How long can Airbus keep its edge over Boeing?
As its US rival has stumbled, the company has established a lead in the market for commercial single-aisle aircraft. But both are eyeing Chinese competition
Margaret Thatcher, Britain’s prime minister during the 1980s, took a dim view of Airbus’s prospects. Asked to provide government money to support the launch of a new small passenger aircraft, the A320, she warned: “It will never work, Boeing will dominate the market.”
It was a reasonable assessment at the time. Airbus was then an upstart European competitor to the US aerospace and defence giant, whose best-selling 737 jet had already been flying for over a decade.
Despite her initial misgivings, the UK lent close to £250mn towards the launch of the new aircraft. The decision paid off. The A320 family of single-aisle jets, typically used on short and medium-haul flights, is now poised to overtake the 737 as the most popular commercial aircraft in history with 12,153 delivered since launch, according to aviation consultants Cirium.
The success of the A320 family has been the driving force behind Airbus’s ascendancy in its five-decade rivalry with its US competitor. For years, the two companies had a roughly 50:50 split of the market for commercial single-aisle aircraft. But by the end of last year, Airbus held a market share of 61 per cent measured by order backlog and 72 per cent by deliveries, according to Cirium.
Boeing still leads in larger, wide-body aircraft types, but in recent years has been mired in the fallout from two crashes of its 737 Max 8 aircraft in 2018 and 2019 which led to the grounding of the plane for 20 months. The mid-air blowout of a door panel on a Max 9 aircraft, in January 2024, led to US regulators imposing a production cap.
With Airbus delivering at higher rates and preparing to increase A320 production further, it is “hard to see how its lead can be broken”, says Rob Morris, global head of consultancy at Ascend at Cirium.
Airbus’s rise has not been trouble-free — political interference from European governments hindered decision-making early on, while another aircraft programme, the A380 superjumbo, proved a commercial mistake.
More recently, the company has grappled with industry-wide supply chain issues that have forced it to delay deliveries. The decision to push back plans to fly a hydrogen-powered aircraft by 2035 has been heavily criticised, and there are challenges in its defence and space business.
As aerospace industry veteran Kelly Ortberg steadies the ship at Boeing, an emerging rival in China is looking to challenge the duopoly. And with pressure growing over aviation’s carbon footprint, Airbus faces perhaps its biggest test yet: how to stay on top.
“It’s one thing to run a very strong company when the other guy is busy shooting himself in the foot,” says Richard Aboulafia, managing director of consultancy AeroDynamic Advisory.
“When the other guy is getting on track, you’ve got to be prepared for a wide variety of choices and outcomes.” He adds that “the next battle” is for the coming decade, when both manufacturers are expected to launch a new generation of single-aisle aircraft.
Guillaume Faury, Airbus’s chief executive since 2019, told the FT that Airbus wants to keep leading from the front. The company is targeting 2030 as the launch date for the successor to the A320, with a new plane entering service in the second half of that decade.
Airbus, he makes clear, has to be a pioneer in aerospace. “We want to continue to lead, to take risks in terms of business . . . to experiment.”
A risk for the group, he adds, is to lose agility. “We know the world will not be what we think it will be. You need to be able to move, to adapt, to adjust.”
Faury’s biggest problem right now is how to speed up production of existing models.
In 2020, the company was forced to cut production by about a third as the Covid-19 pandemic grounded planes around the world, bringing a decade of ever-increasing output to a juddering halt.
The industry has struggled to regain its previous productivity levels. A loss of experienced labour and persistent supply chain bottlenecks held back output just as demand for travel bounced back, and deliveries from the two manufacturers have remained below pre-pandemic peaks.
Airbus may have struggled, but Boeing has fared worse due to the worldwide groundings of the 737 Max after the two fatal crashes. The European group has held the crown as the world’s largest aircraft maker by deliveries for the past six years.
Boeing delivered 348 jets in 2024, fewer than half the 766 that Airbus managed, as 737 Max output remained subject to a 38 per month cap pending improvements to quality control.
A shortage of engines has been one of the most persistent challenges for both companies. CFM International, a joint venture between France’s Safran and GE of the US, and Pratt & Whitney have struggled to keep up with demand. Both companies’ engines for the A320neo have also had durability issues.
The engine bottleneck is straining Airbus’s plans to increase production, especially its aim to raise A320 manufacturing to 75 a month by 2027. It said in July that it had been forced to build 60 “gliders”, or aircraft waiting for engines, but stuck to its ramp-up trajectory.
Faury told analysts at the time that Airbus would keep working with engine makers in 2026. “They have to deliver on the ramp-up, both for us and for the after-market as the number of [A320neos] flying is increasing quite fast.”
Customers, frustrated by repeated delivery delays, say they want Airbus — as well as Boeing — to focus on delivering existing orders before launching ambitious new aircraft development programmes.
“We need to have greater confidence that Airbus and Boeing will be able to get to those production rates at a high standard of quality before they launch any new product,” says John Plueger, chief executive of Los Angeles-based aircraft lessor Air Lease.
“The confidence you have in any new product is largely gained from what your experience is with either manufacturer on the current product.”
Other operational hurdles loom for Airbus. It is adding A320 final assembly lines at existing sites, notably in Tianjin in China and at Mobile in Alabama in the US, to support the higher production volumes.
The company must also integrate parts of Spirit AeroSystems into its operations. The US supplier is being taken over by its former parent Boeing, forcing Airbus to carry out the work Spirit used to do for its programmes, including operations in Belfast, Northern Ireland.
The task of making sure Airbus’s factories deliver will fall to the incoming head of its planemaking division, Lars Wagner. Currently chief executive of German engine maker MTU Aero Engines, Wagner will succeed Airbus veteran Christian Scherer in January.
Although Wagner previously worked for Airbus and is known in the industry for his strong operational focus, Plueger warns that he “will walk into a different Airbus than the one he left”.
It is “a much larger, much more successful [Airbus] but also a much more complicated machine in terms of how many planes have to be produced”.
While Airbus’s commercial business is straining to meet demand, its defence and space division faces more deep-seated challenges.
Its second-largest business segment accounts for about one-fifth of the group’s revenues and builds everything from fighter jets and transport aircraft to drones and satellites.
Parts of the division are doing well — Eurofighter, the pan-European project in which Airbus is a partner, has won recent orders, while MBDA, Europe’s missile champion in which the company holds a 37.5 per cent stake, has also benefited from new work due to the war in Ukraine. The troubled A400M transport aircraft this summer secured new agreements from France and Spain that will keep its production line running.
But it has suffered from higher costs and growing US competition, in particular from players like Elon Musk’s SpaceX in the market for satellites, and has not seen the same surge in orders as other European players that have benefited from demand for products like armoured vehicles.
Faury argues there is commercial logic in retaining the unit. “There are a lot of synergies and cross-fertilisation between civil and military on aircraft, that’s what we do on helicopters, on satellites, on rockets,” he says.
He is also an outspoken advocate for consolidation in Europe’s fragmented defence industries so they can better compete with the US. Airbus has scale in commercial aerospace and military helicopters but needs to build up in satellites, where it is negotiating a joint venture modelled on the successful MBDA missile partnership with Italy’s Leonardo and Thales of France. The companies, says Faury, have “more homework to do” but talks are “progressing very well”.
Less positive are relations with France’s Dassault Aviation, Airbus’s main partner on the Future Combat Air System (FCAS) to build a new fighter. There have been repeated arguments over technology sharing, who would lead critical parts of the programme, and the specifications of the fighter jet. The two companies have reached a stalemate on the second phase of the programme, which should culminate with a prototype version of the jet.
Dassault, which builds the successful Rafale fighter for France and other countries, has said the governance structure needs to change and that despite being the designated lead on this phase it can still be outvoted by partners in Germany and Spain.
It is a sensitive topic, with politicians from both Berlin and Paris now charged with unblocking the stalemate. The partners are also under pressure to accelerate development amid competition from the rival Global Combat Air Programme involving BAE Systems of the UK, Leonardo and Japan’s Mitsubishi Heavy Industries.
GCAP has pledged to build an advanced fighter jet by 2035. Were FCAS to collapse, Airbus could try to team up with GCAP, but given that programme’s advanced timetable, industry experts believe Airbus’ time is running out.
Faury won’t discuss what a potential compromise with Dassault might look like but insists that, unlike his French partner, Airbus “is not challenging the rules of the co-operation which have been defined [at the outset]”.
The longer-term challenge for both Airbus and Boeing is when to launch a new aircraft — and what kind of aircraft it should be. Airlines are under pressure to cut their carbon emissions by 2050, meaning the choice of technologies will be crucial.
“If they don’t get that right and someone else does, Airbus loses everything they’ve worked the last 55 years for,” says Sash Tusa, an analyst at Agency Partners. “They’ve really got to get climate right.” The next plane, he adds, has to be revolutionary or “it probably won’t have a very long shelf life”.
Faury believes that 2030 “is the moment where the stars will be aligned” for the launch of a new aircraft programme. A plane launched then will enter service in the second half of the 2030s, meaning that “there will be a lot of those planes in service by 2050, which is the time when we want to see a significant, very significant improvement in carbon dioxide emissions.”
Boeing chief executive Ortberg has struck a more cautious tone, saying in July the company was assessing several factors that would need to converge before launching a next-generation plane. These included the readiness of the market and key technologies, as well as Boeing’s financial condition. “That is not today, and probably not tomorrow.”
Faury agrees that the technologies are not ready today. But he believes they will be by 2030, potentially including a radical engine design with exposed fan blades.
Test flights of a demonstrator of the “open fan” engine, being developed with CFM and dubbed RISE, are due to take place on a modified A380 superjumbo towards the end of this decade. Airbus hopes the new engine configuration will contribute to an expected 20 to 30 per cent fuel efficiency improvement compared with existing models.
Faury says CFM is offering ideas that are “really more than evolutionary” and that Airbus is committed to “giving [RISE] the best possible chances” but does not rule out an engine based on improved conventional technology.
A new plane is likely to have much longer wings than today’s models. Faury says the company believes a more radical “blended wing” design that merges into the fuselage could make sense for bigger wide-body aircraft of the future or for drones. For the single-aisle size, he says the benefits of blended wing are “minimal”: “We believe a RISE-based architecture with long wings is something that still wins.” New production methods will also be required to turn out planes at much higher rates than today’s A320s.
Airbus’s healthy balance sheet gives it financial flexibility to invest in what would be a multibillion-dollar programme, though Faury likes the “idea there is skin in the game with governments [that] they are supporting this”.
But government backing for a new programme could prove contentious at a time of trade tensions between the US and the EU and — while Airbus is not yet ready to approach national governments — Faury notes that the US administration is “heavily supporting [its] own national champion”.
US President Donald Trump has rowed back from including aerospace in his tariff blitz against the EU but has made buying Boeing planes part of recent trade deals. Faury contends that awarding it the contract to build the F-47, the next-generation US fighter jet, is another form of support.
Boeing also is not the only threat to Airbus’s current dominance. Brazil’s Embraer, the world’s leading producer of smaller regional jets, has been studying whether to expand into larger models.
Industry experts worry that in the long term, China’s Comac might prove the real disrupter. Many of the components on its single-aisle C919 jet, including the engines, still come from US suppliers, but that could change over the next two decades.
Faury’s current remit at Airbus runs until 2028 and he says it’s up to the board to decide what happens after that. But the decisions he takes over the coming years will determine Airbus’s path into the 2030s and beyond.
With potential new rivals and a resurgent Boeing backed by a mercantilist president ready to make a comeback, the vast company has to stay nimble.
“It’s very hard to conceive of Airbus losing its number one position,” says analyst Tusa. “But it’s one of the rules of war — always remember the enemy has a turn.”
