Dubai Airshow 2021: this is something to look forward to

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Karim Sahib | AFP | Getty Images

Dubai, United Arab Emirates-Dubai’s last international airshow was held in November 2019, and it felt like another era.

Just a few months before the Covid-19 pandemic completely disrupted travel, this much-watched biennial aviation event celebrated an industry that looks very different today.

But after nearly two years of stagnation in the tourism and aviation industries, the market has begun to pick up again.

The 2021 Dubai Airshow opens on Sunday, November 14. The following is what to expect:

Tourism recovery?

With the continuous successful launch of vaccination campaigns and the government’s relaxation of Covid restrictions, the travel situation has been improving.

“Executives are cautiously optimistic about the future,” aviation analysts at consulting firm Accenture wrote in a report before the show.

The company predicts that global commercial aerospace will grow by 13% year-on-year in 2022, but it will still be 4% lower than the level in 2019.

Dubai’s flagship airline Emirates Airline-the Middle East’s largest airline and the largest aircraft buyer-has itself enjoyed a partial recovery, with its half-year revenue for the 2021-2022 fiscal year increasing by 86%, thereby reducing its previous losses .

Nonetheless, concerns about potential new Covid variants, inflation and rising energy prices have left a lot of uncertainty in the industry. The Dubai show will definitely see a lot of discussions about the industry’s recovery and the way the aviation industry has become safer and more hygienic due to the pandemic.

Partly because of this uncertainty, but also because the air show in Dubai is smaller than the Paris or Farnborough air show, analysts do not expect to see many large orders this year. Sheila Kahyaoglu, an aerospace and defense analyst at Jefferies, said this is also because Gulf Air’s orders “are often more focused on wide-body airliners.” “So I think given the slower international traffic, I don’t think this will be a catalyst for more orders.”

Supply chain issues

The tightening of global supply chains has affected many industries, and aerospace is no exception.

Kahyaoglu said that in the aviation sector, supply chain shortages mainly affect the defense sector. “In communication systems, ships, semiconductor components-as long as it affects the rest of the world.”

In the field of business jets, the impact is small because fewer private jets are produced every year than other types of jets, but it still “causes a shortage of parts, so original equipment manufacturers [original equipment manufacturers] Must be aware of their material procurement,” Kahyaoglu said.

Accenture stated that more than half of aerospace industry executives (55%) “have insufficient confidence in the timeliness and quality of the supply chain in the next six months”.

Goods win

There is only one part of air traffic that exceeds the level of 2019, and that is cargo.

People may have stopped traveling for a long time, but the flow of e-commerce and products continues to grow. Before the pandemic, large amounts of cargo were transported in the belly of passenger planes. But as travel restrictions increased and these planes went offline, Richard Aboulafia, vice president of analysis at Teal Group, said, “Suddenly people said,’Hey, we need a dedicated cargo plane because there is no belly cargo.’ “

Aboulafia said that Airbus and Boeing, the two largest aerospace companies in the world in terms of revenue, are expected to showcase new large freighter versions of existing aircraft.

“You will see Airbus talking about, and possibly even launching, a cargo version of the A350 XWB jetliner,” he told CNBC.

“You might see exactly the same things as the 777X freighter version from Boeing, the latest version of the 777, which has composite wings, etc. This is really interesting because the Gulf is a very large cargo market.”

In fact, in the most recent half-year earnings of Emirates Airlines, the cargo business performed strongly, increasing by 39%, bringing the business volume to 90% of 2019.

Arms sales

On the defense front, people will still be concerned about whether any progress will be made in the sale of the Lockheed Martin F-35 II Joint Strike Fighter to the UAE on the last day of the Trump administration. According to reports, Washington and Abu Dhabi are still negotiating the huge $23 billion deal, which mainly includes 50 F-35 jets and at least 18 armed drones.

Previously, U.S. laws and export regulations prohibited it from selling deadly drones or F-35s to any of its Arab allies. But the changes implemented by the Trump administration make this possible, which means that if it is completed, this will be the first time F-35 and US-made armed drones have been sold to any Arab country.

Justin Bronke, an air power and technology researcher at the Royal United Services Institute in London, said that there is also “the overall trend of continuous modernization of the fighter fleet, mainly modern fourth-generation platforms.”

The fourth generation broadly refers to fighters that have been in service from the 1980s to the present. It has a variety of combat roles and more advanced technologies than its predecessors, such as infrared search and tracking capabilities and digital avionics.

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