SINGAPORE: Boeing bullish on near-term airliner demand despite European woes

Singapore
Source:
This story is sourced from Pro
See more Pro news »

Boeing's head of marketing says that while the spate of airline collapses in Europe signals a difficult time ahead for the region's carriers, it does not raise the spectre of an airliner glut in the near term even as production is at record levels.

"European carriers have suffered slow growth and some have struggled to find financing and had to exit the market. But at the same time, in the USA I can't imagine a time when airlines haven't managed their capacity and businesses better," said Boeing vice-president marketing Randy Tinseth.

Speaking during the Singapore air show, Tinseth said he expects that the problems in the European market will remain in the near term, which will lead to further consolidation and changes. "We probably won't see improvements until the second half of this year or into next as the economy improves.

"But this is a global business and you have to look at it as a whole. When I look around the world, Middle East carriers are growing and successful, low-cost carriers are growing successfully and US carriers are reporting strong profits."

Boeing's production is set to rise by 20% this year to 585-600 aircraft, while Airbus forecasts around 575 deliveries, which would put their combined output in 2012 at over 1,150 aircraft.

Tinseth said that Boeing's decision to raise production is based on its view on airliner supply and demand across the globe: "We are increasing our rates because demand is there. It's driven by three things - emerging and developing economies; those successful business models (low-cost carriers, Middle East airlines etc); and the huge demand for replacement aircraft."