A lot of us were surprised when Airbus unveiled its version of the long range market forecast during the Paris Air Show. They typically hold that for later in the year, and what they shared at Le Bourget was clearly lacking in detail.
The one thing that was clear - the great divide between our forecast and Airbus’ when it comes to the very large airplane segment.
Over the next 20 years, Boeing forecasts the need for 540 new airplanes like the 747-8 and the A380. Our new Current Market Outlook reflects a continued shift from very large airplanes to twin-engine airplanes like the 787, 777X and A350.
But Airbus actually raised its very large airplane forecast by almost 50 units from last year, saying it expects a demand for 1,550 of these big airplanes. They make this prediction despite the fact that the A380 hasn’t received a single order all year.
On a side note, we also believe Airbus is forecasting too low on the single-aisle side. Take their forecast of 22,927 airplanes. That equals combined production rates of 95 per month over the next 20 years. Even if the market was split equally between Boeing and Airbus, which is unlikely since there are other single aisle competitors coming into the market, a production rate of about 48 per month wouldn’t match up to the higher production rates they’re talking about.
When Airbus launched the A380 in 2000, it predicted the demand for 1,235 very large passenger airplanes alone through the year 2019. Fast forward to today— and the total number of passenger VLA’s actually ordered is only 371. You do the math.
We use our forecast as a key part of our production rate decisions. This week, we announced that we’re lowering our 747-8 production rate again—this time to 1 airplane per month starting next March. While the very large airplane market continues to be challenging, we’re optimistic this adjustment and some good news on the cargo front will allow us to keep the program healthy.
With four firm 747-8 orders so far this year— and an MOU from Volga-Dnepr for 20 additional 747-8 Freighters — things are looking up.
In our view, the market for big airplanes is small—but viable. However, every trend and signal points to airlines moving toward small and medium widebodies as travelers demand more frequent point to point routes.