Boeing Projects Solid Cargo Market
Global air cargo traffic will expand at an annual rate of 5.9 percent over the next two decades, according to Boeing’s World Air Cargo Forecast for 2010/2011. Consequently, Boeing expects worldwide air freight traffic to triple through 2029.
Boeing released the biennial forecast today at the November 2 to 4 International Air Cargo Forum and Exhibition in Amsterdam.
Boeing research indicates the world freighter fleet will increase to 2,967 airplanes, from the current 1,755, during the 20-year period. Large freighters will account for 33 percent of the fleet, compared with 27 percent today, according to the company.
However, conversions will account for about 70 percent of total demand, according to the report. Boeing projects a 20-year output of 743 new factory-built cargo airplanes and 1,751 conversions from passenger and passenger-freighter combination airplanes, worth a total of some $180 billion in current U.S. dollars.
Air cargo traffic began to rebound strongly 12 months ago and continued its recovery through the first eight months of this year. As a result, Boeing expects world air cargo traffic to return to its 2007 peak by the end of this year.
“Economic activity–world gross domestic product–is the key driver of the air cargo market,” said Jerry Allyne, vice president, strategic planning and analysis for Boeing Commercial Airplanes. “Following the recession and a year of recovery, world economic growth is forecast to average 3.2 percent over the next two decades.”
The 2008-2009 period marked the first time that air cargo traffic contracted for two consecutive years, noted Boeing. The decline affected nearly all geographic markets, but markets connected to industrial freight flows generally fared worse than markets less dependent on such flows, it added. The nearly 13-percent drop in cargo traffic in 2008-2009 reflected the steep plunge in industrial activity related to the global economic downturn.
Industrial activity began to recover, particularly in Asia, in August 2009. Monthly air cargo traffic statistics turned positive in November 2009, and the first eight months of this year have seen an estimated 24-percent growth in traffic, compared with the same period last year.
Along with the strong economic rebound, anecdotal evidence suggests that many industrial shippers have turned to air cargo in response to the overcorrection that constrained capacity in other modes of transport, particularly container ships, said Boeing.
“Industrial requirements are driving the rebound, as air cargo is an essential tool for industry and commerce to manage supply chains and bring goods to market,” said Allyne. “As airlines return to profitability, they will begin to consider fleet renewal to improve long-term operating costs.”
Boeing emphasized that Asian production fundamentals remain solid and continued growth in China will affect the market positively, as will fewer barriers to international air trade.
According to Boeing, Asian air cargo market growth will continue to lead all global traffic routes, as domestic Chinese and intra-Asian markets grow 9.2 percent and 7.9 percent per year, respectively. Asia-related markets will grow more quickly than the global average, it added.