Aircraft shortage worries 'overdone' as slowing global economy curbs jet demand

Concerns about aircraft supply shortages affecting airlines may be "overdone" as carriers report soaring profits, a slowing global economy curbs new jet demand and the use of larger narrow-bodies with higher seat counts boosts capacity, a report said. China's diminished demand for narrow-body aircraft is also expected to reduce the effects of fewer deliveries from Boeing and Airbus over the next few years, according to a report by Bloomberg Intelligence on Friday. "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," George Ferguson and Melissa Balzano, aerospace and defence analysts at Bloomberg Intelligence, said in the joint report. "Demand could be abating on rising narrow-body seat counts, the peak of geared-turbofan [engine] inspections and slowing global gross domestic product [GDP] growth, especially in China." A global shortage of aircraft has been pushing up fares and forcing airlines to keep older jets flying longer. Some carriers, such as Emirates, have invested billions of dollars to retrofit their older jets as they await delayed deliveries of new aircraft. Airlines around the world have struggled to increase capacity in response to rising travel demand as supplies of jetliners are limited by parts shortages, industry-wide hiring problems and overloaded repair shops. Bloomberg Intelligence's analysis of Boeing and Airbus aircraft shortages shows 466 fewer narrow-bodies were built than planned, from mid-2022 to the beginning of 2023, as supply chains slow down the manufacturers' production rates.<br/>