Chinese airlines are likely to buy more than 7,000 planes worth $1.1 trillion over the next 20 years, as they grow their fleets to meet robust demand for domestic and international travel, Boeing Co <BA.N> said in a bullish forecast on Wednesday.
Its latest estimate of 7,240 aircraft purchases for the period to 2036 is 6.3 percent higher than the U.S. planemaker’s previous prediction of 6,810 planes last year.
“China‘s continuous economic growth, significant investment in infrastructure, growing middle-class and evolving airline business models support this long-term outlook,” Randy Tinseth, Boeing Commercial Airplanes vice president of marketing, said.
“China’s fleet size is expected to grow at a pace well above the world average, and almost 20 percent of global new airplane demand will be from airlines based in China,” Tinseth said in a statement.
Boeing and European rival Airbus <AIR.PA> have been jostling for market share in China, the world’s fastest growing aviation market, with both opening assembly plants in the country.
Both firms have profited heavily from the aggressive fleet expansion plans of Chinese airlines, which are now experiencing falling passenger returns on routes, thanks to stiffer competition and capacity increases.
The U.S. firm said it expects three-quarters of the 7,240 plane orders to be for single-aisle aircraft, thanks to strong demand for travel within China and throughout Asia. The widebody fleet would require 1,670 new planes, it added.
Tinseth said he expected more demand for widebody aircraft, adding that the falling returns now being experienced by airlines was temporary. “They are big investments, it takes time, and they will get there,” he said.
He added that there was more optimism on the long-term economic outlook, given better-than-expected economic growth in China this year, while the cargo market was also seeing a resurgence.