Boeing expects long-term demand for new airplanes to swell to $5.2 trillion over the next 20 years, a rosier outlook than the aerospace company issued a year ago, as a result of rising emerging markets demand as well as the need to replace aging planes.
The company, which has for decades issued a long-term forecast, expects new airplane demand to total 36,770 from 2014 to 2033. A majority of that growth will be due to fleet growth, which is a result of expected demand in emerging markets and the development of new airline models.
A bulk of the demand is for single-aisle planes. Boeing expects orders for those customers will be driven by fast-growing low-cost carriers and network carriers that are pressed to replace aging airplanes.
The overall forecast is more bullish than the report issued in 2013, when Boeing estimated the long-term market value to total $4.84 trillion.
Boeing, which reports second-quarter results later in July, issues the forecast to provide greater clarity about the long-term business plan for the company. Boeing’s targets are often conservative: actual demand in 2013 exceeded the targets Boeing set in 2004 and 1994.
Much of the growth over the next 20 years is expected to be fueled by traffic growth within Asia Pacific, as well as within China and Latin America. Boeing also expects overall worldwide airline traffic to climb 5% over the 20-year period ended 2033, better than global gross domestic product growth of 3.2%.