What Boeing’s Trouble Means for Airbus Market Share

It has been a rocky few years for Boeing (BA), which was once the world’s leading aircraft manufacturer.

Between two fatal crashes involving its bestselling 737 MAX aircraft, subsequent fleet groundings, whistleblowers highlighting production and quality issues, and the recent incident involving a panel falling off an Alaska Airlines (ALK) plane mid-flight, the plane manufacturing industry is going through a lot of turbulence. For Boeing’s European competitor Airbus (EADSY) there are implications too.

Falling out of Favor

Boeing and Airbus are two parts of a global duopoly of plane makers. Sure, there are also Brazil-based Embraer (ERJ) and Canadian Bombardier (BDRBF), but Boeing and Airbus really dominate the market, particularly when it comes to bigger jets.

For more than two decades after Airbus went public in 2000, Boeing was the bigger company by market capitalization, but the recent turbulence has pushed it into second place with Airbus valued at nearly $140 billion, and Boeing at about $112 billion.

Adding to this growing divide, Boeing delivered just 27 planes last month, while Airbus delivered 49.

Boeing’s ongoing troubles have reverberated throughout the airline industry. United Airlines (UAL) and Southwest Airlines (LUV) both slashed plane delivery expectations for the year. But airlines can’t just turn to Airbus for their new plane needs. Orders have been placed years in advance, and delivery backlogs mean that Boeing will continue to supply airlines around the world with jets. The long lead time of the industry could mean that it takes a while for Airbus to encroach on Boeing’s market share.

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