Boeing Raises Global Outlook For Aircraft Demand

Boeing raised its forecasts for new plane demand on the growth of low-cost carriers, the replacement of less efficient aircraft and economic recovery.
The company said in a report on Thursday it expected 30,900 new planes to be ordered worldwide over the next two decades, up 6.5 percent from last year's forecast of 29,000.
It said the new orders would be worth USD$3.6 trillion, up 12.5 percent from the USD$3.2 trillion forecast a year ago.
"A slightly higher GDP (gross domestic product) forecast, an increase in replacement demand and the growth of low-cost carriers in emerging markets will help stimulate demand," Randy Tinseth, vice president for marketing at Boeing's commercial planes division, told reporters.
Boeing's market outlook to 2029 comes ahead of the world's biggest airshow next week at Farnborough near London.
The company forecasts that Europe will need 7,190 new planes by 2029, valued at USD$800 billion.
It expects world air traffic to grow by 5.3 percent a year to 2029, with passenger numbers rising 4.2 percent per year.
During that time, the Asia Pacific region will overtake North America as the largest market for air traffic in the world.
Rising and volatile fuel prices will continue to shape the aviation industry. Boeing expects the price of crude oil to be between USD$75 - USD$85 a barrel next year and between USD$70 - USD$90 a barrel over the next 20 years.
"Once oil is over USD$90 a barrel, alternative fuel sources become viable which would enter the market and bring the oil price back down to USD$90," Tinseth said.
The company will focus on cementing its Boeing 737 strategy by the end of the year and re-evaluate what it is doing with its Boeing 777, he added.
"Over the long term, we see the aviation industry as resilient and our long-term market outlook is very strong."

(Reuters)