Singapore air show kicks off amid travel rebound, supply constraints

Singapore on Tuesday kicked off Asia's biggest air show - the first in six years unaffected by pandemic restrictions - as the global aviation industry grapples with a rebound in travel demand in the face of severe supply constraints. More than 1,000 companies from more than 50 countries are participating in the biennial commercial and defence-focused Singapore Airshow, led by Western industry giants such as Airbus, Boeing and Lockheed Martin, and their Chinese competitors such as COMAC and AVIC. 

Russian companies such as Russian Helicopters and Irkut that attended past editions of the show are not participating this year amid the war in Ukraine. However, Israeli companies Israel Aerospace Industries and Rafael Advanced Defense Systems, which dropped out of the Dubai Airshow in November amid the Israel-Hamas war in Gaza, are in attendance.

The flying displays feature military aircraft from Singapore, Australia, India, Indonesia, South Korea and the United States, the COMAC C919 commercial jet's first appearance outside Chinese territory and an Airbus A350-1000 powered by 35 per cent sustainable aviation fuel.

COMAC posted the first aircraft orders of the show on Tuesday morning, with China's Tibet Airlines finalising an order for 40 C919 single-aisle planes and 10 ARJ21 regional jets, and China's Henan Civil Aviation Development and Investment Group ordering 6 ARJ21s. Given its timing early in the year, there are typically fewer major order announcements at the Singapore Air Show than at its counterparts in Paris, Farnborough and Dubai.

By the end of 2023, travel demand had made a near-full recovery from pre-pandemic levels in 2019, with domestic travel running 4% higher than pre-COVID levels and the international market lagging at 88% mostly because of China's slower rebound, according to International Air Transport Association data. "While it was easy to ramp down in response to the pandemic-induced demand crisis, the ramp up has been beset with challenges," Alton Aviation Consultancy said in a report on Tuesday. "Delays in returning aircraft into service, exacerbated by a shortage of manpower across the entire value chain, led to a slower pace of recovery in APAC."

SUPPLY CHAIN STRUGGLES

Major suppliers, planemakers and engine producers have struggled to keep up with the rebound in demand after the sharp downturn during COVID-19 led to job losses, freight snarls and an industry skills shortage. Boeing, in particular, is under scrutiny after the mid-air blowout of a cabin panel on an Alaska Airlines 737 MAX on Jan. 5 led the U.S. Federal Aviation Administration to take the unprecedented step of freezing production of its best-selling single-aisle plane at 38 per month.

Airbus this month announced a further delay in entry to service of its long-range A321XLR single-aisle jet to the third quarter from the second. Suppliers told Reuters that Airbus is producing about 50 A320neo family jets a month compared with a production plan that had foreseen 58 by end-2023. Christian Scherer, the CEO of Airbus's commercial aircraft business, said on Tuesday there were many "pinch points" in the aerospace supply chain.

"The production ramp-up is putting pressure into the supply chain everywhere and it is our job to tackle it," he told reporters, adding that Airbus had deployed several dozen supply chain engineers to unlock bottlenecks. The production issues are delaying the ability of airlines to replace older jets with more fuel-efficient models as the industry looks to meet its goal of "net zero" emissions by 2050.

Airlines are also looking to buy as much sustainable aviation fuel as possible to reduce their carbon emissions, even though it costs up to five times as much as conventional jet fuel. In Singapore, travellers will bear the cost of the transition towards green jet fuel, its transport minister said on Monday, as he announced the city-state's plans for a levy on departing flight ticket prices from 2026.