Boeing revised longer-term demand forecasts on Tuesday, as a snapback in commercial air travel in domestic markets such as the United States predicted a more depressed industry than last year seen at the height of coronavirus lockdowns.
Rozier View moves underpin by the aerospace giant to prepare for increased travel demand and military services, even as its ability to respond to the brighter outlook remains hampered by industrial delays and the lingering 737 MAX crisis.
The US planmaker, with Europe’s Airbus dominating jet sales, forecasts 43,610 commercial jet deliveries worth $7.2 trillion over the next 20 years, an increase of 500 units from 43,110 projected a year ago.
On the shorter 10-year outlook, which is more vulnerable to the severe fallout on airlines from the COVID-19 pandemic, Boeing sees 19,330 deliveries, higher than last year’s forecast of 18,350.
The 10-year projection is 6 percent shy of the forecast published in 2019, but the decline from pre-crisis levels has fallen from 11 percent a year ago.
“One of the strongest reasons for confidence is how fast we’ve seen a boom in domestic travel over the past 12 months,” Mark Allen, Boeing’s chief strategy officer, told reporters.
Boeing sees domestic flight at pre-crisis levels in 2022, followed by regional traffic in 2023 and international in 2024.
Demand for airliners is seen as a threat to the broader economy. Boeing raised its assumption of average annual global economic growth to 2.7 percent from 2.5 percent last year’s forecast.
Boeing and other planners are predicting that environmental pressures and COVID-19 will accelerate jet retirements, leaving room for new planes on the market.
But many analysts have raised concerns about the unexpected spread of coronavirus variants and ongoing travel restrictions, even as vaccination rates continue to rise.
Boeing’s forecast for annual passenger traffic growth was unchanged at 4 percent, although the growth rate has dropped from the once-reliable 5 percent since 2015 as the record aviation boom peaked.
Over the next decade, Boeing sees demand for $9 trillion in goods and services across the full range of goods and services, from freighters to fighter planes, up from $8.7 trillion in demand a year earlier.
Its defense and space forecast is flat at $2.6 trillion.
The push to the services comes as mounting budget pressures are expected to limit weapons spending and prolong the use of systems already in the US arsenal. Boeing began deliveries of refurbished and modified F/A-18 jets last year.
Boeing slightly raised its 20-year forecast for delivery of twin-aisle models such as its 787 Dreamliner and Airbus A350 to 7,670 jets, up from 7,480 previously.
This section is hardest hit by the crisis as widespread border restrictions affect international air travel.
Boeing is currently battling 787 deliveries due to production problems, which have cut off a major source of cash.
For medium-range single-aisle jets such as its 737 MAX—the industry’s No. 1 cash cow—Boeing has 32,660 deliveries over the next 20 years, up from 32,270 in the past.
Boeing’s 737 MAX returned to service late last year after a nearly two-year safety ban. It recently won approval in India, though a lax ban in China adds to the uncertainty.
Boeing also cut its 20-year forecast for cargo demand for 890 jets from 930 estimated a year ago.
Demand for freighters has soared during the pandemic as shippers have sought alternatives to the pet space of passenger jets abandoned on the ground due to weak travel demand. Both Boeing and Airbus are proposing to develop new all-cargo aircraft.
by Eric M Johnson and Tim Hepfer
This News Originally From – The Epoch Times