In the last few years, the Airbus Group (EPA:AIR) from Leiden, Netherlands have always received more aircraft orders than Boeing (NYSE:BA), which is headquartered at Chicago in the United States. Boeing investors have been concerned about this.
But that seems to be changing now as the American designer and manufacturer of airplanes have taken an impressive lead over their European rival this year. Boeing has taken a good lead after the first quarter of this year. In the first three months, Boeing has received a net of 198 orders. Last year, in the first three months, Boeing had a total of 121 net orders, so this time, the number of orders received is up by more than 50 percent, which is an impressive gain.
Very Few Orders for Airbus
In contrast, Airbus has received only six orders, after cancellations and conversions. That is bad news for Airbus because it is lower than the 10 orders they received in the first quarter of last year. Orders picked up later in the year, though, and Airbus ended up with a record 731 net orders in 2016.
This has been a very quiet quarter for Airbus. In fact, by the end of February, they had more cancellations than orders. That changed in March and Airbus managed to break into positive territory. There were eventually just 6 net orders after the first quarter, which included three orders for the A350 widebody, and nine orders for the A320 narrowbody, minus the two A380 cancellations, and four A330neo cancellations.
Difficult Times for the Aerospace Business
These are difficult times for the aerospace industry. Order inflows have slowed down since 2014 because of several factors, such as economic weakness in some markets, and buyer fatigue. Older planes are being replaced less frequently now as well because of the lower fuel prices. In 2016, for the first time since 2009, Boeing failed to sell as many planes as it delivered.
Because of this, Boeing’s sales expectations for 2017 were fairly modest. Dennis Muilenberg, the CEO said the total number of orders is probably going to be less this year.
Though Boeing (NYSE:BA) has taken an early lead over Airbus, but the Netherlands-based aircraft manufacturer wouldn’t be too worried yet, and Boeing wouldn’t also be taking a victory lap. Aircraft orders usually come in spurts. Three months is not a very long time. Airbus (EPA:AIR) may well catch up in the end with a couple of big deals.