Boeing upbeat on wide-body freighter demand

Boeing predicts “very strong demand as we look forward” in the main-deck air freight market as the industry doubles in size over the next 20 years.
Unveiling the company’s two-yearly World Air Cargo Forecast at the Air Cargo Forum in Seoul, Randy Tinseth (pictured), VP marketing for Boeing Commercial Airplanes, said global GDP was expected to average 3.2 per cent a year to 2033, and the revenue tonne-kilometres flown by airlines by an annual 5 per cent.
Every percentage point of growth was “equivalent to 10 triple-seven freighters,” he pointed out – and in marked contrast to much recent industry analysis, Boeing thinks freighter aircraft will maintain their current 55 per cent share of the market. “Freighters will continue to be the preferred choice,” Tinseth claimed.
The air freight industry had “found a way to grow consistently,” averaging 5.3 per cent growth despite periodic blips. Boeing forecasts had been consistently accurate, if anything understating the appetite for freighters.
The new forecast puts demand for new production freighters at 840, heavily weighted towards the wide-body end of the market with 590 aircraft of 80 tonne-plus capacity required (including Boeing’s 777 and 747-8), and 250 in the medium 40-80 tonne category such as 767s and Airbus 330s. No demand for standard freighters is predicted at all, though Tinseth said “there could be four or five”.
Boeing’s overall numbers are only a little higher than the 803 new-builds projected in Airbus’s own recent 20-year analysis, but the view from Toulouse is that demand will be heaviest in the medium segment. Tinseth gave that short shrift, saying: “Our forecast drives our strategy, their strategy drives their forecast.”
One indicator of the steady recovery in global trade, Tinseth said, was that “We’re seeing planes coming back from the desert.”
There had been a fall from 45 aircraft mothballed during the recession to 40 today, he told Air Cargo News. “First utilisation goes up, then carriers look toad back capacity.”
The world freighter fleet is expected to increase by 60 per cent overall during the next 20 years, but a little over half of demand will be met 1,330 passenger-to-freighter conversions, the majority of these in the up-to-40-tonne category.
Boeing will offer own converted 777-200ER BCF and 737-800BCF models and sees a lot of interest from China in the latter, where the express market has grown dramatically.
Tinseth said the company would consider licensing data to a third-party converter for one or both types. “It’s a different cost and value proposition, but we have offered both options before for the 767-300 and the MD-11,” he said.
Tinseth accepted that, although the world economy had been improving for the last 18 months and industrial production was growing again, “There’s clearly more capacity than demand.”
The market will come into balance by the end of 2016 and strong demand for freighters will follow, despite challenges from directional imbalance, environmental regulations, trade quotas, airport curfews, terrorism, oil prices, industrial relocation, surface competition and the seemingly vast belly-hold capacity of latest generation aircraft.
Boeing dismissed a number of these potential threats. Tom Crabtree, from the company’s Airline Market Analysis team, said: “There’s a lot of hype about near-shoring. It’s a mixed bag, as industry has always moved. Supply chains are not getting closer to the point of consumption for all goods.”
The belly capacity “tends to be overstated,” Crabtree added. There had been widespread rumours of 50-tonne shipments of mangoes being shipped out of Pakistan on 777 passenger aircraft, but 10-11 tonnes was more typical in the lower hold.
Boeing also plays down talk of serious or permanent modal shift. Tinseth said container ships were taking no more than 1 to 2 per cent of available air freight, and much-publicised rail services from China to Europe accounted for no more than a pin-prick.
Furthermore, industry analysts had feared that the integrators would have swallowed up 40 per cent of the market by now, but he put the current split between regular air cargo and small parcel/express traffic at 83:17.