Both Airbus and Boeing are preparing for a challenging 2017, according to aerospace analyst Rob Stallard of Vertical Research Partners, who said: “Airline demand indicators are easing. We could be near or past the peak in this up cycle.”
He added that, while deliveries are expected to accelerate in 2017, the industry is preparing for a slowdown in orders, as airlines adjust to rising oil prices and a deceleration of passenger traffic growth.
“IATA, the airline industry lobby group, is forecasting that traffic growth will slow from 2016’s 5.9% to 5.1% in 2017, while capacity is still showing signs of growing more quickly at 5.6%. However, that is still a slowdown on 2016’s 6.2% expansion.”
The rate of deferrals and cancellations also appears to be picking up. United Continental announced last month that it will defer 61 Boeing 737 deliveries from 2017-2018, while Southwest Airlines has also pushed back the delivery of more than 60 737 single-aisle jets.