Published: Thursday, June 14, 2007
Boeing likes its 20-year outlook
EVERETT - The future still looks bright for Everett-built Boeing Co. jets, said the company's new head of marketing Wednesday.
"As traffic grows, airlines fly more airplanes to more places," said Randy Tinseth, Boeing's vice president of marketing for commercial airplanes.
As a result, Boeing estimates the delivery of 28,600 new airplanes into the world fleet over the next 20 years, worth $2.8 trillion.
That's up nearly 1,400 planes and $200 billion from Boeing's 20-year projection released last year, Tinseth told members of the media during a conference call Wednesday.
Boeing bumped up the predicted deliveries of single-aisle and twin-aisle jets while reducing its forecast for large jumbo jets such as the 747 or rival Airbus' A380. The plane manufacturer re-emphasized its belief that passenger demand for convenient, direct flights will force airlines to pick up more mid-size jets, including its 777 and new 787, which is scheduled to enter service next year.
Passenger air traffic will increase at a rate of 5 percent annually over the next two decades while cargo traffic will grow at a rate of 6.1 percent each year. With more people and more cargo flying in the future and continued high fuel prices, airlines will look to replace their older, large fuel-guzzling jets with newer, lighter, more fuel-efficient jets such as the 787 Dreamliner, Tinseth said.
Several major U.S. carriers haven't placed significant orders, but that's not a trend Tinseth sees lasting much longer. High fuel prices coupled with the age of their existing jets will force those carriers to begin placing orders sooner rather than later.
"Airlines have to start moving, they have to start replacing those airplanes," Tinseth said.
Through 2015, Boeing believes airlines will order about 1,412 jets in the 200- to 400-seat market. Boeing offers both its established 777 and its new 787 jets, both assembled in Everett. Toulouse, France-based Airbus sells its A330, A340 and A350 planes in this market.
But the A350 XWB, Airbus' answer to Boeing's fuel-efficient Dreamliner, won't enter service until 2013, five years after the 787. Tinseth and Boeing see this as a huge sales opportunity.
"We'll have the airplane sooner," he said.
Airbus' A350 family caters more to the higher end of the 200- to 400-seat market more directly challenging Boeing's slightly larger 777 family. However, Tinseth ruled out the possibility of offering a stretched 777, a 777-400, to challenge Airbus in the 400-seat range.
"In terms of the 777, we have an airplane that's doing extremely well in the marketplace," he said.
Tinseth acknowledged a few differences between this forecast and last year's. One such change meant accounting for the needs of roughly 1,000 jets, for the governments near Russia.
In previous forecasts, Tinseth said, "we've done an excellent job in forecasting air traffic."
However, he said, the company has been conservative predicting the twin- and single-aisle markets.
Narrow body aircraft, such as Boeing's Renton-built 737 and Airbus' A320 series, continue to lead Boeing's forecast in terms of volume, with an estimated 17,650 jets being snatched up by airlines by 2026. Last year, Boeing had predicted a demand of 16,540 single-aisle aircraft entering the market over a 20-year timeframe.
In the past, Boeing has over-forecast the need for jumbo and superjumbo jets, Tinseth said. It reduced the number of 747s and A380s being delivered over the next 20 years from the 990 predicted last year to 960.
In Airbus' most recent market forecast, released last fall, it projected airlines will buy more than 1,200 passenger jumbo jets over the next two decades.
Airbus spokesman Clay McConnell told the Associated Press that the difference between the two companies' forecasts is slight. He said Airbus anticipates strong demand for point-to-point travel as well as routes that go through hubs, which will be a mainstay for the A380 and Boeing's 747.
Boeing's stock increased $1.99, or 2 percent, Wednesday to close at $98.47.
Reporter Michelle Dunlop: 425-339-3454 or mdunlop@heraldnet.com.
"As traffic grows, airlines fly more airplanes to more places," said Randy Tinseth, Boeing's vice president of marketing for commercial airplanes.
As a result, Boeing estimates the delivery of 28,600 new airplanes into the world fleet over the next 20 years, worth $2.8 trillion.
That's up nearly 1,400 planes and $200 billion from Boeing's 20-year projection released last year, Tinseth told members of the media during a conference call Wednesday.
Boeing bumped up the predicted deliveries of single-aisle and twin-aisle jets while reducing its forecast for large jumbo jets such as the 747 or rival Airbus' A380. The plane manufacturer re-emphasized its belief that passenger demand for convenient, direct flights will force airlines to pick up more mid-size jets, including its 777 and new 787, which is scheduled to enter service next year.
Passenger air traffic will increase at a rate of 5 percent annually over the next two decades while cargo traffic will grow at a rate of 6.1 percent each year. With more people and more cargo flying in the future and continued high fuel prices, airlines will look to replace their older, large fuel-guzzling jets with newer, lighter, more fuel-efficient jets such as the 787 Dreamliner, Tinseth said.
Several major U.S. carriers haven't placed significant orders, but that's not a trend Tinseth sees lasting much longer. High fuel prices coupled with the age of their existing jets will force those carriers to begin placing orders sooner rather than later.
"Airlines have to start moving, they have to start replacing those airplanes," Tinseth said.
Through 2015, Boeing believes airlines will order about 1,412 jets in the 200- to 400-seat market. Boeing offers both its established 777 and its new 787 jets, both assembled in Everett. Toulouse, France-based Airbus sells its A330, A340 and A350 planes in this market.
But the A350 XWB, Airbus' answer to Boeing's fuel-efficient Dreamliner, won't enter service until 2013, five years after the 787. Tinseth and Boeing see this as a huge sales opportunity.
"We'll have the airplane sooner," he said.
Airbus' A350 family caters more to the higher end of the 200- to 400-seat market more directly challenging Boeing's slightly larger 777 family. However, Tinseth ruled out the possibility of offering a stretched 777, a 777-400, to challenge Airbus in the 400-seat range.
"In terms of the 777, we have an airplane that's doing extremely well in the marketplace," he said.
Tinseth acknowledged a few differences between this forecast and last year's. One such change meant accounting for the needs of roughly 1,000 jets, for the governments near Russia.
In previous forecasts, Tinseth said, "we've done an excellent job in forecasting air traffic."
However, he said, the company has been conservative predicting the twin- and single-aisle markets.
Narrow body aircraft, such as Boeing's Renton-built 737 and Airbus' A320 series, continue to lead Boeing's forecast in terms of volume, with an estimated 17,650 jets being snatched up by airlines by 2026. Last year, Boeing had predicted a demand of 16,540 single-aisle aircraft entering the market over a 20-year timeframe.
In the past, Boeing has over-forecast the need for jumbo and superjumbo jets, Tinseth said. It reduced the number of 747s and A380s being delivered over the next 20 years from the 990 predicted last year to 960.
In Airbus' most recent market forecast, released last fall, it projected airlines will buy more than 1,200 passenger jumbo jets over the next two decades.
Airbus spokesman Clay McConnell told the Associated Press that the difference between the two companies' forecasts is slight. He said Airbus anticipates strong demand for point-to-point travel as well as routes that go through hubs, which will be a mainstay for the A380 and Boeing's 747.
Boeing's stock increased $1.99, or 2 percent, Wednesday to close at $98.47.
Reporter Michelle Dunlop: 425-339-3454 or mdunlop@heraldnet.com.
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