(Bloomberg) — Boeing Co. expects global jetliner sales to bounce back from the Covid-19 pandemic later this decade, contributing to a potential $9 trillion market for aerospace and defense products and services.
That’s 5.9% larger than the $8.5 trillion addressable market that the Chicago-based manufacturer forecast last year, when the coronavirus outbreak sapped demand for travel and new planes. Boeing expects global planemakers to deliver 19,000 aircraft worth $3.2 trillion through 2030, a more bullish outlook than the 18,350 planes worth $2.9 trillion that it predicted a year ago.
The prospects for aerospace should be bolstered by global economic growth, rising demand for cargo-hauling jets and a shift by airlines to newer, greener aircraft, according to Marc Allen, Boeing’s chief strategy officer. But the recovery could come in fits and starts, depending on the pace at which vaccines are distributed and border restrictions lifted, he cautioned. Defense sales, which helped bolster Boeing’s finances during the crisis, aren’t likely to see similar growth.
“Clearly, the shape of the recovery will be uneven and volatile,” Allen told reporters in a briefing before the forecast was made public. “But we do believe these long-term trends will bear themselves out.”
Boeing expects global travel to return to pre-pandemic levels by the end of next year or early 2023, driven by a rebound in shorter domestic flights. Long-range travel will recover by mid-decade, said Darren Hulst, Boeing’s vice president for commercial marketing.
The planemaker doesn’t see the new era of webcasts and Zoom calls fundamentally altering demand for business travel over the longer term, either. “We’re pretty confident that business travel will be back,” Hulst said, noting that corporate travel defied gloomy predictions after the 2008 global financial crisis and Sept. 11, 2001, attacks.
In fact, Boeing expects passenger traffic to grow an average of 4% a year, unchanged from its 2020 commercial market outlook. The company expects airlines to add 43,610 new aircraft through 2040, with single-aisle jets accounting for three-quarters of deliveries. Airlines will need 7,670 new wide-body planes over the next 20 years — about 8% fewer than it predicted in 2019.