Aerospace
As in April, aircraft deliveries by Boeing in May were more than double those of the same month last year, at 35 planes compared with 17. Deliveries up to the end of May were 48% up on the same period last year, at 165 planes from 111. Most of the Boeing jets delivered during the month were its 737-MAX model, as deliveries of the 787 Dreamliner remain suspended until the second half of this year and the 777X launch has been postponed. The 737 programme has reportedly faced a challenge in reaching its 31 planes per month target this quarter because of delays in parts supply, but Boeing still aims to boost it to 38 planes per month in early 2023. It is currently building two Dreamliners a month.
Source: Boeing, Airbus
Airbus reported an almost 32% drop in May aircraft deliveries, at 47 aircraft against 69 delivered in May 2021. Most of its deliveries in the month were its single aisle A320neo and A321neo single aisle aircraft. The building rate on the workhorse A320 family is set to ramp up from 45 per month to 65 per month by next summer. In the first five months of the year, Airbus total deliveries were still up 7.7% on last year at 237 from 220 a year earlier. Airbus aims to deliver 720 planes in total this year.
COVID-19 gave aviation the biggest shock in its history, said International Air Transport Association (IATA), whose air traffic projections it derailed. The pandemic cost the industry a loss of travel worth all of 2019 revenue passenger kilometers (RPKs) 1.8 times over. IATA expects traffic in 2040 to be 6% below its pre-pandemic forecast.
Nonetheless, all signs now point towards ongoing recovery in international passenger traffic, in spite of the war in Ukraine and travel restrictions in Asia Pacific, specifically in China. Some routes have already returned to pre-pandemic levels, according to IATA’s analysis of the market for April 2022. In April, industry-wide PRKs grew by 78.7% year on year, bringing passenger volumes overall to 37.2% below pre-pandemic 2019 levels. International RPKs rose by 331.9% y-o-y in April in what was a strong recovery worldwide in overseas passenger air travel. The war in Ukraine did not prevent a resurgence in European international travel, which led global recovery with a 480% y-o-y increase. This was followed by a 290.1% y-o-y rise in international PRKs in the Asia Pacific, showing recovery from the Omicron variant, 265% growth in the Middle East and three digit growth in all other regions.
However, local restrictions in response to Omicron continued to impact domestic travel, leading to an overall 1% y-o-y decline. Tight restrictions in China saw domestic PRKs drop 80.8% y-o-y in April 2022.
Inflation, high jet fuel prices, and low consumer confidence were ongoing risks, but international bookings showed a public willingness to travel abroad – a positive trend that IATA expected to last throughout this summer. News stories in June were full of pent-up demand for international holiday travel coming up against a shortage of chartered planes.
Automotive
Source: CAAM
China’s vehicle production rose by almost 60% from April to more than 1.92m units, according to the Chinese Association of Automobile Manufacturers, but remained 5.6% down on 2.04m vehicles produced in May 2021. Despite supply chain issues, China continues to dominate global electric vehicle production.
In late June BMW announced the launch of battery-powered EV assembly at its new $2.2bn factory in Liaoning province. The Lydia plant will increase BMW’s output in China to 830,000 vehicles from 700,000 in 2021.
China’s output of EV’s including both battery-powered and hybrid more than doubled y-o-y in May to 466,000, according to CAAM, and, at 2.07 million in the first five months of this year was 114.2% up on 2021. China’s car and sales 57.6% from April but stayed 23.6% down y-o-y in May, EVs bucked the trend, as sales of battery and hybrid cars, at 44,700 in May are more than double y-o-y.
The EV charging picture in the EU — Source: ACEA
In the EU, electric vehicles have also been taking a larger share of what has been otherwise a declining market. New passenger car registrations in the EU in May fell 11.2% y-o-y to 791,546 units, the eleventh consecutive months of decline, according to the European automobile manufacturers’ association ACEA. Yet, according to data so far, hybrid electric vehicles accounted for just over a quarter of new car sales in the EU in Q1 2022, while battery electric vehicles took a 10% market share.
In June the European Parliament voted to cut CO2 emissions by 100% by 2030, which is set to accelerate the switch. To achieve this, better charging infrastructure is urgently needed in Europe, said ACEA, which pointed out that half of the region’s EV charging points are concentrated in two states; the Netherlands and Germany.
Semiconductors
Worldwide semiconductor sales increased 21.2% year on year in April 2022 to $50.9 billion and were and 0.7% up on the March 2022 sales of $50.6 billion, according to the Semiconductor Industry Association (SIA).
Global semiconductor sales have increased by more than 20% on a year-to-year basis for 13 consecutive months, indicating consistently high and growing demand for semiconductors across a range of critical sectors,” said John Neuffer, SIA president and CEO.
“High global chip demand will necessitate more semiconductor research, design, and manufacturing in the years ahead, and we urge leaders in Washington to enact innovation and competitiveness legislation that ensures more of this chip production and innovation occurs on U.S. shores.” SIA accounts for 99% of U.S. semiconductor industry revenue.
The Americas were the fastest growing market, with sales up 40.9% year on year and 3.1% on March. In Europe and China sales increased 19.2% and 13.3% respectively y-oy, but were down on March by 3.3% and 0.6% respectively.
rld Semiconductor Trade Statistics
After strong 26.2% growth in 2021, Wo organisation (WSTS), which compiles trade data, expects the global market for semiconductors to continue growing this year and the next across all regions, albeit at a slower rate. Global sales are forecast to grow by 16.3% in 2022 to $646 billion, up in double digits across all main geographical regions, with the growth rate then slowing to 5.1% worldwide to $680 billion in 2023.
Logic devices, which perform complex functions and are used in communications, are forecast to lead this year with 20.8% growth, followed by analog devices with 19.2% growth, and memory at 18.7%. Optoelectronics is expected to be show only marginal 0.3% growth on last year.
ln 2023 WSTS expects the market to be driven by mid-single digit growth in logic and analog devices. Sales in the logic category are projected to reach US $200 billion in 2023, accounting for roughly 30% of the total market. Sales in all other products and across all regions are expected to grow in 2013.
Oil and Gas
Source: Baker Hughes
The Baker Hughes oil and gas rig count in May continued the trend of the US expanding while the international count declined month on month. Y-o-y rig numbers rose in the US and worldwide as the western world sought to reduce dependence on Russia, with most regions offsetting a decline in Europe.
US rig count rose to 718 in May, up 58.5% year on year, a steady rise since August 2020. Rig counts in the rest of the world were down slightly from April to 910, but up 20.8pc against May 2021.
