Bombardier’s just-released annual market forecast predicts demand for 24,000 business jets valued at $648 billion over the next 20 years, a delivery number equal to last year’s forecast.
The company, however, cut its forecast for commercial airplane demand from last year by 300 planes, predicting a market for 12,800 commercial planes in the 20- to 149-seat segment, signaling an outlook that includes slower economic growth and sharp increases in forecasted oil prices.
“As the business and commercial aircraft markets continue to recover from the industry downturn, indicators are mixed, yet trending positively,” Bombardier said in a statement.
Bombardier is confident in the long-term potential of business aircraft, the company said.
The forecast predicts delivery of 9,800 business jets worth $266 billion from 2012 to 2021 and deliveries of 14,200 jets worth $382 billion from 2022 to 2031.
Market confidence must be restored for business jet deliveries to strongly increase and realize its full potential, the company said.
Deliveries are expected to lag order intake as planemakers work to maintain acceptable backlog levels.
Business jet deliveries for this year are expected to be comparable to that of 2011, with growth beginning in 2013 in the large aircraft category.
North American customers will take delivery of the largest number of jets over the 20-year period at 9,500, followed by 3,920 deliveries to Europe.
China will become the third-largest market for business jets, the forecast said.
Key growth markets are expected to include Brazil, India, Russia and the Commonwealth of Independent States, Indonesia, Mexico, South Korea and Turkey.
Bombardier projects that more than half of the current commercial aircraft fleet will be replaced in the next 20 years, a slightly higher percentage than last year’s forecast.
Technical obsolescence, cost inefficiencies and age are increasing retirements of older aircraft, it said. That will increase demand.
“Although high oil prices will continue to challenge airlines’ profitability, the arrival of new, technologically advanced aircraft that deliver direct operating cost reductions will accelerate the retirement of older, less fuel-efficient aircraft,” Bombardier said.
The current forecast for commercial airplane deliveries in the 20- to 149-seat market over 20 years represents a decrease of 2.3 percent from the forecast a year ago, the company said.
It predicts demand for 300 planes in the 20- to 59-seat category; 5,600 planes in the 60- to 90-seat category, and 6,900 planes in the 100- to 149-seat category.
Global demand for air travel and for new aircraft continues to shift toward emerging markets, the forecast said.
North America is expected to take the largest number of deliveries with 4,730 planes, followed by China with 2,220 aircraft, and then Europe, which includes Russia and the CIS, with 2,240 planes.