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docmtl
Topic Author
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Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 8:19 pm

Hi, folks

Embraer has sorted out its forecast for the 150-seats and less aircraft market: 5500 in the next 9 years.

https://www.flightglobal.com/airframers ... 19.article

Interesting figures, but I wonder where these come from and are they reliable in general ?

Has anyone double checked previous forecasts from the industry to see how reliable they are ?

docmtl
 
Sokes
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 8:32 pm

Demand forecasts for Very Large Aircraft comes to mind.
 
MIflyer12
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 8:55 pm

docmtl wrote:
Interesting figures, but I wonder where these come from...


Large companies typically develop their own forecasts as synthesis of multiple sources. You can view this not just as signaling to markets about the size of opportunity, but having a role in guiding Embraer's engineering expense and investments. Anybody constructively wanting to evaluate this forecast will look at the market components and major/declared assumptions.

Examples:

Of the 5,500 anticipated deliveries, 1,080 will be turboprops and 4,420 will be jets, Embraer predicts. About three quarters will be replacement aircraft, and net growth will be about 25%, according to the forecast.

and

Geographically, just under one third of those 5,500 airframes, or 1,710, will go to the Asia-Pacific region, and another 29%, or 1,600, will go to North America. European customers will take about 1,350 aircraft, or 25% of the total, and Latin America will account for about 9%, or 510 aircraft. The remaining 330 aircraft, or 6%, will go to Africa and the Middle East, Embraer predicts.

IMHO, that North American market estimate is way too large unless Embraer or other manufacturers immediately come forward with a AA/DL/UA scope-compliant offering. You won't see AC/WS/AM/B6 receiving anywhere near 1,600. (Maybe they're pumping the number with Southwest's MAX 7s.)
 
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Dutchy
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 8:58 pm

Forecast are forecast, Lots of different parameters are involved, Each one of those needs its own analysis and in the end, it is a prediction. So minor changes might have big consequences. But forecasts are needed to base your business decisions on.
 
silentbob
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 9:04 pm

Embraer didn't really read the North American market very well in regards to scope, so I'm not sure I'd trust their assumptions in arriving at that number.
 
airbazar
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 9:06 pm

Sokes wrote:
Demand forecasts for Very Large Aircraft comes to mind.

That's only true if you don't include the 77W and 779 in that VLA category. The reality is that the larger 777's have a max capacity of more than 500 seats so the forecast wasn't completely wrong.
 
Sokes
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 9:16 pm

Dutchy wrote:
But forecasts are needed to base your business decisions on.

Unless the plane makes the market.
However that may be rather true for big planes than for small ones.
 
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EMBSPBR
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 9:31 pm

silentbob wrote:
Embraer didn't really read the North American market very well in regards to scope, so I'm not sure I'd trust their assumptions in arriving at that number.


From the same source:

"Of the 5,500 anticipated deliveries, 1,080 will be turboprops and 4,420 will be jets, Embraer predicts.
About three quarters will be replacement aircraft, and net growth will be about 25%, according to the forecast."
 
LCDFlight
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 9:59 pm

Both supply and demand are involved. If no aircraft are offered, none will be sold. Saying there "is a market for" something is non-falsifiable statement, because when the sales do not occur, they can say "the supply did not meet the buyers' needs" or even, "the needs changed."

More interesting question is, how many will be delivered or firmly ordered during that time. That's a prediction that has defined right and wrong answers. I think the market could almost get by on ZERO such deliveries, and instead downcycle older aircrames at a lower utilization. Or, if there is an amazing <150 seat product available at low prices, maybe Embraer is right.
 
FlyingElvii
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 10:18 pm

LCDFlight wrote:
Both supply and demand are involved. If no aircraft are offered, none will be sold. Saying there "is a market for" something is non-falsifiable statement, because when the sales do not occur, they can say "the supply did not meet the buyers' needs" or even, "the needs changed."

More interesting question is, how many will be delivered or firmly ordered during that time. That's a prediction that has defined right and wrong answers. I think the market could almost get by on ZERO such deliveries, and instead downcycle older aircrames at a lower utilization. Or, if there is an amazing <150 seat product available at low prices, maybe Embraer is right.

Replacements of CRJ’s alone likely account for much this, I think. And the dynamics of large aircraft and frequencies just changed dramatically.
 
LDRA
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 10:24 pm

What's the range capability distribution for that five thousand small narrow body aircrafts?
 
dstblj52
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Wed Dec 02, 2020 10:51 pm

FlyingElvii wrote:
LCDFlight wrote:
Both supply and demand are involved. If no aircraft are offered, none will be sold. Saying there "is a market for" something is non-falsifiable statement, because when the sales do not occur, they can say "the supply did not meet the buyers' needs" or even, "the needs changed."

More interesting question is, how many will be delivered or firmly ordered during that time. That's a prediction that has defined right and wrong answers. I think the market could almost get by on ZERO such deliveries, and instead downcycle older aircrames at a lower utilization. Or, if there is an amazing <150 seat product available at low prices, maybe Embraer is right.

Replacements of CRJ’s alone likely account for much this, I think. And the dynamics of large aircraft and frequencies just changed dramatically.

I guess but unless they think they are going to sell 1600 e170-175's their isn't much of a market especially given that total allowable by scope is roughly 1200 jets total of greater then 50 seats
 
Jomar777
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Thu Dec 03, 2020 8:49 am

silentbob wrote:
Embraer didn't really read the North American market very well in regards to scope, so I'm not sure I'd trust their assumptions in arriving at that number.


Maybe, if you consider Embraer's share on the US market on the range they are forecasting and their success so far, you may review your assumption...
 
FluidFlow
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Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Thu Dec 03, 2020 9:10 am

I do not think that this prediction is too far off. 100 Turboprop a year is maybe a bit high but of course EMB hopes that there are sales if they launch their new toy.

4000 jets <150 seats would also include the E1s for the NA market (no E2 sales there expected due to scope) and includes also a lot of A22X aircraft. On top of that the odd 319N and 737-7s.

250-500 737-7+319N (Southwest and China)
1000-1500 A22Xs
500 E1s for NA
500 E2s

Optimistic but not unrealistic. Throw the odd Russian Superjet in there and 500-1000 forced sales of ARJs to Chinese carriers and you are at the 4000, give or take a bit.
 
JonesNL
Posts: 388
Joined: Tue Aug 06, 2019 2:40 pm

Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Thu Dec 03, 2020 10:30 am

FluidFlow wrote:
I do not think that this prediction is too far off. 100 Turboprop a year is maybe a bit high but of course EMB hopes that there are sales if they launch their new toy.

4000 jets <150 seats would also include the E1s for the NA market (no E2 sales there expected due to scope) and includes also a lot of A22X aircraft. On top of that the odd 319N and 737-7s.

250-500 737-7+319N (Southwest and China)
1000-1500 A22Xs
500 E1s for NA
500 E2s

Optimistic but not unrealistic. Throw the odd Russian Superjet in there and 500-1000 forced sales of ARJs to Chinese carriers and you are at the 4000, give or take a bit.


The A319neo is almost dead. The production capacity for the A22x is not there. 737-7 might get around 500-600 orders in 9 years time when Southwest places an big order. Seeing the 5 years before the mergers shenanigans started at Embrear I only see an max of 500 deliveries for the E1 and E2 combined. So the maximum deliveries I see is:
A319neo: 200
A220: 800-1000 (if ramp-up to 14/m materializes in 2025, else much less)
737-7max: 600
E1&E2: 500

With all the optimum scenario's we are talking about 2100 units, almost 50% off their estimate...
 
FluidFlow
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Joined: Wed Apr 10, 2019 6:39 am

Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Thu Dec 03, 2020 12:29 pm

JonesNL wrote:
FluidFlow wrote:
I do not think that this prediction is too far off. 100 Turboprop a year is maybe a bit high but of course EMB hopes that there are sales if they launch their new toy.

4000 jets <150 seats would also include the E1s for the NA market (no E2 sales there expected due to scope) and includes also a lot of A22X aircraft. On top of that the odd 319N and 737-7s.

250-500 737-7+319N (Southwest and China)
1000-1500 A22Xs
500 E1s for NA
500 E2s

Optimistic but not unrealistic. Throw the odd Russian Superjet in there and 500-1000 forced sales of ARJs to Chinese carriers and you are at the 4000, give or take a bit.


The A319neo is almost dead. The production capacity for the A22x is not there. 737-7 might get around 500-600 orders in 9 years time when Southwest places an big order. Seeing the 5 years before the mergers shenanigans started at Embrear I only see an max of 500 deliveries for the E1 and E2 combined. So the maximum deliveries I see is:
A319neo: 200
A220: 800-1000 (if ramp-up to 14/m materializes in 2025, else much less)
737-7max: 600
E1&E2: 500

With all the optimum scenario's we are talking about 2100 units, almost 50% off their estimate...


Don't forget the ARJ orders (that will happen) and some more SSJ orders (that will happen). They can get together 1500 orders. The origin countries will make sure of that. So then we will be at 3600. So not that far off.
 
tommy1808
Posts: 14638
Joined: Thu Nov 21, 2013 3:24 pm

Re: Embraer forecasts the need for 5500 airframes less than 150 seats by 2029. Are these industry forecasts reliable ?

Thu Dec 03, 2020 12:40 pm

FluidFlow wrote:
JonesNL wrote:
FluidFlow wrote:
I do not think that this prediction is too far off. 100 Turboprop a year is maybe a bit high but of course EMB hopes that there are sales if they launch their new toy.

4000 jets <150 seats would also include the E1s for the NA market (no E2 sales there expected due to scope) and includes also a lot of A22X aircraft. On top of that the odd 319N and 737-7s.

250-500 737-7+319N (Southwest and China)
1000-1500 A22Xs
500 E1s for NA
500 E2s

Optimistic but not unrealistic. Throw the odd Russian Superjet in there and 500-1000 forced sales of ARJs to Chinese carriers and you are at the 4000, give or take a bit.


The A319neo is almost dead. The production capacity for the A22x is not there. 737-7 might get around 500-600 orders in 9 years time when Southwest places an big order. Seeing the 5 years before the mergers shenanigans started at Embrear I only see an max of 500 deliveries for the E1 and E2 combined. So the maximum deliveries I see is:
A319neo: 200
A220: 800-1000 (if ramp-up to 14/m materializes in 2025, else much less)
737-7max: 600
E1&E2: 500

With all the optimum scenario's we are talking about 2100 units, almost 50% off their estimate...


Don't forget the ARJ orders (that will happen) and some more SSJ orders (that will happen). They can get together 1500 orders. The origin countries will make sure of that. So then we will be at 3600. So not that far off.


Will i am pretty sure China can make ARJ orders happen with ease, the same isn´t true for the SSJ or it would have happend years ago. And as nice and economic a working SSJ certainly is, unless their suddenly learn how to support fleets in the field interesstt in an type where you need 5 to keep one flying is probably going to remain low. And that does seem to be the only real downside of the type.

best regards
Thomas

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