Boeing, Airbus Expect Asian Airlines to Order Bigger Aircraft
By Gaurav Raghuvanshi
SINGAPORE--Boeing Co. (BA) and Airbus SE (AIR.FR) both expect Asia-Pacific carriers to step up orders for bigger jets, fueled by rising demand from new airlines and the replacement of aging fleets, executives from the two planemakers said.
Airbus predicts Asian airlines will buy nearly 4,000 twin-aisle jets and another 650 of the biggest passenger aircraft produced by the Toulouse-based company and its American rival over the next 20 years.
While the global aviation market in terms of passengers is expected to double over the next 15 years, the size of the Asia-Pacific market will grow three-fold in the next 20 years, said Eric Schulz, the new head of sales at Airbus, at a press event at the Singapore Airshow on Tuesday. As the Asian market expands, airlines anticipate more demand for flights of eight- to 12-hour duration.
Boeing sees great potential in India, a market that it expects to keep growing in double digits over several years, said Randy Tinseth, Boeing's vice president for marketing, in an interview.
New carriers, including the Indian joint ventures of Singapore Airlines Ltd. (C6L.SG) and Malaysian budget airline group AirAsia Bhd. (5099.KU), are looking to grow their fleets with bigger planes to start international flights on profitable routes to Europe. Chinese carriers are also expected to start ordering wide-body jets, Mr. Tinseth said.
China will also become a production hub for Boeing's 737 narrow-body jets with a completion center for the jets expected to open by the end of this year, Mr. Tinseth said.
Boeing is also evaluating a plan to launch a new aircraft to address what it calls a "middle of the market" that it believes can find buyers among Asian carriers. Boeing has discussed the possible new aircraft with several airlines and expects demand of about 4,000 such planes, Mr. Tinseth said.
The costs of designing and building a new aircraft type, which will be Boeing's first new airliner in 15 years, has been a worry for its investors. "We can build it at a cost that makes sense," Mr. Tinseth said, declining to give an estimate.
The new plane would overlap with the discontinued but still widely used 757 and 767, ferrying 200 to 280 passengers up to around 5,000 nautical miles. The industry expects the new model to be called Boeing 797.
Write to Gaurav Raghuvanshi at firstname.lastname@example.org
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February 06, 2018 06:09 ET (11:09 GMT)Copyright (c) 2018 Dow Jones & Company, Inc.