FARNBOROUGH 2016: Airbus maps demand

In line with the rest of the industry, Airbus expects the global fleet to double from the 19,500 aircraft in service today to approximately 40,000 in 2034.
John Leahy, Airbus’ COO customers, broke the figures down further. He estimated that 7,000 of today’s aircraft would stay in service, while the remaining 13,000 would need to be replaced with more fuel efficient types (leaving 20,000 aircraft representing new growth).
If brought to fruition, these numbers will meet the demand driven by a 4.5% growth in passenger traffic each year, which, according to Airbus specifically, means the industry will need 32,425 new passenger aircraft above 100 seats by 2035 (valued at US$5.2 trillion). Leahy predicted 23,000 of these would need to be single-aisle aircraft and 10,000 would be twin-aisle.
Although there’s a large gap between these numbers, with narrow-bodies dominating 71% of the market share when it comes to new units, Leahy said those aircraft only make up 46% of the market’s value (US$2.4 trillion), while wide-bodies – which make up 29% of the market share – represent 54% of the dollar value (US$2.8 trillion).
Leahy disputed the claim that traffic growth is in line with GDP growth and argued that the former is outstripping the latter. Growth is being generated, Leahy added, by the fact that aircraft are creating one and a half times more revenue passenger kilometres than they were in 1995.
With 89% of passengers flying economy class, he attributed traffic growth to private consumption, or the expansion of people identified as ‘middle class.’ He noted that in 1995, 23% of people in emerging markets were deemed middle-class, and that today the figure stands at 55% (representing 3.5 billion people).
Airbus see Asia as the driving force behind these changes. With a combined population of over six billion people, the OEM thinks its economies will grow at 5.6% per year and the propensity to travel will triple to 75% of its population. Within 10 years, Leahy declared, China’s domestic air traffic will become the world’s largest.
Overall, in terms of route expansion between now and 2035, he highlighted that 70% of growth would come from existing networks, while 30% would be down to new services.
At the moment, Leahy says Airbus’ orders are decreasing. The OEM has logged 200 so far in 2016 and expects to see 650 in total by the year-end in comparison to the approximate 1000 orders placed in both 2014 and 2015. This, Leahy divulged, means that at a push this year, orders could match deliveries. However, concluding that the A320 Family holds 60% of the single-aisle market share vs Boeing’s 737, Airbus is comfortable with these developments in the order cycle.

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