February 5, 2010 / 10:50 AM / 9 years ago

AIRSHOW-Quiet Singapore Airshow ends with fewer deals

* $9 bln deals signed at airshow, $4 bln less than 2 yrs ago

* Too many airshows, says Leahy of Airbus

By Harry Suhartono

SINGAPORE, Feb 5 (Reuters) - The aviation industry’s first major meeting of the year concluded business on Friday with only a few deals and no major sales by aerospace giants Boeing and Airbus, reflecting unease about the global economic outlook.

The Singapore Airshow reported that $9 billion worth of deals were signed during five days of trade, $4 billion short of the previous airshow in the city-state in 2008.

“It was disappointing, no commercial (aircraft) deals, everything was on MROs (maintenance, repair and overhaul). People even thought last year’s Dubai Airshow was disappointing,” said aviation analyst Shashank Nigam, who writes a blog on the industry.

In 2009, Dubai wrapped $14 billion worth of deals which included sales of two Airbus A380s, the world’s most expensive aircraft.

The biggest commercial deal at the Singapore Airshow this year was a $3.5 billion deal between International Aero Engines and Jetstar Airways, of which $1.5 billion was for V2500 engines and $2 billion for a long-term service agreement. [ID:nSGE61409R]

The International Aero Engines consortium groups Pratt & Whitney (UTX.N) together with Rolls-Royce (RR.L), MTU Aero Engines (MTXGn.DE) of Germany and a trio of Japanese heavy engineering companies.

European aircraft maker Airbus, a unit of EADS EAD.PA, said on Thursday that it had signed a memorandum of understanding to sell six Airbus A330-200 aircraft to Hong Kong Airlines, valued at $1.15 billion at list price. [ID:nSGC003472]

Organisers, however, put a brave face on the slow sales. “The commercial guys are doing good business. I was thinking that the defence side would do well, but the commercial boys are snapping up the business,” Jimmy Lau, managing director for Singapore Airshow 2010, told reporters.

“The swing in the market is back and everybody is getting ready to fleet up again. Airline operators are looking to put back in service what they cut back the past year and a half or so. The growth in MRO is going to be there,” Lau said.

About 70 percent of the deals struck during the airshow came from the commercial side and the rest from the defence side, Lau said.

The biggest defence sale was between India’s air force and a state-owned firm, which was announced at the show.

The Indian Air Force ordered 750 Akash surface-to-air missiles from the Bangalore-based defence enterprise Bharat Electronics Ltd at an estimated cost of 40 billion Indian rupees ($860 million), the organisers said.

The United States Air Force also awarded Raytheon (RTN.N) a $170 million contract to produce infrared-guided air-to-surface missiles for the United Arab Emirates, the organiser said.

The four-day trade show was jolted by the scrapping of a flight display on Thursday when a South Korean pilot steered his fighter jet too close to spectators, having “infringed the safety boundaries,” witnesses and the show organiser said. [ID:nSGE6130CL].

Before the global economic downturn, the aviation industry had grown used to the ritual of an orders race between Boeing (BA.N) and Airbus at air shows, with customers spending $62 billion in 2008 before the crisis kicked in.

That may be changing.

“This is a quiet airshow. The world is getting too many airshows,” Airbus Chief Operating Officer John Leahy told Reuters this week.

“I think we need to get together as an industry and maybe limit the number of airshows.” ($1=46.55 Indian Rupee) (Additional reporting by Mariko Katsumura and Nopporn Wong-Anan; editing by Raju Gopalakrishnan and Muralikumar Anantharaman)

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