Since the Covid-19 pandemic, the demand for Narrowbody aircraft types, the Boeing 737 and the Airbus A320– two dominating models- has increased dramatically due to reopening borders and a fresh demand for travel.
Over the past 12 months, East Asian airlines have been steadily increasing their fleet of New Tech Narrowbody aircraft; as the graph shows, the fleet has grown to have a total of 151, including new as well as used units. This is set to grow more rapidly as production growth and expansion demand are high in the region, with the current monthly average delivery of 32 aircraft set to rise by 10-20%.
A Continuous Demand for Narrowbody Aircraft
Even with the development of newer models, there are no signs of Boeing 737 older generation models’ demand slowing down. The lack of significant change in inactive models in the figures below suggests that demand for New Tech and Old Tech Narrowbody aircraft is linear, meaning demand is constant, resulting in an increase in market value. However, supply chain issues could be a driving force for these consistent statistics regarding the push for New Tech aircraft deliveries, although it seems East Asian airlines do not want to retire their old tech fleets but are, in fact, debating 4 to 6-year lease extensions according to discussions between industry players.
High Demand from China for Airbus models
While Boeing 737 Classics and Airbus A320 families operated in East Asia currently in use are respectively even, there is an evidential shift away from Airbus models, with a higher percentage of Airbus A320neo aircraft on order, displaying not only a shift away from the Boeing 737 Old Tech family, but also demand for Boeing 737 MAX aircraft. These orders are dominated by Chinese airlines, accounting for 47% of Airbus orders, whereas countries such as South Korea and Japan are placing more orders for Boeing aircraft.
However, Airbus is due to introduce the A321XLR into service in 2024, aiming to establish itself as customer satisfying commercial aircraft and having the potential to be used as a replacement for airlines looking to replace Widebody capacity. These aircraft are popular for regional flying and so, with China’s high demand for Airbus A320neo aircraft, it is likely that the A321XLR will also be favoured.
The Aftermath of Covid-19
From this, it is evident that the market is ever-changing and complex; with the influence from global Covid-19 pandemic and a new demand for travel, the East Asian airline market as a whole, it seems, has steered its demand in the direction of Airbus aircraft and away from Boeing products, significantly changing the East Asia’s aircraft portfolio. While there are many influences on the reasoning behind this, the market will, and does, continue to develop and change with global influence beyond prediction.
What are your thoughts on the post Covid-19 demand for Narrowbody aircraft? Let us know in the comments.
