Good times seen to roll for aviation industry despite economic blips
26 September 2011
Though many industries at the moment have a cautious outlook in the backdrop of fears of a "double dip" recession in the world economy, the mood in aviation, especially among the aircraftmakers, remains optimistic.
This week Airbus came out with long-range forecasts, projecting that vigorous emerging-market growth and the need to replace ageing and inefficient planes in the rich countries would spur a demand, between now and 2030, for almost 28,000 large aircraft (passenger planes with over 100 seats, plus freighters) valued at almost $3.5 trillion.
Airbus's archrival, Boeing, is even more upbeat, predicting earlier this month, a demand for around 31,000 planes, valued at $4 trillion, by 2030. And if the bulging order books are anything to go by the good times seem to be about to roll in.
What apparently underpins the confidence of the aircraft makers is the the iron law of aviation: rising numbers of urban middle-class people would mean higher demand for air travel, despite the short terms blips in the economy.
Through the oil shocks of the 70s, Middle East wars, terrorist strikes and hijackings, the number of passenger-miles logged have always fallen in line with its long-term growth trend. At the moment according to Airbus there are 39 "megacities" worldwide whose airports handle more than 10,000 long-haul passengers daily and in 20 years it expects there would be around 90 such cities, many of them in Asia. The busiest three hubs in the world would then be in Dubai, Beijing and Hong Kong, with Heathrow and JFK in fourth and fifth place.
The rich world too offers plenty of potential for growth but a second important driver of demand for new planes in these countries would be the desire of airlines to save on fuel and maintenance costs, especially with new taxes on emissions coming into force, by junking their old crates for shiny new planes.