Product and Customer Concentration – the Risks for OEMs |

Airbus and Boeing each have extensive wide-body and narrow-body product lines, as well as several key customers who order large fleets of aircraft. But heavy concentration can be a risk as well. Nobody wants to put all of their eggs in one basket. But how do the duopoly members compare to the diversity of sales across the product family and concentration with just a few key customers?Using our deliveries database, we examined the concentration in both model types and customers for Airbus and Boeing to determine if one of the players had higher risks than the others. Our findings were quite interesting.Tracking our daily delivery database from January 1, 2021, through November 5, 2023, we found that Airbus delivered 1,867 aircraft to 1,151 from Boeing. Airbus's market share in deliveries during the period was 61.8%, giving it a strong lead in the duopoly. There were several issues impacting both OEMs during the period, with Boeing having the more difficult impacts due to quality issues. Both OEMs faced supply chain issues, and with the Pratt & Whitney 1100G engine issues, we expect supply chain and quality issues to continue into 2025-2026. Each OEM will have a difficult time meeting 2023 production targets. Concentration by Product Looking on a model-by-model basis, Boeing’s 737-8 and the high-density 737-8-200 variant of the same aircraft are the top sellers at Boeing, with 752 aircraft delivered of the 1,151 total, or 65.3%. Adding the 737-9 with 172 deliveries and 777F with 54 deliveries, the second and third-best sellers generate 85.0% of aircraft deliveries.. The top six, including the 787-9. 767-300F, and 787-10, bring the cumulative total to 96.4%. The following chart shows the percentage concentration by model for Boeing deliveries from 1/1/2021 through 11/5/2023: [caption id="attachment_78910" align="aligncenter" width="581"] AirInsight[/caption] By contrast, Airbus's best seller is the A321neo, with 726 aircraft delivered, only 38.9% of the total. The A320neo follows this at 722 aircraft and 147 A220-300 aircraft to bring the top three to 85.4% of the total. Adding the A350-900, A330-900, and A350-1000 at 129, 55, and 29 deliveries brings Airbus concentration up to 96.8% for the top six models.The significant difference between the two OEMs is that Boeing is ultra-dependent on the 737-8 for 65% of its deliveries, while Airbus's best seller is only at 39%, a much lower concentration. While the concentration levels even out after three airplanes, Boeing has a considerable risk in the single model comprising more than half of its deliveries. Airbus, despite the A320neo and A321neo being in the same family, serves different markets, thereby lowering risk.With the future introduction of the 737-7 and 737-10, Boeing should improve its risk profile once the new aircraft are fully certified. Interestingly, new freighter deliveries from last-generation airframes, the 767-300F and 777F, were the third and fifth most delivered aircraft, totaling 103 of the 1,151 deliveries, or 8.9%. From a sustainability perspective, those aircraft that are powered by old technology engines are not as efficient as newer models. Boeing has a virtual monopoly on the freighter market continues to capitalize on older technology aircraft. This also indicates how much the recent 787 quality issues impacted deliveries and cash flow at Boeing, as over the last three years, more 767F and 777F models have been delivered than 787-9 and 787-10 combined. [caption id="attachment_78911" align="aligncenter" width="568"] AirInsight[/caption] Airbus, by contrast, has 38.9% of the deliveries in the A321neo, followed by an additional 38.7%, with the A320neo in second place. After those two models, the concentration pattern is similar to Boeing’s, with 85.4% for the top 3 and 96.8% for the top six models. But the dependence on one model at Boeing is disconcerting, clearly demonstrating the need for the 737-10 and 737-7 to be successfully certified and introduced as soon as the FAA approves their designs. Customer ConcentrationLooking at customer concentration, we find a similar disparity between the two OEMs. Boeing has a much higher customer concentration than Airbus, with its top customer, Southwest, at 14.8% of deliveries during the period, the top five at 42.4%, and the top ten at 57.7%. The following table illustrates Boeing’s customer deliveries concentration during the 1/1/2021-11/5/2023 period for the top 15 customers, who accounted for 66.6% of deliveries. [caption id="attachment_78915" align="aligncenter" width="788"] #image_title[/caption] By contrast, Airbus has its largest customer with only 6.9% of deliveries during the period and a much less concentrated customer base. The top five account for 22.2%, the top ten for 33.3%, and the top fifteen for 42.2% of deliveries. This customer concentration is much lower for Airbus than Boeing, which has North American geographic risk. [caption id="attachment_78913" align="aligncenter" width="790"] AirInsight[/caption] The Bottom Line:It appears, based on what has been delivered over the last three years, that Airbus has lower risks in terms of product concentration and customer concentration than Boeing. Boeing has a high concentration of North American customers, with five of its top 15 in North America and 38.7% of deliveries during the period. Airbus, by contrast, has only 15.2% of deliveries in North America. Boeing remains the hometown choice in North America but must diversify its customer base to regain the market share lost to Airbus. Based on future orders, we believe the next three years will show better results than the last three for Boeing. But Boeing remains well behind Airbus in total orders and continues to lose the sales battle. The middle of the market that Boeing invented with the 757 and 767 has now gone clearly over to Airbus and the A321neo family, Airbus's best-selling product. We believe Airbus will continue to hold a significant market share advantage until a new generation of narrow-body aircraft emerges in 2030-2035.

US Flight Planner - US DoT On-Time Data	Airbus vs Boeing - Official OEM Data
US Airline Schedule Performance - US DoT Data	Daily OEM Production & Deliveries -

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