The first aircraft in Airbus’ A320neo Family has been delivered to Luftansa.

Equipped with twin Pratt & Whitney PurePower Geared Turbofan engines, the A320neo presently burns 15 percent less fuel than comparable current generation aircraft. Airbus expects further cabin innovations to increase that figure to 20 percent by 2020.

Nearly 4,500 orders for the A320neo Family have been placed with Airbus since 2010 and over that time the A320neo has captured some 60 percent share of the market, according to the company.

“Featuring the leading technology of Airbus and Pratt & Whitney, the A320neo is by far the most efficient and most silent aircraft on short- and medium-haul routes,” said Carsten Spohr, chairman and CEO of Lufthansa AG.

Lufthansa is expecting to receive 52 new aircraft in 2016, a significant increase over previous years.

“This occasion marks a new step forward to delivering on our promises and meeting our industry’s goal for sustainable aviation. The A320neo embodies Airbus’ passion and commitment to deliver maximum value and efficiency to our customers through continuous innovations,” said Fabrice Brégier, president and CEO of Airbus.

Boeing Reduces 747 Production Rate

As Airbus was showing off its new A320neo, Boeing made a concurrent announcement that it will be lowering the production rate on its 747-8 program to match supply with near-term demand in the cargo market.

In September 2016, the 747-8 program’s production will decline from one airplane per month to 0.5 per month. The company previously announced that it would lower the rate from 1.3 per month to one per month in March 2016.

This is not wholly unexpected, given the recent air transport industry data indicating that air freight volume declined by 1.2 percent in November 2015 compared to November 2014. In contrast, global passenger demand grew at 5.9 percent above the 10-year average rate, according to the International Air Transport Association (IATA).

This fits with the general trend of aerospace manufacturers moving away from very large aircraft in favor of smaller, single-aisle airliners. The spoke-and-hub model of air transportation is in decline, thanks in no small part to improvements in engine efficiency over the last decade.

The commercial and cargo aircraft industries are closely connected; outdated commercial airliners often find new homes as air freighters. Although these older aircraft are more fuel-hungry compared to newer models, cargo companies may well consider it worthwhile if they can purchase a used commercial airliner at a fraction of the cost of a new one.

Given the move toward single-aisle planes in commercial aircraft, it’s possible that we could see a similar pattern emerge in the cargo industry over the next decade.

Is the declining demand for large cargo freighters the first sign of a shift toward smaller cargo freighters?

Tell us what you think in the comments below.