Ahead of Boeing’s results on April 22, we thought this chart might be instructive. Click to enlarge.
That’s the number of aircraft in temporary storage. The increase in late 2008/early 2009 is startling — and much worse than in the previous down cycle, post the 9/11 attacks in 2001 and the attendant slump in air travel.
An oversupply of aircraft has implications not just for the two big planemakers — Boeing and Airbus — and enginemakers like Rolls-Royce, but for the airlines as well; airlines like Ryanair and Southwest, for instance, which just reported its third consecutive quarterly loss. Part of low-cost airlines’ expansionary business model involves selling off older, more expensive planes to lower operating costs and/or boost the bottomline. A glut in aircraft will mean lower offers for second-hand planes, as well as for new ones.
Related links:
Mohave Desert airplane tour – Webshots
Aerospace datapoint du jour – FT Alphaville
Diverging strategies, airline edition – FT Alphaville
Fun with maths at Airbus – FT Alphaville