Boeing Market Outlook

by Randy Tinseth, Boeing

Aircraft manufacturers keep a close eye on the state of the industry and factors driving demand for new aircraft.  Boeing’s latest analysis of 2009 and outlook for 2010 shows:

• Deep recession in 2009 drove large industry losses, however in the same year the world’s aircraft manufacturers delivered more than 1,000 new jet aircraft including 481 from Boeing Commercial Airplanes (BCA). In fact, Boeing had record deliveries for the Next-Generation 737 and the 777, with 372 and 88 airplanes respectively.
• Good planning – including careful production rate adjustments and diversification of production skyline – helped to even out the effects of demand fluctuation.
• Demand remained strong in the narrowbody segment with airlines continuing to replace older aircraft and LCCs experiencing growth in the downcycle.  Airlines in emerging markets also benefited from growing demand as a great proportion of their populations begin to travel by air.
• Looking ahead to the remainder of 2010, BCA believes the economic downturn has hit bottom and recovery has begun. However, recovery is a relative term. In reality, many airlines have yet to feel recovery by any tangible measure.
• Recognizing the challenges of the market, BCA plans to deliver between 460 and 465 aircraft in 2010.  While 737 production will be unchanged, production rates on the 777 will be reduced in June and previous rate increases for the 767 and 747 have been delayed. These rate adjustments reflect the current weakness in the cargo market and long haul travel.
• This still remains a growth industry. Boeing forecasts that air travel will grow at 4.9 percent per year over the next two decades. In order to meet this growth, Boeing and the industry continue to invest in new and innovative products and services to meet the demands of the market.