DUBAI: The Dubai Airshow opens on Sunday with some analysts doubting that Gulf carriers, big spenders in recent years, will be doing much big-ticket buying, but organizers are cautiously optimistic. Rupinder Vig, an analyst at Morgan Stanley, said “this Dubai Airshow is going to be much more low key than the last few years.”
“If you look at what most of the airlines of that region have been saying for the last six months or so ... I wouldn’t expect massive orders to come through,” he told AFP.
Another analyst, requesting anonymity, said “the small contracts that will be made public during the show will not have an impact on stock exchanges.”
At the 2007 edition of the biennial show, European manufacturer Airbus received its largest-ever single order valued at $20 billion from Dubai’s Emirates, which mainly included 70 units of the future long-haul A350.
This year, Airbus and its major rival Boeing are likely to take few if any orders.
However, Allison Weller, director of show organizer F and E Aerospace, has “expressed confidence that this (event) will spearhead the aerospace industry’s recovery, reflecting the ‘green shoots’ apparent elsewhere in the world economy,” the airshow’s website says.
“The past year has been a difficult time for the aerospace industry worldwide, with manufacturers, suppliers and service providers facing a bleak and uncertain future,” Weller is quoted as saying.
“However, with a more bullish outlook for the coming year, especially within the Middle East region, I am cautiously optimistic that the Dubai Airshow will signal a return to a healthy marketplace.”
She said the industry is “now looking to the Middle East, where aerospace suppliers and service providers have managed to weather the economic maelstrom better than elsewhere.”
Weller did not cite any figures, but has been quoted as saying she expects sales to beat the $155.5 billion spent in 2007, claimed to be the largest amount of deals ever concluded at a single event.
This year, 900 exhibitors from 50 countries are expected to show their wares and services, compared with 850 in 2007. At the same time, organizers expect to attract around 50,000 visitors, up from 45,421 two years ago.
The major Gulf carriers appear to have fared better during the global recession than airlines in Europe and America. The majority of them are young, and have enjoyed steady growth, backed by high income of their governments, which enjoyed a huge windfall in oil revenues in recent years.
Companies like Emirates, Qatar Airways and Etihad Airways of Abu Dhabi, enjoy having young fleets of aircraft that consume less fuel. More flexible labor laws in the Gulf region also help companies there to smooth over rough patches.
“They are still in the phase of seizing a market share,” the unidentified analyst said.
Even so, there are questions about the extent to which regional players will help kick-start sales.
“If you look at Emirates, or the other major players in the Middle East, they all have got huge backlogs of aircraft,” Vig said. “The key question is: are they planning to keep those backlogs? Do they want to delay any deliveries?”
Emirates indicated on Wednesday it might look into increasing its intake of Airbus A380 superjumbos, of which it ordered 58 units, by taking over the orders of distressed carriers.
“We are always one of the first-movers to take advantage of the market,” Chairman Sheikh Ahmed bin Saeed Al-Maktoum said.
On the defense side, meanwhile, no significant deals are expected to be announced, despite a rich military display.
“From what we are hearing we are not really expecting any orders on the defense side at the Dubai Airshow. Very little. You are going to see more of that happen in the first half of next year,” Vig said.
