Boeing said on Tuesday that India would require 1,850 planes over the next 20 years, revising its market outlook by six per cent. In its last market outlook, the US plane maker had said India would need 1,740 planes in the next two decades.
The new demand forecast has been arrived at after taking into consideration the low crude oil prices and future growth of passenger demand in regional routes, which can be served by single-aisle aircraft such as the Boeing 737s.
According to Boeing’s senior vice-president for Asia-Pacific, Dinesh Keskar, the plane maker is in a comfortable position in India, with more aircraft orders coming in from Jet Airways and SpiceJet. Keskar said Jet Airways and SpiceJet had 75 and 55 Boeing 737 Max on order but these are largely for replacements and the airlines will need to order more for growth. Boeing will begin deliveries of 737 Max to the two airlines in 2018.
“We are more bullish on India than before. India continues to have a strong commercial aerospace market and the highest domestic traffic growth in the world. With the new aviation policies in place, we see even greater opportunities and remain confident in the market and the airlines in India,” he added.
While low crude oil prices have driven down the operating costs of airlines, Keskar cautions airlines need to guard against supply-demand imbalance which can cause overcapacity in the market and impact airline profitability.
He expects Indian carriers to order more wide-body planes in the future. “At some point, they will (order). Vistara is a candidate for wide-body planes though initially I understand they will fly on short-haul international routes.”