeing and Airbus to sell their products in the market, especially since many airlines are replacing older aircraft and expanding their fleets.
When asked about COMAC’s C919 and if it poses a substantial threat to Boeing’s market share in China, Calhoun said, “I’m actually bullish with respect to my company and China. They need more lift like everybody else in the world.”
Photo: Thiago B Trevisan | Shutterstock
The larger barrier is the tense geopolitical situation between the United States and China, which the CEO hopes will dissipate soon, allowing Boeing to work with the Chinese airlines without any constraints.
The C919 is considered to be subpar when compared to its Airbus and Boeing rivals, especially with range. Boeing estimates that it will take COMAC quite a while to produce a proper rival to the A320neo and 737 MAX.
When talking about the future threat the manufacturer posed to Boeing, Calhoun said:
“We have a giant robust market growing at a very healthy pace. So by 2050, honestly, having three competitors to satisfy that is not the worst thing in the world for aviation. In fact, I view it as a good thing.”
Calhoun encouraged the entry of the C919, as it would help with the increase in travel demand, and suggested that there is enough space for three manufacturers.