By Allison Lampert
March 16 (Reuters) – U.S. planemaker Boeing has asked suppliers to identify any impact to production caused by the U.S.-Israeli war on Iran, according to a message to suppliers seen by Reuters, as industry concerns rise that a longer conflict could further constrain aircraft production.
Global planemakers are speaking with suppliers and customers as they assess the impact of a war now in its third week, which has pushed oil prices to about $100 a barrel with no clear end in sight. The conflict has disrupted flights and shipping, with Reuters reporting delays in transporting aircraft parts to Middle East carriers.
In a recent online communication to suppliers, Boeing asked companies working on its commercial programs to identify by March 9 any work carried out in the Middle East, including by sub-tier suppliers, and any operational impacts.
“As we continue to monitor the situation in the Middle East, we are assessing potential impacts to the stability of our supply chain,” said the message.
Boeing declined to comment.
MIDDLE EAST NOT MAJOR PARTS HUB
While the Middle East region is not considered a major manufacturing hub of components for new planes, suppliers like Strata in the United Arab Emirates make parts for Boeing’s 787 Dreamliner jet. Boeing, however, also sources parts like the vertical fin from other sites.
Strata was not immediately available for comment.
AIRBUS AND EMBRAER ALSO ON ALERT
A senior supply-chain source said the shipping and air disruption at one of the world’s critical transit points could have an impact on Boeing’s European rival Airbus if the war dragged on beyond a few weeks.
A spokesperson for Airbus said the planemaker is in close dialogue with customers and suppliers across the region.
Brazilian planemaker Embraer has also questioned suppliers about the impact of the conflict on output and transport costs, a source familiar with the matter said.
In response to questions from Reuters, Embraer referred to comments by CEO Francisco Gomes Neto, who told analysts on March 6 that the planemaker was “taking care of our suppliers, both direct and indirect in the region” and had not seen any “impact in deliveries or even short-term sales.”
While the impact on aerospace has so far been limited, some analysts say a prolonged conflict that keeps oil prices high could weigh on demand for new aircraft. Some Gulf carriers are among the largest buyers of wide-body jets from Boeing and Airbus.
“What I’m really more concerned about is long-term demand for jets in the region,” said Richard Aboulafia, managing director at U.S. consulting firm AeroDynamic Advisory.
The world’s largest commercial planemakers, along with business jet makers, are ramping up production as aircraft supply continues to lag demand, swelling order backlogs. That is adding strain to a supply chain already facing rising demand from the defense sector.
A separate industry source said some planemakers are also weighing the risk that the U.S. Trump administration could invoke the Defense Production Act to compel suppliers to accelerate output to support the conflict. If applied broadly, such a move could weigh on commercial aerospace, since many suppliers serve both defense and civilian programs.
(Reporting by Allison Lampert in Montreal, Tim Hepher in Paris, Federico Maccioni in Dubai and Gabriel Araujo in Sao Paulo; Editing by Joe Brock and Matthew Lewis)
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