Boeing to revise India forecast in June. Currently, there is a large divergence between Boeing forecast of 492 aircrafts and Airbus forecast of 900 aircrafts over the next twenty years(2006 to 2025). IMO, Boeing is being very conservative in its forecast. Here's why:
#For the fiscal year 2004-05, total traffic(domestic & international) was 60 million and growing at 22%. Aviation growth for a developing economy is about a 1.3 factor of GDP growth. Given favourable demographics of India and further liberalization, one can expect the Indian economy to grow at an average rate of at least 7% which translates to a GDP of 4 times the current level by 2025. Applying the multiplier of 1.3 on quadrupling of GDP, total passenger traffic should be about 300 million by 2025.
The current traffic of 60 million is supported by about 225 aircrafts. India would need at least 1000 aircrafts by 2025 to support 300 million passengers. Metro airport expansion/modernisation and new airports at BLR/HYD would be completed by 2025. Expected capacity of five metro airports is expected to be around 250 million by 2025 and a lot of additional capacity at secondary cities will come on-line by 2025.
In summary, Boeing is way off in its forecast for Indian market.
Boeing on Monday said it will revise its forecast for Indian civil aviation market in June and expects the aircraft needs of the country will be definitely less than that of Airbus, its Trans-Atlantic rival. "We will be revising our forecast for the country in June. According to the Airbus forecast, the requirement here is 900 airplanes valued around $90 billion. Its more than triple of our last year forecast...and I believe the actual requirement would be somewhere in between," Boeing Commercial Airplane senior vice president (Sales) Dinesh A Keskar told reporters here.
According to Boeing's last year forecast, Indian carriers will buy 492 aircraft for about USD 36 billion over the next 20 years. Meanwhile, according to Airbus forecast last month, the European airplane maker had said the Indian civil aviation market would need about 900 aircraft valued $90 billion.
[Edited 2006-03-20 18:07:09]