Aircraft Interiors – industry development summary: Mar/Apr-2024

This edition covers Mar-2024 and Apr-2024 and features:

• Keeping connected - SpaceX hits major development milestone with airBaltic ground test;
• INTERIORS INSIGHT - Airbus: get ready for the first wave of A350 retrofits;
• Latest global interior updates.

Keeping connected - SpaceX hits major development milestone with airBaltic ground test

In late Mar-2024 airBaltic conducted a successful ground test of SpaceX's Starlink IFC onboard an Airbus A220-300 at its hub in Riga, Latvia. This is a major milestone for SpaceX and airBaltic since the two signed an agreement in 2023 to install Starlink fleet-wide.

While SpaceX, an American spacecraft manufacturer founded by headline-grabbing Elon Musk, has been around since 2002, the company didn't enter the IFC market until 2022.

JSX, a US FAA Part 135 airline, was Starlink's launch customer and completed active fleet installation in 2Q2023.

Meanwhile, Hawaiian Airlines was SpaceX's first major commercial airline client, signing an agreement for installation across its Airbus A321neo, A330, and Boeing 787 fleets. After some delays, installation began in Feb 2024. The CAPA Aircraft Interiors Database currently tracks the airline's entire A321neo fleet flying with the technology.

In a matter of two years SpaceX has grown to more than 60 aircraft with its solutions installed. The firm has also sealed firm deals or trial agreements with major airlines, including Air New Zealand, Qatar Airways, and Japan Airlines' LCC - Zipair.

It is still unknown whether SpaceX can break the firm grip that the top players exert over the market: the IFC industry has thus far been highly concentrated.

According to the CAPA - Centre for Aviation Aircraft Interiors Database, the top IFC providers Viasat (including Inmarsat), Intelsat S.A., Panasonic Avionics and Anuvu occupy more than 90% of IFC market share of passenger aircraft in service. Besides Viasat's tremendous growth, there has been little change in the make-up of the market over the past decade. On a related note, in late Apr-2024, SES announced an intention to acquire Intelsat.

Timeseries of global in-service IFC market share over the past decade (2014-2024), as of 14-Apr-2024

Source: CAPA - Centre for Aviation Interiors Database.

SpaceX entered the market when legacy IFC players started shifting their attention away from geostationary equatorial orbit (GEO) to low-earth orbit (LEO) satellites. LEO is touted as faster, with lower latency, than GEO; OEMs are exploring either LEO-only solutions or multi-orbit solutions to switch between GEO and LEO. This created the perfect opportunity for SpaceX, touting the largest satellite constellation worldwide and operating LEO satellites exclusively.

Current IFC companies are not willing to give up their shares and are proactively developing solutions to support LEO.

Intelsat successfully tested its Electronically Steered Array (ESA) solution in the Arctic Circle, in partnership with the ESA launch customer, Alaska Airlines. ESA is an integral component of multi-orbit solutions as it enables switching between LEO and GEO satellites. This was demonstrated on Intelsat's test flight to Utqiaġvik (formerly known as 'Barrow'), the northernmost airport of the US.

High latitudes have usually been 'dark spots' for GEO connectivity; this is not a challenge for LEO. On Intelsat's test flight, the aircraft operated on GEO capabilities for its first leg to Anchorage, then successfully switched to LEO as it flew into the Arctic.

Hughes Network System, a long-time IFC supplier but recent entrant to the direct market, caused an upset when Delta Air Lines announced that its 717s and regional jets would switch from Intelsat's ATG-4 solution to Hughes. The agreement currently covers only GEO, but may possibly be extended to tap into Hughes's Medium Earth Orbit (MEO) and LEO solutions.

Meanwhile, the major wireless IFE player AirFi signed VietJet Air as its LEO client in Mar-2024: AirFi was among the first to offer LEO, signing Atlantic Airways of the Faroe Islands back in 2018. However, the firm has yet to deploy any LEO solution commercially.

As LEO and multi-orbit prove their promises, traditional GEO solutions continue to gain ground.

The CAPA - Centre for Aviation Aircraft Interiors Database has tracked that Korean Air, a long time hold-out on IFC, recently kicked off IFC retrofit activities. To date, the airline has only publicly announced line-fit IFC plans for its next generation Boeing 737 MAX 8, 787 and Airbus A321neo aircraft. However, CAPA - Centre for Aviation data now shows two of the airline's Boeing 777-300ERs flying with what is likely Viasat-powered IFC.

Other newly GEO-connected airlines include Royal Jordanian and Shenzhen Airlines.

Airbus: get ready for the first wave of A350 retrofits

On 03-Apr-2024 Airbus published a marketing piece on Airbus A350 retrofits starting in the coming years, and the OEM's capabilities in supporting airlines' cabin upgrade decisions.

Airbus stated that aircraft typically undergo cabin retrofit when they have reached eight years of service. It is unclear the exact definition Airbus has in mind for 'retrofit', as eight years is on the lower end in terms of typical full cabin retrofit cycles. It is possible Airbus is simply referring to reconfigurations or re-upholsteries.

According to the CAPA - Centre for Aviation Fleet Database, more than 60 current passenger A350s will reach this age by the end of 2024. By the end of the decade, over 460 A350s would have reached the eight-year suggested retrofit timeframe.

In the announcement Airbus also highlighted some A350 retrofit trends, including demand for privacy features in business class and an increase in popularity of premium economy cabins.

CAPA - Centre for Aviation will be taking a deeper dive to understand the numbers behind these trends:

• Demand for privacy features (namely - sliding doors):

In CAPA - Centre for Aviation's Aircraft Interiors Database - industry development summary: Jul/Aug-2023, a deep-dive was conducted on the growing prominence of premium class sliding doors. Growth in availability of the feature is especially notable in Europe.

The A350 is no exception to this trend. The CAPA - Centre for Aviation Aircraft Interiors Database shows less than 5% of A350s in service featuring sliding privacy doors in 2017. This number has now more than quadrupled, with clear accelerated growth post-COVID-19. The number of airlines offering the feature has also grown from one to 12. Equally impressive is the ever-growing variety of doored seat products, with new entrants every year.

Timeseries of A350s in service with doors in business class, by type, 2014-2024, as of 14-Apr-2024

Source: CAPA - Centre for Aviation Interiors Database.

• Premium Economy

The rise of Premium Economy is no recent phenomenon. However, specifically examining A350s delivered over the years, it is still fascinating to note the pace that the product has been growing, and how there is still more room for it to grow.

According to the CAPA Aircraft Interiors Database, just over half of all A350s delivered in 2016 were equipped with premium economy cabins; in 2023, this figure stood at close to 75%. Overall coverage is expected to grow not only from line-fitted aircraft but also from retrofit activities.

ITA Airways signed a cabin retrofit agreement with Airbus Service in 1H2023 to replace parts of the economy seats with premium economy seats. This is expected to be completed by mid-2024. Delta Air Lines is expected to add 'Premium Select' to all of its A350s that were previously operated by LATAM Brasil.

Global share of Airbus A350s delivered with premium economy seating, 2015-2024

Source: CAPA - Centre for Aviation Interiors Database.

Airbus is attempting to reshape the IFC and IFE markets

On the IFC front, Airbus is attempting to reshape the IFC market with its Airspace Link HBCplus solutions.

Offering it as either a line-fit or retrofit option, Airbus aims to make switching IFC providers far easier by installing hardware compatible with a host of managed service providers (MSP). This enables airlines to alternate between IFC providers more easily, as they no longer need to install supplier-specific hardware.

Emirates is the launch customer for the solution, with plans to install HBCplus on 50 of its upcoming A350s. Air India and Ethiopian Airlines have also signed the solution for their A350s.

The A350 IFC market has been dominated by Panasonic Avionic and Inmarsat (now Viasat) GX Aviation. Both are listed as MSP for HBCplus. It is yet to be made clear how the OEM's shares will be impacted in the long run.

Timeseries of IFC solution on A350s in service, by type, 2014-2024, as of 14-Apr-2024

Source: CAPA - Centre for Aviation Interiors Database,

On the IFE side, the first A350s mostly featured either Panasonic Avionics eX3 or Thales AVANT as their IFE solutions. Since 2018 RAVE, from Safran Passenger Innovations, has steadily gained ground and currently occupies close to 20% of the A350 market.

Aircraft in the next generation of A350s are expected to tap into a different array of solutions.

EgyptAir and Qantas Airways both chose Panasonic Avionics' latest Astrova solution.

Meanwhile, the Thales AVANT Up was selected for Air India's next batch of A350s and Ethiopian Airlines' upcoming A350-1000s.

Timeseries of IFC solution on A350s in service, by type, 2014-2024, as of 14-Apr-2024

Source: CAPA - Centre for Aviation Interiors Database.

Ongoing and future A350 retrofit plans

In Mar-2024 Malaysia Airlines unveiled a new business class seat based on Collin Aerospace's Elevation platform. The seats are to be used on its upcoming A330neos and for A350 retrofits from 2026. New features of the product include sliding privacy doors, wireless charging, and USB-C (among others).

According to the CAPA - Centre for Aviation Aircraft Interiors Database, Collin Aerospace's Elevation and its revamped version, Elements, are currently flown by British Airways, Etihad Airways and STARLUX Airlines.

Malaysia Airlines' A350 currently features four of Thompson's Vintage XL First as 'Business Suites', and 35 Vintage business class seats as standard business seats. The switch to Elevation will likely mark the end of 'Business Suites' at the airline.

Taiwan's China Airlines also recently filed plans to invest USD400 million to retrofit its A350s. Although details are scarce, it is likely that privacy doors will be part of this plan for better competition with the self-dubbed boutique airline STARLUX.

Over in Europe, the CAPA - Centre for Aviation Aircraft Interiors Database tracks that Finnair is one aircraft away from completing its A350 retrofit programme. Existing Safran Cirrus III business class seats are being replaced by Collins' AirLounge seats and premium economy is being introduced for the first time, with seats provided by HAECO (now under ZIM Group).

Lufthansa is likely next.

Lufthansa has firm plans to start A350 retrofits soon. In 2023 Lufthansa introduced a host of premium products as part of its Allegris initiative. The first aircraft with Allegris seats is an A350 that was just delivered in mid Apr-2023 (albeit missing first class seats until year-end, due to supply chain issues). The carrier is expected to deploy Allegris seat products on existing A350s.

CAPA - Centre for Aviation is also tracking retrofit activities for airlines inducting second-hand A350s. In recent years there has been a wave of A350 operator changes due to factors, including COVID-19 and geopolitical tensions.

The list of impacted airlines includes Aeroflot, HNA Group, LATAM Airlines and SAS. With the ongoing global widebody shortage, these A350s quickly found homes at Air India, China Airlines, Delta, Iberia, Malaysia Airlines and Thai Airways.

However, also at play are challenges in the interiors supply chain, forcing airlines to resort to soft upgrades (e.g. seat-cover replacement), and to consider retrofits at a later stage.

This should be an interim situation.

Delta Air Lines has already firmed up plans to standardise its A350s, selecting Airbus Services to retrofit nine A350-900s previously operated by LATAM (with LATAM cabin products). This nose-to-tail cabin retrofit aims to align everything from seats, lavatories and galleys to overhead stowage bins with first-hand Delta A350s.

China Airlines has also included its former SAS A350s as part of its A350 retrofit programme.

Latest global interior updates

Europe

• Aegean Airlines to introduce lie-flat Business Class seats on at least four A321LRs.
• Air France to retrofit its Embraer E190s with Expliseat seats.
• Condor receives first A320neo with RECARO BL3710 and SL3710 seats line-fitted.
• Croatia Airlines selects Panasonic Avionics' Ku-band IFC for its Airbus A220s.
• Discover Airlines becomes launch customer of AERQ AERENA.
• Icelandair picks Viasat IFC for its Airbus A321LR; receives first shipment of Panasonic Astrova.
• Lufthansa takes delivery of first Allegris-equipped aircraft; announces new business class for Airbus A380.
• Turkish Airlines introduces 'Crystal' business class.

Asia Pacific

• Air China trials VoWiFi to support inflight calls.
• Air Tahiti selects PXCom for wireless IFE on ATRs.
• Cathay Pacific unveils upcoming Aria business class suite and new premium economy seat for Boeing 777s; plans flat beds for Airbus A330 regional business class.
• IndiGo to trial wireless inflight entertainment.
• Korean Air selects Viasat for Boeing 787 IFC.
• Shenzhen Airlines IFC installation kicks off.
• Vietnam Airlines plans to offer IFC on US, Europe and select domestic routes by 2025.

Middle East

• Gulf Air now offers free WiFi on Boeing 787-9 and Airbus A321neo.
• Qatar Airways planning for new Qsuite and first class cabins.
• Royal Jordanian to install Viasat IFC on more than 40 aircraft.

North America

• American Airlines plans to add more premium seats to Airbus A319s and A320s.
• Endeavor Air trials Hughes JUPITER on Bombardier CRJs operated for Delta Connection.
• Frontier Airlines introduces UpFront Plus product.
• American Airlines to introduce business plus 'Flagship Suite Preferred' seating.