While the 2020 Singapore Airshow is unlikely to offer anything close to the blockbuster orders of years gone by, one of the biggest names in the business remains upbeat about the region’s longer-term prospects.
Boeing has published its market forecast for Southeast Asia and predicts that $1.5 trillion of commercial aircraft and associated services will be required over the next two decades. This translates to approximately 4,500 airliners, valued at $710bn at list prices, in addition to $785bn of related commercial aftermarket services.
Unlike Gulfstream, Viking and Bombardier, the Chicago-based firm has maintained its physical presence at this year’s event, albeit in a slimmed-down capacity amid continued fears relating to the 2019 Novel Coronavirus.
Despite the ongoing global grounding of the company’s flagship 737 MAX model, Boeing describes single-aisle examples as “the main driver of capacity growth” in Southeast Asia. Further analysis by the firm suggests that three countries from the region – Vietnam, Thailand, and Indonesia – made the global top ten list of nations that have added the most airline seat capacity since 2010. Boosted by a vibrant LCC sector and a revitalised flag carrier, Vietnam has experienced the strongest growth out of the three at nearly 15% per year, followed by Thailand and Indonesia at approximately 10% respectively.
Randy Tinseth, vice president of commercial marketing at Boeing noted: “With an expanding middle-class in markets that continues to liberalise, coupled with a strong domestic, regional and international tourism sector, Southeast Asia has become one of the world’s largest aviation markets.”
While smaller jets dominate the figures, Boeing also acknowledges that “a significant amount” of widebody aircraft, “in terms of value and number of units” will also be needed. The manufacturer states that much of this demand will be driven by “airlines adapting to the evolving business environment and new long-haul expansion opportunities”. Overall, twin-aisle types are expected to comprise 19% of new Boeing aircraft deliveries.
Of course, the acquisition of the airframe is only half the story. Without the right personnel in post, the aircraft won’t be making a penny for their new owners. To cope with the expected rise in demand, Boeing further expects the need for 182,000 commercial pilots, cabin crew and aviation technicians to fly and maintain the fleet across the region. The company says this figure is based on a mix of new deliveries, annual aircraft utilisation rates, crewing requirements by region and regulatory arrangements.
Following a tough year for the air cargo sector in 2019, Boeing appears optimistic about the potential for a rebound. The firm predicts that global freight volumes will “recover in 2020, due in large part to solid industrial production and world trade”. With China at the heart of the cargo market within the region, the medium-longer term consequences of the ongoing Coronavirus outbreak are still unclear. The analysis suggests that over the coming two decades, air cargo will grow at 4.2%, with freighters remaining “the backbone” of the industry with the need for 1,040 new and 1,780 converted examples over the period.