Richard Aboulafia is VicePresident, Analysis of the Teal Group
The crisis in the eurozone is in full development. IATA has announced that the profits of the aviation sector will be halved this year comparing to forecasts. Yet the big manufacturers are challenging each other in the race for orders. Farnborough 2012 will be the air show of crisis or recovery?
Most of the orders we saw last year, and most of the orders we’ll see this year, are for deliveries beyond 2017. They are basically positions taken for the next generation of narrowbody jets, Airbus’s A320NEO and Boeing’s 737MAX. These orders, therefore, should not be regarded as statements of market optimism in the current timeframe.
In Europe, Air France is implementing a huge restructuring. Other major airlines are not doing well. After the merger between British Airways and Iberia, is to be expected more consolidation, if not worse?
The European legacies face weak home markets and growing competition from the Arab Gulf carriers. But the big three will remain the big three. What we’ll see more of is the gradual process of absorbing marginal players, as we’ve seen over the past few years. Yet if anything the crisis has stalled this process. TAP, for example, is unlikely to be purchased in the middle of a crisis like this one. Worst case scenario, of course, is more complete failures, as we’ve seen recently with Malev and Spanair.
The Asia Pacific is now driving the market for the aviation industry. Some states, like China, challenge the European Union Emission Trading Scheme and therefore suspend the purchase of European aircraft. Protecting the environment may become a concern for the industry?
It’s clear that the EU massively overstepped in its ETS initiative. Either it backs down now, with relatively little pain except some embarrassment, or they back down later, after the rest of the world ignores them and imposes painful retaliation.
Usually the military sector has been an important driving force for technology research. Is this still true even in times of cuts to defense spending?
There has been less and less of a connection between military research and commercial aerospace. Since the 1970s, the trend has actually reversed, with considerable transfer ot technology from the commercial world to the military one. Also, Europe has not spent more than a token amount on military R&D in over a decade, yet the continent continues to do very well with civil technology research and market share.
- 1Five children among a dozen migrants to drown off Turkish coast
- 2New coin issued to mark Queen’s record reign
- 3Thousands stuck in Budapest as Hungary refuses to allow migrants to travel
- 4Schengen recoil could turn EU travel back 20 years
- 5Eurostar suffers severe delays as migrants attempt to block Channel Tunnel
- 1Migrants with tickets denied access to Budapest train station
- 2Satellite images show ISIL destruction in Palmyra
- 3‘No person is illegal’ – Vienna holds rally for refugees
- 4Ukraine: deputies explain for and against the decentralisation law
- 5Hungary’s hardline stance on refugees ‘benefits’ people smugglers
- 1euronews live TV - News | euronews : the latest international news as video on demand
- 2International breaking news | euronews online world breaking news in video
- 3Caught red-handed: the Russian Major fighting in Ukraine
- 4Video footage shows massive explosion in Tianjin, China
- 5Ukraine puts top Russian general Gerasimov on ‘most wanted’ list
- 6Why World Elephant Day matters
- 7Momentum for Mars: Astronauts say mission is inevitable
- 8Latest News Bulletin
- 9Who came out top in the US Republican television debate?
- 10UK: at least 7 dead after plane crashes into road in Brighton
- 11Snowden, Assange and Manning statues unveiled in Berlin
- 12Virginia:TV journalist and cameraman shot dead live on air
- 13ISIL militant group claims to have killed Croatian hostage in Egypt
- 14Earth Overshoot Day…Pushing Mother Nature too far
- 15Windows 10, three weeks on: the good, the bad and the ugly
- 16International news | euronews, latest international news
- 17Bringing the trolls out of the dark: Russian ‘troll’ awarded 1 rouble damages
- 18As ‘Daily Show’ Jon Stewart’s tenure ends, scholars say goodbye to their research topic
- 19European Union News | euronews: latest breaking news and headlines about European Union
- 20Scientists find sinkhole cave under Mexico’s Kukulkan Castle Pyramid
Migrant crisis: external borders need to be stabilised, says EU commissioner
Top EU migration official insists policy revision imperative
Germany wants camps in Italy, Greece, Turkey to sort through migrants seeking asylum
Jesse Jackson: ‘We’re winning’ battle for racial equality
Pump up the volume: essence of Botero’s sculptures revealed in Spoleto exhibition
Wires > News
- 22:39 CET Separate trials ordered for Baltimore police officers charged in…
- 22:34 CET Israel parliament approves 2015-16 budget draft in first vote
- 21:43 CET Eighteen Turkish workers kidnapped in Baghdad, firm says
- 20:33 CET Row over Libyan sovereign fund LIA reaches UK court
- 20:16 CET Migrants shut Eurostar trains to UK; dead wash up on Turkish beach
- 20:14 CET Islamic State claims bomb attack on Yemeni mosque, 28 reported dead
- 20:08 CET U.S. Army to open elite Ranger School to all genders
- 19:32 CET Malaysia’s anti-corruption efforts undermined by questions about…