Boeing Slashes 10-Year Demand Forecast (but Maybe Not Enough)
Earlier this week, Boeing (NYSE: BA) released the highly anticipated 2020 version of its long-term market forecast. Not surprisingly, it had to reduce its forecasts for aircraft demand -- particularly in the near-term -- due to the massive impact of the coronavirus pandemic on global aviation. But despite an 11% cut to its estimate of aircraft deliveries over the next decade, Boeing still appears to be underestimating how long it may take for demand to recover fully.
In its 2020 commercial market outlook, Boeing said that airlines would need approximately 18,350 new commercial jets over the next decade. That figure represents an 11% cut to its 2019 forecast. Over the full 20-year forecast period, Boeing expects the industry to return to its historical growth trend, creating a requirement for over 43,000 new aircraft.
Digging into the numbers, Boeing expects single-aisle planes (such as the 737 MAX and rival Airbus A220 and A320neo families) to account for 74% of demand over the next decade (13,570 deliveries). Like most industry observers, Boeing expects wide-body demand to recover more slowly. As a result, it projects demand for 3,060 new passenger wide-bodies between 2020 and 2029, or 17% of the overall mix. The remaining 9% is split between regional jets with fewer than 90 seats and freighters.
Source Fool.com
