DUBAI — Airline executives from around the globe gathered in Dubai for the International Air Transport Association’s (IATA) Annual General Meeting, only to find that the supply chain constraints that plagued aircraft deliveries last year have shown little improvement.
“The best thing I can say about the supply chain exasperations of the last year is that they appear to have not gotten worse,” stated Willie Walsh, IATA’s director general, during his annual state-of-the-industry address.
IATA forecasts the total number of commercial flights worldwide in 2024 to be 38.7 million, a reduction of 1.4 million from the estimate provided by the trade group in December. This decline is primarily attributed to ongoing aircraft delivery delays. Currently, 1,583 aircraft deliveries are scheduled for this year, marking an 11% decrease from projections made a few months ago.
In the first quarter, Airbus delivered 142 planes, up from 127 in the same period last year. In contrast, Boeing, grappling with increased scrutiny of its 737 narrowbody program, saw its deliveries plummet to 83 from last year’s 130 in Q1.
Engines remain a significant bottleneck. New-generation engines from GE and Pratt & Whitney have proven less reliable than their predecessors. The heightened demand for engine repairs has overwhelmed maintenance shops and strained the spare parts market. The delay in aircraft deliveries has also forced airlines to extend the use of existing aircraft, further pressuring the parts supply chain.
Industry experts are divided on whether the supply shortages will ease first for engines or airframes, with no clear end in sight for either issue.
“There is a school of thought that says we are closer to the end of the engine challenges than we were last year,” said Vik Krishnan, a partner focused on aviation at consulting firm McKinsey. “But the airframe [shortage] still hasn’t gotten that much better — both on widebody and on narrowbody.”
United CEO Scott Kirby noted that while the industry’s supply chain problems may have hit their lowest point, they have yet to improve. He expressed particular concern about the engine issues being the most challenging to resolve.
“If you want to solve a problem, first you have to acknowledge a problem,” Kirby said, adopting an optimistic stance. “There’s a broad acknowledgment of the problems and that means we can get them solved.”
However, Lufthansa Group CEO Carsten Spohr offered a more pessimistic perspective, describing the supply chain challenges as a significant hurdle for the industry.
“I don’t think it’s going to recover very quickly,” Spohr warned.
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