Aircraft seat suppliers are struggling to meet the demand for new high-end, lie-flat seats, for business and first class in big widebody jets, and the supply chain squeeze has begun to slow Boeing jet deliveries.
The shortage of premium seats and new Federal Aviation Administration certification requirements for seats are prime reasons American Airlines pushed back delivery of two Boeing 787 Dreamliners from this month into sometime in “the first quarter” of next year.
“This is not something specific to American,” said airline spokesman Matt Miller. “It’s an issue the entire industry is facing.”
American’s 787 business class seats are made by French supplier Zodiac. B/E Aerospace, based in Florida, is the other leading seat manufacturer, supplying, for example, the business class seats in United Airlines’ 787s.
Boeing insists that, despite American’s deferral of two deliveries, it will still meet its 2014 target of 110 Dreamliner deliveries by year-end. To do so, it will have to deliver seven more 787s by the end of the month.
“Our delivery guidance for the year has not changed,” said Boeing spokesman Doug Alder.
“Zodiac and other suppliers are having a hard time meeting demand,” said Ken Herbert, an industry analyst with investment bank Canaccord Genuity. “I think Boeing will find a way to make that number, but I’m sure it’s having an impact on other aircraft and other airlines.”
The soaring production rate for large jets that fly internationally has created heavy demand for new premium seats. Higher levels of seat customization by airlines adds to the pressure.
This year, through November, Boeing had delivered a record 207 widebody jets. In all of last year, Boeing delivered only 133 widebodies.
“We’re working on several fronts to increase seat production capacity,” said Alder.
Airbus is facing the same pressures. Spokeswoman Mary Anne Greczyn said maintaining the seat supply is “a daily challenge.”
So far, though, she said, “we are managing it and preventing it from affecting our delivery schedule.”
Another factor slowing delivery of new seats is that the FAA has developed new requirements applying to seats, such as those in business class that are not facing forward to a seat immediately in front. Passengers in such seats must be protected from head injury, using air bags or some other safety measures.
This new requirement means that seat makers, to get their seats certified, have had to devise entirely new crash tests, using new “crash test dummies” with flexible necks.
Analyst Herbert said many airlines are pushing to upgrade their premium class cabins, with fully customized seats that incorporate the latest inflight connectivity technology and comfort, and all require separate FAA certification.
“On the 787, in particular, there is a bit of a certification crunch,” said Herbert.
Airline analyst Robert Mann said top-end modern seats, enclosed in plastic shells and sporting luxury finishes and lie-flat controls, cost from $120,000 to $200,000.
That’s partly because the cost of developing these designs has to be amortized over a relatively small number of seats. In comparison, he said, a typical coach seat costs about $7,000.
Zodiac manufactures the seats for American in Gainesville, Texas, just north of the airline’s headquarters.
The Gainesville plant had a four-week strike in September, contributing to the seat supply shortage. Even before that strike, Zodiac acknowledged to analysts that its interiors unit faced “operating difficulties … due to an extremely high level” of demand.
In a Thursday conference call from Paris, Zodiac chief executive Olivier Zarrouati said, “Our engineering office was unable to cope with the workload and so there were some delays in deliveries.”
However, he added, efforts to improve output “are already starting to bear fruit.”
Zarrouati said the next six months should see Zodiac’s seat supply chain return to normal.