Boe­ing sees 20-year de­mand beat­ing tar­gets as it inks China deal

The Myanmar Times - - International / Business -

BOE­ING boosted its 20-year fore­cast for the global air­craft mar­ket yes­ter­day, lifted by de­mand from bud­get car­ri­ers and emerg­ing mar­kets, as it re­vealed a new multi-bil­lion-dol­lar deal to sell planes in China.

Boe­ing said it ex­pected over­all de­mand for new planes over the com­ing 20 years to out­strip its pre­vi­ous fore­casts by 4.1 per­cent, pre­dict­ing to­tal de­mand at a com­bined 39,600 jets worth US$5.9 tril­lion.

Boe­ing fore­cast an av­er­age 4.8pc an­nual growth in pas­sen­ger traf­fic over the 20 years, with 9100 new wide body planes to come on stream dur­ing that pe­riod. It cited strong re­place­ment de­mand worth an es­ti­mated $2.8 tril­lion in a peak pe­riod from 2021 to 2028.

“De­spite re­cent events that have im­pacted the fi­nan­cial mar­kets, the avi­a­tion sec­tor will con­tinue to see long-term growth with the com­mer­cial fleet dou­bling in size,” Randy Tin­seth, Boe­ing’s vice pres­i­dent of mar­ket­ing, said in a state­ment.

Boe­ing pre­dicted 15,130 new plane de­liv­er­ies to Asia in the next 20 years, mak­ing it the re­gion with the largest slice of the cake.

Also yes­ter­day, Boe­ing signed a draft agree­ment with China’s sta­te­owned Xi­a­men Air­lines to sell up to 30 of its 737 MAX 200 planes with a cat­a­logue value of $3.39 bil­lion.

The ac­cord for the sin­gle-aisle twin en­gine jets, un­veiled on the side­lines of the Farn­bor­ough air show, re­quires the ap­proval of the Xi­a­men Air­lines board as well as the China South­ern Air­line Group board and Bei­jing.

In a state­ment, Boe­ing said Xi­a­men, al­ready a 737 MAX cus­tomer, sees the MAX 200 as a fit for its low cost sub­sidiaries, which in­clude Jiangxi Air­lines and He­bei Air­lines.

The Chi­nese are likely to ob­tain a sig­nif­i­cant dis­count on the list price for the planes, as is ha­bit­ual in the sec­tor.

“We are pleased with this new mile­stone in our re­la­tion­ship with Xi­a­men Air­lines,” Boe­ing chief ex­ec­u­tive Ray Con­ner said.

“The mar­ket-lead­ing ef­fi­ciency and re­li­a­bil­ity of the 737 MAX 200 will en­able Xi­a­men and its sub­sidiaries to ex­pand its grow­ing net­work, while main­tain­ing an op­ti­mal fleet.

Boe­ing said Xi­a­men Air­lines, a state-owned sub­sidiary of China South­ern Air­line, op­er­ates an all-Boe­ing fleet of more than 140 air­planes in­clud­ing six 787 Dream­lin­ers, 130 NextGen­er­a­tion 737s and four 757s.

The car­rier plans to grow its op­er­a­tional fleet to 200 air­planes by the end of the decade, it said. –

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