Members of the UAE Al Fursan aerobatics demonstration team during the Dubai Airshow 2021 at Dubai World Central – Al Maktoum International Airport. EPA
Members of the UAE Al Fursan aerobatics demonstration team during the Dubai Airshow 2021 at Dubai World Central – Al Maktoum International Airport. EPA
Members of the UAE Al Fursan aerobatics demonstration team during the Dubai Airshow 2021 at Dubai World Central – Al Maktoum International Airport. EPA
Members of the UAE Al Fursan aerobatics demonstration team during the Dubai Airshow 2021 at Dubai World Central – Al Maktoum International Airport. EPA

Dubai Airshow ends on optimistic note for travel industry's recovery


Deena Kamel
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Global aircraft manufacturers secured deals, touted new freighters, reconnected with customers and expressed optimism about the future at the Dubai Airshow that ended on Thursday amid signs of recovery from the Covid-19 pandemic that has hammered the aviation industry.

The world's first major aerospace exhibition in two years since the onset of the pandemic concluded after a week in which dozens of multibillion-dollar commercial and military deals were signed, while aviation industry players emphasised their efforts at addressing climate change concerns.

The National provides a round-up of the biennial event's highlights.

The most significant deals

Airbus received orders and commitments for 408 aircraft, comprising 269 firm orders and 139 provisional orders, covering the range of its commercial aircraft families, including a first commitment for the new A350 freighter version.

The manufacturer, based in Toulouse, France, bagged a major order for narrow-body jets from private equity company Indigo Partners. The group's airlines placed a firm order for 255 A321 Neo family aircraft, valued at $32 billion at 2018 list prices, although customer discounts are customary. The order includes 102 planes for Europe's Wizz Air (75 A321 Neos and 27 A321XLRs), 91 A321 Neo aircraft for US-based Frontier, 39 A321 Neos for Volaris and 23 aircraft for JetSMART (21 A321 Neo and two A321XLRs).

The European plane maker also won a debut commitment for seven A350 freighter jets from US leasing company Air Lease Corp, as the global air cargo market booms.

The letter of intent for the 111 jets included 25 A220-300s, 55 A321 Neos, 20 A321XLRs, four A330 Neo wide-bodies and seven A350 freighters. The order will be finalised in coming months, Airbus said, without providing a deal value.

Kuwait's Jazeera Airways placed an order for 28 A321 Neos and the option for five more jets in a deal worth $3.4bn at list prices, while Nigeria’s Ibom Air became a new Airbus customer with a firm order for 10 A220s.

On the third day of the air show, US rival Boeing scored an order for 72 737 Max jets valued at nearly $9bn at list prices. Smaller deals included an order by Air Tanzania for the 787-8 Dreamliner, a 767-300 freighter and two 737 Maxs. Emirates ordered two 777 freighters. Sky One FZE announced a sales agreement for three 777-300 planes.

Best things to see

Boeing's mammoth 777X, the world's biggest passenger jet, dominated the skyline of the air show's static display, looming large with its signature wings and a queue of visitors waiting to see the interior. The international debut of the long-delayed aircraft came as customer Emirates and Boeing held discussions at the event about the timeframe to deliver the aircraft.

Russia displayed a prototype of its new fifth-generation warplane, the Sukhoi Su-75 Checkmate, for the first time outside the country.

State-owned Rostec revealed a perfume to commemorate the Checkmate's international debut in a YouTube video.

"Checkmate is a fifth-generation fragrance for masters of the game," the video says, revealing the Checkmate aircraft against the outline of a black knight chess piece. A full-size bottle appears through the rotating metal engine blades, a gift box unfolds into a black-and-white chessboard to highlight the slogan 'Turn the Chessboard'.

Russia presented the Checkmate as a cost-efficient fighter jet with flight speeds of Mach 1.8 and a range of 2,800 to 2,900 kilometres.

Military spending

Desert Sting DS-16 precision-guided glide weapon by Halcon on display at the Dubai Airshow. AFP
Desert Sting DS-16 precision-guided glide weapon by Halcon on display at the Dubai Airshow. AFP

The UAE's Ministry of Defence announced 22 deals worth Dh22.5bn during the first four days of the air show, awarded to local and international companies, according to its official Twitter account.

Abu Dhabi-based defence conglomerate Edge, whose exhibitor stand was among the biggest at the site, signed a slew of deals during the event. The latest included an agreement with weapons maker Israel Aerospace Industries to jointly develop advanced unmanned surface vessels for military and commercial use.

Airbus sold two additional Airbus A330 multi role tanker transports to the UAE Air Force and Air Defence, and secured a new export order for two A400M new generation airlifters from the Indonesian Ministry of Defence.

Emirates

The Dubai-based airline had a busy week at the air show. It signed an agreement with GE Aviation committing to develop a programme under which an Emirates Boeing 777-300ER powered by GE90 engines will conduct a test flight using 100 per cent sustainable aviation fuel by the end of 2022. The collaboration is expected to show how widebody commercial aircraft using jet fuel made from alternative sources can lower lifecycle CO2 emissions, it said.

Emirates SkyCargo announced that it will introduce two new Boeing 777 freighters into its fleet in 2022, and signed an agreement with Israel Aerospace Industries for the conversion of four Boeing 777-300ER passenger aircraft into full freighters, starting in early 2023.

The airline said at the air show that it will retrofit 105 of its Boeing 777 and A380 aircraft with its Premium Economy cabin. The entire 18-month retrofit programme, starting in 2022, will take place in its home base in Dubai.

During the show, Emirates was engaged in positive talks with Boeing regarding the delivery time and supply chain for the 777X programme, said Sheikh Ahmed bin Saeed, chairman and chief executive of Emirates airline and group.

When asked if state-owned Emirates could be among the 10 government entities that Dubai plans to list on its bourse, Sheikh Ahmed said: “We have successful businesses within the group that can be [listed]."

Etihad Airways

Sustainability was top of the agenda for the Abu Dhabi-based carrier at the show. Etihad Airways, which has been focused on its fleet of GEnX-powered Boeing 787’s under its Greenliner sustainability programme, will now include the Rolls-Royce XWB-powered Airbus A350 fleet. The first of Etihad’s A350s, launched at the air show as the “Sustainability50”, marks the airline’s commitment to the 2050 target of net-zero carbon emissions.

Aviation outlook for the Middle East

Middle East airlines will require 3,020 new passenger and freight aircraft deliveries by 2040, according to the 2021 Airbus Global Market Forecast launched at the show. This will bring the total fleet to 3,210 from a 2019 fleet baseline of 1,300 aircraft.

Airbus forecasts that air traffic in the Middle East will achieve full recovery to 2019 levels between late 2022 and mid 2024.

Other workplace saving schemes
  • The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
  • Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
  • National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
  • In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
  • Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

THE DETAILS

Deadpool 2

Dir: David Leitch

Starring: Ryan Reynolds, Josh Brolin, Justin Dennison, Zazie Beetz

Four stars

WHAT IS A BLACK HOLE?

1. Black holes are objects whose gravity is so strong not even light can escape their pull

2. They can be created when massive stars collapse under their own weight

3. Large black holes can also be formed when smaller ones collide and merge

4. The biggest black holes lurk at the centre of many galaxies, including our own

5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed

MATCH INFO

Uefa Champions League final:

Who: Real Madrid v Liverpool
Where: NSC Olimpiyskiy Stadium, Kiev, Ukraine
When: Saturday, May 26, 10.45pm (UAE)
TV: Match on BeIN Sports

Updated: November 18, 2021, 6:32 PM