Aerospace manufacturers plan to show business as usual at next week’s Paris Air Show with big aircraft orders, even as U.S. tariffs, escalating conflicts and fragile supply chains disrupt the global aviation and defense industry.
The world’s largest aviation trade show, held June 16-20 in Le Bourget, provides a key stage for aircraft and weapons makers to showcase cutting-edge technologies such as artificial intelligence and autonomy, along with splashy order announcements.
Airbus may kick off the event on Monday with two major Saudi orders, a sign of strong growth in air travel in the Gulf, while it faces last-minute competition from Embraer for a potential order of about 100 smaller A220 jets from AirAsia.
Boeing is expected to take the bulk of its fleet restructuring orders from longtime customer Royal Air Maroc, but will have a quieter week than its rivals as it snatched up big orders following U.S. President Donald Trump’s recent visit to the Gulf.
Behind the scenes, civil aircraft manufacturers and defense and supply chain giants such as Lockheed Martin and Raytheon will grapple with the uncertain impact of Trump’s erratic tariff statements and brewing conflicts.
“We were just coming out of this (COVID-19) and some of our second and third tier suppliers were just starting to get back on their feet, and now there’s this uncertainty,” said Christian Scherer, CEO of Airbus’s aircraft manufacturing business.
A U.S.-China agreement to restore a fragile trade truce lifted sentiment ahead of a global aerospace conference, but some delegates said the industry was adjusting to the prospect of a 10% base tariff that could continue while lobbying for exemptions.
“Despite all this disruption, it should be a good air show with orders, especially for Airbus on home soil,” said Richard Aboulafia, managing director of AeroDynamic Advisory.
Even so, weak supply chains and a fractured trade and defense alliance just days before a NATO summit have upended years of planning for the nearly $1 trillion industry.
Defense Spending
The war in Ukraine and tensions in the Middle East have disrupted airspace, rerouted freight and passenger routes, and increased insurance costs.
Spurred by the war in Ukraine, European countries are increasing military spending at a rate not seen since the Cold War.
Germany, Poland and the United Kingdom have all announced significant increases in their defense budgets, including planned spending on air defense, drones and next-generation fighter jets.
The show will feature a variety of drone types, including low-cost, expendable models that have proven highly effective in the war in Ukraine.
Such platforms are increasingly seen as a necessity in modern warfare because they offer a cheaper, scalable alternative to traditional manned aircraft.
As relations with the United States weaken during the Trump administration, many European countries are reconsidering their reliance on U.S. defense support, and the global defense landscape is being reshaped as artificial intelligence systems develop and political alliances shift.
“If the Europeans were spending more on defense, you’d think they’d hire Europeans to build European capacity and capabilities, just as the U.S. enjoys the services the U.S. provides,” said Byron Callan, a defense industry expert and managing partner at Capital Alpha Partners in Washington.
“That’s probably one of the most important changes to come out of the U.S. election and Russia’s invasion of Ukraine.”
Access to rare earths is another pressing topic.
Environmental issues, typically a prominent theme at air shows, will again be addressed in dedicated displays this year, but they are likely to be relatively low-key this year as Trump has downplayed green initiatives.
At the Global Aviation Summit this month, airlines reaffirmed their commitment to net-zero goals but expressed concerns about the limited availability of sustainable fuels and next-generation aircraft.
A series of high-profile studies, such as Airbus’s plan for a hydrogen-powered passenger jet, have been slowed or halted.
Aircraft manufacturers say taking delivery of existing aircraft that burn at least 15% less fuel is the quickest way to curb emissions. But deliveries have been delayed because of supply problems, and environmentalists say planemakers chasing more orders are bracing for a longer reliance on fossil fuels.
