40 years of working together
Boeing is celebrating 40 years of working together with China's aviation industry. In 1972 CAAC placed an order for China's first Boeing airplanes--ten 707s. Mainland Chinese airlines have since ordered more than 900 Boeing airplanes. More than 6,000 people currently work at Boeing-related businesses and tens of thousands more support Boeing suppliers. This partnering will continue.
With GDP forecast to rise 6.5 percent annually over the next 20 years, China will continue to serve as a growth engine for the global economy. China's share of world GDP will continue to increase over the next several decades. As Chinese incomes converge toward those in the historical industrialized nations, an expanding middle class will expect to enjoy a comparable standard of living and consumption patterns.
Traffic continues to be robust, rising 12.1 percent in 2011 compared to 2010. Growth will moderate toward 7.0 percent, which will nonetheless drive a need for 5,260 new airplanes valued at $670 billion.
A projected 230 airports will be available for commercial use by 2015 as domestic travel continues to grow. Airlines will also look for opportunities to expand, particularly in regional and long-haul markets. The number of new international markets has doubled over the past 10 years. Over the next 20 years, intra-Asia and long-haul traffic are both expected to grow 7.2 percent, driving the future fleet mix. Single-aisle airplanes will be preferred for newly opening markets within China. Within Asia, a mix of single-aisle and twin-aisle airplanes will be needed, while long-haul flying will rely on airplanes like the 787, 777, and 747-8 Intercontinental.
The Chinese cargo market is one of the world's largest and fastest growing. Domestically, it has grown 15.5 percent annually since 1990. China's airlines are forecast to grow 6.2 percent annually over the next 20 years, outpacing all other regions. This growth suggests a need for 120 new freighters and 230 freighter conversions. Chinese cargo airlines now number among the world's top cargo airlines, and we expect their market share will continue to increase.
Adapting business models
Historically, the majority of airlines in Europe and North America were large network airlines. Today a mix of network carriers, low-cost carriers, charter airlines, and air cargo operators meets consumer needs. As aviation continues to grow in China, airlines will adapt and evolve their business models to meet the needs of their customers.