Industry needs 'third and fourth' jet maker to revive competition, Flydubai boss says

The airline industry needs more aircraft manufacturers to enter the market to stimulate competition and shake up the dominance of Boeing and Airbus, the chief executive of Flydubai said.

Delays in aircraft deliveries are affecting Flydubai's capacity to grow and such supply chain issues are likely to persist for the next year at least, Ghaith Al Ghaith told the Aviation Future Week conference in Dubai on Tuesday.

“It's about time that there's a third and even fourth aircraft manufacturer. The bottleneck, the choke, that we see right now in the business is because of the limitation that you don't have enough competition,” Mr Al Ghaith said.

“Imagine there is only one or two airlines operating in the whole world. It would be a disaster … having more competition is very good for our industry and this is something we should welcome with open arms.”

Flydubai said in August that it was forced to cancel the launch of routes planned for the second half of this year and to reduce flight frequency because of jet delivery delays at Boeing.

The all-Boeing fleet operator said in July that its growth plans have been “stunted” after it received an update from the US manufacturer that it would not receive any more planes this year, creating a capacity shortage during the summer period of strong demand.

Other UAE and international carriers have also been hit by supply chain woes that continue to roil the industry. Boeing and Airbus are struggling to increase production quickly enough to meet soaring post-pandemic demand for new aircraft.

The aviation supply chain is facing several challenges such as a shortage of parts, a shortage of skilled workers, aircraft certification hold-ups and, in Boeing's case, increased regulatory scrutiny amid its safety and quality crisis.

The aviation industry is debating Chinese plane-maker Comac's viability as a rival to the Boeing-Airbus duopoly as airlines are struggling to meet soaring travel demand amid a shortage of new aircraft that has constrained capacity.

Comac is positioning its C919 narrow-body as an alternative to the Airbus A320 Neo and Boeing's 737 Max.

The C919 is a “potential competitor” to Airbus and Boeing but it remains a fairly new plane and its performance is yet to be proven in the long term, said Tony Whitby, director of strategy and fleet planning at Air Arabia.

“It needs to be proven over time in terms of what the operational performance is and whether it degrades over time. Also what the economics are associated with the airplane, especially as it moves through stages of its life,” he said.

Comac also has to secure regulatory approvals for its aircraft in different regions to become a more viable option for a wider customer base.

“For it to be an attractive proposition to airlines such as ourselves, it needs to go through those approval processes so that it can cover all the geographies available to us both within our business as it exists today as it is planned and envisaged in the future,” Mr Whitby said.

Delivery of Air Arabia's 120 Airbus A320-family aircraft has been postponed partly because of supply chain issues and partly at the carrier’s request as it awaits the next-generation CFM Leap engines that will be ready by early next year, Adel Ali, group chief executive of Air Arabia, said last week.

The airline is evaluating all aircraft options in the market but it is still early days for the Comac C919.

“We will look at all the aeroplanes that are available in the marketplace as they exist today, if they evolve as future variants or as manufacturers introduce things, its incumbent on us as a management team to evaluate all these options,” Mr Whitby said.

“We certainly wouldn't rule something out, but the life cycle of this particular product has got some way to be attractive.”

Airbus welcomes competition in the market because the company was born from competition against Boeing, said Wouter Van Wersch, executive vice president of international.

Competition “makes us all better, so we are actually quite happy to see a new entrant coming in”, he said.

“Comac is at the start. They've got 10 aircraft flying at the moment in China. So I don't think they're there but China is an economic powerhouse and I’m sure they’ll get there but it will take some time. We like competition but for now we still lead the market,” he said.