Podcast: Farnborough Returns With Sustainability The Hot Topic

ATW Editors covering the airshow, back after a four-year gap, talk about the commercial air transport buzz, orders, technology announcements and that heatwave.

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Rush transcript

Karen Walker:

So hello, everyone, and thank you for joining us for Window Seat, Aviation Week, air transport podcast. I'm Air Transport World, and Group Air Transport editor-in-chief, Karen Walker. So, welcome on board. I am joined by my two colleagues, two editors who are based in the UK, Alan Dron and Victoria Moores.

And of course, this week has been the Farnborough Airshow week. In fact, it still is the Farnborough Airshow week. The first Farnborough Airshow since 2018. Obviously, the Farnborough Airshow alternates with the Paris Airshow, so 2018 was the Farnborough year. Paris followed in June, 2019.

And then of course, the world all changed, and the pandemic pretty much brought everything to a halt, including air shows. So this isn't the first of the air shows to have happened since the pandemic. There was the Dubai Airshow in November. I was at that one. And then the Singapore Airshow in February. Farnborough and Paris, they're the ones with the real history. They're the really big international air shows. So, all eyes were focused on the return of Farnborough.

And Alan and Victoria had the good fortune to be on site with the rest of the Aviation Week Network team, covering the show. They have pretty much wrapped up most of their coverage now, but I'm absolutely thrilled that, despite that I'm sure they're pretty exhausted, they made time to join us on the podcast and give us some sort of views on how the show went.

So, I'll just quote a few numbers that I saw, that the Farnborough people put out. They said there was some 80,000 trade visitations, 1,500 exhibitors, 87 aircraft in the static and flying displays. Most of those were commercial aircraft. And some 1,800 journalists from 47 countries.

Alan and Victoria, you've both covered a lot of Paris and Farnboroughs over the years. Victoria, I'd like to start with you. Did this feel like a normal Farnborough Airshow when you turned up? Did it feel busy?

Victoria Moores:

I would say yes and no. So certainly when you're on the trains, when you're in the queues for the buses, when you're going through security, things like that, it did feel very busy. There were crowds, and obviously, crowds has become a bit of a thing since COVID. But processing was pretty good. So, yeah, it did feel as though it was a large representation from the industry, here.

But what I would say is the static display, to me, didn't look all that crowded with aircraft. It did look a lot smaller than previous years, so perhaps we were seeing it there. So that's my thought, is the yes and no. There's definitely a different feel and conversation going on at the show too, which I'm sure that we're going to get to.

Karen Walker:

Alan, that's an interesting comment that Victoria just said about the static display. What was your thought?

Alan Dron:

Very much the same. I thought it was quite the most anemic static display I've seen at a major show for many a year. Various people were commenting on it. It was just dull, frankly. There wasn't a lot of interesting metal out on the ramp. By contrast, I mean, in the halls, I mean, the aisles were positively thronged. I mean, to the point where it was, and you'll be very familiar with this, it's difficult to make your way quickly from one press conference to the next.

Karen Walker:

Yeah, that sounds very familiar. That one, and particularly with the Paris air show, when what? The one press conference is right at one end, and then you can bet your life, the next one you're going to is right at the other end. At Farnborough is more sort of an up down show. But yes, you have my sympathies on that one. And what about the flying display, then? Was there much activity there, Victoria?

Victoria Moores:

I'll be honest and say that I was in the throngs of people running between the press conferences at the points when the flying display was on. I caught a couple of bits with the commercial aircraft, and obviously it, was great to see some new aircraft flying here. So the 777, and also the MAX 10. But like I say, didn't get much of a chance to look up in amongst all of the briefings that were going on.

Karen Walker:

Yeah. So, Boeing made a big deal about bringing the 777X, the 777-9 specifically they brought, and also the newest, biggest variant of the MAX, the 10. And talking of Boeing, I mean, they really got out of the gate very quickly at the show. It's very much felt like this was a show where Boeing was sort of like getting its mojo back after a tough period, obviously the pandemic, but in their case, they've had so many self-inflicted issues. Dubai was a very, very quiet air show for them. Very quiet. But they seemed to be much more optimistic. And I thought it was very telling that their Commercial Airlines president, Stan Deal, was very much visible at this show, and that seemed to be deliberate. Would you agree, Victoria?

Victoria Moores:

Yeah, absolutely. Stan was out and talking right from the beginning of the show on Sunday. And like you say, they kicked off the show with that big order announcement for 100 MAXes for Delta. And I'd say that was the standout order for me of the show. And obviously, politically, that was very important as well, given recent history between Delta and Boeing. I think that I'd probably like to bring in a quote from Christian Scherer, who is the Chief Operating Officer at Airbus. During the one of the most recent press briefings I went to, he said, "It was about time for Boeing to pick up some speed." So I thought that was quite an interesting comment to be making on Airbus' part. But yeah, Boeing definitely did have quite a lot of activity at the show, and yeah, Stan Deal was very much in attendance.

Karen Walker:

So, let's talk more about the order side of things, because again, typically, especially at Farnborough and Paris, there's this big ping-ponging, back and forth, competitive thing as who, between Airbus and Boeing, who's got the biggest orders, etc, etc. This show was not like that, and we'll talk about that in a bit. But the other thing I'd just like to quickly raise here, is that another huge talking point going on in the UK this week is the heat wave, absolute sky high record temperatures has affected the whole country, including London. Farnborough is just south of the capital city. Alan, did that affect logistics in any way at the show?

Alan Dron:

Well, it certainly affected some of our team members coming down by train from central London each day. I do find it remarkable that the train company that runs that route seems completely incapable of understanding that there is a small matter of a large air show in their network, every two years, in July. They do nothing whatsoever to put on additional trains, or adding carriages to existing trains. Yes, the trains were rammed. It was fairly bad on some days. And I know that some of our colleagues had a really rough time getting actually physically into the show.

Karen Walker:

Alan, that wasn't really the heat, but that sounds more like a-

Alan Dron:

Well, I think it was, partly. The heat was starting to affect the actual tracks. Trains were having to actually travel at slower speeds than normal, which didn't help people getting into the show.

Karen Walker:

Okay. And maybe more specific to the air show, that couldn't help but underscore the whole climate change, the reality and urgency of climate change. People in the UK are seeing temperatures north of 40 degrees, whatever that is in Fahrenheit. It's certainly in the 90s. Yes.

Alan Dron:

I believe it's 104 in all.

Karen Walker:

104. Okay. Well, that is extreme. That does raise eyebrows about just how quickly this climate change is affecting us. And of course, there is a huge focus on aviation sustainability and reducing carbon emissions. So I saw lots of announcements related to sustainability. Victoria, you were at a really big one, I thought. That Airbus-Airline partnership. Tell me about that.

Victoria Moores:

Yeah, that was an interesting one. Basically, Airbus has brought together a group of, I think it was seven different airline groups. So that's not even seven airlines. That's multiple airlines beyond that, because you have the likes of IAG, in there as well. Air France. KLM.

And what they're coming together to do is to really look at a technology which involves removing carbon emissions from the atmosphere and then storing them. And I thought that, for me, a notable thing in that is that this technology, at the moment, does not comply with the various regulatory mechanisms that there are, which add costs to an airline's financials. So I'm talking about the EU Emissions Trading Scheme, and also the CORSIA Scheme that's coming in. And I thought it's interesting to see them going for a technology that, at the moment, does not benefit their bottom line.

I think it's going to be interesting to watch this, because one of the things I really noticed at the show, was the change of conversation has 100% changed to sustainability. I'd say at the last show that I was at, a few years back because of COVID, the theme there was electric aviation. And it really has just taken over the whole show, now. And I think that partnerships across the value chain were absolutely a theme of the show. Airlines manufacturers. Engine manufacturers. We saw Rolls Royce teaming up with easyJet on hydrogen technologies for engines. So I think that sustainability is very much the shifting conversation at this show.

Karen Walker:

Yeah, I agree. I saw so much on that. And so that technology you were talking about, carbon capture, the Airbus-Airline partnerships about, there's a lot of interest in that. And to see such an active partnership being formed across manufacturers and airlines, I think, is very telling. But we were seeing a lot of those sorts of announcements of partnerships, as you say, sort of action being taken across the industry, with governments.

I also noticed that even when an order was announced, nobody just said, "Hey, we've sold this many aircraft." And in fact, I never even saw any values put on any of the deals that went out there. But everybody was keen to stress, give the metrics on, the fuel efficiency and sustainability of the types of aircraft and engines that were being sold. What did you see there, Victoria?

Victoria Moores:

Yeah. One of the things that I noticed, like you say, you get the standard historic thing of this deal is valued at XYZ. It's going to make our operations more cost effective, etc. Something that stood out for me today was easyJet signed an order, follow-on order, for some more A320 family aircraft. For the first time ever at an order announcement, I heard their executive, their Chief Financial Officer, saying this will bring cost and operational benefits, and it will also reduce our regulatory compliance costs for sustainability. First time I've ever heard that actually being connected to an aircraft order, the regulatory compliance costs.

Karen Walker:

Interesting. Alan, did you get the same impression?

Alan Dron:

Well, just going back to something that Victoria was saying a moment ago, or you were saying a moment ago, about this plan to directly capture CO2 out of the atmosphere. Given the fact that airline groups are coming into this plan, and given the fact that airlines are going to increasingly be charged for emitting carbon over the years to come, I just wonder if this plan, which ultimately foresees hundreds of plants throughout the world literally sucking CO2 out of the atmosphere, I just wonder if this raises the possibility that perhaps by helping to fund these plants, airlines could perhaps start to agitate to get some sort of rebate, or offset, against the costs that they're going to be asked to pay for emitting carbon.

Karen Walker:

Interesting point. Yeah. But certainly I think we're going to see, I think Farnborough's set a tone for what the conversation is going to focus on at future shows, and of course, across industry.

Let's just pick up a little bit on the orders that were announced. As I say, this was not a big order show, by any stretch. And we've mentioned a couple of these points here. So there was the very significant order, Delta ordered 100 MAX 10s. And of course, the MAX 10, at the moment, well, the MAX 10 has still got to be certificated by FAA. And there's been some controversy about that. So for Delta to come in, this major airline come in and say, "Yeah, we want 100 of them," was a big confidence booster for that program. And also Delta is the only US major carrier, so far, docked to have ordered the MAX. So that was a real feather in Boeing's cap, no question.

And then Boeing had a good order from AerCap, the big leasing company, for 787s. And while everybody's talking about, yeah, the narrowbodies market's going to be a lot quicker to come back than widebodies, that was another nice thing. Again, the 787 at the moment, that's still not being delivered. It's suspended deliveries while it works through production issues. But when you've got a company like AerCap, that really, really knows its business, ordering more 787s, again, that was another confidence issue. Tell us a little bit about the easyJet order, Victoria. That came today, so that was pretty late in the show.

Victoria Moores:

Basically, this forms part of a 2013 agreement between easyJet and Airbus. So at that time, they created a framework for what their orders would involve. They'd already used up all of the firm orders under that, so this is affirming up of purchase rights and options for 56 aircraft. One of the questions that I asked at the press conference was whether or not easyJet might now create a new framework agreement with Airbus. And their Chief Financial Officer said it's a little bit early for that yet, because they've now got their aircraft through to 2028. But I think that that might be a thing to watch across future years, because easyJet going to want to secure the terms for their future fleet.

Karen Walker:

I thought it was interesting, and correct me if I'm wrong, you're both on-site. And just so that everybody's clear, I've been very involved in all of this, but remotely, from my Washington office. But you were both on-site. I seem to see, we're used to this, Airbus and Boeing will put out a customer announcement, press briefing, at their chalet or at the press conference center, at so and so time. And I saw several of those happen, and then nothing happened. The thing either got canceled or delayed. Did either of you see that? I know you were running around trying to get to different things. Was that an indicator of maybe they'd hoped to get a deal done? They were trying to get a deal done and then it just wasn't possible. Alan.

Alan Dron:

Well, I think, possibly the most notable one was ITA Airways, the successor to Alitalia. There'd been rumors for some considerable time that there was going to be an order, quite a substantial one, placed with Airbus at the show. And they got as far as saying, "Yes, there's going to be a press conference at 3:30, on Tuesday." And that was firm right up to the last minute. I was down at the Airbus chalet. Then they said it had been postponed to 4:00. Then somebody said, "No, no, no. It happened at 3:30," but it didn't. So, quite what was going on there, I really don't know. I can only assume that there were last minute glitches. And as you say, people are not really prepared to put pen to paper these days, just to get a bit of publicity at an air show.

Karen Walker:

Yeah. That was interesting, and that might change as the recovery builds up. But I just wonder whether there might be a less emphasis on, yeah, the deal has to be signed at an air show. We all know that's a little bit unreal. You know that. But I'm wondering, there was some other big deals that people had talked about. Would they happen? Air India, now that it's owned by the Tata group, is looking to make some big widebody orders. I think Jet Airways, again in India, was another possibility. But none of those came in the air show. Although again, Christian Scherer, at Airbus, did make a comment. Is that right, Victoria? What did he say?

Victoria Moores:

Yeah. It's been a bit notable that, when we've been looking at the agendas, that it hasn't appeared as though there were going to be all that many customer announcements from Airbus. And Christian Scherer, who's their Chief Commercial Officer, sorry, I got that wrong earlier, he responded to that. And he said that he was actually quite satisfied with where Airbus is up to, in terms of orders. And he also said, "We can do business quietly, and that's what we are doing." This is a public room. In the private rooms, it's quite active, which really does suggest that the conversations are taking place. They are happening, but they're not necessarily shouting about them, or they haven't necessarily been finalized yet.

Karen Walker:

Yeah. People are not going to just put together a deal that they're not happy with for the sake of air show publicity. So, yeah, that was interesting too.

Now, there was also some new technologies described and presented here of that, as well. One of the ones that took my attention, Alan, you went to the Boom press conference. And for anyone who doesn't know, Boom is a Denver-based startup company designing and building a supersonic airliner. It's hard to believe, in the current world, that anybody would want a supersonic airliner. But in this case, I thought the topic, the way they presented it, was quite interesting. Over to you, Alan.

Alan Dron:

Well, where does one start with this one? To call the redesign radical is, I think, stretching British understatement to its limits. They've gone from three to four engines. They've got a completely new wing. They've applied area ruling to the fuselage, which in the 1950s was referred to as Coke bottle styling. It looks utterly different from what has gone before. And you do wonder why such a radical redesign this far down the road. And this, at this point, was put to Blake Scholl, the founder and CEO, and he basically said, "We've just learned so much that we felt it was time for a reiteration of the design."

Interestingly enough, just going back to the sustainability angle, they were very careful to say that, despite the fact that this is a supersonic airliner, it is going to be able to use 100% sustainable aviation fuels. So that's good then.

But it did strike me as being really quite odd that we are getting such a different looking design this far down the road. And they're supposed to be starting production, I believe, next year. I think it raises questions.

Karen Walker:

Yes, absolutely. There was another technology announcement, in fact a couple more, but there was one specifically. Victoria, I think you were at that press briefing. Again, this was from Airbus, on a future wing design.

Victoria Moores:

Yeah, that was one that I was at this afternoon, Karen. Going to potentially lead to something that would look quite different when you're in an airport, because Airbus is basically pulling together any advances that they can have on wing production. Obviously lots of digitalization there. New materials. They're pulling together everything that they can to make a more efficient, more effective wing. It's completely technology agnostic, so this could be hydrogen. It could be something else. They're looking at materials, processes, and the shape of the wing.

But they produced this prototype for a wing that will have a folding wing tip, which I found really, really interesting. And the fact that they're at the point of having a full size prototype for the wing box, not for the folding part, seems to be a step forward for them. And it's going to be interesting to see, quite literally, how the aircraft takes shape with this new wing.

Karen Walker:

So. A whole cross section of activity, for say orders, it's pretty slow relative to what we've seen, but there were orders. And some technologies, and huge amounts of conversation about sustainability. And in fact, beyond sustainability, there was actual real action on programs being forged here. So overall, would you say a good show?

Alan Dron:

I think, on balance, yes. I think it was like the air shows of old. Well, it's pleasant just to have an air show again after two years. And although Singapore and Dubai are important, they're more important regionally. As you said, Le Bourget and Farnborough are still the two major ones. So, yes. Despite the subtropical temperatures, it was, on balance, a good show, I'd say,

Karen Walker:

Victoria, you talked to a lot of airline's CEOs and senior executives. You said there were a lot of airline people present, correct?

Victoria Moores:

Yeah, absolutely. There were CEOs here. So, today I spoke with the CEO of Ethiopian Airlines. Yesterday, we had the CEO of easyJet here. I also spoke with the CEO of a new startup airline, which is Hans Airways, which is going to be flying between the UK and India, using A330s. They're just about to take delivery of their first aircraft. So there was an executive presence here. Also, Alan spoke with the CEO of Qatar Airways. There were people here. There was activity here. And especially considering the heat, it was great to see everybody getting back together, and connecting in person again. That was the other theme.

Karen Walker:

Nice. But I think, again, I congratulate you both for not being completely exhausted, and still joining us for this podcast. And thank you. I think this has sort of set a bit of a benchmark for, yes, this industry is definitely in recovery mode. And I think it'll be all eyes now on the Paris Airshow in June, 2023. So, thank you both for joining us, and I do hope you get a good rest this weekend.

Meanwhile, thank you also, to our audience for joining us. I hope you'll join us again next week. Make sure you don't miss us by subscribing to the Window Seat Podcast on Apple Podcasts, or wherever you listen. Until then, this is Karen Walker, disembarking from Window Seat.