Boeing’s Market Prediction for Oceania

In a presentation in Sydney on the 26th of October, Boeing Commercial Airplanes’ vice president of marketing, Randy Tinseth offered Boeing’s market data and forecast for both the global and Oceania commercial aeroplane market. He said that globally, by 2028, airlines would need 29,000 new aeroplanes valued at US$3.2 trillion. According to Boeing’s forecast, as part of that total, airlines in Australia, New Zealand and the South Pacific Islands would require 670 new aeroplanes valued at approximately US$90 billion.

Tinseth said it was encouraging that 27 percent of Boeing’s 20-year forecast was already on order. “Equally important,” he said, “is that this backlog is well balanced—by type of airplane, by airline business model, and region of the world.”

He noted that as at the third quarter of 2009, Boeing had an order backlog of 3,400 aeroplanes, valued at US$254 billion.

According to Tinseth, airlines and the aviation industry in general have been hurt by a challenging and volatile business environment. He said that while the world economy has been in recession—with reduced passenger and cargo traffic and volatile fuel prices—Boeing’s data indicates that “the economic downturn has reached bottom and recovery has begun.” Tinseth predicted that global recovery would be a long, slow process, and airlines would have to continue to adapt to the realities of the market.

He said that the Australian economy had fared better than the rest of the world, noting that it had grown while most of the world dipped well below 2008 levels. He said that global recovery to the 2008 peak would not occur until perhaps 2010.

Tinseth predicted that air travel growth in Oceania would be above five percent, compared to a world average of 4.9 percent. In line with this, he said that 67 percent of Oceania’s commercial aeroplane deliveries until 2028 would be to accommodate growth, while the remainder would replace older, less efficient aeroplanes.

Considering the Asia Pacific region in its entirety, Tinseth predicted long-term annual air traffic growth to be 6.9 percent over the next 20 years.

“In the near term,” Tinseth said, “airlines have adapted to the realities of the market by adjusting capacity, improving efficiency and restructuring. In the longer term, airlines will continue to invest in more efficient, environmentally progressive airplanes that also serve the travel patterns of air travellers with their ability to fly to more places more often.”