China needs 7,690 new jets

Trade war could bring benefits to Boeing rivals

China’s civil aviation market will hit a value of $2.7 trillion in 20 years and the country will need 7,690 new planes during that period, US airplane maker Boeing said on Tuesday.

While about 52 percent of all commercial jetliners currently operating in China are made by Boeing, a Chinese expert said that in the short term the company could lose some of its shares in the lucrative Chinese market if the trade tensions with the US continue to escalate.

The new planes that China needs in the next 20 years will be worth $1.2 trillion, making the country the world’s only aviation market worth over $1 trillion, according to the company’s new Commercial Market Outlook for China released on Tuesday.

Compared with the last forecast released in 2017, the demand for new planes has increased by 6.2 percent.

Also, China will need $1.5 trillion worth of services to support this demand during the upcoming 20 years, helping it become one of the largest aviation service markets in the world.

“Today, the domestic market is about half the size of the US market. But before the end of the forecast period, China will overtake the US to become the world’s domestic marketplace,” said Randy Tinseth, vice president of marketing at Boeing Commercial Airplanes.

China is a critical market for Boeing, as in 2017, about 30 percent of all its deliveries went to Chinese customers, and the company is quickly approaching the delivery of its 2,000th commercial jetliner in the country, Tinseth said.

“China is a great opportunity for Boeing, our competitors and companies that are still building and going into this business,” Tinseth said.

The company has so far been mostly spared in an ongoing trade war between the US and China, Reuters reported.

Qi Qi, an independent industry analyst, said currently the company is not affected by the trade war, as its best-selling 737 Max is not included in the long list of punitive tariffs.

“But it is hard to tell whether the trade war will catch up with the firm in the end, as US President Donald Trump’s tariffs threaten to cover all Chinese exports to the US and China’s tariff retaliatory choices are dwindling. It could be that big jetliners are also included as the tensions continue to rise,” Qi told the Global Times on Tuesday, noting that alternatives are easy to find in the singleaisle plane market.

Qi also said that part of the market share will be enjoyed by China’s homegrown jetliner the C919 large passenger plane, which supports the domestic plane making industry.

“If the trade war continues to escalate, alternatives such as Chinese domestic plane makers and Europe’s Airbus could stand to benefit,” Qi noted.