Boeing lifted its forecast for aircraft demand in China in the next two decades, saying a rising middle class would spur leisure and business travel.
The planemaker projects demand in China for 6,810 aircraft valued at $1.025 trillion, making the nation the first trillion-dollar aviation market in its forecast, Boeing said in a statement distributed in Beijing Tuesday. The aircraft maker last year predicted China would need 6,330 new planes worth $950 billion in the next two decades.
In China, “we continue to see very strong passenger traffic growth. We’ve seen a very strong consumer segment of the market,” Randy Tinseth, vice president of marketing at Boeing Commercial Airplanes, said at a briefing in Beijing. “The good news for aviation is that is the segment of the economy that services the aircraft market.”
Carriers across Asia are expanding their fleets as economic growth makes air travel affordable to more people, lifting orders for Boeing and Airbus Group. The more-optimistic outlook from Boeing, which last year announced a plan to build an aircraft-completion center in China, comes after it delivered a record number of planes to China in 2015.
The planemaker won more orders from Chinese carriers including China Southern Airlines Co.’s Xiamen Airlines unit this year.
Passenger traffic will expand 6.4 percent annually in China over the next 20 years, Boeing said.
About 71 percent of the new aircraft demand in China will be for growth, the planemaker said. Including a retained fleet of 910 planes, China will have 7,720 aircraft by 2035, the company said in presentation materials.
The depreciation of the yuan has improved profitability of Chinese airlines and hasn’t damped orders at Boeing, Tinseth said. The Chinese currency has weakened 4.6 percent against the dollar in the past 12 months, the worst performer among 11 Asian currencies tracked by Bloomberg.
The aircraft-maker predicted China will need 5,110 new single-aisle jets with a market value of $535 billion through 2035, or 75 percent of total new deliveries. The widebody fleet will triple in size, requiring 1,560 new airplanes. China’s narrowbody and widebody fleet account for about 18 percent and 5 percent respectively of the global figures, Boeing said.
In September last year, Boeing said it will open a facility in China with Commercial Aircraft Corp. of China to paint, complete interiors of and deliver the single-aisle 737 aircraft to Chinese companies. The U.S. company is still working closely with Chinese partners on the details and will issue a statement at a later date, Tinseth said.
The planemaker said it expects 39,620 new aircraft valued at $5.9 trillion to be delivered worldwide in the next 20 years.