Concerns surrounding the well-documented aircraft shortage in the market, may be “overdone”, a Bloomberg Intelligence report said.
“Despite reports of airplane shortages, our analysis finds that global airline profitability, weak return on capital and plateauing lease rates mean there may be no lack of planes,” said analysts George Ferguson and Melissa Balzano.
Through an analysis of aircraft promised versus aircraft delivered, they found that there was a small but widening deficit of aircraft with slower build rates from Airbus and Boeing. This deficit could increase to around 825 aircraft by 2025 and to over 1,100 by the following year.
“Offsetting this gap are 3,000 narrowbodies deliveries in 2020-23, years that global available seat kilometres were below 2019's,” the report said. In addition, the larger seat counts in new aircraft has further offset this deficit.
In addition, with the world economy slowing, the need for narrowbodies will decline, the report said. This is particularly present within China, which is projected to acquire 100 fewer planes annually. As airline optimise operations by increasing seat capacity, the impact of delayed deliveries is further mitigated.
In the short-term, inspections on the geared turbofan (GTF) have put pressure on fleet efficiency. However, these are expected to ease towards the end of this year.