Despite global economic concerns and a weak aerospace industry, Airbus announces plans to build its first US manufacturing facility in Mobile, Alabama.
Airbus is set to deliver its first A320 series jet from its Mobile, Alabama manufacturing facility by 2016. With only a 20% market share of the US narrow-body jets it is hoping to grab additional market share from its US rival, Boeing. According to the President and CEO of Airbus, “The U.S. is the largest single-aisle aircraft market in the world with a projected need for 4,600 aircraft over the next 20 years - and this assembly line brings us closer to our customers.” Airbus anticipates the facility will produce between 40 and 50 aircraft per year by 2018.
The A320 series is perhaps its most popular of passenger airplanes. Among its major customers includes UK-based EasyJet, China’s China Eastern and China Western Airlines and the US’ US Airways. In fact, the majority of US Airways’ fleet consists of the A320 series and it plans to phase out its Boeing counterpart – the 737 series by 2014.
The Airbus series also provides cargo space ranging from 749 cu ft to 1,827 cu ft. US Airways transports cargo along its US domestic, European/Middle East and South American tradelanes. While the air cargo industry has been tough as is, the airline noted an almost 11% increase in cargo revenue-ton-miles for its South American lane during first quarter of this year. Not surprising, its US domestic and European tradelanes declined 21% and 13% respectively for the quarter.
The Airbus announcement is a boon for Alabama who in recent years have attracted such auto and auto parts manufacturers as Mercedes, Toyota, Delphi and Honda. Ports along the Gulf Coast such as Mobile and Tampa Florida are sure to see an increase as well as those along the East Coast such as Savannah and Jacksonville.
Also, area airports such as Huntsville are likely to see an increase in demand. Huntsville is logistics provider Panalpina’s America’s hub. The airport noted 93,458 tons of cargo passed through the airport during 2011, which represented a 32% increase year-over-year. The performance was a record for the airport, with 18% more freight handled in 2011 than the previous record year in 2007.
Birmingham International Airport will likely benefit as well. Air freight operators include FedEx, UPS and Delta.
Rail and intermodal services will benefit as well. Kansas City Southern, Norfolk Southern, CSX and Canadian National all provide services within the state. As part of Norfolk Southern’s intermodal network, its Birmingham regional facility is set to open later this year.
Despite an uncertain global economy and continued weakness within the aerospace industry, Boeing recently raised its 20 year outlook and has predicted that more than 23,000 of the 34,000 planes that will be sold will be single-aisle planes such as its 737 and the competing Airbus A320. Boeing and Airbus are both increasing production to meet an order backlog as airline companies seek to replace older airplanes with more fuel efficient ones.
According to Boeing’s forecast, Asia-Pacific region will be the biggest market for new planes, with a potential for 12,030 aircraft through 2031. The next biggest market is Europe with 7,760 and North America with 7,290, a bit more optimistic than Airbus’ forecast.