Asian markets drive aircraft demand

Market growth in East Asia, paired with surging e-commerce demand, will be one of the key drivers of new aircraft over the next 20 years. Asian markets account for around 40% of long-term global demand for new airplanes, as carriers continue to build out their express networks and support supply chain demand, according to Boeing’s recent Commercial Market Outlook (CMO) 2022-2041. According to the forecast, Southeast Asia will receive 35 freighter deliveries while South Asia and China will receive five and 205 freighters, respectively. The region’s freighter fleet is expected to be roughly the same size as North America’s fleet by 2041. [caption id="attachment_99360" align="alignright" width="420"] 777-8F. Photo/Boeing[/caption] Europe and North America each account for a little more than 20% of demand, with the remaining % going to other regions. Rising volumes and the need to replace aging aircraft will drive the need for new freighters, according to Boeing. The company predicts that air cargo traffic, measured in revenue tonne kilometers (RTKs), will increase 4.1% annually over the next 20 years, which is .1% higher than the 2021 forecast. Although airfreight capacity has nearly returned to 2019 levels, the ratio of main-deck freighter capacity to belly capacity on passenger aircraft is still high, according to Boeing. Currently, freighter aircraft handle two-thirds of all airfreight, while long-haul passenger flights continue to be affected by COVID-19 travel restrictions. Boeing forecasts that carriers will need 2,795 additional freighters over the next 20 years, comprised of 940 new widebody models and 1,855 forecasted converted freighters. By 2041, the freighter fleet to increase 80% to 3,610 — up from 2,010 aircraft in 2019, representing a 3% annual increase in fleet growth, according to the Boeing report. Meanwhile, Airbus forecasts that until 2041 there will be demand for 2,440 new-build or converted freighters , according to the plane maker’s “Global Market Forecast 2022” (GMF22) published earlier this month. Of those freighters, roughly 900 will be new builds. Single-aisle aircraft make up 80% of the demand at roughly 990, with mid-size widebody and large widebody aircraft coming in next at 890 and 560, respectively. In addition to converted freighters, which are meant to help meet e-commerce demand, the new freighters will also help increase sustainability and capacity, according to Boeing. Of the 2,030 aircraft in service at the beginning of 2020, 31% will remain in service, including those delivered in both 2020 and 2021 and the rest will be replaced, according to Airbus. Express volumes Express air cargo volumes, boosted by e-commerce shipments, are expected to outgrow general air cargo volumes, which currently dominate the market. In 2019, express shipments accounted for only 17% of overall cargo volumes, Airbus reported. But by 2041, express shipments will account for roughly 25% of overall freight tonne kilometers (FTKs), Airbus forecasts. The boom in e-commerce has led to stakeholders strengthening and launching new express networks in emerging markets like China, according to Boeing. Indeed, while already on a growth trajectory, express shipments continued to see increases during the pandemic, with international express up 9% in 2020 and 11% in 2021, according to Air Cargo World sister publication Cargo Facts Consulting . In the U.S., domestic air express grew 12% in 2020, with a more moderate increase of 5.5% in 2021. However, express shipments in China — both air and ground — grew at a faster pace, increasing 68% in 2020, and 30% in 2021. Express operators also have been heavily investing in e-commerce, including FedEx Express, which launched flights between Paris (CDG) and Osaka (KIX) in October 2021 and CDG-Beijing (PEK) via KIX in June to meet e-commerce demand . Meanwhile DHL in July invested roughly $668 million in its U.K. e-commerce branch , DHL Parcel UK, to strengthen infrastructure. Freighter demand Cargolux is one of the many carriers looking to grow its freighter fleet. Today the carrier announced its intention to order 777-8F aircraft , although the exact number of units is to be determined, as reported by Cargo Facts , another sister publication. Meanwhile, Georgian Airlines plans to convert three 737-800BCFs with Boeing , while aircraft leasing company BBAM has also ordered nine 737-800BCFs , with an expected delivery date of 2024-2025. A320 and A321 freighters are also significantly gaining traction as carriers look to bolster their fleets to accommodate growing cargo demand. Recent Airbus deliveries include U.A.E.-based Vaayu Group, which received the world’s first A320-200P2F July 16 that was handed over to India-based cargo airline Pradhaan Air Express after conversion. Vaayu expects to receive a second A320P2F on lease by December. Malaysia-based Raya Airways is also looking at ramping up its fleet and intends to lease two A320P2Fs and two A321P2Fs from ST Engineering , as reported by Cargo Facts . Meanwhile in June Silk Way West was looking to add its first Airbus freighters to its f leet with two new A350Fs, which have expected delivery dates of 2027 and 2028. There is also an option for the Azerbaijan-based carrier to receive two more freighters.

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