Jetrader - March/April 2011 - 25

The role of the United States has been declining in significance for a number of decades. I talk here about North America but often use only U.S. statistics. Including Canada would add approximately another 10 percent to the total. Trafﬁc statistics bear out clearly the demise of the once pre-eminent role of the United States. American airlines carried more than 70 percent of world trafﬁc in the 1940s, dropping to less than half of that total in the 1970s and now amount to around 30 percent of world trafﬁc. A similar picture can be seen in ﬂeet statistics. U.S. carriers dropped to ﬂying less than half

the existing ﬂeet in the 1970s and now amount to around one-quarter of the world ﬂeet. The same trends can be seen in aircraft manufacturing. The DC-3 dominated aviation for a number of years, becoming the ﬁrst successful commercial aircraft. Similarly Douglas Aircraft was, for a long time, the dominant aircraft manufacturer. Boeing was the ﬁrst to bring a successful jet aircraft to the masses and the ﬁrst to have a wide-body jet aircraft helping to bring the possibility of ﬂying to everyone in the world. Since the launch of Airbus, that U.S. dominance has been severely challenged. In 2003 Airbus, for the ﬁrst time, surpassed production levels of Boeing. At that time, many pundits believed Airbus would displace Boeing, especially with the growing production levels of Bombardier, Embraer and the emergence of possible future competitors in China, Russia, Japan and other countries. Fortune magazine even had an article 10 November 2003, entitled: “Lord of the Air: What’s left for Airbus after overtaking Boeing?” clearly pointing out that the United States is deﬁnitely out of the race. There was one area where the United States was still No. 1. U.S. airlines led the world in an unfavorable category, namely ﬁnancial losses. After 2001 through 2009, the world airline industry lost a total of US$67.8 billion with U.S. carriers

contributing a vast majority of that loss at US$58.1 billion. As a matter of fact, there were some years where the loss of a single U.S. airline equaled almost all the losses of world airlines. In 2004, Delta lost US$5.2 billion while the whole world lost US$5.7 billion. The picture was even more dramatic in 2005 when, because of restructuring costs, United lost a whopping US$21.2 billion while the whole industry registered only a US$4.1 billion loss. In other words, without even one U.S. airline, the airline industry would have been wildly proﬁtable.

As all aircraft salespeople know, old planes, money in pocket and future growth means airplane orders must be coming.
Will this decline of the importance of North America in aviation continue? To see the future it is worthwhile to look at orders of aircraft. At today’s backlog statistics, U.S. carriers are expecting only about a similar amount of aircraft to be added to their ﬂeet as those of China. U.S. backlog is only 13.8 percent of total

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Jetrader - March/April 2011

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