Press Release

Contact: Raymond Jaworowski, Senior Aerospace Analyst

Phone: (203) 426-0800

Web site: www.forecastinternational.com

E-mail: ray.jaworowski@forecast1.com

Forecast International, Inc.

22 Commerce Rd. Newtown, CT  06470 USA

 

FOR IMMEDIATE RELEASE

 

Boeing Pulls Ahead, But Airbus Getting Ready for Late Stretch Run

 

NEWTOWN, Conn. – [] ― In its new study titled “The Market for Large Commercial Jet Transports,” Forecast International projects that 9,528 large commercial jet transports, valued at some $986 billion, will be produced from 2007 through 2016.  The Connecticut-based market research firm projects that Boeing will account for nearly 56 percent of these aircraft, while Airbus will build 43 percent of the jetliners.  A handful of Russian and Ukrainian companies are expected to account for the remainder.

 

The study details how Boeing’s launch of the new 787 mid-size airliner has, at least for now, given Boeing a decided advantage in the airliner market.  Forecast International senior aerospace analyst Raymond Jaworowski notes, “It is difficult to overestimate just how much the 787 has turned Boeing’s fortunes around.  Boeing correctly saw that airlines wanted a new, efficient airliner in the mid-size capacity class.”

 

Besides introducing the all-new 787, Boeing has launched a larger variant of its flagship 747.  This new model, dubbed the 747-8, will be available in both passenger and freighter versions, and is being positioned to exploit a perceived capacity gap in the Airbus product line between that company’s A340-600 and A380.

 

Airbus appeared to underestimate the potential of the 787 at first, and made a couple of false starts in determining how to respond to the Boeing challenge in the mid-size market.  In the meantime, the European company was running into significant schedule delay with its 525-passenger A380.  However, Airbus is well on its way to fixing the A380 program, and has responded to the Boeing 787 with the all-new A350 XWB.  The XWB is designed to take on not only the 787, but Boeing’s 777 as well.

 

According to Jaworowski, “The A350 XWB is already providing Boeing with some serious competitive match-up difficulties.”  In response, Boeing may be forced to introduce a stretched 787 version and/or a new 777 model.  The main difficulty, though, for Airbus with the XWB is schedule:  it is currently targeted for service entry in 2013, some five years after service entry of the 787.

 

Meanwhile, both manufacturers have begun turning their attention to designing new products for the narrowbody market.  These new designs would replace the Airbus A320 family and the Boeing 737 series, respectively.  Given the size of the narrowbody market, the launch of an all-new narrowbody by one manufacturer will force the other to launch as well.

 

The competition between Airbus and Boeing is set against a backdrop of improving financial conditions for the airline industry.  U.S. airlines are expected to finally turn a profit in 2007, while European and Asian carriers have been profitable for a few years now.  At the same time, though, air traffic growth is slowing somewhat, leading to concerns about future overcapacity.

 

Slowing air traffic growth does not necessarily mean that the recovery in the airline industry will be short-circuited, however.  It does mean that airlines will have to be smart about controlling their fleet growth.

 

Forecast International, Inc., is a leading provider of Market Intelligence and Analysis in the areas of aerospace, defense, power systems and military electronics.  Based in Newtown, Conn., USA, Forecast International specializes in long-range industry forecasts and market assessments used by strategic planners, marketing professionals, military organizations, and governments worldwide.  To arrange an interview with Forecast International’s editors, please contact Ray Peterson, Vice President, Research & Editorial Services (203-426-0800, ray.peterson@forecast1.com).