Boeing Co (NYSE:BA) Upbeat on Future
Smaller planes will dominate aviation orders worldwide in the next 20 years, driven by the needs of budget airlines in emerging markets like Southeast Asia, Boeing said Friday.
Nearly three in four of the 41,030 new commerical planes expected to be delivered in the period at a cost of $6.1 trillion will be single-aisle, according to the US aircraft maker.
“As you would expect because of the dominance of (low cost carriers) and requirements to connect shorter ranges, 72 percent of units will be in the single-aisle category,” Dinesh Keskar, Boeing’s senior vice president for Asia-Pacific and India sales, said at a briefing in Singapore.
Southeast Asia is one of the world’s fastest-growing regions for budget air travel, with an expanding middle class driving a travel boom.
Boeing said it has hiked its forecast for the number of new aircraft to be delivered in Southeast Asia in the next two decades to 4,210 — up 460 on last year’s prediction.
“This is a testament to how this region is growing, how the infrastructure is coping,” said Keskar.
Passenger traffic growth in most of the region is in double digits, with Malaysia, Vietnam, Thailand and Indonesia among the leaders, Keskar added.
He said 39 percent of all new planes in the next two decades will be destined for Asia, trailed by 21 percent for North America and 19 percent for Europe.
Single-aisle planes favoured by budget airlines, such as Boeing’s 737 MAX and Airbus’ A320, are projected to account for 77 percent of the market share in Southeast Asia, he added.
He said the company remains optimistic despite concerns about overcapacity as Southeast Asian governments build new airports and improve existing ones.
The Boeing Company is an aerospace company. The Company’s segments include Commercial Airplanes; Defense, Space & Security (BDS), such as Boeing Military Aircraft (BMA), Network & Space Systems (N&SS) and Global Services & Support (GS&S), and Boeing Capital (BCC). The Commercial Airplanes segment develops, produces and markets commercial jet aircraft and provides related support services, to the commercial airline industry. The Commercial Airplanes segment also produces commercial aircraft and offers a family of commercial jetliners. The BDS segment’s operations involve research, development, production, modification and support of the products and related systems. The BMA segment is engaged in the research, development, production and modification of manned and unmanned military aircraft and weapons systems. The BCC segment’s portfolio consists of equipment under operating leases, finance leases, notes and other receivables, assets held for sale or re-lease and investments.
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