Greetings from London, where I released our annual Current Market Outlook—Boeing’s 20 year forecast for commercial airplane demand. This year’s report shows a 4.2% increase in demand over last year—36,770 total airplanes valued at $5.2 trillion. While the forecast covers a lot of ground, I wanted to share a few of my key takeaways.
Strong, resilient market
Some still question whether there’s a market “bubble.” All you need to do is look at this week’s order from Emirates for 150 777Xs. Airlines are demanding more fuel-efficient airplanes to replace their older fleet. And the continued emergence of low-cost carriers means demand for new airplanes.
I made the rounds on London television to discuss the new forecast. Here’s me at Bloomberg London.
Single-aisle demand fueling the forecast
The hot demand for single-aisle airplanes is the main driver of this year’s forecast. 25,680 new airplanes will be needed in this segment, with the heart of the market being in the 160-seat range. The Next-Generation 737-800 and new 737 MAX 8 offer our customers the most revenue potential in this mid-sized space, where network flexibility and cost efficiency meet.
Point to point
Point to point service continues to be alive and well. Airlines are focused on providing more frequent non-stop service, whether it be with big airplanes or small ones…long range service or short range hops.
We’re forecasting that 8,600 new airplanes will be needed in the twin-aisle segment, about the same as last year. Small widebody airplanes in the 200 to 300 seat range such as the 787-8 and 787-9 Dreamliner will lead the demand. But this year’s forecast reflects a continued shift in demand from very large airplanes to efficient new twin-engine products such as the 787-10 and new 777X.
We’ve been issuing our Current Market Outlook for more than 50 years—with a good track record. In fact, we’ve been a bit conservative— with more airplanes delivering than we estimated. This track record gives us confidence in our forecasting methods and models. But more importantly, it gives us confidence in our product strategy, business plan and the advice we give our partners, customers and suppliers.
We now turn our full attention to the Farnborough Air Show which starts on Monday. The 787-9 arrived at Farnborough this morning and will take part in the flying display.
The 787-9 is seen here just minutes after landing at Farnborough.
I’ll leave you with a food picture from a proper British pub— check out this steak and ale pie!