Press Release
Contact: Raymond Jaworowski, Senior Aerospace Analyst
Phone: (203) 426-0800
Web site: www.forecast1.com
E-mail: ray.jaworowski@forecast1.com
Forecast International, Inc.
22 Commerce Rd. Newtown, CT 06470 USA
FOR IMMEDIATE RELEASE
Airbus and Boeing Pursue Divergent Strategies
NEWTOWN, Conn. [April 27, 2004] ― A new study by Forecast International entitled "The
World Market for Large Commercial Jet Transports," has projected that a total
of 5,835 large commercial jet transports will be produced between 2004 and
2013. The total value of this production, in constant 2004 U.S. dollars, is
estimated at $545 billion. Boeing and Airbus are expected to account for the
bulk of this production. Boeing production for the 10-year period is projected
at 2,911 aircraft, while Airbus is forecast to build 2,778.
Following three years of mostly negative results, the
airline industry is still struggling but appears poised for recovery. This
anticipated recovery may turn out to be slow and gradual, but nevertheless a
sense of optimism seems to have taken hold in the airline industry.
Low-fare carriers continue to be a bright spot in the
industry. This should continue to be the case during the anticipated recovery,
although the major carriers should also see improved results. Starkly
underlining the different near-term prospects of the two airline types,
however, is the fact that many low-fare carriers anticipate strong profits in
2004 while the best that many majors can expect for the year is to break even.
The majors are suffering from yield erosion due partly to
competition from the low-fare airlines and, to some extent, from private
corporate jets. Other difficulties include heavy competition among the majors
and overcapacity on long-haul international routes.
The outlooks of Airbus and Boeing on the future of the large
commercial transport market diverge significantly, with each company developing
a major new product that reflects its respective viewpoint. The A380
represents Airbus' view that airlines require a 550+-passenger aircraft for use
mainly on dense trunk routes between major hubs. However, Boeing's new
mid-size 7E7 Dreamliner series reflects that company's view that route
fragmentation will be the dominant trend in the market, with airlines requiring
smaller aircraft to fly point-to-point. Neither company has announced any
immediate plans to directly challenge the other's new program by marketing a
similar aircraft.
Boeing formally launched the 7E7 program this week. After a
series of shelved new product proposals, including the highly publicized Sonic Cruiser,
Boeing's credibility in the market was on the line with the 7E7 program.
Forecast International senior aerospace analyst Raymond Jaworowski said, "If
the 7E7 was never launched, Boeing's reputation with potential customers might
have taken a serious hit."
In the narrowbody market, Boeing's 737 series competes with
the Airbus A320 single-aisle family. The A320 family does have one advantage
over the 737 in that the A320 cabin is approximately seven inches wider than
that of the Boeing aircraft. This results in better passenger comfort, which
is an important factor in the deliberations of airlines regarding what aircraft
to buy. It would not be surprising if a Boeing successor to the 737 has a
wider cross-section than the current 737. Appearance of any 737 successor,
though, is several years away.
Forecast International, Inc., is a leading provider of
Market Intelligence and Analyses in the areas of aerospace, defense, power
systems and military electronics. Based in Newtown, CT, USA, Forecast
International specializes in long-range industry forecasts and innovative marketing
presentations, including regular 10-year forecasts. To arrange an interview
with Forecast International's analysts, please contact Monty Nebinger
(203-426-0800, monty.nebinger@forecast1.com).
