Boeing plays moral card in production poker game

Boeing will present its 20-year commercial aircraft market outlook during the show, but be prepared for more finger pointing than forecast changes.

Randy Baseler, Boeing Commercial Airplanes vice-president of marketing, says the 2003 market outlook "has not much changed since last year".

At the Farnborough airshow last year, Baseler outlined a forecast that anticipates a worldwide economic growth average of 2.9% a year in the period 2002-2021 and an average annual growth of 4.9% in passenger traffic in the same period. Cargo will grow by 6.4% a year, says Boeing.

That translates into a need for 17,200 new aircraft over the period to meet growth needs, and a further 6,700 aircraft to replace retired aircraft, for a total of just under 24,000. Over that period, the world fleet will grow from 15,271 aircraft to about 32,500.

With little good news for the global airline industry to celebrate since the last forecast - and the SARS virus adding its own impact - even a "no change" situation can be viewed with some relief as forecasters underline a sluggish economy and slow but ultimately achievable recovery.

What we might see this year, however, is a sharpening of the swords in the blame battle between Airbus and Boeing over which company's strategy is helping or hindering that recovery.

"Boeing knows the market and is doing what is right for the industry and our company," says Baseler. "We have cut our production in half since 9-11. We think that's the right thing to do for the industry."

Baseler points to Boeing's production of 600 aircraft in 1999, while it expects to deliver 280 aircraft this year and between 275 and 300 in 2004.

He adds: "Airbus meanwhile has held its production at 300. We think that's a mistake. Industry thinks that's a mistake. The number of A320s for sale has almost doubled. There are a lot of excess aeroplanes out there and yet Airbus continues to overproduce.

"If you have overcapacity you should be cutting back on your capacity. Their lease rates have dropped significantly below 737 lease rates."

Baseler says airlines will continue to need some 24,000 new aircraft in the 40-seat plus range over the next 20 years. Airbus and Boeing broadly agree the overall size of the market, but continue to differ widely in how it will be broken down between the various seat-size segments. Boeing says 71% of that total market, or 13,210 aircraft, will be for single-aisle aircraft. Airbus, with its greater emphasis on the 500-plus seat sector need, sees the single-aisle market making up just 54%, or 8,259 aircraft, of the total.

"Boeing projects that in the next 20 years, the 737/A320 family segment will require 45% more airplanes than Airbus projects," says Baseler. "We believe our 737 family will remain the airplane family of choice between 100 and 200 seats.

Source: Flight Daily News