*

Airbus, Boeing ( BA ) to unveil aircraft orders despite supply

bottlenecks

*

Tariffs, conflict, supply-chain woes cast shadow on

industry

*

Defence firms to showcase drone, AI tech as EU spending

rises

By Tim Hepher and Joe Brock

PARIS, June 12 (Reuters) - Aerospace manufacturers will

aim to project business as usual with big-ticket aircraft orders

at next week's Paris Airshow, despite U.S. tariffs, escalating

conflicts and fragile supply chains rattling the global aviation

and defence industries.

The world's largest aviation trade show, running from June

16 to 20 in Le Bourget, gives aircraft and arms manufacturers a

key stage to showcase cutting-edge technologies such as AI and

autonomy, while making headline-grabbing order announcements.

Airbus may kick off the event with two key Saudi orders on

Monday, illustrating strong air travel growth in the Gulf, while

facing last-minute competition from Brazil's Embraer ( ERJ )

for a potential order for some 100 small A220 jets from AirAsia.

Boeing ( BA ) is expected to secure the bulk of a fleet shake-up by

long-time customer Royal Air Maroc but is heading for a quieter

week than its rival after pre-empting the show with big orders

during U.S. President Donald Trump's recent visit to the Gulf.

Behind the scenes, civil planemakers, as well as defence and

supply-chain giants such as Lockheed Martin ( LMT ) and Raytheon

, will be grappling with the uncertain repercussions of

Trump's volatile tariff announcements and simmering conflicts.

"We were just getting our heads out of the water

(post-COVID) and some of our tier-2 and tier-3 suppliers were

just beginning to breathe again, and now this uncertainty," the

CEO of Airbus' planemaking business, Christian Scherer, said.

A U.S.-Chinese deal to restore a fragile trade truce lifted

spirits ahead of the global aerospace gathering but some

delegates said the industry is adapting to the prospect that

base tariffs of 10% could endure, while lobbying for exemptions.

"Despite all this chaos, it should be a good air show for

orders, particularly for Airbus, which will be on home turf,"

said AeroDynamic Advisory managing director Richard Aboulafia.

Even so, weak supply chains and fractured alliances in trade

and defence have upended years of planning for the near

$1-trilion-dollar industry, days ahead of a crucial NATO summit.

DEFENCE SPENDING

The war in Ukraine and tension in the Middle East have

disrupted airspace, re-routed cargo and passenger traffic and

increased insurance costs.

European nations, spurred by the war in Ukraine, are ramping

up military spending at a pace not seen since the Cold War.

Germany, Poland and Britain have all announced major defence

budget increases, including planned spending on air defence,

drones and next-generation fighter jets.

The show will feature a wide array of drones, including

low-cost, expendable models that proved so effective in the

Ukraine war.

Such platforms are increasingly viewed as essential to

modern warfare, by offering a cheaper and scalable alternative

to traditional manned aircraft.

Many European nations are rethinking their reliance on U.S.

defence support amid weakening ties under Trump, reshaping the

global defence landscape as AI-powered systems gain traction and

political alliances shift.

"If Europeans are paying more on defence, you'd expect them

to employ Europeans to build European capacity and capability in

the same way the US is served by American provisions," said

Byron Callan, a defence industry specialist and managing partner

at Washington-based Capital Alpha Partners.

"That's probably one of the most important changes that's

emerged from the US election and the Russian invasion of

Ukraine."

Access to rare earths is another pressing topic.

Environmental concerns, typically a prominent theme at air

shows, will again be addressed in a dedicated display but may be

relatively muted this year as Trump downplays green initiatives.

At a global airline summit this month, carriers reaffirmed

their commitment to net-zero targets but flagged concern over

the limited availability of sustainable fuels and

next-generation aircraft.

A raft of high-profile studies, such as plans by Airbus for

a hydrogen airliner, have slowed or stopped.

Planemakers say taking delivery of current aircraft -

burning at least 15% less fuel - is the fastest way to curb

emissions. But deliveries have been delayed by supply problems

and environmentalists say that jetmakers chasing ever more

orders are baking in longer reliance on fossil fuels.