Boeing bullish on Indian market despite challenges

India's airlines will lead air traffic growth through 2040, growing at a rate of 6.9 per cent. The growth for the South East Asia market is pegged at 5.5 per cent, China (5.4 per cent), Africa (5.4 per cent) and Latin America (4.8 per cent), Boeing said in a presentation. The projection is based on an over 20-year horizon and the growth could be much higher in the near term. Besides, the company said Indian airlines are projected to see massive growth in terms of seats offered. Boeing, which has around 90 per cent global market share in cargo, expects to play a large part in India's cargo market.

Boeing said that fuel prices, 70 per cent of an airline's operational costs being priced in foreign currency and the lowest average fares for similar distances and demands are among the major challenges in India. As per the aircraft maker, its 737-10 plane with 9 per cent lower seat costs will help enable a strong aviation market with sustainable low fares.

As many as 137 Boeing planes were operating in India since last month. They include 68 Boeing 737 NG aircraft, 29 Boeing 787 planes and 16 Boeing 737 MAX aircraft. There were also 18 Boeing 777 aircraft and 6 Boeing 757 planes. Five scheduled carriers have Boeing planes in their fleet - Air India, Air India Express, Vistara, SpiceJet and Akasa Air.

India's continued economic growth and its expanding middle class will fuel demand across South Asia for 2,400 new commercial jets valued at nearly $375 billion during the 20-year forecast period, according to Boeing.

Single-aisle airplanes will increase their share of total airplane demand to serve India's vast domestic market and competitive regional market, which includes established carriers as well as start-up airlines. To improve and expand long-haul connectivity – especially routes from India to North America and Europe – carriers will continue to invest in versatile, fuel-efficient wide-body airplanes.

India's air cargo growth is expected to average 6.3 per cent annually, driven by the country's manufacturing and e-commerce sectors, including its Make in India initiative. Boeing forecasts demand for more than 75 freighters, including 10 widebodies and 737 Boeing Converted Freighters.

Boeing's analysis of market dynamics shows the resilience of the industry with many domestic markets nearly or fully recovered from pandemic impact, while international traffic gains momentum as restrictions ease.

The CMO forecasts a market value of $7.2 trillion for new airplane deliveries, with the global fleet increasing by 80 per cent through 2041 compared to 2019 pre-pandemic levels. The commercial services market to meet this demand is valued at $3.6 trillion.

Approximately half of passenger jet deliveries will replace today's models, improving the global fleet's fuel efficiency and sustainability.

Continuing their strong growth story, Asian markets account for roughly 40 per cent of long-term global demand for new airplanes. Europe and North America each account for just over 20 per cent of demand, with 15 per cent of deliveries going to other regions.

The CMO also predicts continued robust demand for dedicated freighters to support global supply chains and growing express networks. Carriers will need 2,800 additional freighters overall, including 940 new widebody models in addition to converted narrow-body and widebody freighters over the forecast period.