Despite Current Economy, Growth Will Return, Company Says

Boeing is looking down the road 20 years, and sees a $3.2 trillion market for new commercial airplanes. That prediction takes into account the industry's near-term realities, including a global economic recession, declining passenger and cargo traffic, and unpredictable fuel prices. The Boeing 2009 Current Market Outlook (CMO), which was released in London Thursday, foresees a market for 29,000 new commercial passenger and freighter airplanes by 2028. That's 400 fewer planes than had been expected  in last year's outlook.

The report, now in its 45th year of public release and widely regarded as the most comprehensive and respected analysis of the commercial aviation market, reflects the extremely dynamic situation the industry is facing today.

"While the commercial aviation industry is facing a significant downturn, it is cyclic and has a long history of declines and upturns," said Randy Tinseth, vice president Marketing, Boeing Commercial Airplanes. "Over the past 30 years, through both tough and good times, traffic growth has averaged more than 5 percent per year, demonstrating the resilience of the market. The long-term outlook points to the next 20 years as being a time in which we see fundamental underlying factors supporting a strong need for new airplanes."

Boeing analysis shows that over time, the commercial airplanes market will stabilize and economic growth will return. Boeing expects passenger traffic to grow at an average rate of 4.9 percent each year for the next 20 years. Demand globally remains strong for new, more efficient commercial airplanes in response to high fuel prices, aging fleets and environmental concerns. The U.S. and European markets will see more replacement airplanes as less-efficient jets are retired. Robust growth in China, the Middle East, India and other emerging markets with dynamic populations and growing incomes will lead toward a more balanced airplane demand worldwide.

Boeing predicts that airlines will grow by responding to their passengers' preference for more flight choices, lower fares and direct access to a wider range of destinations. This means that they will focus on offering more flights using more efficient airplanes, rather than on using significantly larger airplanes.

Single-aisle airplanes will have the largest market share (67 percent) in raw numbers, driven by the large European and North American domestic markets and growth in local markets in Asia Pacific.

Twin-aisle airplanes will have the largest market share by investment dollars, with 40 percent of demand coming from Asia Pacific and 23 percent from Europe.

In fact, the growing Asia Pacific region will command the largest market in both units and value with 31 percent (8,960) of the units and 36 percent of the value ($1.13 trillion). Air travel to, from and within the Asia Pacific region will grow from a 32 percent share of the world air travel market to 41 percent over the 20-year period.

FMI: www.boeing.com