When he introduced Boeing’s 2011 Current Market Outlook (CMO) via video in mid-June, Randy Tinseth, vice president of marketing for Boeing’s commercial airplanes, got a bit sentimental.
“The 2011 Current Market Outlook is a story. A story about growth, a story about a market that has great opportunities, Tinseth said as he finished roaming Boeing Field, where flight tests of 787s and other models take place.
While perhaps not as dramatic a story as Tinseth hopes to relay, it surely is broad in scope and quite staggering when translating future airplane and, hence, metal demand into dollar amounts.
By the Numbers
- 33,500 the number of new airplanes and freighters between 2011 and 2030
- $4 trillion the value of the market over the next 20 years
- 8 percent the increase in passenger traffic in 2010
- 5.1 percent the projected, long-term annual increase for passenger traffic
- $1.5 trillion the Asia/Pacific region’s forecasted share of new planes
Labor Disputes Aside, Aerospace’s Future Looks Rosy
Although Boeing has been battling the machinist’s union over moving a plant from Washington state down South, the future for them and rivals Lockheed and Airbus looks pretty good based on the below graph:
Namely, emerging market GDP growth and demand for travel is forecast to continue well into the next few decades. As more people enter the middle classes across Asia, for example, they’ll have the means to make use of low-cost carriers (LCC) to globe-hop. LCCs are expected to grow at an annual rate of 5.7 percent, according to Boeing.
So, times are good for the airplane makers. Forbes’ Agustino Fontevecchia wrote that back in March of this year, “AIG’s plane leasing unit ordered 100 new Airbus and 33 new Boeing planes for $11.8 billion. And GE Aviation signed a $600 million deal with Air Asia X in May, according to a Forbes article by Heather Struck proving that US-based aerospace companies are betting big on Asian economic growth.
“Continued momentum in global economic growth, coupled with the liberalization of international mobility, is likely to fuel [the need and desire to travel], according to RBC Capital Markets analysts, as cited by Struck.
So as people all over the world fly to their vacation destinations this summer, do aluminum and titanium alloy suppliers have something to unequivocally cheer about? Or will the bullish airline industry be immune to future slowdowns like the one in 2009? Tell us what you think or join us for a high performance metals webinar, details below:
Join us for a FREE upcoming webinar: “High Performance Metals & Alloys Market Outlook and Primer, featuring speakers Scott Fasse of United Performance Metals and Jorge Vazquez of Harbor Aluminum. Click here for additional details and to register.