Wide-Body Jet Market Rebounds with 15% Profit Margin Expected by 2030

The global wide-body jet market is experiencing a robust recovery after nearly a decade of stagnation, according to a recent report. The report highlights significant improvements in aircraft pricing and a surge in market demand as key indicators of this resurgence. The market, which has been in a prolonged slump, is now showing signs of a strong rebound, with analysts predicting a substantial increase in profit margins. This shift is attributed to a reversal in supply and demand dynamics, leading to a revaluation of the market's potential.

The market's struggles began around 2014, when the introduction of the Boeing 787 led to an oversupply of aircraft. This was compounded by production cuts for the Airbus A330 and the termination of the A380 project, as well as the cessation of Boeing 747 production. The COVID-19 pandemic further exacerbated these issues, with production cuts for both the Boeing 787 and Airbus A350. However, the market has since begun to stabilize, with the normalization of international air travel demand driving a resurgence in the wide-body jet sector.

One of the most notable indicators of this recovery is the significant increase in the market value of new wide-body jets. For instance, the market value of a new Airbus A350-900 has risen to over 160 million dollars, up from less than 140 million dollars in 2022. This increase is driven not only by demand from airlines but also by the enhanced capabilities of engine suppliers such as Rolls-Royce and General Electric, as well as the improved performance of original equipment manufacturers (OEMs).

The surge in orders for wide-body jets is another clear sign of the market's recovery. Since December 2023, Airbus has secured orders for over 270 wide-body aircraft, with a book-to-bill ratio exceeding 2.5. Major global airlines, including Saudi Arabian Airlines, Asiana Airlines, Korean Air, Japan Airlines, IndiGo, British Airways, and Delta Air Lines, have all placed significant orders in recent months. This flurry of orders reflects the industry's confidence in the future growth of international routes.

This wave of high-priced new orders is expected to significantly boost the profitability of manufacturers. The report predicts that the profit margins for the Airbus A350 program will improve as production ramps up, reaching levels similar to those of the A330 program by 2026-2027. More importantly, starting from 2028, as these high-priced orders enter the delivery phase, the pre-tax profit margin (excluding research and development costs) for the A350 is expected to see a strong increase, potentially exceeding 15% by the end of 2030. This optimistic outlook is underpinned by the sustained demand for wide-body jets and the improved market conditions, positioning the sector for continued growth and profitability.