The ongoing backlog of more than 14,000 undelivered aircraft shared between the world’s two biggest aircraft manufacturers is set to keep flight prices high for the next five years.
With Boeing and Airbus both hit hard during the pandemic, the two giants have struggled to ramp up production since 2020 and have alarmingly long lists of orders yet to be fulfilled.
In its Q4 2024 results released in January, the US-based Boeing admitted that its backlog of commercial aircraft now totals more than 5,500.
Nor is Europe’s Airbus doing any better, with its full year results for 2024 released at the end of February showing that the order backlog at the end of December 2024 had totalled 8,658 commercial aircraft.
Global impact
The issue has attracted the attention of global aviation body IATA too, which expressed concerns that 2024’s aircraft delivery figures of 1,254 were 30% less than anticipated, while 2025’s predicted total of 1,802 aircraft built is not guaranteed and is considerably less than the 2,293 aircraft expected.
IATA director general Willie Walsh says: “Supply chain issues are frustrating every airline with a triple whammy on revenues, costs and environmental performance.”
With airlines now becoming increasingly vocal about the impact the delayed deliveries are having on their own operations, aviation experts are predicting flight prices will remain high for the next five years with new and established routes impacted.
John Grant, a partner at aviation analysts OAG, argues that while Airbus may have the bigger backlog, it is Boeing that will take longer to resolve the issue.
He says: “Airbus are worse off in terms of outgoing orders but at least they have a bit more of a defined production path heading forward.
“They have got more capacity to build that they can use, as they demonstrated in December when they managed to get more than 100 aircraft out.”
Grant adds that while the problems created by the delays have been around for about five years, they have worsened since the Covid pandemic’s end as airlines are not receiving anticipated aircraft and cannot meet the ongoing bounce back in the leisure travel market.
And this has become increasingly apparent as airlines release their 2024 results, blaming the missed deliveries for any holes in their balance sheets.
Ryanair group CEO Michael O’Leary says in the group’s 2024 full year report that while the airline received 48 Boeing 737-8200 aircraft in 2024, this was still 20 aircraft short of what had been agreed.
This shortage had a real impact on the airline’s business with it being blamed for the airline carrying 183.7 million passengers in 2024 instead of the 185 million targeted.
O’Leary adds that the problem has also forced Ryanair to revise its predicted figures for 2025 downward to 200 million passengers as opposed to the original 205 million.
While Ryanair might be one of the most vocal airlines about the issue, Grant says it has impacted airlines in every corner of the world, adding: “It’s created immense frustration for everyone with the uncertainty it generates.”
The shortage of aircraft has seen ticket prices increase around the world in 2024 with some airlines seeing double digit growth, while there are concerns that similar rises will haunt the leisure travel market in 2025.
Sven Carlson Aviation Consulting managing director Carl Denton agrees the problem is not going away soon, adding: “The expectation was that seat prices would go down but they haven’t.
“While the delivery of aircraft is a long-term problem that will unwind over time, the immediate issue is what’s going to happen this summer.”
Denton argues that rather than simply passing on cost increases to consumers, airlines will increasingly focus on the most profitable routes.
He adds: “Airlines will be looking at shorter sector flights and fewer flights on longer sector flights. In the European market it will be good for Spain and Portugal and not so good for Turkey this year.”
Grant agrees that routes will become a key focus, although he believes that airlines will revert to type when considering where to fly.
He says: “It varies by airline as we saw last summer; Ryanair reduced frequencies on major routes so that they could maintain the new route developments that they had under way.
“But other airlines wouldn’t start new routes as they weren’t prepared to invest in that activity with the fleet they have available.”
Denton also warns that the traditional remedy for airlines in the current situation of leasing additional aircraft during the summer is unlikely to provide a solution due to the increased cost driven by demand.
Grant agrees, adding increased leasing costs further complicate issues for airlines that also regularly rent aircraft to fill in gaps created by the maintenance schedule.
Ryanair to the rescue?
While flight prices may be looking expensive for summer 2025, Denton argues that the cost of an overall holiday might be less than feared thanks to the travel industry’s constant evolution.
For instance, in the European market he says that we are yet to feel the full effect of Ryanair’s decision to start working with both TUI and a number of OTAs in the autumn of 2024.
Denton adds: “There’s going to be more emphasis on leisure as that’s where the yields can be greater.
“With Ryanair now having friendly relationships with certain travel companies, they’re going to start moving into the TUI, easyJet and Jet2 sphere where leisure markets are more appealing and the ability to sell that capacity is far easier now they have better relationships.”
Grant adds while the world’s airlines may publicly bemoan the impact that the delivery delays have had on their operations, they are still benefitting from the situation.
“It is really interesting as what we have now is less capacity in the market than otherwise would have been the case,” he says.
“Everyone’s complaining but what it has done is created capacity discipline that otherwise wouldn’t be there.
“If it wasn’t there then the average fares we are seeing in the market would be a lot lower as there would be more competition and fighting for each customer.”
Whatever happens, it is apparent that the problem will remain for the next five years until Airbus and Boeing up their production and meet their delivery promises, so giving the travel industry yet another problem to resolve.