China to need 7,690 new aircraft by 2037, says Boeing

CHICAGO: Boeing Co raised its forecast for aircraft demand in China even as an escalating trade war between the world’s two biggest economies casts a shadow over the planemaker’s prospects in the Asian country.

China would need 7,690 new planes valued at US$1.2 trillion (RM4.98 trillion) in the two decades through 2037, said the aircraft maker yesterday as part of its annual report outlining the global market scope for the next 20 years.

That is a six per cent rise over its projections last September for 7,240 aircraft through 2036.

“The growth in China can be attributed to the country’s growing middle class, which has more than tripled in the last 10 years and expected to double again in the next 10,” said Randy Tinseth, vice-president of marketing at Boeing.

While Boeing’s predictions are based on a blend of economic and airline-user data and don’t include the potential ripple effects from geopolitical or economic turmoil, the trade tensions between the United States and China are threatening to weigh on future sales.

The U$12.2 trillion Asian economy, slated to surpass the US as the world’s biggest aviation market by as early as 2022, is crucial to both Boeing and rival Airbus in their battle for dominance.

Policymakers in China could still deal a blow to Boeing by favouring Airbus for future orders.

But for now, Boeing seems to be insulated from the tensions with China, which accounted for about 13 per cent of its revenue last year. It delivered 202 aircraft to Chinese airlines last year, compared with 176 by Airbus.

In its forecast yesterday, Boeing said China would need 5,730 single-aisle planes, accounting for 75 per cent of total new deliveries for the next two decades.

The country would need 1,620 widebody aircraft, or triple the country’s current fleet size, it said.

Last month, Boeing raised its global forecast by four per cent to 42,700 planes valued at over US$6 trillion.

At present, China had 15 per cent of the world’s commercial airplane fleet, and that was likely to expand to 18 per cent by 2037, said Boeing.