Farnborough air show facing global turbulence after Brexit vote

The event, held every two years, traditionally sees Boeing and Airbus compete as they unveil their latest orders

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The Farnborough air show takes off Monday amid turbulence from both Britain’s shock EU exit referendum and ultra-low oil prices. The event, held every two years southwest of London, traditionally sees US titan Boeing and Europe’s Airbus compete as they unveil their latest multi-billion-dollar orders.

This year’s event has been overshadowed by worries over economic fallout from Brexit, while a prolonged period of very low oil prices has weighed on demand for fuel efficient jets, analysts say. Organizers know there is little chance to beat the record $201 billion (181 billion euros) of business clinched in 2014.

F-35 Lightning II stealth fighters will be a centerpiece to this year's show, with the supersonic jets capable of short takeoffs and vertical landing. The Lockheed Martin-built F-35s – the most expensive aircraft in the world – were due to appear at Farnborough two years ago but were grounded after an engine fire.

British Prime Minister David Cameron, who announced his intention to step down after losing the EU membership referendum last month, attended the week-long show on Monday.

“We have the second largest aerospace industry in the world after the United States," Cameron said ahead of his visit.
"It is a brilliant moment to showcase that industry to the rest of the world – and to clinch some important export deals, both in the military and in the civilian space.”

Ahead of Farnborough, some airlines have posted profit warnings linked to expected Brexit fallout. The vote sent financial markets tanking and sparked worries about global economic fallout that could weigh on demand for airline travel. For its part, Airbus had warned that Brexit could harm its future investment in Britain, where it employs some 15,000 people.

The industry is already being dogged by a record backlog for orders of planes, which -- alongside weaker demand from airlines – contributed to a 30 percent decline in aircraft purchases last year. Nevertheless, order books are “historically the highest” with a total of 13,400 planes, according to AlixPartners analyst Alain Guillot, amid solid growth in passenger traffic.

Canada’s Bombardier could meanwhile win fresh orders for its fuel-efficient C Series jetliner at Farnborough as the firm looks to challenge the dominance of Airbus and Boeing in medium-range, single-aisle aircraft. British astronaut Tim Peake – who returned from the International Space Station last month – will make an appearance on Friday and also Saturday, when the show is open to the public.

The Red Arrows will also carry out flypasts but will not perform stunts at Farnborough for the first time in 50 years, following last year's Shoreham air show crash which killed 11 people on the English south coast.

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