ISTAT Jetrader - Winter 2022 - 16

AUDIENCE POLL
When do you expect the
supply chain for engines to be
back to normal?
* Mid-2023: 15%
* End of 2023: 46%
* Mid-2024 or later: 38%
RIGHT:
Adel A Ali, group
chief executive
officer of
AirArabia, provided
Tuesday's keynote
address.
LEFT: The
Appraisers
Panel, from left:
Aisling McCarthy
(moderator), Oliver
Stuart-Menteth,
Olga Razzhivina,
David Rushe and
Mike Yeomans.
on liquidity and getting costs down.
This has resulted in other issues, like
labor shortages. Going forward, the
airlines are going to have to restructure
their balance sheets. The question
now is, as you head into 2023, what
happens if there is a recession? You will
have higher labor costs, fuel prices are
high ... what do they do with the cash?
Do they use the cash to de-lever, or do
they wait for a potentially bad 2023? I
don't think this is the time for airlines to
look for investment-grade ratings. "
Airbus vs. Boeing
Marjan Riggi, senior managing director
and global head of aviation and
transportation at Kroll Bond Rating
Agency, moderated the always-popular
Airbus vs. Boeing Panel, which included
Paul Meijers, senior vice president of
sales and marketing for Airbus, and
Boeing's vice president of marketing,
Darren Hulst.
Meijers and Hulst explained their
perspective of the supply chain issues
affecting aircraft production rates.
16 * THE OF F I C I AL PUBL I CAT I ON OF ISTAT
" It's not as simple as pointing to one
or two things, " Hulst said. " The goal is
stability. We need a stable process to
get us to our production goals. We're
working closely with our suppliers on
their stability. From an engine producer
side, being aligned on where we
see demand. "
For his part, Meijers said, " We
actually have some common suppliers
with Boeing. Our production rate
targets are not unrealistic and
based on signed contract with a firm
objective to deliver on time. Some of
our deliveries are currently late, which
is disappointing, but we're working
to recover. We are going to execute
on our ramp-up and collaborate with
our suppliers to achieve it. Against
the backdrop of these disruptions
in global supply chains, delivering
around 700 aircraft in 2022 is still the
target. It won't be easy to achieve, but
Airbus teams are fully engaged with
our suppliers and industry partners to
deliver on our commitments toward
our customers. "
Propulsion
The Propulsion Panel was moderated
by Douglas Harned, managing director
at AllianceBernstein, and included Zaini
Baroom, senior strategic marketing
and operations manager at GE Aviation;
Rom Chambard, vice president of
marketing at Rolls-Royce; Paul
Finklestein, director of marketing at
Pratt & Whitney; and Sandrine Lacorre,
product marketing general manager
at CFM.
The panel discussed their
companies' current priorities, the effect
of Russian sanctions on their supply
chains and inflation. On inflation,
all mentioned the contract clauses
in place that protect both the buyer
and seller. " There have always been
inflation clauses in the agreements, "
Lacorre said.
Baroom said GE Aviation is
managing its costs by eliminating
waste so it can mitigate some of
the risk. Chambard said there's a
difference between what Rolls-Royce
can pass onto its customer and the
w
ISTAT Jetrader - Winter 2022

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