After a four-year break due to the COVID-19 pandemic, the Paris Air Show, the largest global trade show and exhibition in the aviation and aerospace industry, made a comeback on June 19, 2023.
The 54th edition of this show at the Paris Le Bourget Exhibition Centre brought around 300,000 visitors, including exhibitors, aviation enthusiasts, and the press. Held once every two years in Le Bourget, the international show is over 100 years old. When it started in 1909, the show was a part of the Paris Motor Show that was exclusively dedicated to aircraft for the first time. Since then, the trade show has presented a jaw-dropping exhibition of military and non-military aircraft and flying machines during the trade days.
Significance
This international Paris Air Show, also formally known as Salon International de l’Aéronautique et de l’Espace or Salon du Bourget, has played a vital role in advancing aerospace and aviation technology. Here are some reasons why this show is important in this sector.
Networking, business opportunities, and big deals
The key players in the aerospace and aviation industry, including airlines, manufacturers, suppliers, government representatives, defense contractors, and potential buyers, come together at this international show, which is rarely possible. It is a business hub for major business deals, negotiations, and networking. The business deals in the aerospace industry are of billion dollars and highly significant. This show is the key event to buying necessary aircraft for the civil and defense industries.
While discussing deals worth billions of dollars, the first two names that come up are Airbus and Boeing, which always compete passionately to announce aircraft orders. This year, the announced orders reached near-record levels that were heavily dominated by these two airlines. They collectively mentioned orders of 1,100 jets; Airbus had commitments of 830 jets. The major commitment of Airbus was with IndiGo with a deal of 500 A320 aircraft.
Showcasing new technology and innovation
The Paris Air Show allows different companies and firms to showcase their products or new advancements in the aerospace industry. It includes electric and hybrid aircraft and unmanned aerial vehicles (UAVs). This year, at least 158 aircraft were displayed, including helicopters, drones, and planes. As for significant displays, Aarok, a prototype medium altitude long endurance (MALE) remotely piloted combat aircraft, created a buzz on the show’s first day. It can land if there is sudden terrain. Many companies have developed new sustainable and fuel-efficient products, including Cassio 330, AURA AERO, etc.
Promoting sustainable technologies
Sustainable technology in the aerospace and aviation industry was one of the key themes of the Paris Air Show this year. About 3% of global carbon emissions are due to air travel, though this industry serves only a minor group of the global population. Even when the aviation industry is still recovering from the downturn of the pandemic, the demand for air travel is still higher. However, sustainable and efficient solutions are needed while recovering from the loss. And we can observe the urge to accept sustainable technologies in this year’s announced orders. Above a thousand of the ordered aircraft were fuel-efficient, most of which were from either Airbus or Boeing.
In newer aircraft, companies have tried to initiate designs that minimize carbon emissions. Most Airbus aircraft on display, including A320neo, A330neo, A220, and A350, reduce more carbon emissions than their previous ones. Even Boeing has shown more fuel-efficient and sustainable aircraft at the event, including 737 MAX and 787 Dreamliner.
Another aircraft developer, ZeroAvia, received an order for 250 ZA2000 hydrogen-electric engines. It has a system of zero-emissions propulsion. Such a system enables regional mobility with no carbon emissions. Moreover, this year, many old and new companies offered electric and hybrid aircraft.
The aerospace industry has a target to achieve net zero emissions by mid-century. And the Paris Air Show is influencing firms, companies, and even governments to achieve this target. The initial objective is to focus on sustainable aviation fuels (SAF) that are made from municipal wastes, crops and plants, agricultural and industrial wastes, and hydrogen. On the contrary, governments are becoming more conscious of developing sustainable technologies in this sector. This year, French President Emmanuel Macron announced US$2.2 billion of public investment to support the development of sustainable technologies to decrease aircraft carbon emissions.
India on the target of democratizing affordable air travel
In this year’s Paris Air Show, India has made a headline by ordering aircraft at a record-setting level. IndiGo, one of the leading airlines in India, ordered 500 A320 aircraft from Airbus, considered the single biggest purchase agreement in the history of commercial aviation. This order has a worth of over US$50 billion. It has eclipsed the order of another leading airline, Air India, which was made in February. The order was 470 Airbus and Boeing aircraft worth US$34 billion. This huge order of 970 aircraft by two major airlines shows their efforts to keep pace with the growing demand within the country.
Indian Airlines are facing a surging demand from middle-class consumers. However, the demand would not prevail if the flight costs increased significantly. Airlines have bought more aircraft to keep costs lower and meet the huge demand. For instance, the A320 jets of Airbus that IndiGo ordered are mainly used on short-haul routes, covering people’s demand to fly for the first time or travel within the country in less time, with a minimum cost. This order of IndiGo will also help lower operating costs and improve fuel efficiency.
The question arising from such events is whether they can cause losses for airlines and consumers later. While the debate may continue, the financing method of IndiGo shows that such deals may not necessarily cause losses. Indigo follows the sale and leaseback model. In this well-known aircraft financing method, there is a need for a constant flow of new aircraft. Airlines sell newly delivered aircraft to different leasing companies, rent them back, and operate them for at least six years, and then they move to any other operator. In this way, airlines can earn additional profits from sales, and passengers can access air travel within their budget. According to Airbus, 34% of the total aircraft financing is due to such financing of the sale and leaseback model. Though the leasing market in India is facing some pressure, IndiGo announced that they were not concerned about such pressure.
On the contrary, many advancements in the Indian aviation industry make air travel cheaper and more accessible. The Indian aviation watchdog has approved IndiGo and Vistara Airlines to operate new international flights this August. The country is also working to resolve discrepancies between the leasing rules of global aircraft and their national bankruptcy laws. India’s aviation secretary took the opportunity of the Paris Air Show to address these issues and their efforts of resolutions to make the concerned authorities confident of the Indian aviation industry.
Bangladesh in the aviation industry
Recently, Biman Bangladesh has decided to order aircraft from Airbus, breaking its reliance only on Boeing. Interestingly, Biman Bangladesh has been interested in buying more widebody aircraft due to the thriving trade and tourism. The aviation industry of Bangladesh is booming even after the COVID-19 pandemic. This sector holds a good amount of unrealized growth potential. However, it is still lagging due to some basic but important issues, including weak infrastructure. The neighboring country, India, can be an example for Bangladesh.
In India, the demand for air travel is increasing rapidly. India is investing more in its infrastructure to meet the demand, increasing the capacities of airports and aircraft. Improving the aviation sector is serving the consumers and utilizing its growth potential. Bangladesh also needs to improve its aviation safety standards so that investors are interested in investing in this sector, and passengers’ confidence in air travel can be boosted. Singapore has also promoted itself as a hub for international travel by investing more in the aviation infrastructure and its frameworks. On the contrary, the aviation industry of Indonesia has expanded rapidly due to the huge domestic demand they have gained by improving their safety standards.
Bangladesh should learn lessons from these countries, and the Paris Air Show can be a medium of it. In every show, different countries share their sustainable and efficient advancement and steps in the aviation industry from which Bangladesh can redesign its pathways. Moreover, Bangladeshi airlines and the government should actively participate in the show to get the best deals and good networking to improve the country’s aviation industry.
Jinat Jahan Khan has a keen interest in microeconomic research and worked as a Research Officer at DataSense previously. She is also a Recipient of the Female Champions Fellowship by the Bill and Melinda Gates Foundation and the Centre for Research and Development (CRD).
