Delta Takes First A350 Sparking Slow U.S. Widebody Market

Delta Air Lines on July 13 took delivery of its first Airbus A350-900, the first of the model to be delivered to a North American customer. Although Delta is now starting to renew its wide-body fleet, the U.S. market has so far been slow for three of the latest wide-body programs—the A350, the Boeing 787 and the Boeing 777X.

Neither Delta, United Airlines nor American Airlines have placed any orders for the Boeing 777X, a program launched on the basis of orders from Lufthansa and the big three Gulf carriers Emirates Airline, Etihad Airways and Qatar Airways.

The three biggest U.S. carriers have ordered a total of 82 A350s, but it is unclear when these aircraft will actually arrive. Delta ordered 25 A350-900s, and is understood to be taking 15 of them within the next two years or so. However, it also deferred deliveries for 10 more, scheduled to arrive between 2019–20, to 2021–24.

American has an order for 22 A350s initially placed by US Airways in 2005. The first aircraft was supposed to have arrived three years ago under the original plan. However, several deferrals have now pushed the first delivery back to 2020.

United’s 2009 order for 25 A350-900s has also undergone several changes, and has grown to 35 A350–1000s. However, the airline publicly stated it is analyzing its future fleet requirements again, raising more uncertainty around its large A350 commitment.
The 787 also is affected by the developments. Delta cancelled an order for 18 of these aircraft in December, after having deferred deliveries until 2020 and later. The order was placed by Northwest Airlines, which merged with Delta in 2008.

If analysts and experts observing the situation are right, neither Airbus nor Boeing can hope for quick change. The transatlantic market, in spite of Asia’s growth, is still the mainstay of U.S. airline long-haul operations, and is undergoing fundamental changes of its own. But U.S. airlines do not have as much control in this market as they do on domestic routes. Low-fare carriers such as Norwegian, Level, WOW Air and Eurowings are emerging on the scene in a big way. There is also growth in the number of transatlantic narrowbody flights into secondary markets at both ends, which is eating into the feeder demand of major hubs.

As low-cost and narrowbody operators gain a bigger share of the transatlantic market, incumbents are cautious about adding new capacity, and also are still in the process of figuring out what the right future aircraft will be. At the current low fuel prices, airlines also don’t feel a need to replace their existing fleets so soon.