Dubai Airshow opens amid huge doubts about its success
Mohammed bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai and Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, inaugurated the Dubai International Airshow 2019, which runs until November 21.
The exhibition kicked off amid huge doubts about the chances of its success despite the promotion of the UAE system for the participation of 160 countries, 1300 companies and 165 civil and military aircraft in the exhibition.
An eight-month-old crisis over the US-made Boeing 737 MAX and large-scale industrial delays have overshadowed the Dubai Air Show, with some airlines reviewing their fleet plans, while others are looking for bargain deals.
Representatives of companies arriving to attend the event said that the event faced increasing questions regarding the demand and capabilities of exhausted suppliers.
At the forefront of their concerns will be a worldwide halt to the Boeing 737 Max after two deadly crashes.
Investors, who have pushed Boeing shares higher, believe the US aircraft giant is overcoming the crisis after an eight-month halt to flights, as the airline expects commercial flights for the model in January. But it faces a dilemma over the accumulation of the record of aircraft that have not yet been delivered, which could take between one and two years to be discharged.
Government-owned flydubai expects its fleet to shrink by a third this year, highlighting the cost of stopping flights to its 737 Max customers outside the United States.
“Flydubai has very big ambitions,” said Richard Abou Elafia, analyst at Tel Group Aircraft Consulting. “Given the scale of these ambitions, they can only wait and see just like others.”
Earlier this year, Boeing lost a potential customer to the 737 MAX. Saudi Arabian low-cost airline Adele dropped an initial order.
Experts say airline frustrations with aircraft and engine manufacturers could also confuse plans by the world’s largest aircraft makers to win purchase orders.
The biggest event for the Middle East aviation sector will give European Airbus and its US rival the chance to connect with some of their key customers who have threatened to pull out of billions of deals.
Manufacturers are struggling to deliver planes on time, forcing airlines to delay expansion plans, while the engines of some aircraft are constantly causing problems for tankers.
“This seems to be a large-scale systemic problem,” said Munir Kuzbari, managing director of Novus Aviation Capital, a consultancy. As a result, we see tension in the relationship between airlines, aircraft manufacturers and engines.”
Dubai’s state-owned airline has issued a stern warning to aircraft and engine manufacturers and said it would no longer receive aircraft that did not meet its performance expectations, raising doubts about $35 billion in pending orders.
Airbus, Boeing and engine makers will seek to allay concerns as they complete sales of aircraft with Emirates, which is also looking to reduce the volume of order for the Boeing 777X.
Airbus is close to a final order for A330 and A350s, while Boeing aims to salvage an initial order for 787s.
But industry sources say Air Arabia could steal the spotlight at the show, as it plans to order up to 120 Airbus planes.
The Gulf model as a center of operations is under increasing pressure, with the growth of the region’s major airlines, which was once too fast.
“The market is still weak for all airlines in the region,” said Diogenes Papiumitis, director of the Global Commercial Aviation Program at Frost & Sullivan, a consultancy. “We will see a further 2 to 3 percent drop in passenger numbers for the whole year.”
Military commanders from the Middle East, who will tour the exhibits, will try to see if they are on the threshold of a new round of generous arms spending in the region as tensions grow in the Gulf.
A series of attacks over the summer have highlighted possible security gaps in some of the world’s biggest defense spenders, who are now buying more from China and Russia.
