Eric M. Johnson, Jamie Freed, and Tim Hepher

PARIS/SINGAPORE/SEATTLE (Reuters) – As the world hunkers down for Omicron, some investors might expect the global jet market to be withering away. It’s far from the truth.

As airlines seek to purchase greener freight and passenger planes, business has reopened as usual. This is in response to the predicted growth of online sales and the anticipated travel demand.

Some of the most discerning buyers in the sector are looking for efficient jets to take them from Arizona to Amsterdam. They want to avoid the lengthy waiting lists that could hinder their growth and threaten the environment.

Singapore Airlines (OTC 🙂 started a three-day series of key decisions. On Wednesday, Singapore Airlines made a tentative decision to replace its cargo fleet and order an Airbus A350 lightweight freighter.

Air France’s KLM and Australia’s Qantas will make decisions about small passenger plane purchases in the near future.

Rob Morris from Ascend by Cirium, the global head of consulting, stated that “people are starting to think about long-term fleet planning and particularly about ESG (environmental. social. and governance).”

He added, “It’s an example of: ‘If my replacement cycles don’t get thought about now, am i going to be left behind?'”

Airbus (NYSE:) and Boeing (NYSE;) have sold all of their benchmark medium-haul model orders until the middle-decade, following a larger previous order boom that lost momentum as the pandemic devastated.

With such long lead times for delivery of jets, focus now shifts to the second decade. This will allow us to move ahead in our quest to secure future capacity.

Brendan Sobie, an aviation consultant said that it is a buyers market.

Two industry giants, Air Lease Corp Executive Chairman Steven Udvar Hazy and a fleet of airlines under the direction Bill Franke (founder Indigo Partners), ordered more than 300 planes for their stand at Dubai Airshow.

‘FEEDING FRENZY’

Some were skeptical about the publicity value of these events, but others supported their suspicions. Others said that the dates of delivery indicated a preemptive strike.

It is obvious that ESG considerations will be crucial throughout this cycle. Morris explained that people are worried that they won’t be able get enough slots.

Many people don’t want to be limited in their ability. Singapore Airlines cancelled orders for passenger aircraft, even though it bought new freighters. Asia is likely to be one of the hardest regions to recover.

However, the combined total gross orders of Boeing and Airbus jets has trebled in the first eleven months to 1,439, compared with the pandemic-depressed levels of a decade ago. This was also helped by a spike in demand for the Boeing 737 MAX, which was allowed to fly after a safety ban.

This figure is 200 more than the 2018 data, the last year that was unaffected by the MAX crises.

The outcome of whether investors making bets on the purchase of new jets is determined by factors which are difficult to determine. Analysts point out that these factors include China’s restrictive border controls and global travel demand.

Eamonn Burns, the general director of Eurocontrol’s air traffic control agency, warned that any delay in China’s vast market reopening beyond the fourth-quarter of next year could slow down the aviation recovery.

GREEN WAVE RISES

The industry is striving to achieve net zero emission by 2050 and planemakers are maximizing their emissions savings to 15%. The sector is dependent on other energy providers to provide more sustainable fuel.

Barry Biffle, Frontier Airlines CEO, stressed that it is better to lock in savings now than wait until 2050. He was part of the Indigo Partners Order in Dubai.

However, a possible green order wave can bring new risks to some aviation companies.

A combination of the increased demand due to the pandemic, and investor and customer pressure to cut emissions, could see the older generation go out of business sooner than anticipated. This would have a negative impact on industry economics.

It would bring in a lot of money for the manufacturers, who depend primarily on selling new products. But it will be devastating for engines and leasing companies, whose profits can spread throughout the life of a aircraft’s entire lifespan.

Olivier Andries is the head of French engine manufacturer Safran (PA:), earlier this month told reporters that after the end of the pandemic, the average age at retirement for single-aisle aircraft could be 20 to 23 years.