The 2017 Dubai Airshow was supposed to be a relatively quiet affair. In the run-up to the air show, there was speculation about Emirates placing a repeat order for several dozen Airbus (NASDAQOTH:EADSY) A380s -- helping to sustain that struggling aircraft program -- but not much else.
Instead, last week seemed like a flashback to the boom times of a few years ago. Boeing (NYSE:BA) and Airbus announced orders and commitments for a massive number of airplanes at the Dubai Airshow, supporting their plans to continue increasing their production.
Boeing struck first
On the first day of the Dubai Airshow, Boeing landed an extremely important deal, as Emirates committed to buy 40 787-10s. This ended several years of speculation about whether the Middle Eastern airline giant would order the Dreamliner or go back to Airbus' competing A350. (Emirates canceled a previous order for 70 A350s in 2014.)
Boeing also booked a smaller five aircraft order for the 787-8 last Sunday, as Azerbaijan Airlines made plans to expand its Dreamliner fleet. (The Azerbaijan Airlines agreement also includes a commitment for two large freighters; the exact model hasn't been specified yet.) These deals continued a hot streak for the 787 family, supporting Boeing's recent decision to boost the 787 production rate from 12 per month to 14 per month beginning in 2019.
On Monday, Boeing continued its momentum by finalizing an order for 20 737 MAX 8s from ALAFCO. This deal was announced as a commitment earlier this year at the Paris Air Show. And on Tuesday, Boeing added on an order from Ethiopian Airlines for four 777 freighters.
Airbus counters with its biggest deal ever
During its first few days in Dubai, Airbus didn't have much to announce. On Tuesday, it unveiled a deal to sell 25 A320neos to Golden Falcon Aviation, with the planes ultimately destined for Kuwaiti airline Wataniya Airways. Given that Wataniya Airways just restarted flights after a five-year shutdown and operates only two aircraft, this deal wasn't too impressive.
However, Airbus stunned the world on Wednesday by announcing its largest aircraft deal ever. Indigo Partners -- a U.S. firm that owns Frontier Airlines and has stakes in several other ultra-low cost carriers (ULCCs) around the world -- signed a memorandum of understanding for 430 A320neo family aircraft. This deal, split between the A320neo and A321neo models, is worth nearly $50 billion at list prices.
The planes ordered by Indigo Partners will be delivered between 2021 and 2026 and divided up among its four portfolio airlines. Frontier Airlines will take 134 aircraft, roughly tripling the size of its fleet by 2026. Wizz Air, a ULCC based in Eastern Europe, will receive 146 airplanes from this deal. Mexican ULCC Volaris will add another 80 aircraft to its order book, while Chilean start-up airline JetSMART will receive the other 70 planes.
On Wednesday, Airbus also announced a firm order for 90 A320neos from CDB Aviation. This finalized two commitments made since 2014, one of which had been announced at this year's Paris Air Show. It ended the show with a token commitment for two A330neos from Air Senegal on Thursday.
Boeing closed strong to "win" the Dubai Airshow
Boeing had a big deal of its own to announce on Wednesday. Hometown airline flydubai made a commitment to buy 175 additional 737 MAX aircraft, split between the three largest models. It also has purchase rights for 50 more 737 MAXs. Boeing closed the show with a small firm order for six 737 MAX 8s from Kazakhstan's SCAT Airlines.
In terms of total Dubai Airshow order volume, Airbus easily surpassed Boeing, thanks to the massive order from Indigo Partners. Nevertheless, Boeing was the real winner last week, due to the mix of orders it received.
All but two of the more than 500 aircraft orders and commitments that Airbus announced were for its A320neo family. Considering that it already had a backlog of about 5,000 A320neo-family orders at the end of October, Airbus didn't really need these deals. Its main challenge right now in the single-aisle market is building the jets it has already sold in a timely fashion, not finding more buyers.
By contrast, Airbus virtually struck out in the widebody market, where order backlogs are much shorter. Orders for the A330neo and A380 have been particularly hard to come by. Meanwhile, Boeing racked up another 51 widebody orders and commitments, including the critical Emirates deal. This positions it to maintain its title as the world's largest aerospace company for the foreseeable future.