US rig count numbers have now risen each month since August 2020, demonstrating strong US drilling activity, and robust demand for associated oilfield materials.
Boeing reported substantially stronger year-on-year aircraft deliveries for April 2022, which more than doubled to 35 (April 2021: 17). However, month-on-month deliveries fell 15% (March 2022: 41).
The bulk of deliveries were for the 737 MAX, with deliveries in April (28) falling just short of the group’s monthly target of 31. Boeing noted it finished Q1 2022 with 320 of the 737 MAX planes in inventory, slightly higher than expectations owing to impacts of Covid-19, supply chain delays and seasonality. Boeing expects to deliver all of these by the end of 2023. The group noted that “the timing and pace of deliveries to Chinese customers and supply chain stability remain key factors to our delivery profile” for the 737 MAX.
Airbus also saw substantially improved deliveries y-on-y, which rose 85% in April 2022 to 48 (April 2021: 26). Similarly to Boeing, however, month-on-month deliveries were lower, falling 24% (March 2022: 63). The majority of deliveries were for A320neo and A321neo single-aisle models. In its Q1 2022 financial results, Airbus reported that the monthly production rate for the A320 aircraft family would rise to 75 in 2025 to meet customer demand. Overall, the group is targeting delivery of 720 commercial aircraft in 2022, which if achieved would be an increase of nearly 18% y-on-y.
GE Aviation’s financial results for Q1 2022 also showed positive momentum behind the aerospace recovery. The group delivered 553 commercial engines in Q1 2022, of which 442 were LEAP engines. This represents an increase of 86% for all engines (Q1 2021: 298) and over 200% for LEAP specifically (Q1 2021: 141).
Air passenger market analysis from the International Air Transport Association (IATA) for March 2022 showed air travel demand was the closest to 2019 levels since the pandemic began. Industry-wide revenue passenger-kilometers (RPKs) increased 76% y-on-y, and were 41% below 2019 levels. Seasonally-adjusted RPKs rose 2.8% in March compared with the prior month. IATA noted that the spread of the Omicron variant in China continued to impact domestic air travel demand there, with volumes down 59.1% y-on-y in March 2022.
Meanwhile, international RPKs showed improved rates across all regions in March 2022, rising by 285% y-on-y at the global level. The highest rates were observed in Europe (+425% y-on-y in March 2022), followed by Middle East (+245% y-on-y) and Latin America (+240% y-on-y). The impact of the war in Ukraine has been relatively limited on air travel data, outside of international Russia and countries neighbouring the conflict.
Monthly data for Chinese car production showed a sharp drop in output in April 2022, down 46% month-on-month to 1.2M vehicles, according to the Chinese Association of Automobile Manufacturers.
The automotive sector in China is grappling with supply chain disruption as a result of new Covid-19 outbreaks and associated lockdowns.
Securities Times reported that low inventories were causing difficulties in maintaining production, particularly in areas such as Shanghai and Changchun, with producers such as Tesla notably affected.
Costs are also reported to have risen sharply, particularly for automotive electronic components, in addition to costs for logistics.
The combination of the Covid-19 pandemic, war in Ukraine, and commodity price increases, have converged to create particularly challenging circumstances in the automotive sector.
Oil and gas
The Baker Hughes oil and gas rig count continued the trends seen in March 2022 through into April, whereby the US rig count further expanded, while the international rig count continued to decline.
The US rig count reached 690 in April 2022, up 58% y-on-y. International rig count numbers, meanwhile, fell nearly 9% to 913. US rig count numbers have now risen each month since August 2020, demonstrating strong US drilling activity, and robust demand for associated oilfield materials.
Semiconductor industry sales published by the Semiconductor Industry Association (SIA) showed worldwide sales rose 1.1% month-on-month in March 2022 to reach US$50.6Bn. Total sales for Q1 2022 were US$151.7Bn, an increase of 23% y-on-y, but down 0.5% compared to Q4 2021.
“Global semiconductor sales remained strong during the first quarter of 2022, increasing across all major regional markets and product categories compared to the first quarter of last year” said John Neuffer, SIA president and CEO. “For the month of March, sales into the Americas continued to lead all regional markets, increasing by 40.1% year-to-year.”
The latest World Semiconductor Trade Statistics (WSTS) data shows that from March 2019 to March 2022, the three-month-moving-average unit sales of different categories of semiconductors saw different growth levels depending on type. Total logic and MOS micro devices grew by 72% and 22%, respectively. These categories perform complex functions and are used in mobile phones, AI systems, personal computers, and other information and communication technologies (ICT).
Total analog devices grew by 45%. These regulate “real world” conditions including cars, aircraft, and renewable energy technology. Total memory devices grew by 31%; these store data and are commonly used in mobile phones, personal computers, and data centres. Discretes and sensors and actuators grew by 28% and 21%, respectively. These devices perform simple functions and are heavily used in all industries.
Total optoelectronics, devices that emit light, decreased by 12%. These devices are common in ICT and industrial applications.