Boeing bumps up forecast for long-term China plane demand

BEIJING Thu Sep 5, 2013 5:32am EDT

Scott Fancher, Boeing Commercial Airplanes vice president and general manager, head of aircraft development, attends a news conference on their airplane development update in Tokyo August 2, 2013. REUTERS/Issei Kato

Scott Fancher, Boeing Commercial Airplanes vice president and general manager, head of aircraft development, attends a news conference on their airplane development update in Tokyo August 2, 2013.

Credit: Reuters/Issei Kato

BEIJING (Reuters) - Boeing (BA.N) said it expects China to need more than 5,500 aircraft in the next 20 years, a six percent increase over last year's two-decade estimate, citing growing demand for single-aisle and small wide body planes as travel within Asia-Pacifc surges.

China, currently the world's second-biggest aircraft market, is key to Boeing's long-term global strategy and the company said its estimate of 5,580 planes valued at $780 billion represents a tripling of China's fleet.

"Tourism in China and intra-Asia travel will help spur demand," said Randy Tinseth, vice president of marketing at Boeing Commercial Airplanes, adding that China will overtake the United States as the world's single-biggest aircraft market in the period through 2032.

"We expect international markets to grow faster than domestic markets and we anticipate the Chinese airlines to grow market share over time."

Boeing said air traffic in China is projected to grow 7 percent per year, fueled by 7.2 percent annual growth of long-haul traffic to and from China, outpacing anticipated global annual growth of 5 percent.

It expects that world traffic carried by airlines in China will grow to 16 percent by the end of the forecast period, up from 11 percent currently and four percent 20 years ago.

Tinseth also said he expects total China deliveries for single-aisle airplanes to reach 3,900 during the period.

In June, Boeing raised its 20-year forecast for global airplane demand, up 3.8 percent from its previous two-decade outlook, citing growth in Asia-Pacific travel.

(Reporting by Fang Yan and Matthew Miller; Editing by Edwina Gibbs)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (1)
MikeBarnett wrote:
Boeing has a correct view of the situation. China has the second biggest economy, but its GDP growth rate is between four and five times as fast as the US GDP growth rate. When China overtakes the US in this decade, China will have a 450% internal growth potential because it has 4.5 times as many people. Its current and next five year plans call for economic development of the central, western, and northern provinces to the levels of the eastern and southern areas. The plans also contain measures for increasing consumer wealth, so greater percentages of the Chinese will be able to fly. Finally, the one child policy allows Chinese parents to have more than one child if they pay penalties and taxes for each additional child. As more people earn more money, more Chinese parents will be able to take advantage of this feature to prevent excessive aging of the population, maintain economic growth, and increase the numbers of airline passengers.

Sep 05, 2013 2:31pm EDT  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

Track China's Leaders