Published September 05, 2012
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.