Boeing (BA) is forecasting that demand for passenger planes will skyrocket in China over the next 20 years, making it the second largest market for new commercial jets.
The Chicago-based jet maker forecast on Wednesday that China will need 5,260 new commercial planes valued at $670 billion from now until 2032, with a significant amount of the demand accounting for small and medium-sized twin-aisles such as the new Boeing 787 Dreamliner and 777.
Demand for jets of their size is expected to comprise 48% of the market in value with some 1,190 new deliveries anticipated over the next two decades. Boeing’s fleet already comprises more than 50% of all the commercial jetliners operations in China.
“It's impressive that over 75% of the demand in China will be for growth instead of replacement," Boeing Commercial Airplanes’ vice president of marketing, Randy Tinseth, said in a statement.
He attributed the increase in demand to sustained strong economic growth, growing trade activities that are expected to lead to a rapid international expansion of Chinese carriers at a rate of 8.9% annually and increasing personal wealth.
Tourism is China is also expected to boost demand, with total deliveries of single-aisle planes reaching 3,650 through 2031. Boeing’s new 737 MAX would likely benefit from that market, the company said.
Boeing predicts worldwide investments for new airplanes will reach $4.5 trillion by 2032 for some 34,000 deliveries.
Shares of the jet maker, which competes directly with Europe’s Airbus, ticked about 1.3% higher on Wednesday to $71.79.