Boeing: Air cargo will recover over long term

Boeing: Air cargo will recover over long term Boeing on Tuesday unveiled its latest biennial World Air Cargo Forecast and predicted healthy year-on-year growth for the industry over the next 20 years, despite dour growth expected for this year and next.
   Despite the first contraction in the aviation market in five years, Boeing expects the world freighter fleet to nearly double over the next two decades.
   “Our research tells us that long-term economic growth, freighter fleet renewal and moderating jet fuel prices will stimulate air cargo traffic growth,” said Randy Tinseth, vice president, marketing, Boeing Commercial Airplanes, in a statement. “These positive prospects will prevail despite the industry’s concerns about our current economic challenges.'
   One factor driving the future growth will be the certainty that economies will eventually recover from the current downturn and perhaps emerge stronger.
   “World GDP is projected to average just higher than 3 percent during the next 20 years,” Tinseth said. “Asian production fundamentals — including abundant raw materials and low-cost labor — remain solid, and China will remain a source of strong economic growth with substantial industrialization and related investment.”
   Boeing said cargo tends to be at the forefront of increased liberalization of air services, which is a further driver of economic growth. The plane manufacturer said the Asian air cargo market growth will continue to lead all global traffic routes, with domestic Chinese and intra-Asian markets projected to grow 9.9 percent and 8.1 percent per year, respectively. Asia-related markets will experience growth in excess of the global average, Boeing added.
   “We’ve seen market contraction during the middle of this year for the first time since late 2003; however, history tells us that the air cargo market returns robustly when the economy strengthens,” said Jim Edgar, regional director of marketing for Boeing Commercial Airplanes, and a contributor to the forecast.
   Boeing is also predicting that the world freighter fleet will increase to 3,890 airplanes from 1,950 during the 20-year period through 2027. Large freighters ultimately will represent 35 percent of the fleet, compared to 26 percent today, while providing 74 percent of total capacity. This segment will require 640 new factory-built airplanes. More than 75 percent of the 3,360 freighters joining the fleet — 2,500 airplanes — will come from passenger-to-freighter modifications, while 860 will be new production freighters.
   Check back later this week for a more in-depth look at Boeing's air cargo forecast, as well as other happenings at the Air Cargo Forum in Malaysia.
   The World Air Cargo Forecast 2008/2009 is available at www.boeing.com/commercial/cargo. ' Eric Johnson